This second in a series of blog posts on the TBMA 2022 Insights Survey (a qualitative survey recently sent to timeshare board members and resort managers) includes responses on the topic of Budget Shortfalls and Reserves.
Several resorts reported that they are fully on track with their budgeting, while others are looking for solutions to cover unbudgeted repairs and expenses. Levying special assessments, a standard solution to meeting budget shortfalls typically causes an increase in delinquency rates and can be a double-edged sword.
New Hampshire: “There is always a shortfall in maintenance-fee revenue. As more members age, the number of terminations in any given year directly affects our budgeted numbers. We add to our reserve accounts each year. We (management, the board of directors, and maintenance) keep a close eye on our facility and discuss what projects we need to concentrate on, and look ahead and begin to plan and set aside for bigger financial projects to avoid having to ask for special assessments from the members.”
South Carolina: “Reserves and a balanced budget are strictly adhered to. Twenty-two cents of every dollar collected from annual fees are held in reserve for capital improvements and replacements.”
Some resorts noted that having (and following!) an updated reserve study is essential to ensuring that funds are available when needed; others have offset budget shortfalls with rental-income and revenue-generation programs.
| Survey Feedback and Upcoming TBMA Insights Meetings TBMA appreciates the participation of our association members in this survey, and their invaluable feedback is now the platform for two TBMA 2022 Insights meetings: • August 2, 2022, in Providence, RI. • October 24, 2022, in Las Vegas, NV. Timeshare board members and onsite resort managers are invited to register for these one-day forum discussion and networking events on the tbmassoc.org website. |
Photo Courtesy of Scott Graham on Unsplash