MadRiver Glen Cooperative
Board of Trustees
Minutes of Meeting
January 11, 2003
After due notice, a meeting of the board of trustees of the Mad River Glen Cooperative was convened at 5:00 P.M. on January 11, 2003, at the Basebox at Mad River Glen Ski Area in Fayston, Vermont. Trustees Bleier, Coleman, Eaton, Michl, Moulton, Moats, Putnam and Steines were present (Schultz was absent). Cooperative counsel Peter Monte was also present. The Cooperative’s president presided. Margo Wade kept the meeting minutes.
Call to Order
President Michl called the meeting to order at 5:07 p.m.
Approval of Prior Minutes
Upon motion duly made by Ms. Steines, and seconded Mr. Eaton, it was unanimously
VOTED: To approve the November 16, 2002 meeting minutes as distributed.
Ms. Steines read two emails she was asked to be read by the contributing shareholders. 1) Jay Sturtavant requests waiver of his 02/03 APR due to serious illness. 2) Allan Frank requests the board develop incentive(s) for the purchase of preservation certificates.
Mr. Michl will draft a response to both requests and circulate the responses to the trustees via email for review and approval. The board also asked that Mr. Snow develop recommendations regarding preservation certificate incentives.
The following is the January 11, 2003 Management Report as submitted.
The mountain opened 11/30/02. One of the earliest openings ever. Operations have run very smooth the whole month.
We had a search and rescue 12/29/02. Four skiers skied off the backside of Mad River Glen. MRG Patrol and StowMountain rescue found the lost skiers. No one was hurt.
The Mad River Valley Chamber is hosting the Eastern Ski Writers Association at the end of the month. Mad River will have a big role in this. All the ski writers from across the country will be here.
Material for the Echo was due on January 1. We had no new material submitted.
Seven shares were sold in December against a budget of four. 13 shares have been sold YTD against a budget of 12.
December was a good month. Numbers are skewed, due to early opening. (See P&L)
Cash flow at the end of December was $130,000 ahead of budgeted cash flow as presented at the July budget review.
Total revenues are over $100,000 ahead of budget, and over $200,000 ahead of last year.
The holiday week was one of our best revenue wise ever.
Mr. Friedman was paramount in getting the Eastern Ski Writers Association to come to the Valley. Different events will be taking place throughout the weekend. Mr. Wimble and/or Mr. Friedman will be attending many of the events. Mr. Moats and trustees offered their services escorting writers around the mountain.
Mr. Eaton, with other trustees’ concurrence, praised Mr. Wimble and staff on smooth operation of the mountain so far this season.
Mr. Bleier respectfully suggested that a reminder be posted on the bulletin boards and via email reminding folks about Echo deadlines. Mr. Moulton added that the Shareholder Relations Committee will also try to assist with this task.
The board unanimously accepted the management report.
December Profit & Loss (see attached)
Financial results of operation for the last month and for the fiscal year to date may be summarized as follows:
Cash on hand: $670,000
In response to Mr. Bleier’s specific financial questions, Mr. Wimble responded:
– the management report figures include the first two weeks of January while P&L is through December
– Basebox figures do not include inventories and start-up costs are high
– capital items are included and need to be pulled out, also a refrigeration unit had to be replaced unexpectedly
– high “Miscellaneous Costs”
– excellent holiday figures put us past budgeted figures
– the first two early season weeks were not high income weeks because mostly season pass holders were skiing
– we did have good early pass sales, up a little bit over last year’s sales
– “Other Income” was inflated when we drafted the budget because we knew we would meet the budget, we just were not sure which department would bring in the additional dollars
– “Services Income” includes rental, repair, ski school, nursery, and environmental program
– “Housing” is the up front cost for the house rental, which is paid back over time by the international employees
– “Marketing” figures are timing dependant, therefore the difference between actual and budgeted
– “Ticket sales” are averaged and also include – ½ days, seniors, promotional discounts, Ski the Valley, group rates, 30 day tickets, and lodge package tickets
In response to Mr. Coleman’s question, Mr. Wimble responded that we are doing well, and mid year budgets tend to look a little out of wack.
Mr. Wimble noted there appears to be a mistake in the December budget for season pass sales that needs to be corrected.
Unbudgeted expenses included the refrigeration unit, the Basebox furnace (prior year), six to seven thousand dollars in Basebox inventories, a large IT services bill recently received for July through December, housing costs, and unexpected phone system repairs.
Net operating income for the December 00/01 season was $40K, net operating income to date is $112K ahead of last year and our revenue is $245K ahead of last year. We broke one million on Tuesday.
Facilities: Mr. Coleman reported that the Facilities Committee did not meet in December. He will be scheduling a meeting for the end of the month.
Finance: Ms. Steines reported the committee will be meeting on January 21st at 3:00 p.m. She will email the board and have Mr. Snow post the date and time on the list serve.
She also reported the Shareholder Loan Finance Committee met on Dec 27th to verify all of the statements for the last four years. Two issues were identified at the time. Three shareholders have not picked up their interest over a several year period. The bonds were created with annual interest payments or Mad Money vouchers anticipated. The committee recommends the board give Ms. Crawford the authority to issue vouchers to bond holder who do not redeem their interest by March 31st. The voucher would be good for 12 months from the date of issue; therefore they have another season to use the voucher. This will allow Ms. Crawford to reconcile and close out accounting. The board concurred with this recommendation.
The committee also recommends the board create an account on the balance sheet to deposit $20K per year that will be used to pay off loans when they come due in 2008. We are not currently accruing monies for bond payments. The committee feels this figure is a conservative amount. The board concurred with this recommendation.
There was some discussion about offering a voluntary redemption of a portion of the bonds. This would demonstrate repayment in the event we need to post another bond request. Mr. Monte pointed out that we cannot force redemption of the bonds and redemption must be voluntary. Ms. Steines added that partial redemption could present an accounting nightmare for Ms. Crawford.
Ms. Steines will write an article for the Co-op News about voluntary bond redemption.
Shareholders Relations: Ms. Moulton reported the committee meets on the 1st Tuesday of the month at 6 p.m. in the Basebox and has met twice since the last board meeting. The committee recommends formalizing town meeting dates including one during Green & Gold, one Christmas week, and the annual meeting. Mr. Michl added that the more institutionalized the greater the attendance. Ms. Steines suggested adding the candidates forum to the list and for these events to turn the Basebox over to the shareholders to avoid conflict with other events.
The committee will begin creating a Shareholder Community Plan including developing a process for scheduling Co-op related events. Mr. Michl pointed out that we only have this booking problem because Tamar and Glenn are doing such a good job at booking events for the Basebox. He also accepted responsibility for not communicating with Tamar about recent Co-op related scheduled events.
Mr. Moulton would like to develop an Historic Register Q&A including the specific answers to questions raised by the board and shareholders.
His research to date found:
– eligible for a 20% tax credit off the taxes we pay on the rehabilitation we do on contributing buildings in the historic district
– qualifying buildings are those that enhance the historic district, such as the Single
shack and its improvements, and Basebox and its improvements, etc. The office building does not qualify because it was constructed in the 70’s.
– Single only vs. a district – The best way to list the single and original trails would be in a district rather than as two separate items. They could be considered a mini-district
– No tax credit is available for rehabilitation of the single because tax credits are only applicable to buildings with interior environments. Structures, such as bridges and lifts are not eligible
– Chris Cochran from VT Historic Preservation is willing to attend a meeting to answer shareholder questions about listing.
From his research, Mr. Wimble reported that the required paperwork to receive the minimal tax credit was not worth the effort. Especially considering both our projects and tax burden are small.
Mr. Moulton will distribute to the board, via email, the list of questions he has developed to date. Next steps for the board will be to supplement the list, solicit more questions from shareholders, circulate the list before the annual meeting and invite Mr. Cochran to attend the annual meeting to answer shareholder questions directly. The board would also present the Q&A list to him prior to the meeting so that he is aware of the concerns. The board’s goal is to build Co-op consensus on the issue.
The committee recommends developing a way to identify other share holders such as a lapel pin and/or small sticker with a simple design. The cost would be low; therefore shareholders would not be resistant to purchasing the item.
The committee recommends adding a suggestion box to the shareholder only web page and requested weekly posting of list serve messages on the shareholder bulletin board.
Mr. Wimble noted that a complete suggestion box report is sent to the trustees and a summarized report can be posted on the bulletin boards.
Board Development: Ms. Steines had nothing to report.
Elections: Mr. Bleier reported the committee met January 10th. The three shareholder committee members are Wendy Bridgewater, Paul Finnerty, and Erik Reisner. Mr. Reisner is an audio expert and will assist in getting the candidate forum recorded.
“Candidates Wanted” notices have been posted on the list serve, bulletin boards, and the committee is actively soliciting candidates. The deadline for committee recommendations is February 1st and February 7th for candidates to submit petitions with 20 signatures to be included on the ballot and mailing. The candidates forum is scheduled February 15th in the Basebox from 5 p.m. – 7 p.m. Another committee meeting is scheduled January 25th at 5 p.m. in the Basebox.
Personnel: Mr. Michl had nothing to report.
20th Committee: Mr. Moats thanked Mr. Moulton and Mr. Michl for their efforts with the Co-op News. It has worked very well for communicating information to shareholders and he has received good response on both sides including expertise on conservation issues and insight. He continues to explore funding sources. Based on both sides of the potential transaction it looks like we should avoid State and Federal funding, which limits the plan a bit. At some point soon we will need to work with an experienced developer (RE: Act 250) to provide the level of detail needed. He hopes to identify Co-op members who are experienced with multi unit development plans and the State process. The project is gradually progressing.
Mr. Michl thanked Mr. Moats for the amount of effort and time he has put into the project.
Policy Regarding Release of Shareholder List
Mr. Michl explained there is question regarding distribution of the list of shareholders and whether the current policy complies with VT law. The trustees have had an opportunity to research the issue outside this meeting.
Ms. Steines read a proposed motion. Mr. Michl added the current trustee positions surrounding the issue include: we have a moral obligation to share the list; we have a legal obligation to share the list; and we may or not have a legal obligation to share the list and it is not worth Co-op resources to find out. Mr. Michl stated whichever reason trustees chose we should approve the motion.
Ms. Crawford charges a nominal fee for list to compensate for time and materials, as allowed by law.
After discussion about how to communicate to shareholders regarding “opting out” of the list for non-official Co-op business it was decided to publish the new policy in the next Co-op News. No formal request to opt out will be sent to shareholders. Shareholders must take the initiative to contact the office to be placed on the “no non-official business” list.
Carol Pierce shared information about the “open public records act” which allows every single record, name and address to be opened by request. Mr. Bleier explained the 1996 policy was developed because of privacy and exploitation for commercial purposes issues, which he believes are the costs of democracy and freedom.
Upon motion duly made by Ms. Steines, and seconded Ms. Putnam, it was
VOTED: To allow the release of the shareholder address list to any shareholder for valid Co-op business. The shareholder requesting the list must sign a release agreeing that the list will be used to communication to other owners on matters relevant to Co-op business only. The list will be printed in a format the office determines to be easiest for them and given to the shareholder after the agreement is signed. The list will include the shareholder of record, their street and town address. The list will be accompanied by a separate listing of those shareholders that request no non-official Co-op business be sent to them, and the shareholder requesting the list will be requested to honor those requests. This policy will supersede the policy approved at the January 20, 1996 board meeting.
VOTING: In favor – Bleier, Coleman, Michl, Moulton, Moats, Putnam, Steines
Abstaining – Eaton
Mr. Eaton qualified his abstention – he supports what the board needs to do but disagrees with the State privacy rules.
Policy Regarding Transfer of Shares to Family Members
The question has arisen regarding the definition of “family members.”
Upon motion duly made by Mr. Michl, and seconded Mr. Eaton, it was unanimously
VOTED: To adopt the following defining language:
For the purposes of Bylaw §9.5, the term “members of the owner’s immediate family” shall include an owner’s spouse, children, grandchildren, sibling, parents, civil union partner, whether related by blood, marriage or adoption. The place of residence of the family member shall not be relevant.
A niece or nephew would not qualify. Great grandchildren would qualify as grandchildren. In the event an aunt or uncle wish to transfer a share to a niece or nephew they would first have to transfer the share to their sibling, who would then transfer the share to the child.
Mr. Bleier pointed out that if a shareholder is not satisfied with the language s/he could petition for a bylaw change. Petitions would need to be submitted 60 days prior to the annual meeting.
Six Month Review of Shares Sold, Tendered, Request for Tendering
The board discussed the 2001/2002 Share Summary. Mr. Wimble stated he has not identified exact trends for tender requests. We saw small flurries of requests when the list was released, when the list serve got really wild, and during last years elections. He added that if we receive a phone call first, we can save one out of three requests. If the shareholder has written a letter we save only one out of ten requests. As a last option we do suggest turning the share into a preservation certificate.
Mr. Eaton added it would be interesting to see the total number of tendered share to date compared to the total number of shares sold. Ms. Crawford estimated that less that 100 shares have been tendered to date. Mr. Bleier suggested a comparison of shares tendered by shareholders who purchased at $1500 and those who purchased at $1750 could be interesting.
Total number of shares sold to date = 1968
Total number of shareholders to date = 1684
Forest Management Committee
Mr. Bleier requested to table the discussion until Mr. Appleton was present to participate.
Mid-Year Review of Board Goals
The board discussed 2002/2003 objectives.
1) Complete Strategic Plan – good progress is being made on the planning effort.
2) Improve Shareholder Communications – we have implemented the Co-op News, continue to develop strategies through strategic planning, and the Shareholder Relations Committee is working on a plan to further enhance the effort.
3) Complete a Shareholder Survey – is under consideration by the Shareholders Relations Committee.
4) Revise Election Procedures (time line, make candidate positions known, improve confidentiality of balloting) – we have completed.
5) Revise General Manager Performance Appraisal, Salary Review, Bonus Policy (time line, write clear policy, review bonus policy) – we have developed a process, except for the bonus policy which is on the agenda for next meeting.
6) Review Patronage Rebate Procedures (should family members be included in a shareholder’s patronage, are shareholder expenditures accurately counted, can we reduce the cost of shareholder patronage accounting, can we reduce the cost of patronage mailing) – we have completed.
The following items were added to the list of goals:
7) Continue to pursue the 20th Hole acquisition
8) Develop Procedure for Scheduling Co-op Events (which may be included in the Shareholders Relations Committee plan, develop a fixed schedule for Town Meetings, Candidates Forum, and Annual Meeting)
The board briefly discussed publication of the next Co-op News, which will occur after the February board meeting to incorporate information from that meeting, but before the annual meeting. There was discussion about timing of the Co-op News and the next issue two issues of the Echo. Targeted drop date for the Co-op News is February 25th; submissions will be due February 11th.
Upcoming Meeting Schedule
– Strategic Planning meeting Friday, February 7th at 5:00 p.m.
– Board meeting Saturday, February 8th at 5:00 p.m.
– Candidates Forum Saturday, February 15th at 5:00 p.m.
– Board meeting Saturday, March 8th at 5:00 p.m.
– Annual Meeting Saturday, April 5th
– Board meeting Saturday, April 12th
New Business/Further Shareholder Comment
Carol Pierce thanked the board for answering all of her questions this evening.
Mr. Heinzerling stated he was pleased with the outcome of the list distribution discussion. He requested that the National Historic Register Q&A be made available on the list serve so that shareholder will become aware of the benefits we can derive from listing on the register.
Mr. Kalkstein asked for clarification about the new list policy. He believes the law does not require a shareholder to sign a release, but that they do need to state a valid purpose for use of the list. Mr. Moulton responded that we should consider the release to be the statement of valid purpose. Mr. Kalkstein raised concern with many shareholders requesting to opt out of the list. Mr. Moulton commented that many shareholders may wish to opt in.
Carol Pierce raised concern with the historic district and the board should be aware of homes in the area that may qualify and the impact to those homeowners.
Mr. Bleier requested earlier posting of board meeting dates on the bulletin boards and asked that the agendas be posted as well. Ms. Putnam mentioned the posting of Co-op/ski area events “this month, this week, this day…” Ms. Bridgewater requested that the information be posted on the upstairs bulletin board as well as the shareholder bulletin board down stairs.
There being no further business to come before the board and upon motion duly made by Ms. Steines, and seconded Mr. Moulton, it was unanimously
VOTED: To adjourn the meeting.
The meeting adjourned at 7:03 p.m.
Margo B. Wade
A true record.
Lu Putnam, Secretary
a. December Profit & Loss