MAD RIVER GLEN COOPERATIVE
Minutes of Board of Trustees Held November 13, 1999
After due notice, a meeting of the Board of Trustees of Mad River Glen Cooperative was convened at 9:05 a.m. on November 13, 1999, at the Basebox, at Mad River Glen Ski Area in Fayston, Vermont. Trustees Bleier, Curtis, Eaton, Meier, Michl, Shultz and Singer. Trustees Kirkpatrick and Russell were absent. The minutes were kept by the acting secretary, Mr. Michl, with the assistance of Cooperative’s counsel, Peter Monte.
Minutes of Prior Meetings
After discussion and upon motion duly made and seconded, it was unanimously
VOTED: To approve as corrected the minutes of the October 2, 1999, meeting of the board of trustees.
The trustees meeting packages included numerous letters from shareholders and proposed responses.
At the meeting the president circulated a letter from Debbie Steines commenting on the single chairlift and other facilities’ projects which was referred to the facilities committee for response.
General Manager’s Report
Robert Ackland, the general manager, reported that he has completed his first month as general manager and is pleased with many of his observations, especially the high level of professionalism and knowledge exhibited by staff.
Trail work continues to clear additional wind damage in the woods. A volunteer work day is scheduled today and clearing tree damage is on the agenda.
Work is completed on the private roads in and around the ski area. The project was completed under budget and the homeowner’s association is on schedule with payment for its share.
The insurance company has advised the Cooperative that legal liability considerations require the Cooperative to pad all lift towers if it elects to pad any. It is prohibitively expensive to pad all lift towers, so none will be padded this year. Staff plans to install a temporary fence as a protective measure near two lift towers on the race course during race and training events. (These towers during race event warm ups are the primary temporary safety concern.)
The general manager has instituted a tracking system for ticket vouchers to record how many are issued for marketing and other reasons and how many are redeemed and when they are redeemed.
The general manager is pleased with the volume of early ticket and pass sales. Although the dollar volume is down slightly from last year, when the twelve and under program is factored into the totals, this year’s results show an improvement in most other sales categories.
1,800 children are enrolled in the twelve and under free-skiing program. Most of the enrolled children are local residents. Staff estimates that approximately 200 to 300 children who requested enrollment were turned away because of the cap on participation. Staff is actively preparing contingency plans to deal with a heavy impact from the program, if it should occur.
29 shares were sold in October (18 of which were re-sales of defaulted shares and 11 of which were new share sales). 1,899 shares are now issued and outstanding. The goal for share sales for October, 1999, was 20, and the goal for the fiscal year beginning October 1, 1999 is 110 shares.
Staff is ready to commence snow making as soon as weather permits. The new snow gun is scheduled to arrive next week.
Staff foresees that no problems are likely to arise from the state inspection of ski area lifts. The state inspection was delayed because of the early opening at some other ski areas which required the lift inspector to alter his inspection schedule.
Department staffing levels are satisfactory except for the Basebox food and beverage service where there will be a challenge to fill required positions.
Mad River Glen Ski Area has become a Tubbs snow shoe center with ties to the environmental program. This will assist in making equipment available and in marketing promotion. Exterior work is completed to convert the slalom hill shack into a center for the environmental program and work continues on progress for interior renovations.
The new trail map is at the printer.
Mad River Glen Ski Area is participating with the Mad River Valley Chamber of Commerce in a ski ticket program tied to local lodging establishments. The Cooperative will receive a percentage of each ticket sold.
Mad River Glen Ski Area has established a reciprocal skiing arrangement with Sugarbush. When Mad River Glen is closed, pass holders may ski at Sugarbush at a $25 per day ticket price. Employees from each ski area may ski free at the other.
The general manager has devoted attention to capital needs for Cooperative operations. A new snowmobile is on order. A trade of the truck is under study to acquire a safer truck with more carrying capacity on the mountain. Office computers need attention to address potential problems with Y2K, network deficiencies and under utilization of technology.
The general manager has formed a senior management team comprised of the general manager, manager, assistant general manager, office manager and marketing manager.
The milk run has ended. Safety considerations mandate a new daily opening procedure for the ski area. Step one in the new opening procedure is to check all lift tops by snowmobile to confirm that it is safe to operate the lifts (absence of drifted snow, etc.). Next, all trails will be checked by the ski patrol for hazards. Finally, lifts will be opened for the public as soon as the trail sweeping is completed (even if before the stated "opening hour").
The trustees observed that deer hunting season has now begun and none of the ski area is posted against hunting. The trustees requested that staff prepare a recommended policy for board consideration regarding hunting activities on the ski area.
Financial Results of Operation
The general manager circulated a detailed financial summary which reflects fiscal year-end audit adjustments. Adjusted operating profit for the FYE September 1999 is $104,331. Inclusion of depreciation, non operating income and non operating expense results in a bottom line loss for the year of $116,700. Operating results for the fiscal year ended September 30, 1999 and for the first month of the new year, October, 1999, are summarized as follows:
40l K Plan
The general manager informed the trustees that the 401K Plan for the Cooperative’s employees is managed by three trustees. The present trustees are Robert Mazza, John Olsen and Richard Soderquist, each of whom was appointed when the Plan was first formed. Mr. Mazza was then the general manager and Messrs. Olsen and Soderquist were then Cooperative trustees.
The general manager recommended that the board approve an amendment to the 401K Plan which would implement ex officio appointment of the Plan trustees. This revision would assure that the Plan trustees at all times are employees or officers of the Cooperative. He suggested that the officers who might serve as such trustees would be the general manager, treasurer and vice president.
Mr. Singer questioned whether the general manager would have a conflict of interest as plan trustee because the general manager is a participant in the 401K Plan. Messrs. Eaton and Curtis responded that the plan would benefit from the general manager’s involvement in management because the general manager will be available and informed from day to day. Any implicit conflict of interest is tempered by a majority of the plan trustees being non-employee officers. After further discussion and upon duly made by Mr. Michl and seconded by Mr. Eaton it was
That the Cooperative’s 401K Plan be amended to designate that the plan trustees shall be the persons serving from time to time as the Cooperative’s general manager, treasurer and vice president; and that the proper officers of the Cooperative and the proper officers of the plan be and they are hereby authorized and directed to execute any and all documentation required to implement the foregoing amendment.
|In favor:||Curtis, Eaton, Meier, Michl, Schultz|
Employee Share Purchase Plan
Mr. Meier reported for the personnel committee. He circulated a detailed plan which would allow a one-time, $150 credit for each full time employee to apply against the purchase of a share of the Cooperative. The purpose of this plan is to facilitate employee ownership in the Cooperative and to provide the Cooperative with the benefits that flow from employees having a sense of ownership in the business. Mr. Bleier noted that employees have difficulty spending Mad Money because they have a free ski pass.
After discussion and upon motion duly made by Mr. Bleier and seconded by Mr. Schultz it was unanimously:
VOTED: To approve and adopt the employee shareholder purchase plan recommended by the personnel committee.
Tuition Refund Policy
The general manager informed the trustees that the FYE 2000 budget includes $5,000 for the expense of the Cooperative’s reimbursement of employee tuition for work-related study. The general manager circulated a detailed plan to define which employees and courses of study are eligible for reimbursement.
In summary, staff’s recommended plan made reimbursement available to full time employees and seasonal department managers. Courses eligible for reimbursement are those provided by an accredited institution in which the employee attains a grade of "B" or better.
After discussion and upon motion duly made by Mr. Bleier and seconded by Mr. Michl, it was unanimously voted:
VOTED: To approve the tuition reimbursement plan presented by the general manager with the following changes:
(1) Courses eligible for reimbursement include courses offered by an accredited institution and other courses approved in advance by the general manager in his discretion;
(2) In exceptional cases, and at the discretion of the general manager, full or partial reimbursement for a course will be available when an employee’s grade is below "B".
Reorganization of Committees
The president circulated a memorandum at the meeting which recommends that the trustees reorganize the Cooperative’s committee structure and the board of trustee’s use of committees. The president recommends that the trustees consider reorganizing the Cooperative’s present committee structure to establish six standing committees for routine operations of the Cooperative with addition from time to time of temporary special committees to handle important, major projects such as the single chairlift. The president also recommends that board of trustee procedures be revised to make more effective use of committees.
The president stated that the present processes of the board of trustees and its committee structure evolved during the start up of the Cooperative and its initial management of the ski area. During this start up period, it was appropriate for the board of trustees to evaluate and formulate policy regarding all details of the Cooperative and of the ski area’s operations.
The president suggested that the Cooperative has progressed beyond its initial start up and it is appropriate for the board to consider whether the trustees should reorganize their practices and procedures to better serve the trustees’ function.
The president recommends that the board of trustees should delegate to its committees the task of detailed evaluation and analysis of operations and proposals. The Cooperative will benefit from thorough committee analysis and evaluation before decisions are debated and decided by the full board. Meaningful committee operations would also provide a structure which would encourage participation by owners with a special interest or expertise in a facet of the Cooperative’s business. More effective use of committees should result in better decision making by the full board and should avoid inappropriate intrusion by the trustees into staff responsibilities. More effective use of the board’s time will also encourage owners to participate on the board of trustees.
The president invited the trustees to give these matters more reflection before the board debates and takes formal action regarding his committee proposals. Further discussion of these issues will be placed on the agenda for the December trustees’ meeting.
The president noted that the agenda for today’s meeting included consideration of the creation of a new committee to operate a retail store by the Cooperative. Over Mr. Bleier’s objection, the trustees decided to defer consideration of this committee pending consideration of the global committee restructuring proposed by the president.
Fritz Branchofsky reported for the communications committee. The committee has under active consideration the following steps to improve communications between the Cooperative and its owners: publication of a monthly newsletter; organization of frequent "town meeting" events for shareholders to meet each other and discuss issues of the Cooperative; more frequent publication of the Echo, establishment of better methods to identify and use owner expertise; and means to coordinate with similar organizations to attain common goals.
Mr. Singer observed that expense is an issue the trustees must consider and requested that the communications committee include in its final report an estimate of the cost of each process they ultimately recommend. There was an extensive discussion about differing views concerning the levels of costs which are appropriate or necessary to improve shareholder communications.
The trustees requested that the committee continue its deliberations and next report to the board its final recommendations including implementing details and estimated expense.
The trustees entered executive session at 11:20 a.m. to discuss pending contract issues. The board resumed open session at 11:58 a.m.
There being no further business to come before the meeting, after discussion and upon motion duly made and seconded it was unanimously
VOTED: To adjourn.
Adjourned accordingly at 12:04 p.m.
A true record.
Leigh Michl, Acting Secretary