ASC Sued Over Steamboat Renege
The day: Tuesday, March 26; the place, a conference room at a New York law firm. This was the setting for the preliminary closing on the sale by ASC of its Steamboat operation to Triple Peaks LLC, the holding company set up by Okemo’s owners, Tim and Diane Mueller, and their partners. (The date for closing had twice been postponed at ASC’s request. This time, a phone call on Monday reconfirmed the Tuesday appointment.) But it takes two to tango, and ASC didn’t show. Rather, a conference call notified Mueller that the deal was off. Elsewhere, ASC spokespersons were busy announcing their cash “debt restructuring needs” had been met by selling Heavenly to Vail Resorts (VR) and that they were going to hang on to Steamboat.
Mueller was “flabbergasted.” Yes, he had heard the same rumors that everyone else had about Vail Resorts (VR) sniffing around Heavenly. (All those VR execs padding around South Lake Tahoe clearly weren’t there to play the tables at Harrahs! Even these Blue Pages, normally a model of journalistic discretion, had suggested the deal in March.) But Mueller assumed ASC was doing both deals. Heaven knows, the SEC filings showed they could use the money!
The fallout is still falling. First step, the Muellers are suing for unlawful breach of a binding agreement. Apart from the legalities, Mueller says, “It cuts to the core of the ski industry where operators and owners have always done business openly and honestly. [ASC’s] behavior may forever change the manner in which the ski industry must now do business.” Expect more, because the Muellers are determined to own Steamboat. We expect ASC is staying tuned.
Utah Gets Big Promotion Dollars
Basking in Olympic afterglow, Kip Pitou, who heads Ski Utah, is quite a happy man, especially with the state’s appropriation of $7 million for tourism. But, he explains, actually $2 million of that has already been spent. Still, he smiles, that’s $5 mill for tourism. Not that he can exactly draw that all down, because it has to be divvied up, starting with the Governor, who gets to spend one mill of it for a “Thousand-day Plan” of post-Olympic activities and…well, what Kip is actually saying is that Dave Perry, his counterpart in Colorado, shouldn’t be so covetous because there’s lots of fingers eagerly grasping for the pie and it’s not going to be that easy for Kip to get his share of the goodies for snowsports promotion.
USFS Names New Recreation Director
Six months after Denny Bschor left the key post of Director of Recreation, the Forest Service has appointed Dave Holland, who had previously served a stint as acting director. NSAA’s Geraldine Link identifies him as “highly supportive of recreation in general.”
Forest Service Fee Structure Changes?
The Forest Service is to propose legislation that would increase the fees paid by ski area operations on Forest Service land. The change would apparently not affect the fee structure as it was hammered out in the 1996 law, but would ramp up the percentages, which now range from 1.5 percent of revenues for those grossing less than $3 million, up to four percent for those grossing over $50 million. At the moment, these special-use fees yield Uncle Sam about $39 million per year, most of which comes from ski operations. The Forest Service wants to phase in increased percentages to bring in an extra $3 million by fiscal year 2004, $10 million more by F/Y 2005 and $15 million more by F/Y 2007.
Will it fly? NSAA’s Geraldine Link thinks not. “We saw this same clause in President Clinton’s fiscal 2001 budget request,” she told Federal Parks & Recreation. “It didn’t go anywhere then and I don’t think it will go anywhere now.”
But it’ll be interesting to watch. Mark Rey, the USDA Undersecretary for National Resources and Environment (for our purposes, the administration’s boss of the Forest Service) has been quoted as being in favor of it, though he acknowledged that “better service from us should go hand-in-hand with increased fees.” Rey will be a speaker at the NSAA Convention in New Orleans. Incidentally, his predecessor in this position during the Clinton administration, Jim Lyons, now a Yale professor, has strong feelings on the subject, calling the ski industry’s fee structure “a rip-off.” And he didn’t mean of the ski areas. Jim was always cited as “a friend of the ski industry.” Go figure.
In the meantime, Ms. Link and NSAA’s president, Michael Berry, are forced to deal with misinformation and misinterpretation on the subject in the press. The ski resort industry, thanks to reporting on the likes of $7 million ski-pads-for-the-very-rich, is an increasingly juicy target, and the San Jose Mercury News (breakfast reading for California’s Silicon Valley set) ran a doozie of a feature by Paul Rogers, headlined: “COLD CASH—Ski Resorts Profit on Cheap U.S. Land.” The long article is so factually dicey, with so many omissions and misinterpretations, it took Berry four pages of rebuttal before he concluded that author Rogers “had a personal agenda in writing this article and…ignored all key facts and data that were inconsistent with that agenda—regardless of their veracity. In so doing, he purposefully misled the public and compromised his own—and the paper’s—reputation.”
What is even worse, author Rogers had interviewed Geraldine Link at length and must have known he was playing footloose with facts when he wrote his piece. Like many, Rogers made the “apples-and-oranges” mistake of comparing the Park Service and the Forest Service models. In the former, concessionaires invest nothing in building and maintaining structure and infrastructure; in the latter, ski area permittees invest their own funds to build lifts, buildings and snowmaking systems to enable the resort in the first place. The Mercury News, though it knew better, made this same error.
In the same article, ASC’s Les Otten, now a part owner of the Boston Red Sox, is identified as “current boyfriend of Katie Couric.” You don’t suppose they confused Les with another Bosox investor, TV producer Tom Werner, do you? Is Les’s next rainbow pot-of-gold to be found in the libel laws?
Now, to Our Rescue: Global Warming?
So, you thought you knew all about global warming, how polar ice caps were melting and how our ski resorts would some day have to adapt as beach resorts. Well, think again. Yes, global warming is happening, and the ice caps are melting, but guess what: this could lead to a big chill. As stated in The New York Times by Terrence Joyce, a senior scientist at Woods Hole Oceanographic Institution, “global warming could actually bring colder temperatures to some highly populated areas like Eastern North America and Western Europe.” How much colder and how soon? “…an abrupt drop in average winter temperatures of about 5 degrees F over much of the United States and 10 degrees in the Northeast…This change could happen within a decade and persist for hundreds of years.”
It seems it’s all about a build-up of fresh water from the melting ice flows which changes currents, especially the Gulf Stream, which slows, is redirected southward and causes the North Atlantic region “to get significantly colder.” It’s happened before, like 12,000 years ago in the last Ice Age. Don’t remember that? Well, it happened again in the “Little Ice Age,” which coincided with the notorious winter at Valley Forge.
Hey, whatever!
Necessity the Mother of Change?
This year’s highly stimulating mid-April Mountain Travel Symposium at Whistler came up with some upbeat conclusions on how our snowsport industry weathered the challenges of 9/11 and recession. Look for in-depth exploration of this in July SAM. Equally stimulating (as always) at a gathering like this of some 800 representatives from resorts and the travel infrastructure is the scuttlebutt in the aisles where a good listener could take a graduate course in informational marketing. Clearly, though dot-coms may have died, the Internet lives and thrives. A few years ago, the Internet made some “snowsliders” into “snowtrackers” who would head for the resorts with the newest and deepest snow. Now, we have “idealtrackers” who bookmark key websites or subscribe to automatic updates to find the best prices.
Correction
In the March Blue Pages we listed the major ski areas that still prohibit snowboarding but omitted Alta. Our apologies to them (and also to any whose hopes we cruelly raised). On the same subject, another with a no-rider policy, Taos, held its annual special one-day boarding bash on the day after the resort closed for the season. Taos GM Gordon Briner was quoted as saying there may come a day when snowboards are always welcome on the mountain. “We’re not stupid enough to say they’ll never be here,” he told Ski Press. That sounds nearer than ever.
