Plattekill Responds to the Belleayre Expansion

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Publish Date

07/19/2013

SAM Magazine--July 19, 2013--The following is a letter Laszlo Vajtay, owner of Plattekill Mountain in Roxbury, N.Y., wrote to the Department of Environmental Conservation in opposition of the proposed expansion at neighboring Belleayre Mountain. For more on the story, check out yesterday's headline news story at http://www.saminfo.com/news/neighboring-county-opposes-belleayre-expansion.

The letter:
I understand the support the Belleayre mountain expansion project has been receiving and I acknowledge the positive economic impact it could have for the local communities. But there are some real negative effects it could have as well on the local businesses it will compete against. My ski area, Plattekill Mountain, is one of those businesses.

I have reservations about the magnitude of Belleayre Resort, but I don’t have a problem with the project itself. It’s private money that’s being put at risk. Route 28 is in desperate need of more quality lodging properties. If that’s what they want to build, and they’re willing to see it through, let them do it. That’s capitalism.

With regard to the Belleayre Ski Center build out, I believe that the business model is flawed. I don’t think the state should spend $74 million of public funds to build out a ski area that will struggle to realize a payback. The projections in the DEC’s most recent UMP estimate skier visits to rise to 320,000. This seems extremely optimistic; it’s twice the reported average for Belleayre over the past five years and more than three times the 103,000 visits reported as of March 11 in the most recent season. That number is significantly higher than the numbers put up by New York’s other two ski areas.

If a private ski area like Plattekill was to attempt to borrow $74 million, I doubt we’d be taken seriously by any financial institution. But if we were able to convince bankers to let us carry that much debt, we’d be in serious financial trouble after a season or two like 2011-12 where all of the ski areas in the region were closed by the middle of March.

This is exactly what happened at Greek Peak in Cortland County, which filed for bankruptcy and was sold at foreclosure auction earlier this year. In that case, an area with 250,000 skier-visits accumulated $48 million of debt after building a hotel and waterpark. They had a growth model that projected 350,000 annual visits and the sale of condos — both of which never materialized — forcing the bankruptcy. The resort recently sold at auction for $6.4 million dollars.

Another example is Montage Mountain near Scranton PA (renamed Sno Mountain). It racked up $14 million in debt, was forced into bankruptcy and sold at auction for around $4 million. I can name others.

I don’t want Plattekill to become another Catskill lost-ski-area statistic like Scotch Valley, Bobcat, Cortina, and many others. We’re moving into our 20th year and we’ve been able to weather bad snow years by keeping our debt load low. Competing against Belleayre and the State has been a difficult challenge, especially during the last decade when millions have been spent on improvements. I’m concerned that it will become even harder to compete with an expansion onto the Highmount property that could diminish our natural terrain advantages that entice skiers to drive the extra 20 minutes to Roxbury.

Belleayre hasn’t been a good neighbor during most of this time. For years before the ORDA take-over, Belleayre undercut our lift ticket prices. They’d wait until we posted our daily ticket rate for the season and then post rates that were the same or a dollar higher. When skiers compared what they were getting for the same price, Belleayre’s infrastructure would often win. On top of this Belleayre would give the product away for free (BOGO) or come up with other discounts to undercut us, while operating at a loss that was subsidized by your tax dollars and mine.

We can only spend what we make. We have to price our tickets to match our infrastructure, cover our fixed and variable costs, and hopefully make a little money to put back into mountain. We have to build property taxes, general liability insurance and employee benefits into our lift ticket cost. Belleayre is exempt from these costs and under the DEC, ongoing losses were a part of the normal course of business.

We also can’t compete with Belleayre’s pay scale and benefits. It’s quite possible that the expansion at Belleayre may lure away our skilled employees.

The state has real advantages when it comes to infrastructure upgrades too. Ten years ago, the DEC got approvals and several millions in funding to install a connection that linked the top of the mountain and the base lodges to the Pine Hill sewer plant. This is a huge advantage that enables significant growth at Belleayre. It would be impossible for Plattekill to permit and fund a comparable upgrade without help.

In the 2000s, Belleayre installed two new lifts including a detachable quad, along with trail changes, significant improvements to the snowmaking infrastructure, a grooming fleet and a state-of-the-art maintenance shop. Have these projects realized payback or a positive return on investment? It’s hard to see how Belleayre’s level of skier visits and admitted losses justify these expenditures.

How can I grow my business and expand my ski area in this environment? My responsibility is to my employees, my family and the Delaware county businesses that depend on Plattekill for survival. I speak for them. Our employees are just as important to the local economy as are Belleayre’s.

What can be done to allow BOTH ski areas to move forward on a level playing field?

Plattekill’s Proposal
• State backed interest-free loans for the private resorts that compete with Belleayre.
• A commitment by New York to refrain from predatory lift ticket pricing.
• True joint marketing between the ski areas to increase skier visits to the Catskills.
• Promotion of a regulatory environment that encourages equivalent terrain and infrastructure/sewer expansion at the private resorts.

It’s hard for me to accept the existing proposal for New York to pay $5 million for 78 acres at Highmount that the developer paid $250,000 for back in 2000 or 2001. It would be much more fair to Plattekill and other competitors if Crossroads Ventures was to maintain ownership and develop the land on their own. Why aren’t they willing to take that risk? I suspect it’s because they don’t see ROI.

As you might imagine I can’t bear to watch Plattekill Mountain--my life’s work--undermined to the point of failure. But if creative solutions can’t be devised to allow Plattekill to compete with Belleayre, I’d accept the same price per acre that state will pay Crossroads Ventures for the land at Highmount, $64,000/acre. This is not a typo. By comparison, The State of NY recently purchased 266 acres on Overlook Mountain in Woodstock, highly desirable land, for under $4000/acre.

Finally, put yourself in my ski boots just for a moment. I’m busting my hump to make payroll and pay taxes that are funding ongoing loses and improvements at my closest competitor. And Belleayre is close. There is no private ski area in the U.S. that is closer to a publicly funded resort.

I am trying to upgrade for the future. Each year I put every dollar of our small net revenue towards used snowguns or parts for our grooming machines. But financing the improvements is much tougher for me than it is for New York. All I’m asking for is a chance to compete on a level field.

Laszlo Vajtay
Owner of Plattekill Mountain




Comments

Turning Belleayre into a summer Mountain bike Park,and Camping

During the spring summer and fall and with UCAT buses routes and buses that can carry bikes,could make this could make it an all year Park.,Much like ski Plattekill A Belleayre Day Pass or a Package deal with UCAT This could form so summer jobs for students and maybe a few local jobs.Having the the sloops dormant doesn't make sense ..please contact me at( 845)255-1404 anytime .

Belleayre

Its time for the State of New York to sell off or lease out long term their Ski Areas

Stop the Giveaway to Crossroads Ventures

I agree totally with Mr. Vajtay. He introduces many valid points in his defense of privately owned ski areas. and our elected officials who have foolishly supported the Belleayre expansion to accommodate the proposed resort must take note.

Plattekill isn't the only business this is going to hurt.

I oppose the incestuous relationships between big money and government at all levels, including this one, and I do, unlike the writer, oppose the building of a monstrosity on that mountain. Destruction is not "capitalism," and there never was any absolute right to build whatever one wants on real property. There are metes and bounds and this mega resort exceeds any reasonable bounds by a lot for a variety of reasons, most of which are obvious, and all of which have been presented at length in many forums. I do believe that people are buying into corporate propaganda and not taking the time to do the homework and due diligence to see that this resort, and the build out being advocated for its benefit will be destructive to the communities in the area, MOST OF ALL, the communities that seem to be most in favor of it, those to the north and west. While creating a huge problem of traffic, congestion and ugliness in the eastern part of the region, this resort is going to choke off business for the communities on the other side, including the small village businesses and the hostels large and small in areas like Middletown. All of the crying about the poor developers that are having such a difficult time getting the approval to destroy a huge piece of open space is selling you something, and when you open it up, it might look like a box of chocolates, but it won't smell like one, I assure you.

Government Waste + Unfair Public Competition

As usual, the money is being taken from people's paychecks to spend irresponsibly on a government project that is completely flawed from a financial perspective from day one. You dont have to be a numbers wizard to realize the NYS figures on what would become of Bellayers skier visits is complete nonsense - artificially manipulated in an attempt to justify this crazy and irresponsible spending. And about that spending. When this goes through, be sure to keep a sharp eye out for who gets the contracts and what Unions are involved - that way you can trace that back to which politicians in New York State are getting the campaign contributions (and God only knows what else). You can fill an encyclopedia with the names of private businesses put out of business due to unfair government competition, I sincerely hope Plattekill wont be next.

Plattekill is in a different category

of ski mountain than Belleayre...expert skiiers in the region know where the goods are...Plattekill has the terrain Belleayre wish they had...I suspect thats one reason for the expansion, but Highmount is still no Plattekill...Laszlo has the best expert terrain in the Catskills... Hunter West is a very close second....I hardly think any expert skiiers are going to be thrilled with the new side of Belleayre, the old Highmount...

Best of luck, Laszlo

Back when I worked for Hedco in the late 80's, early 90's, I did a long demo up at Gore. My equipment absolutely crushed the competition in their side-by-side tests, and their Mt. Mng., GM, and snowmakers couldn't wait to get some of our guns. After some long, hard negotiations, we agreed on the numbers and we were told we'd have a PO the following week. Come Monday, the Mt. Mng. mysteriously disappears, and we're told he "went on vacation". After sweating bullets and raising hell, I'm connected to some suit at ORDA who tells me that since one of my competitor's business partners is a big donor to them, that they couldn't buy our equipment. They ended up with a bunch of the other guns, which worked like crap, made huge messes, and were basically parked. Fine stewards of the public's tax dollars. Maybe Weiner and Spitzer can help, they seem like pretty stand-up guys?

SUPPORT PLATTEKILL

Laszlo, Keep up the good fight for a level playing field. Everyone there works hard and it shows. I call it "A diamond in the Roxbury".

Keep up the fight Laszlo!

Your friends in Maine have your back. Couldn't have been said better. Stay strong.

Great Penmanship!

So very well said.

NYS Competition

It is the same old story, NYS competes unfairly with private business. Our Cross Country Ski Areas of NY Association has been at loggerheads with the State over providing free groomed cross country skiing at Saratoga Spa State Park and other state venues. If there was a more normal succession of winters it would be a problem again. They provide an identical service, groomed ski trails, and do not charge a fee. Not much different that marinas, golf courses, and campgrounds operated by the State at the expense of surrounding private businesses trying to offer a similar or identical service. You can be torn between the State providing an economic engine for an area with employment and commerce, and their unfair stifling of private enterprise. Much more discussion on NYSkiBlog here http://nyskiblog.com/plattekill-on-belleayre-mountain-expansion/ Dick Carlson

Truth In Lending

Laszlo, How can we help ?

Plattekill Power

Laszlo, keep doing what you guys are doing and push forward with plans! You run an amazing and very unique mountain, but the best part is that you develop your mountain as you have envisioned it. I am behind you 110%. Push forward... There is no clear answer what the state will or will not do at bell. Regardless what happens, there will be years of fighting and controversey over what happens.It will probably take years in court In the meantime, keep providing an amazing skiing experience to those who beleive in platty, you guys do an amazing job!!!

Old News

Great letter, great arguments. 'Crazy' Mike Brandt made the same arguments in the 70's & 80's, to no avail. There has never been a level playing field in New York when it comes to the State competing unfairly with private ski area operators.

I'm Behind you 100% Lazlo

It is wrong for the state of New York to operate any department that competes with any private, tax paying business. I have so many concerns about the numbers of this project. The skier visit increase numbers along with the estimated ROI don't make sense. ORDA's $16.9 million operational loss for 2012 doesn't make me feel very good about the way they run a business and to want to expand one of its loosing entities to compete with those paying for It is crazy. I am a 16 year employee of an upstate NY ski area and am starting my 3rd year as mountain manager there....I feel Lazlos pain. New York should start working for its residents instead of thinking up new ways to spend taxpayer money. Any private area would be laughed out of the bank with these numbers.

Belleayre Expansion

Great letter. The Slutzky brothers (of Hunter Mountain) were fighting the idea of State-owned Ski Areas competing directly against privately owned resorts for years back in the '80s and could never get anywhere. Maybe it's time to revisit the issue.

Well stated

He isn't looking for anything but a level playing field in the marketplace....that unfortunately is becoming unamerican.

Damn fine letter.

Damn fine letter.

May Plattekill Survive!

I don’t think anyone could have articulated a better letter on this subject (which relates so well to bigger pictures in our country with the fairness of private vs. public funding). My family and I have met Laszlo, owner of Plattekill, and admired him and his great mountain. Based on his letter below I admire him even more and hope for Plattekill’s future success.

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