Cannon Mountain...thoughts

[thetrailboss]

I'm pretty sure the discussions for this biennial budget are around leasing the Cannon Mountain ski area, not the entire Franconia Notch State Park.

As I understood it, the specific "business units" were to include the Tram, Cannon proper, and Echo Lake Beach/Campground. If you took those assets out of the FNSP unit I think you would see that they (as in Cannon, Tram, Beach/CG) made money if not broke even each year in this report from now almost ten years ago.

 

[Puck it]

As I understood it, the specific "business units" were to include the Tram, Cannon proper, and Echo Lake Beach/Campground. If you took those assets out of the FNSP unit I think you would see that the made money if not broke even each year in this report from now almost ten years ago.

The Tram is broken out too in the pdf. It must be Summer Ops only. It made money by itself.

 

[threecy]

As I understood it, the specific "business units" were to include the Tram, Cannon proper, and Echo Lake Beach/Campground. If you took those assets out of the FNSP unit I think you would see that the made money if not broke even each year in this report from now almost ten years ago.

The Tram is broken out too in the pdf. It must be Summer Ops only. It made money by itself.

Indeed...with just this information, it's tough to pinpoint (the FNSP operations expenses decline while the Flume expenses go up), but one can expect some of the FNSP operations expenses to be pushed out of the ski area line item if it were leased. It should also be noted that these numbers are before more recent energy price spikes.

Regardless, Notch operations would net the parks department pretty close to a million a year based upon the limited information in these charts.

 

[jack97]

Why don't you explain for us what you think a private owner can do to Cannon to bring it to 250K skier visits.

Sunapee had to undergo massive investment to get to that number. Sunapee also has terrain far better suited for the average skier than Cannon does.

I disagree in regard to terrain.

I think one of the first things you'd see a private operator invest in would be snowmaking.

If the disagreement in regard to terrain is in the context of best suited for the average skier, I recall the rumor that when Peak Resort wanted to expand their business toward NE, they decided against the old Temple ski area and opted for the Onset/Bobcat/Crotched area. According to the rumor, the reasoning was that most of Temple's pitch was consider to steep for the crowd they wanted to attract. The second reason was a lack of a water supply. I think the guys over at Snow Journal could shed some light into this.

 

[riverc0il]

The Tram is broken out too in the pdf. It must be Summer Ops only. It made money by itself.

As I recall, when the tram was originally built, it was primarily built for summer tourism and was understood that it could/would take a loss in the winter.

This past days posts on the subject speak to folks bashing Threecy without doing their own research. FSN/Cannon includes Flume and Summer operations. The entire thing can be in the black with skiing operations in the red. It has already been noted but I just want to point out that a lot of folks are snapping at threecy while also throwing around assumptions and questionalbe numbers.

Let's face it folks, this discussion has gotten circular based on preferences of what the function of government is. Time to give it up.

 

[threecy]

If the disagreement in regard to terrain is in the context of best suited for the average skier, I recall the rumor that when Peak Resort wanted to expand their business toward NE, they decided against the old Temple ski area and opted for the Onset/Bobcat/Crotched area.

Peak looked at a variety of areas, open and closed, before choosing Crotched. Frankly, it remains to be seen if it was the best choice out of the areas they looked at.

According to the rumor, the reasoning was that most of Temple's pitch was consider to steep for the crowd they wanted to attract.

I don't think that's accurate - the current quad lift line at Crotched is steeper than the quad lift line at Temple.

 

[deadheadskier]

As I recall, when the tram was originally built, it was primarily built for summer tourism and was understood that it could/would take a loss in the winter.

This past days posts on the subject speak to folks bashing Threecy without doing their own research. FSN/Cannon includes Flume and Summer operations. The entire thing can be in the black with skiing operations in the red. It has already been noted but I just want to point out that a lot of folks are snapping at threecy while also throwing around assumptions and questionalbe numbers.

Let's face it folks, this discussion has gotten circular based on preferences of what the function of government is. Time to give it up.

I'm not going to deny I've taken issue with threecy's stance and could be perceived as bashing him. At the same time, he comes across as a 'know it all'. Today's posts proved that he's right on a lot of the financial aspects of Cannon. That said, I've asked plenty of times for data on certain claims he makes. I am not as familiar with the gov't process as he is. He'd receive far less 'bashing', if he was more direct in presenting the true numbers that he knows instead of of having a history of being very vague on the subject.

18 pages of this thread it's him stumping, "Cannon loses money, Cannon losses money, Public ski areas put private ski areas out of business, etc." Then FINALLY today, he points me towards the true financials. Mind you, I said in the first few pages that I need to see hard numbers before I truly make up my opinion.

It took until today to get those numbers. And they do give me pause. For a guy who has such a hardcore opinion on Cannon being leased out, he could've built a lot more credibility and received a lot less bashing if he presented the hard numbers from the document Cannonball posted today at the very beginning of the thread.

He finally backed up his stance and it took another member taking him to task to get there. A lot of the BS in this thread would've never happened had he presented hard facts early on when he was asked for them.

I'll apologize to threecy for 'bashing' him, but it's not like he hasn't been smug in his own arguments to.

 

[threecy]

I'm not going to deny I've taken issue with threecy's stance and could be perceived as bashing him. At the same time, he comes across as a 'know it all'. Today's posts proved that he's right on a lot of the financial aspects of Cannon. That said, I've asked plenty of times for data on certain claims he makes.

I'll apologize to threecy for 'bashing' him, but it's not like he hasn't been smug in his own arguments to.

These are internet forums open to the public. I cannot post every piece of data I have, or every piece of information I've been told.

I'd invite you to read through the posts in the thread...you'll note that I've been trying to focus on the ski industry related issues, whereas you've been trying to make this personal (suggesting that I have a grudge, was denied a job, etc. etc.). I don't see the need for that. Call me smug or a know it all...if people want to avoid know it alls, they tend to avoid internet forums

18 pages of this thread it's him stumping, "Cannon loses money, Cannon losses money, Public ski areas put private ski areas out of business, etc." Then FINALLY today, he points me towards the true financials. Mind you, I said in the first few pages that I need to see hard numbers before I truly make up my opinion.

It took until today to get those numbers. And they do give me pause. For a guy who has such a hardcore opinion on Cannon being leased out, he could've built a lot more credibility and received a lot less bashing if he presented the hard numbers from the document Cannonball posted today at the very beginning of the thread.

Cannon has a long history of losing money outside of good snow years. I don't think there was any doubt that Cannon has lost money in bad years - I believe the discussion here was more along the lines of 'Cannon has made money in the past few years and has thus turned a corner.'

 

[Puck it]

Cannon has a long history of losing money outside of good snow years. I don't think there was any doubt that Cannon has lost money in bad years - I believe the discussion here was more along the lines of 'Cannon has made money in the past few years and has thus turned a corner.'

Private areas can lose money also in bad snow years. Right?

 

[witch hobble]

Dudes, don't start the kiss and make up bullshit now. Dig those heels in!!! We have a little more than six months until those lifts turn for skiing again. :argue:

I suspect if you seperated out ski area operations as a line item in many large resorts' budgets, they would be loss leaders. No?

 

[deadheadskier]

These are internet forums open to the public. I cannot post every piece of data I have, or every piece of information I've been told.

I/QUOTE]

why not?

 

[Puck it]

why not?

 

[threecy]

Private areas can lose money also in bad snow years. Right?

Indeed...when Cannon shows a loss, taxpayers are on the hook for hundreds of thousands of dollars. If Sunapee loses money, the State still gets something like $150,000 + 3% of gross.

why not?

Exactly I learned my lesson almost 10 years ago when I posted something ski related that shouldn't have been posted. Some of these ski forums are closely monitored. Even amongst those not closely monitored, certain threads show up at the top of Google search results.

 

[from_the_NEK]

Exactly I learned my lesson almost 10 years ago when I posted something ski related that shouldn't have been posted. Some of these ski forums are closely monitored. Even amongst those not closely monitored, certain threads show up at the top of Google search results.

 

[Puck it]

 

[deadheadskier]

Exactly I learned my lesson almost 10 years ago when I posted something ski related that shouldn't have been posted. Some of these ski forums are closely monitored. Even amongst those not closely monitored, certain threads show up at the top of Google search results.

See I understand this full well. My brother lost a job once for discussing sensitive information on a public forum.

However, none of the questions asked of you have been 'inside secret info'. It's all public information. I don't see the harm in pointing someone towards facts that actually help to support your argument.

If you knew of the Flume/Tram/Ski Area data, you should have just said look at these numbers.

 

[threecy]

See I understand this full well. My brother lost a job once for discussing sensitive information on a public forum.

However, none of the questions asked of you have been 'inside secret info'. It's all public information. I don't see the harm in pointing someone towards facts that actually help to support your argument.

Not necessarily, in regard to Cannon. My slap on the wrist wasn't sensitive information per se, but nonetheless something that didn't need to be posted online. Was surprised to see who was reading those forums at the time though

If you knew of the Flume/Tram/Ski Area data, you should have just said look at these numbers.

I hadn't seen the cited charts before. There have been news stories and various releases over the years citing the losses at Cannon in bad snow years - I didn't know that was actually being questioned here.

 

[Black Phantom]

Not necessarily, in regard to Cannon. My slap on the wrist wasn't sensitive information per se, but nonetheless something that didn't need to be posted online. Was surprised to see who was reading those forums at the time though


I hadn't seen the cited charts before. There have been news stories and various releases over the years citing the losses at Cannon in bad snow years - I didn't know that was actually being questioned here.

Excellent work, councilor. :flag::beer:

 

[Cannonball]

I hadn't seen the cited charts before. There have been news stories and various releases over the years citing the losses at Cannon in bad snow years - I didn't know that was actually being questioned here.

It's odd to me that you have been posting "facts" about Cannon's profitability ad nauseum for many months over several threads, yet you haven't seen this data before? I found all of these NH reports by copying and pasting one of your quotes into a google search!

 

[Puck it]

Last Meeting Minutes that were posted also.

​

Cannon Mountain Advisory Commission meeting ​

November 19, 2010 / Cannon Mountain​

Minutes prepared by John DeVivo​

Members present:​

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[FONT=Arial,Arial][FONT=Arial,Arial]Chairman Dennis Murphy, Representative Kathy Taylor, Representative David Russell,
Treasurer Catherine Provencher, Rich McLeod, Martha McLeod, Gerry Coogan ​

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Members absent:​

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[FONT=Arial,Arial][FONT=Arial,Arial]Senator John Gallus, Senator Deborah Reynolds, Jay Polimeno ​

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Others present:​

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[FONT=Arial,Arial][FONT=Arial,Arial]John DeVivo, Kevin Johnson ​

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Call to order:​

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Chairman Murphy called the meeting to order at 10:15 AM, with a round of introductions made.​

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Approval of 11/16/09 meeting minutes:​

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Martha McLeod moved that minutes be accepted, Rich McLeod seconded, and the minutes were approved.​

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Financial update FY10:​

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John DeVivo reported the following:
Cannon recorded a net profit of $426K on its Quickbooks report, DRED reported a FY10 closure of $417K on its State report for Cannon; Season Pass revenues exceeded $1M for the first time; Sunapee contribution to the Cannon Mountain Capital Improvement Fund was $365K; Kevin Johnson asked if this was the first year that the entirety of Cannon’s financials were reported in the State report, rather than having only the ski-specific appropriations pulled out; John DeVivo did not have that answer available; Treasurer Provencher detailed the Cannon Mountain Capital Improvement Fund​

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[/FONT](CMCIF) [FONT=Arial,Arial][FONT=Arial,Arial]report, and offered to have it updated for the CMAC membership; Since July 1, 2007, Cannon has eliminated nearly $1.2M of its $1.494M operating deficit (approx.80%), with a remaining deficit of $301K. ​

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Outlook for winter 10/11 season:​

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John DeVivo reported the following:
Cannon’s current FY11 net positive is $172K, some $159K ahead of FY10 YTD; revenue is running 8% ahead of FY10, while expense is running 5% under FY10; Season Pass revenue is running 25% ahead of FY10; Snowmaking began on 11/18, with a plan to open at 8:30 AM on 11/26; Capital and maintenance projects are wrapping up; Cannon is awaiting the arrival of the new drive unit for the Zoomer Triple, and approval on its lease-to-buy backhoe unit (12/08 G&C); Summer projects/improvements list – 4 top 10 Eastern rankings in SKI Magazine; Mittersill Double Chair construction is on schedule and on budget; Base area improvements at Tramway, Notchview, Peabody, and Brookside (doors, decks, windows, bridge, roof) were detailed; Snowmaking water line on Zoomer trail is underway, New Prinoth Bison and Trooper vehicles were approved at 11/17 G&C meeting; New promotional partnership with Littleton Chevrolet is working well; New retail and merchandising campaigns are underway; New website set for late November launch.
Treasurer Provencher asked which, if any, capital maintenance projects were completed during summer ’10 using operating funds built into Cannon’s FY11 budget; John DeVivo detailed the annual groomer lease, the new snowmaking vehicle lease-to-buy, the snowmaking water line, and the various base area improvements; all were completed using operating funds built into the FY11 budget.
Cannon’s management team believes that its remaining $301K operating deficit will be eliminated in FY11; future net profits should be applied toward making capital/maintenance improvements and paying down the debt service on the CMCIF, with the annual difference between the Sunapee lease payments and the debt service on the CMCIF to be made up for by allocations from Cannon’s net profit; Cannon’s management team believes that with its aggressive 10/11 marketing plan, the improvements made and marketed since September 2008, and an ever-increasing season pass holder base, the ski area will post a fourth consecutive net profit while continuing to improve upon its products, services, and infrastructure; The ski area has built some $500K into its FY11 operating budget toward capital and maintenance projects, based on expected revenues, and given the necessary performance, will encumber those funds in spring ’11 for summer ’11 projects and enhancements.
The Mittersill Double Chair construction project is running on time and on budget; the load test is expected to take place in mid-late December, with an opening scenario to follow shortly thereafter; Governor and Doctor Lynch are expected to ride on the first chair, with all CMAC members invited to the ceremony; the date itself on the opening scenario is a moving target, as the lift services an all-natural terrain area; Lift-accessed all-natural terrain areas have become prominent across the US, and at Eastern and Western Canadian areas, as well; The project was spec’d at approximately $2.62M, with a contingency budget setting it at approximately $2.95M; The project was funded with 50% CMCIF funds and 50% general funds; The project scope included not only the lift construction, but the tear-down and removal of the old lift and the expansion/reclamation of 86 acres of all-natural terrain (a 50% increase in Cannon’s terrain offerings). Martha McLeod asked about snow depth requirements at Mittersill to make the area viable; Rich McLeod and Dennis Murphy answered that substantial snowfall is required, but that the type of snowfall and other weather patterns play into effect, as well; John DeVivo answered that Mittersill is a bit better wind-protected than Cannon proper, and that solid base depths at Mittersill and less rain and wind effects would lead to substantial "open" time at Mittersill, as the area is meant to serve an audience seeking all-natural terrain.
Rich McLeod remarked to Chairman Murphy that under its current management team, Cannon is being operated as efficiently and effectively as it ever has; there was concurrence amongst the group; John DeVivo replied that Cannon’s team is very passionate and has set aggressive goals toward future successes.​

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Improvement plans for 2011 and beyond:​

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John DeVivo reported the following:
Mittersill base area/infrastructure improvements (parking lot enhancements, small base facility, limited snowmaking) will follow over a 3 – 5 year period; The area is designated for all-natural use for a 3 - 5 year period, following its 25 years’ use as such and a desire to offer this type of product for consumption within the marketplace; The original intent regarding State capital plan requests was to request capital funding on the Cannon side for the 12/13 fiscal cycle and on the Mittersill side for the 14/15 fiscal cycle.
For the FY11 / FY12 / FY13 fiscal cycles, the ski area management team has built some $500K into each operating budget to use for maintenance capital projects (ex. snowmaking enhancements, retail enhancements, snowsports building expansion) based on expected revenues, with the intent of encumbering the funds each spring for summer/fall use; There is a $2M snowmaking project request in for FY12/FY13 consideration for the impending budget discussions; The CMAC recommends that if the project is approved by DRED and the Governor’s office for further consideration, it be removed by Cannon for this legislative session, with the thought that our success in gaining approval on the first and second phases ($1.433M and $460K respectively) of capital through the CMCIF, and the approval of the Mittersill Double Chair construction ($2.95M) through the CMCIF and general fund was a solid step; the Legislature is not expected to pass any wide sweeping capital plans during this session; Maintenance capital projects ID’d for planning by the ski area in early FY12 (using funds encumbered in FY11) include: new drive unit for the Cannonball Quad, grooming fleet enhancement with a new Bison WinchCat, rolling stock enhancements, retail space and Snowsports building enhancements, and snowmaking system improvements (either on-hill via pipe & hydrant enhancements or off-hill via added air capacity).
Gerry Coogan asked whether an updated 5 – 10 year master plan or capital plan would be forthcoming. John DeVivo replied that the 1998/99 Master Plan as crafted by Sno Engineering had been approximately 50% completed in scope (concurred by Rich McLeod), but that the plan is essentially obsolete at this point; Martha McLeod noted that revisions to said Master Plan were required (elimination of a lift and trail section above 2,500’ elevation on Mittersill) to secure the MOA with NH Audubon and the land exchange with WMNF; the drafting of a revised Master Plan will be focused upon over the next year or so, and presented in each stage of its evolution to the CMAC.
Cannon’s FY11 goal is to eliminate its existing operating budget deficit ($301K) and use that remaining net profit toward capital maintenance projects; Cannon’sFY12/FY13 goal is to build maintenance capital into each annual budget and utilize its net profit toward paying down the debt service on the CMCIF; Cannon’sFY14/FY15 goal is to build maintenance capital into each annual budget and utilize its net profit toward paying down the debt service on the CMCIF, and to explore options with available CMCIF funds.
Franconia Ski Club will soon be launching a fundraising drive toward the expansion of the Ernie’s Haus facility (used non-exclusively by FSC as its operating base) and one of several trail expansion/improvement objectives; The Club has ID’d several trail initiatives, including linking several trail areas or expanding snowmaking capacity up onto Mittersill sections; when the FSC plan takes its final shape, details will be shared with the CMAC membership and the general public; such projects would be subject to approval by G&C as "accept and expend" projects.​

Legislative issues:​

Representative Taylor presented the draft of an amendment to RSA 227:14 (Resident Ski Rates, Reduced Rates) as requested by Cannon Mountain to:​

Reflect the same age structure for both its day use tickets and its season passes
Eliminate the secondary school status and clean up the age requirement language
Establish consistency with the same date (December 15) used for the NH Resident season pass discount and the age/date requirement for current-year season passes

John DeVivo asked Representative Taylor if the item on Line 21 (Effective Date) may be flexible, as Cannon’s sales season (for the following year’s season passes) typically commences on the last Saturday in February or first Saturday in March; Representative Taylor replied that she would seek flexibility and/or immediate effectiveness, depending upon the bill’s status in various committees and/or a legislative vote on it.
A question was raised as to whether a bill would be introduced in the current session regarding the leasing of Cannon Mountain; no one present at the meeting had any such information; John DeVivo remarked that he’d heard from Senator Gallus’ office in Concord earlier in the morning that he (Senator Gallus) would be unable to attend the CMAC meeting, and that he (John DeVivo) had remarked to the Senator’s Aide that it was likely that the CMAC membership would like to know if the Senator had any information on that subject. The Senator’s Aide offered that he’d work on getting an answer on it from the Senator.​

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Other/new business:​

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None identified.​

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Set next meeting date/time:​

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Chairman Murphy remarked that the CMAC typically meets during the spring season, but that with elections having taken place and new appointments to the CMAC forthcoming, he’ll wait a bit to see what shakes out in the legislative session and see what new appointments are made to the CMAC before setting the next meeting date.​

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Adjournment:​

[FONT=Arial,Arial][FONT=Arial,Arial]Chairman Murphy adjourned the meeting at approximately 12:05 PM.
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