Mad River Glen
Cooperative
Board of Trustees
Meeting
Minutes – Saturday,
September 8, 2007
Draft – Pending
Review
After due notice, a meeting of the Board of Trustees of the
Mad River Glen Cooperative was convened at 8:05 a.m. on Saturday, September 8,
2007 on the third floor of the Basebox at Mad River Glen Ski Area (“MRG”) in Fayston, Vermont.
Trustees Jay Appleton, Paul Finnerty, Jed Kalkstein, Steve
Mackenzie, Eric Schoenholz, and Rick Moulton were present. Lars Bruns, Bill Reynolds, and Geordie Hall were
absent. Also present was President Jamey Wimble. Shareholders in attendance: Bill Heinzerling.
CALL TO ORDER:
Jay Appleton, chair, called the meeting to order at 8:05 a.m.
REVIEW OF MINUTES:
Regarding the draft July 14 minutes, Rick Moulton moved to
accept the minutes, Jay Appleton seconded. The July 14 minutes were approved as written by
a vote of 5-0. Steve Mackenzie abstained
due to his absence at that previous meeting.
FALL MEETING
SCHEDULE
The next meeting of the cooperative will be a town hall
meeting at 5:00pm on October 6th during Green and Gold weekend.
The following meeting is on Saturday, November 10th
to review the strategic plan with particular focus on big picture marketing and
ticket pricing.
The December 8th Board meeting will include
review and approval of the final 2006-2007 financial audit, a reconsideration
of the share redemptionsuspension, and the annual review of patronage rebates.
OPENING SHAREHOLDER COMMENTARY:
None.
MANAGEMENT REPORT:
A section of the sewage line required unexpected
repair. The project went well and the
total cost was approximately $4,500.
Initial indications are that the Triple Major pass is a real
hit among the college crowd. The demise
of the American Skiing Company and their 6-mountain pass is helping drive
demand for this pass which costs $269 and provides access to Bolton, Jay, and Mad River.
A discussion ensued regarding the history of Mad River’s
attempts in the past to do a similar program with Sugarbush and their history
of disinterest in offering such an option to skiers -- including their
reticence this year to continue offering reciprocal skiing to staff of both
mountains as well as to continue with the Ski The Valley ticket. Despite initial suggestions that Sugarbush
may want to discontinue these programs, they appear to be back on track at this
time.
The concrete footings were poured with helicopter support
last week. However, due to additional helicopter
delays the towers are now scheduled to be set on September 20th. As a result, there is now no way that the
lift will be completed in time for Green & Gold weekend. There will be public communication next week
confirming the schedule and the absence of chairlift rides this year. A discussion about the possibility of using
the double chair for foliage rides confirmed that safety issues preclude that
option.
Three change orders have been posted to the project cost
resulting in a net increase of $50,000.
However, Management believes that this will shrink since we have yet to credit
off the small amount due back to Mad
River for the labor we
have provided to the project to date.
Management has been careful to extend payables and as such we have still
not needed to draw any money from the bank resulting in substantial interest savings
to date.
COOP FINANCIAL:
Year-to-date through August has net operating income at
approximately $70,000. Management
expects to break even on an operating basis by year end in September.
There were no additional share sales during the month of
August, but the year-to-date total is 128.
Two shares were tendered in August under special consideration for
financial hardship. These shares were
redeemed at the net book value as required by Section 9.6 of the Coop Bylaws.
The Coop cash position is far better then was anticipated at
annual meeting time last April. As of end of August the Coop balance sheet
shows $479,000. Of this cash, $105,000
is specifically earmarked for the Single project. In addition, pre-season sales
are beginning to roll in.
SINGLE CHAIR CAMPAIGN:
The campaign has continued well through the summer
maintaining momentum, though clearly at a slower pace then during the ski
season. The campaign has as a result
crested over the $1.2M.
There will be a campaign solicitors’ meeting during Green &
Gold weekend. In addition, there will be
a dinner for tower sponsors and solicitors during that weekend.
All the towers have now received sponsorship with the
exceptions of the Return at the top, Mid-station, and the Drive. In addition, there are still slightly more
then 100 chairs available for sponsorship.
The Board congratulates all those involved in the hard work
of the campaign and in particular recognized the fantastic job of leadership
that Geordie Hall and Deb Steines have demonstrated – they have done (and
continue to do) a truly remarkable job!
An extensive discussion on the need to get the participation
level up among shareholders unfolded as the Campaign is nearing its target of
$1.54 million.
SHARE REDEMPTION DISCUSSION:
The Board did not act to lift the suspension on share
redemptions. Jay Appleton asked what benchmarks
would make the Board consider with moving forward with redemptions. Eric Schoenholz, Finance Committee chair,
offered that he would feel more comfortable after the campaign goal of $1.54
million in pledges has been reached, and that there would be no long term debt from
the Single project (other then bridging cash flow for multi-year pledges to
come in). In addition, he would want the
audited financial statements completed in order to establish the net book value
for redemption purposes. The audit will
be complete by the December meeting, and the Board agreed to consider resuming
share redemptions, either all or and portion, at that time.
Section 9.6 – Share Redemption: As follow up to the
last meeting, Eric Schoenholz drafted an explanation as to the issues discussed
at previous meetings regarding the Bylaw’s Section 9.6. This draft was circulated among Board members
at the meeting to help the Board explain the issues to interested shareholders.
SECTION 2.1 -
ANNUAL PURCHASE REQUIREMENT:
Management was asked at the previous meeting to get an
opinion from legal counsel regarding the Bylaw language regarding the Annual
Purchase Requirement. The opinion of counsel
was consistent with the assessment of Lars Bruns: The Board is not obligated to increase the Annual
Purchase Requirement (APR) amount, however tif the Board chooses to do so, the maximum increase allowed is the rate of
inflation as measured by the Consumer Price Index (CPI).. Further, annual increases are cumulative, and,the theoretical maximum today would amount to approximately
36% higher then the current $200 APR.
The Board and Management agree that the economic impact of an increase
in the APR is far less than would be appropriate to warrant any increase at
this time and is therefore not inclined to explore any increases in the APR.
OTHER:
Steve Mackenzie raised the question as to whether it would
make sense to offer discounts for shareholders to purchase non-refundable Mad
Money. The Management and Finance
Committee agreed to explore this suggestion and report back to the full Board.
COMMITTEE REPORTS:
There were no new items from Finance committee. The Executive committee discussed a hardship
request for share redemption and approved to such redemptions at the net book
value.
CLOSING SHAREHOLDER COMMENTS:
Since there would not be any lift rides on Green and Gold
weekend, shareholder Bill Heinzerling asked whether mountain biking would be permitted
instead. Jamey Wimble responded that it
would not be.
Bill Heinzerling asked a follow-up question seeking
clarifications on the carbon offset program at Mad River. Jamey Wimble indicated that the mountain has
purchased offsets for the full amount of its operations and has offered to the
option to skiers to buy offsets for their carbon footprint. The projects that will be funded are through
Vermont-based Native Energy and will be primarily for Methane power generation projects
in Vermont.
NEXT MEETING:
Upon review of the calendar, it was determined that the next
meeting of the Board will be on Saturday, November 10th at 8am on
the third floor of the Basebox at Mad River Glen Ski Area (“MRG”) in Fayston,
Vermont.
In addition, the Town Hall meeting will occur on Saturday,
October 6th at 5:00 pm during Green & Gold weekend.
ADJOURNMENT:
Steve Mackenzie made a motion to adjourn the meeting,
seconded by Eric Schoenholz. The meeting
was adjourned after a 6-0 vote at 9:54am.
Respectfully submitted, Jed Kalkstein
A true record.
Attest:
_________________________________
Lars Bruns, Secretary
