ARDA and ARDA-ROC Oppose Legislation Proposing Voluntary Surrender of Timeshare Interests (HB 4259)

2015-05-29

Issue Brief

Representatives Hamilton, Govan, Bedingfield, Putnam, Felder, Bowers, Henderson and Nanney introduced a bill, HB 4259, which if passed, would enable a timeshare owner to voluntarily surrender their timeshare to a timeshare association upon meeting certain provisions.
 

Impact

ARDA and ARDA-ROC believe that the bill, as drafted, would present significant hardships for homeowners’ associations, timeshare developers, and managing entities for the following reasons:

  • There are constitutional issues by legislatively allowing an individual to alter the contractual terms and conditions of the purchase.
  • For entities selling timeshare interests, proceeds from sales would not be able to be recognized under the full accrual method of accounting and clean title would be nearly impossible to obtain.
  • One of the most significant concerns is that it will be the responsibility of the remaining owners in the association to bear the costs of ownership when an interest is returned to a developer or managing entity and goes unsold.

 

Position/Call to Action

 ARDA and ARDA-ROC oppose the proposed legislation as it presents significant pitfalls for both owners and the timeshare industry alike.

Issue Updates

 With the end of session nearing, it’s likely the bill will not get a hearing before the Judiciary until next session. That said, ARDA and ARDA-ROC representatives have begun having discussions with committee members about the devastating impact this would have on the timeshare industry and owners in South Carolina.

Resolution

July 8, 2016 - This bill did not pass

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