Governor Ron DeSantis signed Florida House Bill 869 into law on June 9. In addition to package stores licensed to sell beer, wine and liquor for consumption off premises, now able to sell nicotine products, HB 869 eased regulations for the timeshare industry. The bill was sponsored by Florida Representative Stan McClain (R) and Senator Ed Hooper (R). Finding the language in the bill baffling, we reached out to several experts to help us understand what appears to be more legislation designed to ease regulations for Developers, to the detriment of timeshare consumers.
HB 869 timeshare provisions include:
- Eliminates certain requirements for the offering of incidental benefits in the sale of a timeshare plan, including repealing the 15 per cent of the purchase price limitation on the aggregate represented value of all incidental benefits offered by the developer, the requirement that an acknowledgement and disclosure statement indicates the source of the services, points, or other products that constitute the incidental benefit, and the requirement that the developer promptly notify the Division of Florida Condominiums, Timeshares, and Mobile Homes of the DBPR upon learning of the unavailability of any incidental benefit;
(Another expert explained that the following very confusing bullet point applies to secondary market transactions)
- Extends from one year to five years the period to void a contract when a closing unlawfully occurred before the cancellation period’s expiration, and retains the one-year right for a purchaser to void a contract if he or she knowingly or unknowingly waived the right to cancel the contract within the 10-day cancellation period;
- Revises public offering statement requirements to allow the developer’s description of each component site for a multisite timeshare plan to be provided to the purchaser electronically, and to provide that a developer is not required to file a separate public offering statement for any component site located within or outside Florida, in order to include the component site in the multistate timeshare plan.
These provisions take effect July 1, 2023.
Vote: Senate 37-1; House 106-0
In 2021, timeshare law was amended to allow contract documents to be provided electronically. This year that provision expands to include descriptions of component sites to be provided to the purchaser electronically. While it’s no problem receiving a contract electronically when buying a house, because the buyer controls the sales process, we have received many complaints about the contract and the Public Offering Statement (POS) being nowhere to be found on a provided flash drive. One law firm reported that one developer’s flash drive never contained the contract as promised. While buyers can request a hard copy, try obtaining a hard copy of documents, while on vacation, by contacting a corporate office. The sales agent typically disappears after the buyer has signed. When CDs were the medium, one timeshare member said that they were given a CD that was passcode protected. When she called repeatedly to obtain the passcode, she was told to stop calling.
Another concern is that the bill repeals the limit of the “aggregate value of incidental benefits” making it easier for the value of incidental benefits to be inflated via the oral representation clause. In 2016 attorney Mike Finn coined the oral representation clause the “license to lie” clause. Incidental benefits can disappear at the developer’s whim. Benefits may include day use of facilities, travel insurance provisions, the ability to rent, or the ability to upgrade a unit. Mike Finn’s take on HB 869:
I’ve been given the opportunity to share my comments about HB 869 which I believe has now been signed into law as of June 9, 2023. I’ve also had an opportunity to review several comments regarding the ‘bill’ by knowledgeable folks within the timeshare industry. Most of the comments I’ve seen are quite logically characterized by separation into two categories, industry or consumer friendly.
I looked hardest at the comments designated ‘consumer friendly’ because I personally don’t believe that any amendment to the Timeshare Act has ever really been consumer friendly. This actually makes sense to me, as I’m familiar with the legislator/lobbyist incestuous relationship that exists, and the caveat that emerges from that; namely that money buys political influence and that consumers have very little political influence as they are the group that the timeshare industry feeds on like the proverbial vampire bat and the villager armed only with torches and pitchforks. Ironically, much of the lobbyist’s money comes from ARDA-ROC, a ‘so-called’ consumer organization operated (again very, very ironically) by ARDA, the timeshare industry’s standard-bearer, who extracts from their consumer-owners a ‘so-called’ voluntary contribution tacked onto timeshare-owners (consumers) annual maintenance dues and fees.
My only point is that there are no consumer-friendly provisions in this new Bill, and very few, if any, in any prior amendments! Even the one that seems obviously consumer orientated, extending to 5 years from 1, the ‘so-called’ voidable time-frame to cancel an “illegal contract” is meaningless, given that the industry is well aware of this provision and inserts within every timeshare contract a built-in delay between contract signing and closing. In point of fact, the ‘closing’ becomes an unattended, unobserved, date on a calendar that simply triggers the purchase immediately after the 5-10 day rescission period. It’s thereby virtually impossible to violate this provision which could be extended from 1 year to 100 years with absolutely no negative impact on the timeshare developers!
This new law is simply one more nail in the unwary timeshare owner’s coffin!
Michael D. Finn, Esq.
Incidental benefits are often of poor value. When I attempted to turn in points for an airline ticket, it would have cost $1,000 for one domestic ticket. The resort’s customer service department explained that airline tickets are for convenience, not value.
What other experts say about HB 869
One expert responded that the bill was confusing and they doubted the Congressmen understood what they were proposing. An attorney familiar with legislative matters said it read like “gobbledygook” and after a few attempts, gave up trying to understand it. A few other experts responded that they need more time to respond. One interesting comment was that Florida is not allowed to impose requirements on states outside of Florida. This was in reference to not providing a Public Offering Statement for multi-site locations located outside of Florida.
ARDA-ROC, the timeshare industry’s Political Action Committee (PAC), raises over $5 million a year from timeshare members. Out of over 2,500 timeshare members, when we asked, none could explain what ARDA-ROC is, and most were not aware of the donation. Most donations are opt-out, meaning you have to contact the resort to have the donation removed. A few times that was not so easy for me to accomplish. In 2010, ARDA was fined by the Federal Election Commission for not calling the donation voluntary. When I paid my 2023 maintenance fee to Diamond Resorts, the website page made no mention of the donation. When I clicked “Make a Payment” I saw this:
Membership Fees Balance Due $1,318.72
I would not be aware of the ARDA-ROC donation unless I checked “Account History” which I never did until I started researching the industry.
|10-Nov-2022||Point Standard Assessment||$1,037.72||$1,318.72|
|10-Nov-2022||ARDA-ROC Voluntary Contribution||$7.00||$281.00|
|10-Nov-2022||The Club Dues||$274||$274.00|
Timeshare Users Group (TUG) admin, Brian Rogers, produced a YouTube video, alarmed that ARDA was referring timeshare members to ARDA members that charge an upfront fee to sell a timeshare. We know many honest timeshare brokers that function like a traditional real estate agents, paid at closing. Brian points out that the definition of Voluntary is: “done, given or acting of one’s own free will.”
Past anti-consumer legislation includes:
- In July of 2021, HB 575 was signed into law allowing all documents to be provided electronically.
- In 2019, ARDA lobbyists in Arizona argued against offering the timeshare buyer a 24-hour “cooling-off period” BEFORE signing a perpetual timeshare contract (financed at 12% to 19%), with little to no resale value.
- A law enacted in Florida in 2015 made it more difficult to be released from a timeshare contract based on “non-material” errors.
- In North Carolina, timeshare brokers no longer are required to hold a real estate license.
The Consumer’s Voice?
In 2019 ARDA-ROC stated that they were working on legislative issues in 14 states including Non-Judicial Foreclosure.
What ARDA reported to the consumer group RedWeek: Supports non-judicial foreclosure laws which provide strong consumer protection provisions. https://www.redweek.com/blog/2019/12/02/arda-roc-maintenance-fees
What ARDA reported to fellow Developers: ARDA-ROC Chairman Kenneth McKelvey stated in letterhead minutes of the April 10, 2019 ARDA-ROC meeting at ARDA’s World annual conference: (The link has been taken down)
“The best thing we can do with exit (is) judicial foreclosure, ruin the credit and enforce the contract,”
The Bill that would have allowed a timeshare buyer 24 hours to consider their decision passed the House 100%. At the AZ Senate hearing, ARDA lobbyist Don Isaacson led the session stating:
“But the bottom line is that the state should not step in to protect people who didn’t bother to understand the nature of the deal. ”
We hope timeshare members will take the time to become involved with legislative matters. It costs about $100,000 to lobby at the federal level, and $10,000 to $12,000 per state, according to a pro-consumer lobbyist we reached out to. Developers make billions, yet bill the consumer $5 million a year to further the industry’s agenda. That’s just not right.
Donations the ARDA-ROC PAC makes to political parties:
ARDA’s June 22, 2023 Public Relations Release
In the early 1990s, ARDA established the Resort Owners’ Coalition (ROC) to harness the voices of timeshare owners and finance political activities to safeguard them from unfair and restrictive regulations.
Timeshare and Resort Developer Accountability, Inc.
Thank you, Irene, for bringing us this update on yet another “propaganda” coup by the timeshare industry, I say “propaganda” because that is what it is. The industry’s own “Trade Body” ARDA, only yesterday, 22 June, published “How Research and Advocacy Are Transforming Today’s Timeshare Experience”, in conjunction with Skift, a travel industry news site. We should also point out that they also provide “Market Research & Marketing Services” to the travel industry.
The timing of this “article” is rather appropriate, ARDA makes the following statements:
“ARDA uses its research and resources to educate lawmakers about the differences between full and fractional ownership so they don’t simply throw timeshare in with every other form of property regulation.”
“We’re sold and look like real estate, but we act like hospitality, so timeshare is in a unique position that requires a lot of education,” Gamel said. “We pride ourselves on being part of the development of almost 100 percent of all the timeshare laws in existence, whether drafting them, helping with amendments, or proposing changes.”
If that does not tell you what they are up to I’m not sure what will.
They seem to love using the word “educate”, a word which I believe is being used incorrectly, I prefer to use the word “indoctrinate”. My reasoning is simple, education implies balance, I was always taught in history that there are always two sides to the events I was studying, and without that, I cannot make an informed decision or opinion.
ARDA gives only their version and what they want the lawmakers to know, the first quote, “so they don’t simply throw timeshare in with every other form of property regulation,” is your first clue.
The second clue is the statement by Mr Gamel, President & CEO of ARDA, “We’re sold and look like real estate, but we act like hospitality, so timeshare is in a unique position that requires a lot of education,”. That is just the question that we have been asking recently, “What is Timeshare?”
Does Gamel have an answer, I doubt it.
He also bleats on about ARDAs “Pride” as being “instrumental” (my interpretation) in the development of “almost 100%” of timeshare laws in “existence”, so where are they and who do they actually benefit, certainly not the consumer?
Just to help you along, here are the two definitions for Education and Indoctrination, please note I have added a couple of updates.
give intellectual, moral, and social instruction to (someone), typically at a school or university.
provide or pay for instruction for (one’s child), especially at a school.
“she had crises of conscience about how best to educate her youngest child”
give (someone) training in or information on a particular subject.
“a plan to educate the young on the dangers of (timeshare)”
the process of teaching a person or group to accept a set of beliefs uncritically. (the lawmakers)
“prisoners are subjected to brainwashing, indoctrination, and punishment” (Timeshare Owners)
“methods that were approved for indoctrination in divinity” (The Industry)
Link to the ARDA, SKIFT article, AIT will be publishing a full review of this “offering” from ARDA in the very near future.
That’s it for this week, as we said in yesterday’s article, “Timeshare never a dull moment”. We hope you all have a great weekend, I received a picture of Baby Dog on vacation, from his cheeky look, I would suggest he has been at the flower beds.