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Mad River Glen

Board of Trustees

Minutes of Meeting

September 14, 2002

 

After due notice, a meeting of the board of trustees of the Mad River Glen Cooperative was convened at 8:00 A.M. on September 14, 2002, at the Basebox at Mad River Glen Ski Area in Fayston, Vermont. Trustees Bleier, Eaton, Michl, Moats, Moulton (departed 11:00 pm), Putnam, Schultz and Steines were present (Coleman was absent). The Cooperative’s president presided. Margo Wade kept the minutes.

 

Call to Order

President Michl called the meeting to order at 8:09 a.m.

 

Approval of Prior Minutes

Upon a motion duly made by Ms. Steines, and seconded Mr. Eaton, it was unanimously

 

VOTED:         To approval of the July 11, 2002 conference call minutes and the July 13, 2002 meeting minutes.

 

Shareholder Comments

Bill Heinzerling thanked Jamey, Nate, Stevie, and all others involved for a job well done on the new windows and MRG logo on the new single bull wheel/engine room enclosure. He pointed out the ski area officially opened in 1948. He recommended increased promotion of the Starks Nest since its renovation it is a pleasant place to take a break. He encouraged bringing back the Birdcage as a viable alternative to the Basebox and suggested signage outside the buildings would alert skiers to the use opportunities.

 

Mr. Heinzerling also submitted a written proposal, which recommends the Co-op investigate acquisition of the adjacent Howard Hillman property. Ms. Steins pointed out that the Stark Mt Foundation is already looking into various properties. Mr. Michl suggested the foundation follow-up on the opportunity and keep the board abreast of development under executive session.

 

Management Report

The following is the September 14, 2002 Management Report as submitted by Mr. Wimble.

 

Mountain Operations:

The hot dry summer continues as we begin to move towards snowmaking season. Again this year we are looking at possible water restrictions due to the drought. Other ski areas are nervous as well.

 

Capital projects are on schedule and on budget. Two projects were deferred to 2003 due to cash restrictions. Single Mid Ramp and Bird Cage.

 

Insurance refund money is in and we received nearly $5,000 more then projected. Total refund $65,000.

 

Eric, Andrew, and I attended the Northeast Winter Sports Summit last week. The Summit provides a Trade Show and numerous seminars in the Ski Industry Field.

Fall foliage weekend is September 28, 29. Green & Gold weekend is October 5, 6.

 

August preseason sales are on track with last season.

 

Share Sales:

Two shares were sold in the months of July and August against a budget of four. Four shares were redeemed in the two months. New collateral material has been made for the 2003 season and an article encouraging share sales has come out in the Echo. We have a new incentive program that is outlined in the Echo. Share Sales web page has been retooled for 2003. The Web page is where 75% of our share sales leads come from, so we are continuing to putt an emphasis on it.

 

Financials:

August P&L is on budget.

 

Cash flow is moving up with preseason sales.

 

Projected year-end, we should be slightly in the black depending on how the “Breakage” ends up.

<<<end management report>>>

 

Discussion

Mr. Wimble is investigating trends regarding why shareholders are redeeming shares, and the sales process. Six or seven shares are on the six-month waiting list.

 

The board has not clarified the share transfers policy. Mr. Michl requested that Mr. Monte make recommendations/clarifications, and the board will make a decision at the next meeting.

 

Current policy allows transfer to “immediate family.” Mr. Shultz recommended the following clarification – immediate family includes spouse, child, parent, grandchild, and suggested that share transfers outside of this clarification require board approval.

 

The board unanimously accepted the management report.

 

December Profit & Loss (see attached)

 

Financial results of operation for the last month and for the fiscal year to date may be summarized as follows:

 

Period

Income

Expense

Profit (Loss)

August 2002

$1,382

$86,205

($84,824)

YTD

$1,666,188

$1,662,126

$4,062

 

Cash on hand:                       $173,706

 

Mr. Wimble reported that we are at $62K in pass sales, which is surprising coming off a poor year.

 

Mr. Michl requested that the report make it clear that the single CD is separate.

 

The board unanimously accepted the financial report.

 

Committee Reports

Facilities: Mr. Coleman was absent, therefore nothing was reported.

 

Finance: Ms. Steines reported that the committee had not been very active; will be meeting after the final statements are ready; and will begin work on capital funding shortly. It has been very quite; therefore she had nothing further to report.

 

Shareholders Relations: Ms. Moulton reported that committee members actively contributed substantive content to the latest Echo, and finalized the mission statement as follows:

 

The Shareholders Relations Committee is the communications arm of the Mad River Glen Co-op’s board of directors. The Committee assists and advises the board on all matters related to shareholder’s communications, which includes evaluating the existing avenues for communication among shareholders, the board and management. The Committee serves as a forum helping shareholders to reach each other and make recommendations to the board and management regarding Co-op policy.

 

There was discussion about the committee’s mission, touching on the following ideas:

- the committee develops mechanisms for helping shareholders communicate…rather than serves as a forum

- the board needs to determine what they want the committee to do

- the committee should stimulate shareholder communication; keep board from slacking; facilitate a flow of communication in order to nurture our sense of community; formed in the board’s recognition of fostering a sense of community

- Mr. Michl suggested “The purpose of the Shareholders Relations Committee is to develop plans and assist in the implementation of plans that maintain and develop a key asset of the MRG Co-op, its unique sense of community.”

- need to separate the committee’s view of its purpose vs. the management’s view of the committee’s purpose

- this is the board’s committee and not management’s committee, realizing parallels and that management hears more direct shareholder feedback than does the committee

- Mr. Klalkstein suggested “facilitate a flow of communications in order to nurture a sense of community”

- charge the SRC with the question “where do we go now?”

 

There was discussion about the recent issue of the Echo, how to improved communication between shareholders, and build community. Discussion included:

- Management has next Echo scheduled for publication in February (January contribution deadline), which is a marketing function that management handles

- SRC strongly feels there should be an issue published in December

- identified a need for community building function that the Shareholder Relations Committee/Board should handle and not necessarily management

- Until the board addresses the how to achieve the goal we have to live with managements publishing schedule

- SRC should perform a comprehensive review of what is needed; possibly employ focus groups to gain input from folks we have not heard from

- it is the board’s responsibility to govern the community transactions – whether news letter, shareholder activities (party, functions), interface with community at large; and volunteerism to nurture community

- some communication may require faster cycle time than current schedule allows

- additional publication will take resources that have not been budgeted; it is unreasonable to task management without giving the financial resources; current marketing budget would not allow more Echo issues

- different publication needs have two different missions tightly linked; should we work towards two publications sometime down the line

- management uses the Echo for many different purposes – general mailing, circulation of 5000; shareholder mailing, share sales info, general inquiries, etc

- shareholder survey showed that 84% of the shareholders were satisfied with the Echo and communications, which is a satisfactory achievement

- are we under utilizing shareholder resources (communication) – ability to kick around ideas in a public forum (in print)

- it may be too confusing for the readers to have two different publications

- managing editor is a very important position

 -volunteer days very important community building

- currently the Echo goes to whole mailing list once a year and to shareholder list 3 times a year

- Increase number of pages and designate to shareholder pertinent material to improve shareholder communication; number of pages should be governed by amount of good copy

- SRC feels we have important information that needs to get out soon and will be stale if we wait until February, such as strategic planning, green & gold, new elections procedure; more frequent publication would build anticipation during ski season – or just before people begin to ski; SRC is excited to get an issue out in Dec with good content

- different publication needs – marketing vs. shareholder communication

- board should avoid requiring management to find the time; increase work load without increased resources

 

The board generally agreed that a separate shareholder mailing was needed to get information out regarding green & gold, Mad Money deadline, elections procedures, and strategic planning. After discussion about the logistics of how to achieve that goal, the following motion was made.

 

Upon motion duly made by Mr. Moulton, and seconded Ms. Steines, it was unanimously

 

VOTED:         That the Board authorizes the Shareholder Relations Committee to develop and coordinate the development of an Echo supplement to be mailed December 1, 2002 with editorial review to be provided by management.

 

Mr. Klalkstein offered $1000 to help finance the mailing because he strongly supported getting the info out to shareholders.

 

Mr. Michl recommended that the SRC listen to the tape of this meeting at their October 1st meeting.

 

Mr. Bleier commended management on the best Echo yet.

Board Development: Ms. Steines discussed the August 22nd draft of the Elections Procedures policy and relayed minor clarifications. (see attached for full elections procedures document).

 

Mr. Moats raised concern about allowable length of the candidate biographies. The proposed procedure favors an incumbent. Due to potential increase of mailing costs, the board decided to allow length of bios to at lease 2 pages, but in no event more than 3 pages. The proposed procedures do not address other mailings, which are handled under other non-election related policies.

 

Ms. Steines suggested that the Code of Ethics not be included with election procedures until the committee had a chance to strengthen the ethics document. The intent is to eventually include the ethics so candidates understand what they are committing to.

 

Upon motion duly made by Ms. Steines, and seconded Ms. Putnam, it was unanimously

 

VOTED:         To approve the Mad River Glen Elections Procedures as revised dated September 2002.

 

Mr. Michl thanked Ms. Steines on her effort contributed to produce the procedures.

 

Mr. Bleier was appointed chair of the Elections Committee. Mr. Michl, Mr. Eaton will join the committee. Mr. Bleier will find interested shareholder(s) to join the committee.

 

Personnel: Mr. Michl had nothing to report.

 

20th Committee: Mr. Moats reported that he and Ms. Pratt are enjoying amicable exploratory discussions about the Co-op taking on holdings of MR Corporation, but stressed that there were no negations underway.

 

November Meeting Schedule

The November strategic planning session was scheduled for Friday, November 15 at 4:00 p.m. The November Board of Trustee meeting was re-scheduled for Saturday, November 16, 2002 at 8:00 am. Both will be held at the Basebox.

 

The main topic for discussion at the trustee’s meeting will be the preliminary audit report.

 

Mr. Michl requested that Andrew post the updated November meeting schedule on the list serve(s).

 

Mad Money Allocation

A new question has been raised about shareholders’ ability to donate unused Mad Money to the Stark Mountain Foundation.

 

The APR was designed to financially boost the Co-op’s income during lean periods of the year. It can be used to purchase on mountain good and services. If Mad Money were allowed to be given to the SMF then we would be taking money out of the mountain’s coffers, which could negatively effect the financial situation. Breakage (Mad Money that is not redeemed), benefits the Co-op.

 

Mr. Bleier pointed out that we have not had summer events for shareholder to come and spend their remaining Mad Money. He also suggested earmarking the breakage to the Single fund.

 

Mr. Wimble recommended leaving the program as is. Therefore, not allow allocation of unspent Mad Money to the Stark Mt Foundation or Recreation Opportunities for Valley Youths (ROFVY).

 

Upon motion duly made by Mr. Eaton, and seconded Ms. Steines, it was unanimously

 

VOTED:         To maintain the existing Mad Money policy, and to clarify that APR Mad Money is to be used only for on mountain goods and services in the year it was issued.

 

Mr. Bleier noted that Mad Money purchased above the required APR is treated differently than the APR. Mr. Moulton suggested an article for the Echo explaining the board’s action, policy and the difference between the two. Ms. Steines volunteered to write the article.

 

Mr. Shultz added that his goal for the mountain is that eventually we will not need to rely on APR. The trustees generally agreed that this idea should be discussed during the strategic planning sessions.

 

National Register of Historic Places – Discussion

Tara Hamilton, from the Mad River Valley Planning District (MRVPD) and Rural Resource Commission (RRC), came before the board to discuss the benefits of pursuing listing of the Mad River Glen Coop with the national historic register. The following summarizes the purpose, explanation and discussion.

 

The national register is the nation’s inventory of properties deemed worthy of preservation. It supports public and private efforts to identify, evaluate, and document historic properties. It is administered nationally by the National Parks Service and in VT by the Division of Historic Preservation (DHP). Locally, the Rural Resource Commission, which works under the auspices of the MRVPD, assists individuals and groups who are interested in getting structures and places listed on the national reregister, through the nomination process. The RRC also seek out grant monies, from dedicated funding sources, to assist preserve and maintaining eligible structure and places.

 

Getting properties listed is a high priority for the DHP. The valley has four national register districts, including Warren and Waitsfield Villages, a Rural Agricultural District between Rt. 100 and the North Road, and Waitsfield Common. The Knoll Farm and Round Barn Farm are also on the National Register.

 

Being listed does not prevent property owners from altering, managing or disposing of a property. It does not require that properties be maintained, repaired or restored, and it does not impact local zoning; towns do not have more jurisdiction over registered properties than prior to listing. Listing invokes a sense of pride, could be used to boost tourism and as a marketing tool because it recognizes an important link to our past. MRG has an important roll in American ski history. MRG is quite unique. Listing could achieve additional recognition, promote community and economic development.

 

Listing enables property owners’ eligibility for significant federal tax credits if and when historic buildings are restored. Up to 20% credit for income producing eligible buildings (would not include a private home that does not produce income) can be earned. Would make properties eligible for certain grants and as a non-profit Stark Mt Fund would be eligible for additional grants. We are not aware of other ski areas listed, but Ms. Hamilton will check into it further. The historic register does include some parks.

 

Currently management is considering listing MRG as a district. The only eligible structures are the single, Basebox and Starks Nest. One advantage of listing as a district rather than by individual structures would be that changes within the district may receive less scrutiny than if individual structures are listed. It is perceived that changes to an individual structure may receive more scrutiny.

 

There was discussion about what kind of changes may be made to a structure once a grant-funded project has been completed. Changes made to a building during a grant funded project would adhere to set criteria to maintain historic elements. Once a grant-funded project is complete, Ms. Hamilton does not believe you would have to continue to adhere to criteria. She will confirm this. Being listed as a district would not hinder time sensitive or emergency projects from taking place. Grant funded projects assume longer planning periods and probably would not include urgent repairs. Structures could loose their eligibility status if significant changes are made to that structure. Structures within a district are listed as non-eligible (less than 50 years old) or eligible (at least 50 years old).

 

There was also discussion about “hidden strings” attached to listing and placing MRG in a more public realm of scrutiny vs. the private control the area enjoys today. Ms. Hamilton pointed out that it is voluntary to apply for grant funding where criteria and/or conditions may be encountered while listing on the historic register holds no such criteria or conditions. MRG (or structures) would have to be at least eligible to apply for historic grants. Structure/properties that are listed receive higher rating points during the grant review process.

 

Will listing help or hinder the Act 250 review process. Currently, under Act 250, a project involving a structure that is 50 years or older will be reviewed by the Division of Historic Preservation who will evaluate the project within the context of the historic environment and will make suggestions/recommendations to the district commission. The District Commission is the decision maker not Division of Historic Preservation. Mr. Wimble feels the historic portion of the Act 250 review process is minor. He added that the district commission questioned why MRG was not listed, since it is eligible, during a recent review.

 

Mr. Moulton feels listing MRG in the historic register is a win/win situation and plays well into our mission statement. He referred to a church in Huntington that has been successfully listed for many years, has received significant grant funding for rehabilitation, and is currently used as a library.

 

Mr. Michl raised concern that regulations may change over time. Ms. Hamilton responded that the national register has existed for approximately 100 years and its function is and has been recognition not regulatory. With regard to assistance, the DHP encourages property owners to request their help especially during project planning staged when historic structures and places are involved. A portion of the listing process includes an architectural review of existing structures.

 

With regard to advantages of not being eligible in terms of an easier Act 250 process, we have already stated on previous application that we are eligible and probably could not go back on that. We could not claim ignorance at this point. We are aware that we have components that could be eligible.

 

Why are DHP and RRC so interested in getting us listed? Because this is a fantastic historic resource, including the trails, Basebox, single chair, Starks Nest, the people, and the whole area. We all have a great sense of pride for this very special place, and being listed would acknowledge the importance of this piece of American history.

 

Mr. Wimble originally was not supportive because he had some reservations about the effect on the Act 250 process. After he had reviewed other local projects, he feels more comfortable with the idea and that listing has benefits. Eric is very supportive of getting MRG listed on the register for marketing purposes. It will be something new to talk about and will add significant PR value. It fits with the mission statement and he does not see conflicts with the “what ifs” that have been identified during the strategic planning sessions.

 

Mr. Michl stated that he has some reservations, specifically that we may loose part of our private control. He questioned if we could be removed from the inventory. Ms. Hamilton stated that a sole owner would have more control over de-listing than a district with multiple property owners. Mr. Michl broke down the decision making process into two steps, 1) designation, which Jamey is comfortable with, and 2) seek out grant funding, which may require us to relinquish some control.

 

It was the board’s consensus to put consideration of listing MRG on the national register of historic places on the agenda for the next board meeting as an action item. In the mean time, Ms. Hamilton will look into the following questions.

- Can we voluntarily de-list once we have been listed on the register?

- Would we be the first ski area to be included on the list?

- What changes can be made to a structure after completion of a grant-funded project?

 

Mr. Heinzerling feels listing MRG on the historic register is a wonderful and significant opportunity. It is what we are about. He feels the Mad River Valley and the Rural Resource Commission have accomplished important local projects, and recommends folks watch “Saving Place” an historic documentary developed by the DHP and RRC about the Mad River Valley, which is currently running on Channel 44.

 

New Business/Further Shareholder Comment

Regarding pass sales, Mr. Bleier suggested a broader interpretation of “couple” that would include non-married couples receiving discounted prices. He referenced the civil union law and also that there are many unmarried couples, including several amongst the board and staff at Mad River. He pointed out that the idea is to attract more families to Mad River, which should include those non-traditional families. He also suggested that the Co-op consider a discounted single-parent rate. His goal would be a more user-friendly family area.

 

It was identified as a board issue that requires further thought; cultivate family business, long term planning issue, values support communities, how integral do we consider our family market, should be explored further during the strategic planning sessions; and Running a sustainable business and a healthy community

 

It was noted that it is too late for this year to change pricing.

 

Mr. Bleier asked for clarification regarding availability of the shareholder list, and requested that the board clarify the policy as an action item for next meeting.

 

Ms. Steines noted that the Stark Mt Foundation would be putting out a mailing to the list shortly. The board supported the mailing.

 

Mr. Kalkstein relayed his attorney’s interpretation of the law. Corporate law is very clear; shareholders have a right to the shareholder list for appropriate purposes. Co-op law is not clear; therefore, Co-op law defaults to corporate law. The inconstancy makes for a grey area, which could be a lengthy argument in the courts.

 

Ms Steines questioned the shareholders presumption of anonymity. Mr. Shultz suggested that we defer the legal question/interpretation and develop our own policy to clarify the grey area.

 

Mr. Bleier asked for a list of people who have tendered their shares, and suggested reeling them back in. Mr. Michl stated that share sales are the responsibility of management; therefore, it is their decision about how to treat these folks.

 

Mr. Bleier commended management on the new window logo, and picket fence added to the new single base building, the recent Echo, and having messages on the Route 17 sign. He also thanked Mr. Heinzerling and Mr. Bancroft on refurbishing and maintaining the stone wall and garden under the sign. He asked why we are marketing off-area ski trips. Mr. Wimble replied that management feels it builds community, they are out sourced and do not cost the Co-op, we make a little bit of money, and we look at them as a perk.

 

Mr. Heinzerling suggested a voluntary shareholder directory. There was concern about the cost and who would be responsible for administrating. Mr. Michl suggested the SRC explore how this could work, the cost, etc. and make recommendations to the board. Ms. Steines suggested putting it on the web to decrease cost. 

 

Adjournment

There being no further business to come before the board the meeting adjourned at 11:45 a.m.

 

Respectfully submitted,

Margo B. Wade

 

A true record.

 

ATTEST:                                                                                                                                           

                                                                                    Lu Putnam, Secretary

Attachments

1)      August 2002 Financial Statements

2)      Elections Procedures

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