Meeting tonight

What to do about the $260,000 Camden Snow Bowl deficit?

Lynda Clancy

Tue, 04/26/2016 - 11:30am

Winter 2015, from the top of the Snow Bowl. (Photo courtesy Peter Lindquist)

CAMDEN — Like most ski areas in New England, the Camden Snow Bowl had a fiscally miserable year, and because Camden’s ski area is municipally owned, the taxpayers are responsible for its finances.

On Tuesday, April 26, the Camden Select Board will meet with Camden Snow Bowl Director Landon Fake and Town Manager Patricia Finnigan to talk about how to cover the Snow Bowl’s $260,000 deficit. The workshop will take place at the Washington Street Meeting Room at 6:30 p.m. It will not be televised nor streamed.

The workshop’s agenda is as follows:

1. Review of the 2016 Snow Bowl Season financial results: The Snow Bowl ended this season with a financial loss. The Select Board will meet with staff to discuss the causes and options to fund it.

2. Solid Waste/Recycling community decision: Discussion of the Mid-Coast Solid Waste Corp. board’s recommendation regarding contracting with Ecomaine for solid waste disposal.

3. Tannery Community Meeting: The Tannery Working Group will be hosting a series of community meetings to update the community on their work and seek community input on the future use of the site.

4. Maine Department of Transportation Project Updates: Rt. 1 North and the Camden-Rockport sidewalk

5. 2016 Town Meeting preparations: Discussion of efforts to inform voters about ballot questions and issues being presented at June Town Meeting

The primary reason for the Snow Bowl deficit, according to Fake, is the increase in snow-making at the mountain, and the over-optimistic revenue projections.

If the taxpayers are to be asked to help mitigate the debt, they may see a warrant article before them in June at annual Town Meeting.

While owned by the town, the Snow Bowl is treated as its own economic entity and is managed as an “enterprise budget.” This means its revenues and expenditures are maintained outside of the town’s general fund. The Snow Bowl budget runs on a July 1- June 30 fiscal year.

There are several cross-over expense lines with the town’s recreation budget, such as some shared salaries; however, because the Snow Bowl is a business, as well as a municipally-run department, the goal is to have most of its operations funded by its own income stream.

Because it is an enterprise budget — and has been for more than a decade — taxpayers do not consider the Snow Bowl budget at annual town meeting. The Select Board reviews and approves, or cuts, the Snow Bowl budget in July.

Last year, the Select Board approved a $947,464 budget for the mountain, knowing that the Snow Bowl was entering its new 2015-2016 year with an $81,000 deficit. The board, Fake, Finnigan, and members of the nonprofit Ragged Mountain Foundation, which has been raising funds to overhaul and expand the Snow Bowl, met July 13 on the deck of the Snow Bowl lodge and acknowledged the debt. They hoped, however, that there would be a strong start to the new ski season in December, and that the new trails and powerful snowmaking equipment would attract more skiers from throughout New England.

That did not happen. The weather was a bust; it rained more than it snowed, and when the snow guns were turned on, what sprayed out often turned to water. Temperatures were just not cold enough.

“We made a lot of water,” said Fake.

He said April 21 that his preliminary figures indicate a $260,000 deficit, although the final bills and checks are still trickling in.

“We are still putting numbers together from last year,” he said.

He said he is working on the Snow Bowl’s 2016-2017 budget, and because the season tickets and season pass prices increased last year, there is little wiggle room this coming year to raise prices and still keep skiers returning to the mountain.

“The only way to cut is to reduce services,” he said. “And that is painful.”

Fake attributes much of the deficit to the increase in snow-making. In 2014-2015, the mountain spent 329 hours making snow; this past winter, the mountain spent 449 hours making snow.

The electricity and labor involved means each snow-making hour costs approximately $200.

On April 21, Fake was still analyzing the numbers, but said: “We were a little optimistic in revenue projections.”

The Snow Bowl did sell more season passes this past winter: In 2014-2015, total revenue from season passes was $197,252. In 2015-2016, it was $225,135.

However, Fake had budgeted total season pass sales to be $243,000.

He said the warm January, when skiers normally still purchases passes, put a damper on any subsequent mid-winter sales.

The Snow Bowl was not alone this winter with its sharp drop of revenue. New Hampshire mountains, which experienced a 40 percent below average snowfall rate, dropped 12-16 percent in revenue this past winter, according to New England Ski Industry news.

Fake said that Cannon Mountain, which is owned by the state of New Hampshire, is facing a $1 million-plus deficit, with revenue and visitation there down 33 percent.

He said his role this coming week is to talk about where the money will come from to alleviate the Snow Bowl debt.

“My job is to help the Select Board and the public understand that there were some expenses we could manage more tightly, but by and large, in order to be in the ski business, you have to commit resources up front,” he said.

That is because, he said, a ski area has presold to its pass holder, and other community programs. Therefore, the investment to produce ski conditions must be made.

He wrote in an April 21 newsletter to passholders and those on the Snow Bowl email list:

“We received 22 inches of natural snow - all season. Our average in the past 7 years has been 87 inches, and in recent years we've had 4 years where we've had more than 100 inches of snow. To overcome the lack of natural snow, we used all our resources to create as much good ski terrain and conditions as possible. We ran the snow making guns for 550 hours; we usually average 400 hours.

“The Snow Bowl is open an average of 68 days for skiing. This year conditions only allowed us to be open 42 days. In a normal year, we might close 1 or 2 days due to excessive weather. This year, we had to close 9 days due to rain and/or wind.”

As for the overall expansion project at the mountain, fundraising remains on track for a new lodge, said Fake. The Foundation has raised $1 million toward the new lodge, which is halfway to meeting its total lodge funding goal, he said.

“We are hoping to begin construction of the lodge in spring 2017,” Fake said.

Camden readies Snow Bowl for new season; ticket, season pass price increases included (July 20, 2015)

Camden approves Ledgewood contract for phase 2 of mountain work (May 20, 2015)

With record snowfall, Camden's Ragged Mountain Recreation Area begins making financial headway

Camden Snow Bowl Redevelopment Committee, Ragged Mountain Foundation hold community meeting (posted March 2, 2015)

• Camden Snow Bowl project up to $8.4 million, fundraising resumes (Feb. 3, 2015)

Making tracks in some dreamy snow at Camden Snow Bowl (Jan. 30)

Snow Bowl to fire up chairlifts; refunds offered to passholders (Jan 21)

Camden Planning Board to begin Snow Bowl lodge review (Jan. 9)

Camden Select Board brings in old friend to help with Snow Bowl progress (Jan. 7)

• Camden Snow Bowl to start making snow Jan. 5 (Jan. 2)

• Camden Select Board pushes Ragged Mountain redevelopment project forward over protests of many Hosmer Pond neighbors (Dec. 18)