Likely no new lodge built this summer; ‘The challenge was the hill’

Mon, 02/02/2015 - 07:13

Lynda Clancy

Camden Selectmen met at 6:15 a.m., Feb. 2, with the town’s Snow Bowl Redevelopment Committee co-chairman Rick Knowlton and Ragged Mountain Foundation President Bob Gordon to talk about financial shortfalls of the Snow Bowl overhaul. (Photo by Lynda Clancy)

CAMDEN — The cost of the Camden Snow Bowl improvement project is now estimated to be $8.4 million, almost $2 million more than originally anticipated. This means that construction of a new lodge at the Camden Snow Bowl will likely be on hold while another $1.6 million is secured and ground work at the mountain is finished. The Ragged Mountain Recreation Foundation, the nonprofit that committed to raising the larger chunk of private donations for the overhaul of the Camden Snow Bowl, will be going back to work, according to its president, Bob Gordon.

“The Foundation is committed to complete the fundraising,” said Gordon, president of the Foundation, at a 6:15 a.m. meeting Feb. 2, with the Camden Select Board.

Gordon said the Foundation’s capital campaign committee had met in anticipation of Monday morning’s meeting to renew its effort, “with new blood.”

The meeting, technically a workshop because the Select Board was not voting on any agenda items, had been several weeks in scheduling, as the three entities — the town leaders, the municipal Redevelopment Committee and the Foundation — worked to agree on a time when they could gather. Additionally, town staff had combed through bills and checks to get precise figures on expenditures to date, and to contact contractors to get bills that had yet to be received.

The meeting had been convened to put clarity to the finances of the public project that has been funded in large part by private dollars — $4.5 million — plus a $2 million municipal bond.

The town of Camden owns and operates the Camden Snow Bowl.

“We haven't deviated from the plan,” Rick Knowlton, co-chairman of the municipal Redevelopment Committee, at the Feb. 2 meeting. “We haven't added things we didn't budget for. We stayed true to the components always in the project. We have spent smart dollars.”

To date, $5.5 million is now expected to be spent on the project through 2015. This phase of work includes all the site work, new trail construction and installation of the new triple chairlift.

The Redevelopment Committee had originally budgeted $4.3 million for that phase of work, which did not include construction of a new lodge, budgeted at another $2.1 million.

“We do not have sufficient funds to proceed with the construction of the lodge,” wrote the Redevelopment Committee in a Feb. 2 memo to the Select Board. “To complete the lodge will take an additional $1.6 million. We are not looking to the town to make up that funding gap.”

The Redevelopment Committee, in its memo (see attached document), said: “The initial plan simply did not contain all of the practical, on-the-ground costs that occur during a project of this complexity and size. Those additional costs were necessary and mostly unavoidable.”

The Ragged Mountain redevelopment project officially got under way last March, when tree-cutting began on the Ragged Mountain alpine ski trails. At that point, the redevelopment project entailed reworking mountain trails and building a new lodge, with a budget of $6.5 million.

The Snow Bowl did not open as originally planned just before Christmas, and the opening of the new triple chairlift, which takes skiers to the top of the mountain, was not operational until Jan. 19.

The Snow Bowl officially opened that lift Jan. 31 to the public, and with a ski race that had been on the calendar for Feb. 1, the mountain was busy over the past weekend. The Snow Bowl had offered its 1,200 season pass holders the option of turning in their passes for a full refund, as a way to make amends for the slow start to the season. The deadline for that deal is Feb. 5.

As of Feb. 2, 40 passholders had taken the mountain up on its offer, amounting to $11,000 in refunds. Camden Parks and Recreation Director Landon Fake said approximately 20 of those passholders were heading out of state, or had physical injuries, which would preclude their skiing at Ragged Mountain, anyhow. The others wanted their money back.

Snow Bowl Project

In 2008, Camden voters approved a non-binding measure that positioned support for borrowing up to $2 million for Ragged Mountain Recreation Area improvements, if matched by a minimum of $4.5 million raised via private money.

Following that vote, project proponents commenced soliciting contributions, as well as holding public fundraisers.

The Foundation met the $4.5 million mark, with a cushion of almost $300,000.

To date, the Foundation has collected $4,010,666, and has $853,239 to collect.

The matching funds — $2 million of town funds and $4.5 million in donations — were to be expended together, not one before the other, and expenditures were planned to match the cash flow of donations over a two-year period.

Voters approved last year to go ahead with the $2 million expenditure for the mountain.

The cost of borrowing $2 million to the taxpayers could average $110,000 in annual interest payments for 30 years.

At the Tuesday, Feb. 3 meeting, the Select Board is to decide which bank to go with on for borrowing $2 million, and the interest rate will be known then.

The capital improvement project at Ragged Mountain was to entail making mountainside improvements in 2014 and constructing a new lodge in 2015.

That is now delayed.

The intent is to “provide the capacity to accommodate up to 600 skiers per day with adequate parking, lodge space, uphill lift capacity, and ski terrain serviced by snowmaking and enhance year-round trail use for hikers and mountain biking,” according to the plan.

The mountain has been supported by the town in varying degrees since the town assumed ownership of its real estate and operations in 1983.

In 1990-91, Camden voters approved funding the Snow Bowl with $149,000 of their tax dollars; in 2009-2010, it was $55,000. In 2012, and following several years of good snowfall, the town contributed zero dollars.

The Redevelopment Committee, a municipally appointed group of citizens, has built a detailed finance and budget analysis of the Ragged Mountain Recreation Area through 2016, incorporating the entire mountain upgrade.

Aside from debt obligation, the projected budget includes no town matching funds in 2015 and 2016.

Instead, the budget anticipates additional revenue will derive from the increased numbers of daily and season ski tickets, ski school enrollment and new lodge rentals.

– Lynda Clancy

The conversation was frank at the Feb. 2 meeting, with the Select Board members demanding more transparency with fiscal information.

“We all support the Snow Bowl,” said Lookner. “But if we criticize it, it is kind of like telling someone we love they have bad breath.”

“In hindsight we could have communicated better,” said Gordon, speaking at the meeting as president of the Ragged Mountain Foundation (He is also co-chairman of the Redevelopment Committee). “Going forward, we will be more transparent. Are we happy? I’m happy with the value we got. We got more than we planned for, I’m happy with the value we are giving this community. We did not waste money.”

Knowlton said, “The desire is not to go back to the taxpayers, but we don’t know when the additional $1.6 million from the Foundation will appear.”

He said at the end of the meeting that the Redevelopment Committee, which was appointed by the Select Board to create the Snow Bowl improvement plan, will meet after the Select Board officially decides at its regular meeting Feb. 3 whether or not to delay proceeding with the construction of the new lodge.

He suggested the committee will then “take a break for the season” and resume its work later in the year.

Given the temperature of the board members at the Monday morning meeting, the brakes are on and the new $2.4 million lodge will wait to materialize.

But it will get built, they all agreed. That’s because Camden voters approved the concept plan at the polls when agreeing to spend $2 million on the entire Snow Bowl redevelopment project. The concept plan relied on construction of a new lodge, not just for skiers, but for four-season use at the Ragged Mountain Recreation Area, the town-owned land that includes not only the Snow Bowl but mountain hiking and biking trails, Hosmer Pond, and a playing field.

The new lodge is considered part of the vision of the town to create more economic energy around its outdoor assets.

The Camden Planning Board has already begin site plan review of the new lodge and parking lot improvements, and has asked for minor changes for the plan to proceed before approval.

The lodge remains in a final design phase at the architect’s office and no bids have been circulated for its construction.

As it stands now, the bills through 2015 for work completed, and more engineering and site work to complete, amount to $5.5 million. Originally, that work was budgeted at $4.3 million.

Primarily, the $1.2 million in additional project costs are related to environmental mitigation and unanticipated costs for electrical systems, trail lighting and chairlift upgrades. The erosion control work to stop sedimentation of Hosmer Pond remains a priority, said Town Manager Patricia Finnegan.

Almost $1 million alone has been spent on mountain regrading, reshaping and trail improvements.

“That's a big number,” said Knowlton.

Another $760,774 has been spent on engineering, architects and erosion control.

Currently, the Foundation has collected $4 million from its pledges and needs to get another $853,239 in its bank account to meet the first phase of its $4.7 million total.

The Foundation has reimbursed the town with $3.3 million so far.

The town has spent $3.7 million on the project so far, and has another $457,000 in bills for this year.

Camden has circulated a request for a $2.55 million tax anticipation bond with banks ($550,000 of that is to be expended on sewer improvements unrelated to the Snow Bowl).

The Select Board will decide Feb. 3 which bank to go with for the note, and that will determine the interest rate and payment schedule for the town.

Cost overruns are attributed to:

1) Failure of the logging contractor to follow appropriate management practices. The damage to the terrain, and subsequent mitigation costs amount to approximately $500,000.

2) Trail and mountain improvements were expanded, including creating more terrain at the top — another 100 feet of descent — in order to make the mountain comply with ski race sanctions.

Islands of trees were removed on several trails for snow-making and grooming.

A new road was cut up the mountain to the cell tower for maintenance, emergency response and mountain biking. The town anticipated that private landowners who own property at the top and the towers would kick in money for that road, but Knowlton said at the meeting: “that did not happen and the burden has fallen on us. That is a big area where we are over.”

3) New electrical lines and poles were added, and the haul cable on the new chairlift needed replacing, in accordance with ski lift safety standards that have been revised since 2009, when the project was first laid out.

New primary electrical transformers were installed to meet Central Maine Power requirements.

4) Engineering costs have increased because of additional trail work, and erosion control.

Camden Select Board member Jim Heard asked if there was any recourse is recouping money from vendors for inadequate work.

“I don't think so,” said Town Manager Patricia Finnegan. “We haven't got a firm answer on that from the insurance person.”

Heard also asked about the history of the decision not hire a construction manager for the project.

Knowlton said that he discussion had always focused on hiring a construction manager for the lodge construction.

He said that while out west, at the bigger resorts, it is conventional to hire general managers for ski mountain upgrades, but in the east, such work is done piecemeal, as what happened with the Camden Snow Bowl.

“In the New England area, the way these kind of improvements go together, piece by piece, you collect these experts and put the project together.”

In hindsight, he said, getting a general manager: “probably would have helped us.”

Cost-wise, he was skeptical that the project would have stayed within budget.

“Would we have ended up in different place, yes, but maybe not by much,” he said. “Fundamentally, the cost of the work would not have been any different.”

The start of the issue, he said, related to the initial chopping of trees late last winter, when work began at the Snow Bowl in March. Then, the snow melted and the rains started. The erosion runoff continued into Hosmer Pond after various heavy rains through spring and summer, and mitigation, with emergency stormwater control, and erosion control measures added costs to the work done by the trail contractor, almost $500,000.

“The redevelopment project is financially sound and remains on track to accomplish the goals of the redevelopment plan, to build improved and updated facilities that create operating efficiencies, add capacity to attract and handle more skiers and year-round recreational users, and make the operations more financially stable and sustainable,” the committee’s memo said. “Together, these changes will help Camden realize the vision of creating a four-season recreation area that will benefit not only this community but also the region for decades to come.”

Snow Bowl to fire up chairlifts; refunds offered to passholders (Jan 21)

Camden Planning Board to begin Snow Bowl lodge review (Jan. 9)

Camden Select Board brings in old friend to help with Snow Bowl progress (Jan. 7)

• Camden Snow Bowl to start making snow Jan. 5 (Jan. 2)

• Camden Select Board pushes Ragged Mountain redevelopment project forward over protests of many Hosmer Pond neighbors (Dec. 18)

• Snow Bowl progress report to Camden Select Board continues to be positive (Dec. 3)

• One by one, 20 chairlift towers went up at the Camden Snow Bowl (Dec. 1)

• Helicopter to help raise, place 23 chairlift towers at Camden Snow Bowl (Dec. 1)

• Report: Ragged Mountain Redevelopment Project $500,000 over budget (Oct. 8)

• Camden Planning Board approves Snow Bowl lighting plan as proposed (Oct. 6)

• Camden Snow Bowl on target for Dec. 20 opening, weather willing (Sept. 19)

• Camden to contract with South Portland firm to manage Snow Bowl lodge, base area (July 24, 2014)