Mad River Glen
Cooperative
Board of Trustees Meeting
Minutes – Saturday,
December 15th, 2007
Draft – Pending
Review
After due notice, a Board of Trustees meeting of the Mad
River Glen Cooperative was convened at 5:00 p.m. on Saturday, December 15th,
2007 on the third floor of the Basebox at Mad River Glen Ski Area (“MRG”) in Fayston, Vermont.
Trustees Jay Appleton, Paul Finnerty, Eric Schoenholz, Geordie
Hall, Steve Mackenzie, Bill Reynolds, Jed Kalkstein and Lars Bruns were
present. Trustee Rick Moulton was absent.
Also present were President Jamey Wimble and Marketing Director Eric
Friedman. ~ 15 shareholders were present.
CALL TO ORDER:
Jay Appleton, chair, called the meeting to order at 5:05 p.m.
REVIEW OF MINUTES:
Regarding the draft November 10th, 2007 minutes, Bill
Reynolds moved to accept them and Geordie Hall seconded the motion. . The
trustees present approved the November 10th minutes as-is, without
changes by a vote of 7-0, with Jed Kalkstein abstaining due to absence on Nov
10th.
OPENING SHAREHOLDER COMMENTARY:
Shareholder Lu Putnam commented on Single Chair campaign donations
and recognition. She felt that all types
of donors should be recognized. Trustee Appleton clarified the
board position on the topic, stating that the board is listening – and the
discussion and decision is in the hands of the Single Chair Campaign committee. Shareholder Penny Parson also commented that
everyone should be included, be it via chair, share, in-kind, or charitable
types of contributions. Shareholder Dot
Helling discussed a different perspective on the issue, noting that all
shareholders have been a part of the campaign…simply through their share
ownership. Trustee Reynolds commented
that folks who have purchased chairs and shares,
received value for their money and could not be considered to have made a
charitable donation. He suggested that
the all donors’ plaque be limited to those who have made charitable donations
of any amount, even as low as $5.
Single Chair Campaign
Committee Chair Geordie Hall stated that the committee wants to hear all
viewpoints and do everything to best represent the coop. He stated the need to take some time to
understand all the inputs and reiterated the need and desire to be as inclusive
as we can be.
Speaking as a shareholder, Eric Friedman talked about how
impressed he has been re: effort into the campaign – and suggested turning our
energies towards raising the rest of the monies needed to close out the
campaign.
MANAGEMENT REPORT (Jamey Wimble):
Trustee Reynolds opened Jamey’s report by complimenting
Jamey and staff regarding the handling of the snowboarders at the opening
ceremony. The team did a nice job,
approaching the situation with common sense, a positive attitude and a sense of
humor.
Jamey discussed the Unicel contract which will provide
revenue of just over $20k per year, starting next week. There is also a small upfront payment being
made by Unicel. Cell phone service
should be available in the next few weeks.
FINANCIAL REPORT (Jamey Wimble):
Jamey reviewed the November financials with the
board. Trustee Schoenholz questioned
some of the budget overages re: facilities expense. Jamey discussed that the most significant one
was single registration, five times the amount of normal and a $19k hit. There was also $10k for tiller barrel
replacement/repair on the snow cats.
They were going out of balance and would cause hydraulic damage if not
replaced. There was also an additional
$7k in lift maintenance for the return bull wheel on the pony tow in Callie’s
Corner which was required by the VT state lift inspector. Everything else was across the board increases
including season start-up charges and fuel.
Jamey felt that these expense overages should level out since we opened
2 weeks early / ahead of budget. He also
warned that December expenses may be high too, although revenues should be
strong.
Trustees Kalkstein and Bruns then made a request to Jamey
for when we run across numbers that are significant overages from budget. They requested that we establish a protocol
for Jamey to preview those prospective overages with the Treasurer who would
then determine whether it was appropriate to bring to the finance
committee.
Trustee Hall inquired as to the early season start re:
income. Jamey mentioned that season
passes were about on path with budget per end of November. Now with the early start, pass numbers have
increased a bit more, as well as mad cards.
“Early snow makes a huge difference.”
Trustee Kalkstein asked about the marketing expenses /
variance from the budget. Jamey
mentioned that marketing tends to vary, but that end-of-year calculations
should be per budget with no dingers expected.
Jamey then took questions from the floor. Shareholder Liz Goodwin asked if pass increases
tend to cannibalize day tickets. Jamey mentioned
that last year, it was about balanced, but was hard to calculate and each year
the pendulum differs a bit where the right pricing spot should be. Another
shareholder mentioned that the return of lower midweek pricing was a great
thing, and makes good sense for people to drive a bit to ski for only $35. Jamey also asked people to please get the
word out and bring them out to the mountain.
FY2007 FINANCIAL Audit
For FY2007, the coop turned a profit of $10,800. The Board then discussed the determination of
a patronage rebate The Finance committee recommended not doing a patronage
rebate due the very small amount of the profit and due to the outstanding debt
for the Double and Single chair. Trustee
Schoenholz then made a motion against processing a patronage rebate, which was
seconded by Steve MacKenzie. All
trustees present voted against a patronage rebate for FY2007 by a vote of 8-0.
SHARE REDEMPTION SUSPENSION:
Trustee Schoenholz mentioned
that the Finance committee continued to recommend suspending shareholder
redemption. He suggested that we wait
until January to see how we make out during the holiday weeks and understand
how we do with collecting 2007 Single Chair Campaign pledges. Trustee MacKenzie inquired about redeeming a
small number of shares as a gesture of good faith. Trustee Schoenholz commented that we have a
$300k mortgage debt outstanding right now that we’re paying interest for, plus
$80k debt on the double payable in June.
He mentioned that the finance committee is working on a quantitative
measure to evaluate whether of not we should do redemption. Trustee Bruns reminded the group of the $80k payments
required to payout double chair bond holders this summer. The current mortgage payment for the single
chair loan is $5,222 per month. The cost
of money for the single chair is $129k over the next three years. Trustee Hall encouraged everyone to pay
pledges early if you can. Trustee
Schoenholz also commented that the board has always honored hardship
requests. Trustee MacKenzie added that
he encouraged lifting the suspension as soon as possible. Chair Appleton
then opened the discussion to the floor for commentary.
One shareholder
present commented on redemption suspension, and that he felt betrayed. He’d like to get his money back, and he’s
offered to make a charitable donation to the coop. While he understands the financial position,
he felt that the shareholder redemption suspension goes against the spirit of
the agreement, the spirit of the coop.
This type of thing isn’t done to someone’s family. There is always going to be a financial
hardship around the corner and in his opinion this action deters new
shareholders.
Trustee Appleton is hopeful that
on Jan 12th we’ll be able to begin to open things up. One suggestion was to take the first $10k in
coop profit from last year and turn it into the shareholder redemptions.
Trustee Kalkstein
felt it important to keep expectations in line.
We still have other structural issues in front of us. We have certain things that we need to do –
raise $ for the single chair campaign.
We have to pay the double debt.
Jay reminded the group that some requests have been waiting for 2
years.
Trustee MacKenzie
inquired about the ability to transfer a share laterally to others. We’ve talked about doing some of this historically;
we should look into this again. Other
board members questioned the legality of share transfers and cited SEC legality
concerns re: rules against establishing secondary coop share markets.
The Finance
Committee agreed to look at the concept of permitting shareholders to redeem
their shares and transfer the proceeds directly to the Single Chair Campaign in
the form of a deductible contribution.
SINGLE CHAIR CAMPAIGN UPDATE (Geordie Hall):
Trustee Hall wanted to publicly thank Eric Friedman for the great
Skiing Magazine article and for orchestrating today’s opening ceremony which went
off really well. It was a great
experience. Geordie also wanted to thank
Win Smith, owner of Sugarbush, who was here and rode his chair. Win also took out a half page add with Single
chair picture in the back page of the Valley Reporter congratulating MRG on the
Single.
Trustee Hall reported that the campaign contributions are
now at 1.409M. Total campaign costs
including cost of capital will be ~$1.9M to $2.0M. In discussing how this number changed, Jamey
noted the following items; $24k sales
tax, 5 change orders, CTEC contract deferral for a year was CPI + 1% ($41k), tower/lattice
design modifications for $10k (tower hold downs), admin to PTV $59k, campaign
administration $97k, historical documentation $10k, cost of capital $129k for
mortgage and electrical work $14k He
also noted that we can amend our grant with PTV to cover additional costs for a
full diesel backup which will add about
$86k. Geordie commented that there are ~45
chairs available for sponsorship at $5,000 each.
EXECUTIVE COMMITTEE ACTIONS
The executive
committee and Trustee Finnerty (per request at the November meeting discussion)
accepted the audit. They also noted the
acceptance of a small grant from CLG who offered to prepare the initial
paperwork for a National Historic Places nomination for the Single in case we
wish to pursue this in the future. There
will be separate discussion/action regarding the application if it is to be
pursued.
FUTURE AGENDA ITEMS/NOTES
Trustee Chair
Appleton reviewed some upcoming board agenda items which included discussion of
long-range capital expenditure spending for January. Jamey will be revising his plan, after which
the facilities and finance committees will review. Trustee Bruns and the strategic plan sub
committee will update the board re: Shareholder Strategic Planning calls
scheduled in January. Jay also noted
that Trustee Finnerty will be assisting with arranging Board elections for
2008.
CLOSING SHAREHOLDER COMMENTS
Shareholder Lu
Putnam requested that we try to encourage more women to run for the board for
this and future elections.
EXECUTIVE SESSION
The board entered executive session at 6:17pm and came out
of executive session at 7:32pm. Trustee
Schoenholz recommended the adoption of two financial policy recommendations re:
Disbursement of Funds and Financial Controls.
Trustee Finnerty moved the request and Bill Reynolds seconded the
motion. All trustees present approved
the adoption of these two financial policies without changes by a vote of 8-0. Trustee Hall inquired about
additional work to be done in the area of cash management procedures. Trustee
Schoenholz stated that this will be ongoing.
NEXT MEETING:
Upon review of the calendar, it was determined that the next
meeting of the Board will be on Saturday, January 12th at 5pm on the
third floor of the Basebox at Mad River Glen Ski Area (“MRG”) in Fayston,
Vermont.
ADJOURNMENT:
Trustee Finnerty made a motion to adjourn the meeting,
seconded by Bill Reynolds. The meeting
was adjourned after an 8-0 vote to adjourn at 7:35pm.
Respectfully submitted, Lars Bruns
A true record.
Attest:
_________________________________
Lars Bruns, Secretary
