Finance Committee Meeting Minutes: May 18, 2022

Attendance:  Andrew Carey, Andrew Snow, Brad Noble, Brian Williams, Eric Palola, Geordie Hall, John Skelly, John Stetson, Matt Lillard, Meg Schultz,

The meeting was brought to order at 9:34 AM by Andrew Carey, MRG Treasurer and Finance Committee Chair.

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Approved March 16, 2022 minutes

• Suggested corrections to the minutes: None noted
• Motion to approve by Eric Palola, seconded by Geordie Hall. Minutes were approved.

Approved April 20, 2022 minutes

• Suggested corrections to the minutes: None noted
• Motion to approve by John Skelly, seconded by Andrew Carey. Minutes were approved.

Review of Financial Reports – Andrew Snow

• Documents can be found here in Google Drive.
• April P&L
  • There were no skiing operations in April. The major revenue driver was breakage on Stark Mountain Cards ($77k) and online tickets ($18k).  Breakage on Stark Mountain Cards represented 49% of the days purchased, whereas breakage on the online tickets was only 6.4%
  • Gross Profit was $118K, which was $11K over budget, and $101K more than last year.
  • Regular expenses were reduced with the restricted operations. Total expenses were above budget for the month, however, because they included year-end bonuses for seasonal employees ($46k). Credit card expenses were also up due to the preseason pass sales.
  • A negative NOI of $171K is $37K less than budget, but $32K greater than last year.
  • Other Income/Expenses included a SMF grant of $6k to pay for the new James Niehues trail maps and a $20k donation expense to the Three Peaks Medical Clinic.
• YTD P&L
  • NOI of $757K is $132K better than budget, and $477K ahead of last year.
  • Bonuses for year-round staff are projected to be in the range of $35k and will be distributed in May.
  • The FC acknowledged the great work done by management and staff for the 2021/22 ski season.

• Balance Sheet
  • Preseason pass sales ($821k) are carried on the balance sheet until the FY 2023.
  • Adjusted CoOp Cash (cash, less POP account and Construction Loan) is $1.79M, or $191K greater than last year.
• Cash Flow
  • The ending cash balance is forecasted to remain above $1.0M for the year.
  • There is no anticipation of using the LOC or Rainy Day account.

Staffing

• Staffing continued to be a challenge for the season. COVID absences and competition for available staff contributed to the ongoing shortage.  The result was an increased use of overtime, specifically for parking lot staff, lift operators and Basebox staff, and the ski school was unable to meet full demand for classes.  Clearly, the national firms are affecting the wage rates.
• Management plans to increase wages next season and will consider options to attract employees as well as greater employee retention.

Options for Cash

• With an increase in available cash, options were discussed, including:
  • Transfer amount equal to FY 2021 share proceeds ($252k) to RDF.
  • Transfer amount equal to construction loan (current balance $264k) to RDF.
• Currently, assets in the Rainy Day Fund (RDF) are held in short duration CD’s, spread among multiple banks per FDIC guidelines.
• Discussion included a number of thoughts or questions.
  • Should the base amount in the RDF be equal to that amount that would be needed in a true disaster of a year?
  • What is the purpose for the RDF?
  • How do funds in the RDF get used?
  • What is the appropriate funding level in the RDF?
  • Should there be more than one account for excess funds, to differentiate between that needed on a “rainy day” versus that set aside for future capital improvements?
• The FC agrees with Management’s plan to transfer $252k, the amount of the 2021 share proceeds, to the RDF.
• More discussion will follow.

Review of Draft Finance Committee Charter

• Discussion focused on the question of how to encourage active participation. Clearly, participation is an issue as evidenced by the lack of quorum in April and a close call at this meeting.
• Based on input to date, the draft charter will be presented to the Board for approval in June.

Budget

• The draft budget will be distributed to the FC in early June for review at the June FC meeting.
• The budget will address increased wages, season pass sales and day ticket pricing.
• Input by FC is critical to keep this process on schedule.

10:39 AM  –  Meeting adjourned by consensus.

Next Finance Committee Meeting – June 15th, 9:30 AM.

Submitted by:  John Stetson