Assembly withholds funds from Eaglecrest

City-run ski area has until October to detail its business plan

Posted: Friday, July 11, 2003

Eaglecrest Ski Area must develop a business plan before the city will grant the funds needed to help it get out of debt, Juneau Assembly members said this week.

"We need more information and we need to be convinced that Eaglecrest is doing everything they can to have a strong business plan," said Assembly Finance Committee Chairman Jim Powell. "We believe they are on the cusp of change, but they need that extra incentive."

Earlier this year, Eaglecrest board President Gary Hogins asked the city for $240,000 to help fill the ski area's $479,000 fund-balance deficit. Hogins outlined a plan that would use the city's contribution to get Eaglecrest out of a deficit situation by fiscal year 2008. He said cutbacks in equipment and overtime would also help, as well as the elimination of nighttime and April weekday skiing.

Hogins also suggested raising revenue by increasing summertime rentals and lowering the price of season passes in an effort to sell more.

Before granting the $240,000 appropriation, the Assembly asked Eaglecrest to work with the Juneau Economic Development Council to create a more detailed business plan.

"The major change will be moving from an under-utilized asset to a more fully utilized asset," Powell said. "We are not talking about total commercialization, but we are talking about mountain bikes, hikes and the use of the day lodge for more activity that is consistent with community values."

For a short time in the 1980s, Eaglecrest hosted a summer salmon bake and used the Ptarmigan Chairlift to take visitors to a boardwalk trail at the top of the mountain. The summer operation did not make enough money to continue.

Eaglecrest has a total projected budget of about $1.7 million for fiscal year 2004, which started July 1. Because the area's success is so dependent on the weather, the budget is set up to function in a three-year cycle, which anticipates one bad revenue year and two good years.

When the ski area has a good year, extra revenue is placed in a fund balance account to cover costs during bad years.

Two of the past three years have been bad with warm winters, and season pass holders have received credits or refunds. The fund balance account is in the red, and Eaglecrest officials said they need help getting out.

The Assembly gave Eaglecrest until October to develop a business plan.

Any funds Eaglecrest requests likely would be taken from the city's budget reserve account, according to City Manager Rod Swope. Until October, the ski area will have to function with a deficit, he said.

Eaglecrest business manager Gary Mendivil did not immediately return a call for comment.

• Julia O'Malley can be reached at jomalley@juneauempire.com.



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