2019 Dues

[Firepath]

So does the 30% bump in security indicate what we all expect to happen - that the security is going to "move back" from DHS and Epcot park entrances and be at the Friendship Boats/Skyliner - meaning we are paying for the security at the boat dock?

Also, wonder what "Member Activities" increased to make that rise so much?

If security costs go up there, then they'll probably drop for the park entrances. I guess we can expect lower park pass prices?

 

[DougEMG]

There are no "DVC Employees" or "Hotel Employees." Costs are allocated based upon established formulas. I've been told the basis is registered guests. If the BoardWalk hosts 2 million DVC guests and 1 million hotel guests in a single year, generally speaking the DVC budgets will be charged for 66% of all resort operating costs: from front desk attendants to lifeguards to security guards.

Disney sells/rents villas to cash guests in a number of different ways. If Disney reclaims the room due to a member using an exchange program (Disney Cruise, Adventures by Disney), the original owner of the points is still paying dues on them. Disney is renting that room to a cash guest to recoup the cost of the exchange. If a room is made available to a cash guest because it was unbooked by a member, a portion of the revenue is credited back to dues under the heading of "breakage." If the room is a result of points that are owned by Disney/DVC, then Disney is essentially paying the dues.

Hence why Disney wanted 5 people in a studio. Up the number of DVC guests compared to hotel guests and you can pass on more costs to the DVC side.

 

[Cyberc1978]

Hence why Disney wanted 5 people in a studio. Up the number of DVC guests compared to hotel guests and you can pass on more costs to the DVC side.

I have heard that mentioned before, does that mean that seen from disney’ perspective a studio will ALWAYS have 5 ppl occupying them even though in reality it sometimes only have 2 or 3 ppl staying there?

 

[DougEMG]

There are no "DVC Employees" or "Hotel Employees." Costs are allocated based upon established formulas. I've been told the basis is registered guests. If the BoardWalk hosts 2 million DVC guests and 1 million hotel guests in a single year, generally speaking the DVC budgets will be charged for 66% of all resort operating costs: from front desk attendants to lifeguards to security guards.

Disney sells/rents villas to cash guests in a number of different ways. If Disney reclaims the room due to a member using an exchange program (Disney Cruise, Adventures by Disney), the original owner of the points is still paying dues on them. Disney is renting that room to a cash guest to recoup the cost of the exchange. If a room is made available to a cash guest because it was unbooked by a member, a portion of the revenue is credited back to dues under the heading of "breakage." If the room is a result of points that are owned by Disney/DVC, then Disney is essentially paying the dues.

Hence why Disney wanted 5 people in a studio. Up the number of DVC guests compared to hotel guests and you can pass on more costs to the DVC side.

I have heard that mentioned before, does that mean that seen from disney’ perspective a studio will ALWAYS have 5 ppl occupying them even though in reality it sometimes only have 2 or 3 ppl staying there?

I believe it is based on actual occupancy.

 

[Bing Showei]

Hence why Disney wanted 5 people in a studio. Up the number of DVC guests compared to hotel guests and you can pass on more costs to the DVC side.

Capitalizing on DVC members' tendency to stretch the points out... oh that is eeeevil.

 

[tjkraz]

I know this. But is there proof that it really happens this way? Precisely this way (down to the last point)?

If the response to every comment is going to be "yeah, but is there any proof?", there is no basis for continued dialogue. Disney accountants, external auditors and the Florida Timeshare Bureau all have some oversight here. Those who cannot trust the system to work properly shouldn't be this heavily invested in Disney. If you really think DVC = Enron, get out now. Nobody on a Disney message board is going to bring any comfort.

These increases should come as zero surprise. It's public knowledge that the minimum wage for most Disney Cast Members is going from $10 per hour today to $13 by the end of 2019. Not everyone is subject to minimum wage, but a 30% rise in pay for a significant block of workers is obviously going to impact our bottom line.

Additionally, anyone who has ever voiced the opinion that Disney housekeepers, landscapers, maintenance workers and other staff members deserve to earn more than $20,000 per year should be applauding the move. The Florida labor market is very competitive with WDW alone employing more than 60,000 workers. Companies with low pay don't typically hold on to the best workers. Let's hope that these increases have a positive effect on the quality of Cast Members at Disney Parks and resorts.

 

[skier_pete]

If the response to every comment is going to be "yeah, but is there any proof?", there is no basis for continued dialogue. Disney accountants, external auditors and the Florida Timeshare Bureau all have some oversight here. Those who cannot trust the system to work properly shouldn't be this heavily invested in Disney. If you really think DVC = Enron, get out now. Nobody on a Disney message board is going to bring any comfort.

These increases should come as zero surprise. It's public knowledge that the minimum wage for most Disney Cast Members is going from $10 per hour today to $13 by the end of 2019. Not everyone is subject to minimum wage, but a 30% rise in pay for a significant block of workers is obviously going to impact our bottom line.

Additionally, anyone who has ever voiced the opinion that Disney housekeepers, landscapers, maintenance workers and other staff members deserve to earn more than $20,000 per year should be applauding the move. The Florida labor market is very competitive with WDW alone employing more than 60,000 workers. Companies with low pay don't typically hold on to the best workers. Let's hope that these increases have a positive effect on the quality of Cast Members at Disney Parks and resorts.

Completely agree. As I think of it, I have absolutely NO issue with the increases in dues to give their staff what I would consider a "livable" wage. $9 an hour is $18,000 a year. YOU try and live on that. Even $15 an hour is $30,000 - and while no-one is getting rich on that, that is certainly a much more livable wage. In order for all the minimum wage staff to go to $13 an hour is costing me a whopping $155 a year - and that means 1,000s of people get to earn that wage. So yeah - count me as one that has no complaints. I'm still making out being able to stay at these resorts much cheaper than cash members.

 

[Bing Showei]

Disney accountants, external auditors and the Florida Timeshare Bureau all have some oversight here. Those who cannot trust the system to work properly shouldn't be this heavily invested in Disney.

As it is you seem less cynical of corporate accountability/greed, how would you account for the unchanged fees for CCV?

Every other property saw increases for 2019 in labor costs reflective of the collective bargaining agreement (for which I am happy to pay my share of), but the housekeeping did not go up for CCV in kind? Instead those numbers have remained unchanged. While I would hope Disney is not engaged in blatant fraud, I do not think a healthy dose of skepticism is out of line. I have trouble granting blanket trust to anyone, let alone any corporation who's primary objective is to increase its profitability for the shareholders.

 

[crisi]

As it is you seem less cynical of corporate accountability/greed, how would you account for the unchanged fees for CCV?

Every other property saw increases for 2019 in labor costs reflective of the collective bargaining agreement (for which I am happy to pay my share of), but the housekeeping did not go up for CCV in kind? Instead those numbers have remained unchanged. While I would hope Disney is not engaged in blatant fraud, I do not think a healthy dose of skepticism is out of line. I have trouble granting blanket trust to anyone, let alone any corporation who's primary objective is to increase its profitability for the shareholders.

Personally, I'm not uncynical. Disney is going to work the system in such a way that is good for Disney....but there are controls on how much that system can be worked. Controls we all bought into.

While Disney sells a resort, before it becomes fully operational, dues are estimated. And historically they've alway been estimated low. Disney can take an "up to 12%" management fee. But they can take nothing. During a sales cycle on a resort, it is in their best interests to estimate dues low and forgo their management fee to make the purchase attractive to buyers. As the resort has a history of operating expenses, the estimations become reality, and dues go up. And as it sells out, Disney take a bigger portion in management fees and dues go up again. These estimations are where they have a lot of wiggle room - but - as the Aulani fiasco shows - not TOO much wiggle room without getting themselves into legal troubles.

However, I don't think it is naive to believe that a 30% increase in wages, which Disney has said is 75% of expenses in running a resort, would result in a 10% increase in dues. You can be both cynical and think that nothing hinky is going on in this case.

 

[lovin'fl]

The dues hiked a lot. Plain and simple. There's a list for what those dues goes to but it's still a lot of $$$$$$. It is now more economical to rent DVC at current rental prices (now maybe rental prices will rise) or get the AP discounted resort rooms (though I suspect room rates will see another hike soon) or stay off site (my DS works for Marriott so we can get great deals and other condo places can be found for less than my $4864 2019 estimated dues (get 3 trips out of that in a 1BR, so $1621 per trip now). But I prefer the bubble and will be glad to see housekeeping (and others) to get raises and then our rooms will be clean and kept up nicely and hopefully no more missing room ready texts or MB failures when we try to get in our room and pay for food at F&W booth. I agree that you should pay for good service. Disney needs to step that up all around. And to keep good workers they need to pay decently. But they, Disney, make an absurd amount of $$$ and they spend an absurd amount of money. They need to maybe reshuffle the shells a bit though and not suck so much out of it's biggest contingent and most successful slice of the pie (DVC). JMO. Also, as I think I mentioned...specifically HHI is not worth owning when you many other options for far less than what my points per stay cost in dues...and be on the ocean.

 

[tjkraz]

Personally, I'm not uncynical. Disney is going to work the system in such a way that is good for Disney....but there are controls on how much that system can be worked. Controls we all bought into.

While Disney sells a resort, before it becomes fully operational, dues are estimated. And historically they've alway been estimated low. Disney can take an "up to 12%" management fee. But they can take nothing. During a sales cycle on a resort, it is in their best interests to estimate dues low and forgo their management fee to make the purchase attractive to buyers. As the resort has a history of operating expenses, the estimations become reality, and dues go up. And as it sells out, Disney take a bigger portion in management fees and dues go up again. These estimations are where they have a lot of wiggle room - but - as the Aulani fiasco shows - not TOO much wiggle room without getting themselves into legal troubles.

However, I don't think it is naive to believe that a 30% increase in wages, which Disney has said is 75% of expenses in running a resort, would result in a 10% increase in dues. You can be both cynical and think that nothing hinky is going on in this case.

This. All of this.

Every resort's budget contains a "developer guarantee" that Disney will cover the excess if dues have been under-estimated. As such, it's likely that DVC is playing conservative with a resort's dues in the early years. It is also possible that Disney over budgeted for 2018 and that is reflected in the modest increases for 2019.

Disney is still feeling-out what it will cost to run a new property, not to mention exactly where the county's tax assessment will land.

 

[KAT4DISNEY]

If the response to every comment is going to be "yeah, but is there any proof?", there is no basis for continued dialogue. Disney accountants, external auditors and the Florida Timeshare Bureau all have some oversight here. Those who cannot trust the system to work properly shouldn't be this heavily invested in Disney. If you really think DVC = Enron, get out now. Nobody on a Disney message board is going to bring any comfort.

These increases should come as zero surprise. It's public knowledge that the minimum wage for most Disney Cast Members is going from $10 per hour today to $13 by the end of 2019. Not everyone is subject to minimum wage, but a 30% rise in pay for a significant block of workers is obviously going to impact our bottom line.

Additionally, anyone who has ever voiced the opinion that Disney housekeepers, landscapers, maintenance workers and other staff members deserve to earn more than $20,000 per year should be applauding the move. The Florida labor market is very competitive with WDW alone employing more than 60,000 workers. Companies with low pay don't typically hold on to the best workers. Let's hope that these increases have a positive effect on the quality of Cast Members at Disney Parks and resorts.

It isn't a "if you don't trust them then get out" type of scenario - that's as exaggerated as the Enron comparison should have been even if Enron is something good to remember if you think that auditing stops all fraud. Asking questions is generally an important thing to be done in the business, accounting and financial world and certainly is the right of DVC owners who are required to pay what DVC directs in their budgets. Of course it's not Enron - or at least I certainly hope not - but rose colored glasses that such things are exempt from happening just because of auditing and regulations is being a tad naive. Enron just happens to be the poster child of that. Remember that this is a division that actually has been called on fudging the numbers. Yes, that person in charge of it all and 2 others related it to it were relieved but it was noticed when they moved into a brand new state. That type of occurrence will and really should at least leave people asking questions when things take an unusual swing either up or down. This year there is a reasonable explanation for the shift but not everyone follows Disney 365 days and it will raise questions now.

And with DVC there's going to be the bottom comparison of if you want to visit and stay onsite is it the most economical way to do it. Honestly, do I think that Disney has made a few decisions based on which would better their bottom and shift some costs off of them? Yes I do. I find it disappointing but not illegal nor even that surprising. It isn't like there's 7 different Disney's to select to give your business to. Nor even 2 or 3. If you want to go to Disney then you work within their system. But that never means that questions can't and shouldn't be asked if you feel they should be. Nor does being puzzled by something and asking a question mean that you shouldn't do business with them.

 

[AdamsMum]

I love my DVC but I'm just not sure I can afford this anymore

This won't break me this year, and I do support staff having a living wage. My concern is it growing this way into the future.

Like others though, I'm thinking they need to revisit the daily trash pick up (room inspection). One guy in Vegas builds an arsenal in a hotel room and everyone is subjected to and has to pay for this daily inspection. If the Vegas tragedy was part of a growing trend I could understand the need for the inspections. Not trying to be insensitive, I hope I haven't offended anybody.

 

[BillPA]

With the increase will they actually come and CLEAN the units or just walk thru and pretend to clean? Many units look as if they haven't had a good cleaning since they were built.

 

[KAT4DISNEY]

With the increase will they actually come and CLEAN the units or just walk thru and pretend to clean? Many units look as if they haven't had a good cleaning since they were built.

I don't expect any changes to the cleaning based on pay increases. It's not like they said that to get this you have to improve your work product. That will only come with a different housekeeping management and mindset.

 

[skier_pete]

As it is you seem less cynical of corporate accountability/greed, how would you account for the unchanged fees for CCV?

Every other property saw increases for 2019 in labor costs reflective of the collective bargaining agreement (for which I am happy to pay my share of), but the housekeeping did not go up for CCV in kind? Instead those numbers have remained unchanged. While I would hope Disney is not engaged in blatant fraud, I do not think a healthy dose of skepticism is out of line. I have trouble granting blanket trust to anyone, let alone any corporation who's primary objective is to increase its profitability for the shareholders.

So here's what happened with CCV at least. I believe from what I read they overpriced the taxes at CCV because of what happened at past resorts. So, in theory they could have LOWERED CCVs rates, but were unlikely to do that anyways. The incorporation of the housekeeping increase at CCV offset the tax savings and therefore the resort did not need to raise rates so drastically.

(Caveat: This is supposition on my part. I can't remember where I read about CCV tax situation, but it was somewhere on the web so not necessarily reliable. However, if that is true, then the logic of the rest of the supposition makes sense.)

As others have said, Disney is not allowed to use the dues to line their own pockets - they are legally obligated to match expenses (with a certain amount kept in holding for major improvements). I don't deny Disney invokes corporate greed plenty of times - but they make plenty of money legally without sticking it to the owners.

 

[KAT4DISNEY]

So here's what happened with CCV at least. I believe from what I read they overpriced the taxes at CCV because of what happened at past resorts. So, in theory they could have LOWERED CCVs rates, but were unlikely to do that anyways. The incorporation of the housekeeping increase at CCV offset the tax savings and therefore the resort did not need to raise rates so drastically.

(Caveat: This is supposition on my part. I can't remember where I read about CCV tax situation, but it was somewhere on the web so not necessarily reliable. However, if that is true, then the logic of the rest of the supposition makes sense.)

As others have said, Disney is not allowed to use the dues to line their own pockets - they are legally obligated to match expenses (with a certain amount kept in holding for major improvements). I don't deny Disney invokes corporate greed plenty of times - but they make plenty of money legally without sticking it to the owners.

We have access to the budget breakdowns at the resorts we own and I do not to CCV but it's being reported that the specific line item for housekeeping did not increase and it's been a large increase at all the other resorts. So, not that the aggregate increase at CCV was less than others but that that specific line item was virtually unchanged per reports. With the wage increases supposedly affecting every other resort it's a good question.

 

[crisi]

We have access to the budget breakdowns at the resorts we own and I do not to CCV but it's being reported that the specific line item for housekeeping did not increase and it's been a large increase at all the other resorts. So, not that the aggregate increase at CCV was less than others but that that specific line item was virtually unchanged per reports. With the wage increases supposedly affecting every other resort it's a good question.

Its always possible that the accountant forgot to put the new plug in for CCV and the dues were released and approved without the housekeeping increase. Mistakes happen.

 

[crisi]

Hence why Disney wanted 5 people in a studio. Up the number of DVC guests compared to hotel guests and you can pass on more costs to the DVC side.

Plus it allows Disney to sell studios to larger families. Its a win win for them all around. And DVC families of five who use studios aren't complaining.

 

[Capang]

As it is you seem less cynical of corporate accountability/greed, how would you account for the unchanged fees for CCV?

Every other property saw increases for 2019 in labor costs reflective of the collective bargaining agreement (for which I am happy to pay my share of), but the housekeeping did not go up for CCV in kind? Instead those numbers have remained unchanged. While I would hope Disney is not engaged in blatant fraud, I do not think a healthy dose of skepticism is out of line. I have trouble granting blanket trust to anyone, let alone any corporation who's primary objective is to increase its profitability for the shareholders.

@skier_pete kind of hit it right on. There was a tax issue. The auditor initially assessed CCR very high, and then it was appealed. However, our dues were set before the appeal outcome. So yes, our dues could have gone down, but they didn't. Instead we saw a small increase.