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Weather is Whitetail's challenge

April 08, 1999|By JULIE E. GREENE

MERCERSBURG, Pa. - Ski industry officials said it's not uncommon for a public agency or government to own a ski resort, but the degree of success depends on the measuring stick used.

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How successful Whitetail Ski Resort will be under the ownership of the Mercersburg Borough General Purpose Authority will depend largely on the weather, said Blair Taylor, district administrator for West Virginia's Department of Natural Resources.

West Virginia owns Canaan Valley ski resort in Tucker County.

"The location of Whitetail is excellent from a marketing standpoint," Taylor said. The operating difficulty it faces is the climate, he said.

Whitetail had a banner season in 1995-96 with 68.8 inches of snowfall in the Hagerstown area, according to weather observer Greg Keefer. Since then the seasonal snowfall totals have been 16.6 inches, 13.3 inches and, this winter, 32.1 inches.

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"If you don't have snow-making temperatures it's kind of like trying to run a canoe race when there's no water in the river," said Bill Risse, director of community affairs for Lackawanna County in northeastern Pennsylvania.

Lackawanna County bought Montage Mountain Ski Resort after the bank called the county's guarantee. That occurred after the nonprofit group that built the resort faced three snowless winters, Risse said.

Montage in one bad year called for a $900,000 subsidy, but it has had years in which it generated $800,000 that was reinvested in improvements, he said.

The ski resort has meant more housing, business, entertainment and pride for Lackawanna County, Risse said.

"Do you want a government that's going to try to enhance your lifestyle and make it more enjoyable, more attractive to live there? Or do you want a government that tries to avoid any challenge and take on as little as possible to keep your tax bill as little as possible?" Risse asked.

"Do they want to help or see the ski resort go bankrupt?"

The failed Shenandoah Federal Savings and Loan in Martinsburg, W.Va., ran into trouble in the early 1980s after lending millions of dollars to two ski resorts: Winter Place in Mercer County and Snowshoe in Pocohontas County.

Whether taxpayers are at risk depends on the guarantees. If the taxpayers are taken off the hook for any investment, the deal could lose some guarantee in value, Gillen said. It's difficult to say without knowing how the deal is structured, he said.

Neither the Mercersburg authority nor the borough would guarantee the bonds to finance the project, the authority's chairman, the Rev. Michael Brendle, said in a prepared statement issued by Whitetail.

A golf course would make a good partner for the ski resort, depending on the course's financing and profitability, Risse said.

"Again it's weather driven. When you have nice weather, golf courses make money. ... When it snows, people go skiing," Risse said.

Second or third owners can make profits if they buy at the right price since the original owners make the heaviest investment for equipment, Taylor said.

If the resort closes, there is the loss of jobs at the resort as well as related jobs in the community, Taylor said.

One reason state officials decided to build Canaan Valley around 1969 was to encourage economic development.

The area saw a boom in second-home development and thousands of jobs in the area can be attributed to the ski resort, Taylor said.

Public ownership could also give the resort access to borrowing or tax advantages, said Robert Gillen, publisher of The Snow Industry Letter, which is based in Warren, Vt.

Owners of private ski resorts could make a good case that it's unfair competition since Whitetail might have advantages as a nonprofit that private owners would not, Gillen said.

According to the Whitetail press release, the Mercersburg authority would continue to pay real estate taxes.

When Dauphin County General Authority tried to buy Whitetail last year a lawsuit was filed by Snow Time Inc., which alleged unfair business practices.

Snow Time official Irvin Naylor could not be reached for comment on Wednesday. Snow Time owns Ski Roundtop near Harrisburg, Pa., and Ski Liberty in Adams County, Pa.

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