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Mad River Glen Coop

Finance Committee Meeting

May 24, 2005


Committee meeting called to order by committee chair Jed Kalkstein at 4:05 PM via conference call.

Committee members in attendance: Roy Liu, Eric Schoenholz, Jeff Paduch, Andy Dulik, Deb Steines, George Hall, Eric Friedman, Leigh Michl, Andrew Snow, Jed Kalkstein (Chair).
MRG Staff: Jamey Wimble

DISCUSSION:

Mad Card
The committee debated Jamey’s proposal regarding Mad Card pricing.Some committee members felt it was beyond the purview of the finance committee to opine on this issue.Nonetheless, a lively debate ensued.

The committee had the following items for management to think about:

  • Discount for shareholders of 10% or hold at $99.
  • Tiered pricing structure based on date of purchase.
  • Methods to stop people from reselling Mad Cards late in the season, thus reducing breakage.

Budget

The committee reviewed the budget for the fiscal year ended 9/30/06.Current view on projected net ordinary income stands at $124,819.

Key expense items driving this figure included:

  • Decrease in breakage assumption (many skiers redeeming in March).
  • Increased labor costs associated with the longer than expected season.

The committee scrutinized the “cooperative expense” line item to see if there was any way to reduce postage costs by migrating shareholder communication to an electronic format.Some suggested forcing people to use email while others suggested a voluntary “opt-in” program followed by a gradual forced migration.Arguments for this include both tangible savings to the mountain and also environmental conservation (not generating as much paper).Jamey will take this idea under consideration.

The committee discussed the decline in basebox revenue for next season, which is mainly a result of no planned summer activities.

Liability insurance will not go up this year as the overall market is beginning to soften.Workers comp is not expected to go up significantly, but the carrier has the ability to increase rates with appropriate contractual notice.Overall, insurance expenses will be stable this year.

As it relates to the capital budget, Jamey provided an update on the POS System implementation which is proceeding favorably.The system will give the mountain the flexibility in the future to introduce further cost savings via the use of a debit cards as well as collecting better customer information.The grips for Lift 3 have been ordered, and Jamey is now evaluating whether a “fix” is more appropriate for the Cricket Club windows.

The committee voted to approve the budget.

Action Items

  • Continue to ruminate on Mad Card pricing structures (Jamey).
  • Provide plan for migrating some shareholders to electronic-only communications (Jamey).

 

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The committee chair will call the next meeting as needed.

The meeting adjourned at approximately 4:45PM.

 


Exhibit A – Operating Budget Presented

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