Minutes of Board of Trustees Meeting Held August 13, 1999
After due notice, a meeting of the Board of Trustees of Mad River Glen Cooperative was convened at 5:00 p.m. on August 13, 1999, at the Basebox, at Mad River Glen Ski Area in Fayston, Vermont. Trustees Bleier, Eaton, Kirkpatrick, Meier, Michl, Russell, Schultz, and Singer were present and voting throughout. Trustee Curtis was absent. The president, Mr. Meier, presided. The minutes were kept by Ms. Kirkpatrick, the secretary, with the assistance of Cooperative’s counsel, Peter Monte.
Minutes of Prior Meetings
After discussion and upon motion duly made and seconded, it was unanimously
VOTED: To approve as corrected the minutes of the July 3, 1999, meeting of the Board of Trustees.
The President explained that this is an extra meeting of the board of trustees held for two time-sensitive purposes: to decide on a plan for work on the single chairlift; and to review progress in the search for a general manager. Accordingly, unless extra time appears the board will dispense with shareholder comments on other matters at this meeting. Mr. Bleier requested asked that the record reflect his objection that the agenda does not allot any time for shareholder comments and communications, which Mr. Bleier feels is especially important in light of our poor communications.
Ms. Kirkpatrick reminded the board that Ken Hildick died recently. The trustees expressed gratitude to Mr. Hildick for his many years of service on the volunteer ski patrol.
General Manager’s Report
Jamey Wimble, assistant general manager, delivered the general manager’s report. The Vermont State barbecue contest will be held at Mad River Glen Ski Area next Friday.
Staff has completed the scheduling discussions with NATO which have resulted in scheduling the telemark festival for March 11, and 12, 2000. This schedule schedules the telefest one week later which will hopefully cause less intrusion on regular ski area operations. Staff continues to investigate the merits for providing discounts for telefest participants on the Friday and Monday surrounding the festival.
Sally Knight has been hired as the race director for Mad River Glen Ski Area. The trustees applauded Sally’s hiring — she is well known because she is a local resident and she has extensive experience in ski racing including participation on the United States Ski Team.
The assistant general manager informed the trustees that the manager of the rental and repair shop has declined employment as manager next year. He is willing to work part time. Staff has begun the search for a replacement manager.
Eric Friedman informed the board that he was invited to participate in a symposium on sustainable resort communities which will be held later this summer at Crested Butte, Colorado. Mr. Freedman will speak at the symposium about the Cooperative’s experience and Mad River Glen’s operations as a low – impact ski area. Mr. Friedman’s expenses will be paid by the symposium’s organizers.
Sharon Crawford, office manager, informed the trustees about difficulties she was experiencing in hiring an administrative assistant. Historically, there has been a high turnover in this position and it is difficult to hire a replacement in today’s job market without including befits in the offered pay package. The office manager seeks authority to offer benefits and a salary increase to meet market demands. She circulated a cost analysis which demonstrated that overall cost savings would be realized if an increase in payroll costs for this position eliminates turnover. It was the sense of the board to approve this request.
July Income and Expense
The assistant general manager circulated income and expense statements for the fiscal year thru July 31. The report may be summarized:
July $12,600 $65,600 ($53,000)
YTD$1,425,000 $1,234,400 $191,230
Ms. Kirkpatrick reported for the single chair committee. The committee has explored the feasibility of work to restore (rather than reconstruct) the single chair drive station. The assistant general manager has collected bids for restoration proposals. She circulated a summary of the costs of various proposals which may be summarized as follows:
New Carriage Drive
Complete rebuild of base station with new carriage drive equipment:
1947 Historical Rebuild
New replica of original vault, gear drive and new motor;
not including enclosing structure
1999 Copy of Original
New vault, modern gearbox and motor;
not including enclosure structure
1947 Historical Rebuild
New replica of gearbox and bearings, new motor;
not including enclosure structure
1999 Component Rebuild
New engine, modern gearbox, and foundation only using all new 1999 components
not including enclosure structure
Ms. Kirkpatrick informed the board that the single chair committee recommends that the Cooperative implement either option 4 or 5, and that option 5 is the committee’s preferred choice. The Committee further recommends that the Cooperative should discontinue its plan to reconstruct, rebuild, or replace the lift with all new equipment and a new structure.
The committee believes that installing new equipment for the drive only would result in substantial cost savings if compared with the planned complete replacement of the structure and mechanical equipment for the chairlift base station. The committee also believes that options 4 and 5 would fix all known major risks of the single chairlift.
The major known risk is that the existing drive equipment remains in service after its useful operating-life expectancy has passed, and the lift is, therefore, at risk of major mechanical failure. A major mechanical breakdown of the present drive for the lift would probably close Stark Mountain for skiing for the remainder of the season because replacement parts for critical components are not readily available. The Cooperative’s revenues would be devastated if the breakdown occurred early in the season. Implementing option 4 or 5 would replace old equipment with new (thereby minimizing the threat of a breakdown), and the new equipment will be readily repairable should a breakdown occur (assuring that the lift could be restored promptly to service and minimizing the resulting revenue loss).
The single chair committee expects that installing new drive equipments will upgrade the single chair to reliable operation for an indefinite time. The single chair should not require additional major attention until the line equipment requires major repair. If the line equipment remains free of major problems for 3 to 5 years, the Cooperative then would be better able than it is now to finance the costs of eventual replacement of the line equipment. It is impossible to predict when the line equipment may need replacement, but inspections by staff and by the State lift inspector have revealed no serious problems with the line equipment to date.
Ms. Kirkpatrick noted that options 4 or 5 would result in retention of the present mechanical design of a vault drive with top tensioning. The committee estimates that if the single chairlift is later converted to a carriage drive with bottom tensioning, either option 4 or 5 would cost between $40,000 to $80,000 for equipment which is not usable for a carriage drive.
The assistant general manager informed the trustees that staff concurs with the single chair committee in recommending implementation of option 5 — confining the single chair project work now to installing new components to replace the drive equipment. Staff agrees this option is a good solution because it preserves scarce cash resources while solving the most critical known worries about the existing drive.
The assistant general manager cautioned the trustees, however, that (1) election of this choice may amount to a long-term commitment to a vaulted drive because of the estimated $40,000 to $80,000 cost of non-reusable equipment if the lift is converted to a carriage drive with bottom tensioning (carriage drive being the mechanically cleanest and most economical operating design); and (2) in the absence of destructive testing, no one can predict with certainty how much time will pass before the single chair line equipment will need major work (at an estimated cost today of one million dollars).
After further discussion and upon motion duly made by Ms. Kirkpatrick and seconded by Mr. Eaton it was unanimously (Mr. Singer abstaining)
VOTED: To approve the single chair committee’s recommendation to proceed with plans to replace the operating components of the single chair lift drive (engines, gear box, and supporting concrete foundation) with new equipment during the spring of 2000; and to authorize staff to proceed with implementation of this project if final costs do not exceed $150,000.
VOTED: To direct the single chair committee to prepare a letter to shareholders to explain the trustees’ decisions regarding the single chairlift project and the reasons for the board’s decisions.
Future Trustees Meetings
The trustees have scheduled the following meetings of the board of trustees:
September 11, 1999
October 2, 1999
November 13, 1999, and
December 11, 1999.
All meeting days are Saturdays; all meetings will be held at the Basebox and convened at 9:00 a.m. (except the December meeting which will convene at 4:30 p.m. if the ski area is then in operation).
The trustees entered executive session at 6:45 p.m. to discuss personnel matters. Mr. Pelletier, of Mountain Hire ( the general manager search consultant) was invited to attend the executive session.