SAM Magazine-Boise, Idaho, Oct. 20, 2010- Federal bankruptcy judge Terry Myers has rejected a $2 million loan intended to allow Tamarack Resort to maintain facilities and reopen this winter while it finds a buyer, saying that the onerous conditions of the loan made it likely the resort would default once again.

Whether Tamarack will open or not is still undetermined. "Judge Myers' ruling certainly doesn't mean skiing is off this winter at Tamarack Resort," said Tim Flaherty, general manager of Tamarack Municipal Association, a homeowners' group. "Homeowners have told us they want to offer skiing to the public this winter, and we're confident that the wisdom of protecting the economic development skiing will bring will provide us a pathway to achieving that. Tamarack Resort is a more valuable asset with skiing in place than it is with the mountain idled."

Any such pathway will have to protect the claims of existing creditors. In his decision, Judge Myers said that the $2 million financing proposal from Tamarack's lender Credit Suisse and others failed to meet federal law, was likely to default, and could therefore further harm other Tamarack creditors. Myers said he based his decision on the last of these issues. "It is a question of whether this specific financial and management proposal, made by Tamarack and supported by Credit Suisse, meets the standards that federal law imposes. It does not."

The $2 million loan was intended to allow the resort to retain a chief restructuring officer to help complete the sale of the resort, and pay a delinquent $250,000 state land lease. It was to provide $50,000 for winterization of unfinished buildings, $303,000 to pay new management, and an estimated $635,000 in lawyers' fees to complete Tamarack's proposed sale.

However, the loan was opposed by construction companies, sewer districts and other Tamarack creditors who noted that Credit Suisse and its partners were insisting this latest loan be paid back before other claims. The loan proposal included a 15 percent interest rate and a six month term for repayment. Judge Myers determined that chances were high that no sale would be completed before the loan was due, and that the loan would thus default and add to Tamarack's debt.

• Previous
  Ski Sundown Found Not At Fault
• Next
  New Owners Investing $500,000 at Waterville Valley