P.R. Laws tit. 31, § 1256a
Until a managing entity is created or provided pursuant to § 1256 of this title, the developer shall pay all common expenses of a timeshare plan or vacation club. The timeshare or vacation club documents shall provide for the allocation of common expenses among all owners of accommodations, timeshares or vacation club rights, including accommodations, timeshares or vacation club rights owned or not yet sold by the developer and the accommodations, with respect to which, the developer may have made a reservation of the use dedication as provided for in § 1264(2)(d) of this title, as calculated by reference to the maximum number of accommodations, timeshares or vacation club rights which the developer may sell and continue to comply with the one-to-one purchaser to accommodation ratio requirement in the case of timeshares and vacation club rights. The developer may exclude, in the case of the accommodations sold or to be sold, a portion of the common expenses which are not common to all owners of the regime and which do not benefit such accommodations. The timeshare or vacation club documents shall allocate common expenses to timeshares, vacation club rights and accommodations owned or not yet sold by the developer on the same basis that common expenses are allocated to similar or equivalent timeshares, vacation club rights and accommodations sold to owners; provided, however, that the developer may, in lieu of paying any assessments arributable to each unsold timeshare, vacation club right or accommodation, enter into a subsidy agreement with the managing entity, pursuant to which the developer agrees to pay to the managing entity, on a monthly basis, the difference between:
(1) The timeshare’s plan or vacation club’s total common expenses and any extraordinary or unbudgeted expenses for such month, and
(2) the aggregate common expenses and special assessments actually collected from the owners of accommodations, timeshares or vacation club rights (other than the developer) during the applicable month. The subsidy agreement must also require the developer to fully fund reserves within thirty (30) days after the end of the fiscal year for which the subsidized budget was prepared to any extent such reserves are not funded at that time by collections from owners of accommodations, timeshares or vacation club rights (other than the developer). The developer of a vacation club may enter into a subsidy agreement with respect to the common expenses of one or more component sites, the common expenses of the vacation club, or both as may be provided in the vacation club documents. The developer’s subsidy obligation shall be secured by a surety bond, irrevocable letter of credit, cash deposit, escrow, or other means or device acceptable to the Company; Provided, however, That the Company may by regulation establish financial and other standards pursuant to which a developer may be exempted from the aforesaid security requirement.
History —Dec. 26, 1995, No. 252, § 6-102; Jan. 5, 1999, No. 3, § 31.