Cannon Mountain...thoughts

[threecy]

I'm not implying anything.

You made the connection between funding education and funding a ski area.

 

[threecy]

I guess he's hoping you'll say something that decisively proves you are a radical.. Then your arguments about Cannon will be more easily refuted.

Indeed...it's easier to try to discredit the opposition than try to make a case as to why the state should continue to fund and operate a major ski area.

 

[Cannonball]

I guess he's hoping you'll say something that decisively proves you are a radical.. Then your arguments about Cannon will be more easily refuted.

Nope.

Threecy made this statement:

Cannon requires millions in new improvements on a regular basis. It's time for the state to get out of the ski business.

I made this parallel statement:

Schools need millions in new improvements on a regular basis. Is it time for the state to get out of the education business?

The point is: just because an operation requires millions of dollars in investment is not a de facto reason not to do it. There are many, many, many good reasons to invest millions of dollars in an operation: profit, social benefits, etc. Threecy's blanket statement that the state needs to get rid of Cannon just because it requires capital investments is not a good argument. The question at hand has been "is Cannon worth keeping in the state system?" A requirement of investment does not automatically make the answer "no".

 

[bobbutts]

Sometimes you have to spell it out for us ;-)

Point taken.

 

[jack97]

New Hampshire should get out of public colleges as well, they are competing with private colleges.

If college tuition gets to high.... well as Judge Smails said, someone has to be digging the ditches.

 

[deadheadskier]

New Hampshire should get out of public colleges as well, they are competing with private colleges.

If college tuition gets to high.... well as Judge Smails said, someone has to be digging the ditches.

liquor and wine business as well.

I buy all my wine from NHS liquor stores. It's cheaper than the mom and pop places. Not fair

 

[threecy]

The point is: just because an operation requires millions of dollars in investment is not a de facto reason not to do it. There are many, many, many good reasons to invest millions of dollars in an operation: profit, social benefits, etc. Threecy's blanket statement that the state needs to get rid of Cannon just because it requires capital investments is not a good argument. The question at hand has been "is Cannon worth keeping in the state system?" A requirement of investment does not automatically make the answer "no".

The State of New Hampshire only has so much money. The more it pours into a facility (which is used by a very small minority of the taxpayers, and at a high per-use fee), the less it has to put into other programs.

 

[thetrailboss]

Indeed...it's easier to try to discredit the opposition than try to make a case as to why the state should continue to fund and operate a major ski area.

Well, to take you up on your offer, the State made a decision in the 1930's that the resulting tourism, economic, social, cultural, and other intangible benefits justified the creation of Cannon and met the public interest. There are some things that cannot be valued in terms of profit/loss.

I think you'd have a very good argument at that time against Cannon because it was one of the largest ski areas. Period. Now you have many private operators of various sizes and in different locations.

 

[riverc0il]

Well, to take you up on your offer, the State made a decision in the 1930's that the resulting tourism, economic, social, cultural, and other intangible benefits justified the creation of Cannon and met the public interest. There are some things that cannot be valued in terms of profit/loss.

In the spirit of intellectual honesty, I feel it neccesary to point out that when the tram was built, it was figured to be profitable during the summer but would be a money loser during the winter. I also don't think we can make 2011 decisions based on 1930's intent. The ski area will fulfill economic needs regardless of state or lease operated.

It is pointless discussing the Cannon lease from a financial perspective unless you are pro-lease and don't care about anything else. From a financial perspective, a lease 100% completely makes the most sense. Guaranteed income in lean years though you might not get quite as good profitability in the best years. You take a slight decrease in revenue in the best years to hedge against the best and have a very predictable number for budgeting purposes.

But why are not all services funded by the state outsourced? Why are some services outsourced and others not? Why is it important for the state to keep some services in house? That is the best argument against a Cannon lease. If you argue against dollars and cents, you'll loose.

Let's here the anti-lease arguments not based on financials but rather what really stands to be gained or lost in a lease.... control. Threecy suggests controls can be written into a lease. I disagree. If you write in enough controls, no company will want to lease the mountain. They have to not only run the mountain more effiencly and profitably, but they have to do that while paying minimum payments and percent of sales to the state. If you tie a company's hands up and force them to run it 100% like the state does, what is the point?!?! There WILL be a loss of control with a lease. That is the best argument against, IMHO.

 

[tjf67]

In the spirit of intellectual honesty, I feel it neccesary to point out that when the tram was built, it was figured to be profitable during the summer but would be a money loser during the winter. I also don't think we can make 2011 decisions based on 1930's intent. The ski area will fulfill economic needs regardless of state or lease operated.

It is pointless discussing the Cannon lease from a financial perspective unless you are pro-lease and don't care about anything else. From a financial perspective, a lease 100% completely makes the most sense. Guaranteed income in lean years though you might not get quite as good profitability in the best years. You take a slight decrease in revenue in the best years to hedge against the best and have a very predictable number for budgeting purposes.

But why are not all services funded by the state outsourced? Why are some services outsourced and others not? Why is it important for the state to keep some services in house? That is the best argument against a Cannon lease. If you argue against dollars and cents, you'll loose.

Let's here the anti-lease arguments not based on financials but rather what really stands to be gained or lost in a lease.... control. Threecy suggests controls can be written into a lease. I disagree. If you write in enough controls, no company will want to lease the mountain. They have to not only run the mountain more effiencly and profitably, but they have to do that while paying minimum payments and percent of sales to the state. If you tie a company's hands up and force them to run it 100% like the state does, what is the point?!?! There WILL be a loss of control with a lease. That is the best argument against, IMHO.

So they lease it out. Some company with good intentions comes in and has a hard time making a go of it. They don't keep up with maitenance and @ the end of the lease turn a run down ski resort back over to the state.

 

[Cannonball]

The last two points/post by Rivercoil and Tjf67 are both very good and I totally agree.

They also happen to points that were raised 30-40 pages ago in this thread. I'd say we've gone all the way around the block a few times on this one and really haven't gotten anywhere. Let's stick a fork in it.

 

[MadPadraic]

The State of New Hampshire only has so much money. The more it pours into a facility (which is used by a very small minority of the taxpayers, and at a high per-use fee), the less it has to put into other programs.

Elementary schools are used by roughly zero tax payers (first graders don't pay taxes in states that don't have sales tax). That's a bad reason to get rid of them. Reductio-absurdum to make a point.

But more generally, you haven't yet shown that Cannon pulls money away from other programs.

 

[jack97]

.....I also don't think we can make 2011 decisions based on 1930's intent.....

Back then circa 1930, the state wanted to kick start a sport and an industry. Presently, given how expensive this sport has become, imo, it may become a sport for the rich only. This could be one of the reason why the number of skiers/riders has become stagnant, only the population with disposable income can play. As such, the children from this population may be the only ones participating in the future.

JD is marketing Cannon as a value proposition so that it addresses another segment of the population.

 

[threecy]

Something I found interesting...

In regard to the way Cannon is being presented as 'profitable' - using the same criteria, the American Skiing Company would be considered 'profitable' as well.

 

[deadheadskier]

So they lease it out. Some company with good intentions comes in and has a hard time making a go of it. They don't keep up with maitenance and @ the end of the lease turn a run down ski resort back over to the state.

good point. actually the major point of all of us who are anti-lease.

There's no guarantee whoever leases the property is a great steward of a wonderful state resource.

At least right now, those who use Cannon are very happy with how the state is running it operationally. By all account, JD has done a helluva job. No guarantee the next operator will run it as well as he has. Some things, simply aren't worth putting the full focus on money. Cannon is one of them IMO.

 

[MadPadraic]

Something I found interesting...

In regard to the way Cannon is being presented as 'profitable' - using the same criteria, the American Skiing Company would be considered 'profitable' as well.

Can you back this claim up? Where is it documented that Cannon doesn't account for its expansion/improvement/maintenance costs?

 

[threecy]

Can you back this claim up? Where is it documented that Cannon doesn't account for its expansion/improvement/maintenance costs?

The detail will probably be released at some point, however it was referenced during HB2 discussion in the NH State Senate on June 1. I can confirm that the older PDF already publicly available (a few posts back) shows alleged Cannon profits (and plenty of losses) that do not include depreciation, bond interest, or other investment costs.

 

[Northernflight]

Something were not really looking at here is how will the lease effect Franconia Notch State Park? Cannon is a majority of the park and going off the article earlier by JD the resort itself seems to be very tightly intertwined into the State Park. What happens to the tram during the summer? Surely the lease will want to run the summer operation. What about the Flume?

 

[threecy]

Cannon is a majority of the park

264 skiable acres, out of 6,692 acres in Franconia Notch State Park.

and going off the article earlier by JD the resort itself seems to be very tightly intertwined into the State Park. What happens to the tram during the summer? Surely the lease will want to run the summer operation. What about the Flume?

A lease should be a good thing for the State Park. Net positive cashflow would flow to the park, millions of dollars of ski area investments would no longer be needed from state coffers, and park staff could focus on the park, rather than a commercial ski area.

 

[deadheadskier]

264 skiable acres, out of 6,692 acres in Franconia Notch State Park.



A lease should be a good thing for the State Park. Net positive cashflow would flow to the park, millions of dollars of ski area investments would no longer be needed from state coffers, and park staff could focus on the park, rather than a commercial ski area.

no guarantee the ski experience will be better as a leased entity than what guests enjoy now. Depending on what the State asks for in payment, there could be much less snowmaking, inferior grooming as well as having more expensive lift tickets and food and beverage.