Finance Committee Meeting Minutes: December 20, 2023

Attendance: Will Kriewald, Matt Lillard, Andrew Snow, Geordie Hall, John Skelly, John Tobin, Andrew Carey, Brad Noble, Bryan Hall, Leigh Michel

The meeting was brought to order at 9:38 AM by Will Kriewald, MRG Treasurer and Finance Committee Chair.

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Approved October 13, 2023 draft minutes with a minor correction

• Motion to approve by Andrew Carey; seconded by John Tobin. Minutes were approved.

Request for Secretary – Will Kriewald

• Bryan Hall offered to help

Review of audit – Tyler Kimberly

• Nothing unusual noted. He thanked everyone for a smooth audit process.
• There was a discussion about the audit process, the level of materiality, and the overall picture of the COOP.
  • There was discussion of the governance letter and the unapproved pay rate observation which was not a major finding, but worthy of inclusion in the letter.
  • There were no proposed audit adjustments.
• Andrew Carey moved to approve the audit, Geordie Hall seconded. All were in favor.

Review of last month BOD – Will Kriewald

• The thresholds were approved.
• $1.5M pub renovation estimate was preliminarily released.

Review of November Financials – Andrew Snow

• November is one of the quietest months of the year, but also when MRG begins to ramp up.
• Almost double revenue from prior year.
• Season pass sales were strong with the new college pass selling well.
• Total revenue was $48k.
  • Netted $52k on the new college pass compared to $45k with Sugarbush.
  • Last time MRG sold a solo college pass we only sold 100 passes that generated $10k.
  • Going to pay attention to usage. Less pass exposure, but expect higher per pass usage.
• Retail income was another bright spot
  • $19k in revenue, nearly doubling last year.
  • Sales continue to be strong in the first part of Dec. with increased skier traffic and holiday shopping.
• Is there any reason ski school is down? – Geordie Hall
  • Down compared to budget, but up vs. last year
  • It’s a timing thing, as YTD it’s still above budget.
• Have been able to keep expenses in check and stayed within budget.
  • $12k excavator repair bill, but was offset in other areas.
  • New IT position was delayed so the lack of cost associated with the position helped reduce operating expenses.
  • Ramp up costs began to hit, but expenses came in line with budget.
  • Net loss was $136k, but this was well ahead of $185k budgeted loss.
• Will Kriewald asked about payroll taxes…
• How have healthcare expenses been managed so well? – Geordie Hall
  • It was a matter of a couple of employee changes, not actual savings per employee
• Why do you put insurance and property tax together? – Geordie Hall
  • The way it’s been done, but could look into separating them.
• Why is plowing listed as other expenses? – Will Kriewald
  • It is not a core operating expense of the mountain operations.
  • Used an outside vendor historically so accounting for it below the line made sense.
  • Could report it above the line next year once they have a better understanding of the impact
  • Using salaried employees right now, but trying to get a sense of what it would cost if we had to pay an hourly employee.
• Why someone would opt out of the plowing? – Andrew Carey
  • Only reason is if they choose to do it themselves, otherwise people sign up for the MRG contract.
• Department P&L’s are being tracked, but negative numbers are expected in Nov.
• Does the department P&L use any basebox cost allocation? – Geordie Hall
  • No, purely tracking direct costs. Not allocating ancillary costs like utilities, base box, etc.
• Early sales were strong, which sets MRG up well for the season.
  • 60%-65% of budgeted income has been generated before the lifts even started.
• What percentage of season pass sales happen in April? – Geordie Hall
  • Andrew will report back
  • Continue to see April sales increase each year as customers take advantage of the discount and want to avoid being shut out.
• Do you expect this early financial strength relative to the budget to reverse? – Geordie
  • As long as the weather is good, gains should be held. Christmas week is a big factor, but as long as the weather holds up MRG should remain ahead of budget.
• Increased cash position by $265k to over $2M compared to $1.8M last year.
  • Hoping to only need $75k from the cash to get through December which assumes a good Christmas week.
• How are the treasury bills laddered? – Geordie Hall
  • Going to double check and get back
• Any thoughts to increase duration if to take advantage when rates decline? – Geordie Hall
  • Could be considered in the spring.
  • No guarantee that rates will fall.
• Where do we stand on the messaging of the strong cash position? – Geordie Hall
  • The board didn’t have a robust conversation last month regarding charging the Finance Committee with messaging.
  • The board discussed the MOU at length.
  • Andrew Carey hoped to have more progress on the MOU to report.
• Are we still looking to vote in April to approve the mid station and is the mid station to start this summer? – John Tobin
  • Matt Lillard said he is still looking to start the project this summer even with an April vote.
  • The drive work can be taken out of the mid station estimate since it is done and paid for using SMF funds.
  • We can fundraise beyond the date of installation since it will be a short fundraising window before beginning work.
• Is $1.5M for the pub significantly higher than expected?
  • Any numbers that may have been discussed before were very preliminary.
• How do we handle the question about why we aren’t using the cash on hand that has been accumulated? – Geordie Hall
  • We are using the cash because it allows management to rely on it during periods when cash flow is negative.
  • MRG is going to have capital needs that we need to account for down the road and its prudent to plan for.

Geordie Hall made a motion to remove John Skelly from the Finance Committee and add Bryan Hall. Leigh Michel seconded the motion

• Andrew Snow thanked John Skelly for his many contributions to the Finance Committee.
• Geordie suggested that we thank him in the Finance Committee report.

10:40 AM  – The meeting adjourned with motion by Geordie Hall seconded by John.

Next Finance Committee Meeting – January 17th, 9:30 AM.

Submitted by:  Bryan Hall