With a few exceptions, business has returned to normal at Walt Disney World following Hurricane Irma. Let's review the storm's fallout and potential cost to Disney Vacation Club owners.
Treehouse Villas are one of the few locations still closed at WDW
The Florida theme parks reopened as planned on Tuesday, September 12 showing little impact from the storm which ravaged the state. A handful of attractions including the Big Thunder Mountain Railroad, Kilimanjaro Safari and Kali River Rapids were intially closed but have since reopened. The Magic Kingdom's Jungle Cruise is one noteworthy attraction still not available to guests.
On the resort side, only the Treehouse Villas at Disney's Saratoga Springs Resort & Spa and Disney's Ft. Wilderness Campground remain closed. The Treehouse Villas are tentatively scheduled to reopen on Sunday, September 17 with Ft. Wilderness to follow sometime later that week.
Most of the damage incurred throughout Walt Disney World has been to vegetation--fallen trees, leaves and other debris covering paths in the immediate aftermath of the storm. It should come as no surprise that the areas still closed to guests--Treehouse Villas, Ft. Wilderness, Jungle Cruise--are heavily wooded areas which require both clean up and repair to any structures damaged by falling objects.
There are reports that boat service connecting Disney's Old Key West Resort and Disney's Port Orleans French Quarter to Disney Springs is unavailable due to the high water level. Apparently the water taxis are unable to clear at least one of the bridges along that route. A similar problem plagued the Friendship boats which service the Epcot resort area, but they were able to return to service on Wednesday.
In the wake of the storm, some members have begun to question how it will impact annual dues for Disney Vacation Club owners. There are several ways in which charges could manifest themselves. The first is Cast Member salaries. We can assume that many employees received overtime pay and other compensation for working extended shifts, both to staff the resort and help with later clean-up. These wages and benefits would fall under the 2017 operating budget. Every year, the resort operating budgets include a guarantee that Disney will pay any overages which exceed the published expenses.
In other words, if the hurricane causes any DVC resort to spend more on staff compensation than was budgeted, that exceess will not be passed on to owners. However, it could cause Disney to re-think its planning in future years, perhaps adding more to the staffing budget in the event of a similar hurricane situation. But if those extra dollars are not spent, they are rolled into the resort's capital improvements fund, so there is no loss to DVC timeshare owners.
Minor repair charges which may cause the resort to exceed its annual "maintenance" budget would similarly be covered by Disney. Larger repairs--like a roof replacement, which may be necessary at some locations--would be funded by the capital improvements budget. As of December 31, 2016 a resort like Disney's BoardWalk Villas had over $24 million in its reserve fund with another $4.7 million billed to owners in 2017. Per the 2017 budget, full replacement of the resort's roof would cost approximately $5.4 million.
Grand Floridian pic.twitter.com/Ec5DyTSWey— LindseyInFlorida (@disneyjunkie75) September 11, 2017
Additional capital funds are earmarked for exterior refurbishment, parking lot maintenance and other tasks, so there are funds available to make large scale repairs without need for any special assessment.
Insurance premiums may be subject to an increase following two straight years of hurricane action in Florida. However, insurance is a relatively small portion of the annual dues. Owners at Disney's Beach Club Villas and Villas at Disney's Grand Floridian Resort pay less than eleven cents per point for insurance in 2017, while Saraotga Springs insurance is just under six cents per point.
In the event of significant damage, insurance deductibles may come into play and those dollars would be passed on to owners. Following Hurricane Matthew in 2016, owners at Disney's Hilton Head Island Resort were billed for a $750,000 deductible to repair storm damage. This fee will be spread over five years (2017 to 2021) at a cost of about eleven cents per point, per year.
Given the modest damage reports coming out of Walt Disney World, it seems unlikely that any insurance claims will be filed with the possible exception of the Treehouse Villas at Saratoga Springs. In such a heavily wooded area, it stands to reason that some of the sixty free-standing Treehouse buildings may have incurred some degree of damage. But the fact that the Treehouses are scheduled to reopen in just a couple of days suggests that damage is not widespread.
Which brings us to Hilton Head. Disney's South Carolina resort remains closed with no published timetable for reopening. Reports of flooding in the Shelter Cove area combined with the lack of a reopening timeline suggests that the resort did sustain some damage. Worst case scenario for Hilton Head owners would appear to be a repeat of the $750,000 deductible combined with an increase in insurance premiums following back-to-back years of hurricane storm damage.
Even if insurance costs were to double -- which is extremely unlikely -- I doubt that most members would really notice the increase.