Hypothetical queston re: LM
I don't know if anyone has posed this question elsewhere on the boards - but I'm curious about opinions regarding the feasibility of operating Laurel Mountain as a co-op, a la Mad River Glen. Does anybody have any knowledge of how the MRG folks went about it when they set up their co-op?
Hey Jeff, Here's a start
, Denis is a shareholder, maybe he'll be able to fill in the blanks; looking for shareholders?
I don't know how efficient this would work, but maybe it could be set up similar to REI's Co-Op program.
Charge $20 or so for a lifetime family membership, and then give members back 5-10% of what they spent at the end of the season.
Another idea is to offer different levels of committment.
$5,000 - Lifetime Season Pass, elgibility to be a trustee, 25 votes towards the election of a board, possibility of dividends.
$1,000 - Season Pass for five years, 5 votes towards the election of a board of trustees, possibility of dividents.
And so on and so forth.
Given the fact that LM has a history of limited 'commercial' success, perhaps this is the answer. Couple that with the fact that it seems to appeal mainly to hard-core, serious skiers/boarders and it makes even more sense.
I hereby nominate Heather as President/CEO of our soon-to-be-formed co-op.
Can I second my own nomination???
A co-op sounds like it may be the only feasible remedy at this point!!! Can anyone suggest how to get this into a real plan...this way if nothing happens, we are already to present to the bank a business proposal with viable solutions.
I'd say contact the folks at MRG. That's probably the model to use because it has a proven track record.
The Cooperative has been very successful to date, paying off the mortgage and making investments in the infrastructure of the ski area. The work is not over and the Co-op anticipates spending $1.5 million in capital projects over the next five years. Sales of new shares go directly towards funding capital projects. Together we will be able to make these projects possible and secure Mad River Glen and its ideals. All of us who have already committed ourselves to this goal invite you to join us in our mission.
Heather, perhaps you could convince someone from MRG to come down and talk to your homeowners/other interested parties/state and country officials in person about how LM could go about establishing a similar COOP.
FAQs on how the MGR COOP works:
Frequently Asked Questions
Questions About the Co-op
What does a Co-op share cost?
A share of the Mad River Glen Cooperative costs $1750. An individual may purchase a maximum of four shares. Shares may be purchased in a single payment or in 35 monthly installments of $50 with a $150 down payment. The total cost of the installment plan is $1900, which includes interest at an 8% annual percentage rate, and allows you to become an owner for as little as $50 a month. Monthly payments are made through an automatic debit program set up from your checking or savings account. Shareholders purchasing shares on the installment plan start enjoying the benefits of ownership immediately.
What is the Annual Purchase Requirement?
The only other cost for shareholder is the Annual Purchase Requirement (APR), which all shareholders pay each year. This obligation was $200 for this season and any increases in the future are limited to changes in the Consumer Price Index (CPI) inflation rate. The APR is due on October 1 of each year and can be applied to nearly every product and service on the mountain. Since it can be spent on season passes, day tickets, food, ski school clinics, rentals, repairs, in the retail shop and on many other services, it does not represent an additional expense for most shareholders.
What is the extent of my liability?
Vermont law provides that shareholders shall not be liable for debts of the Cooperative. Your liability is limited to your $1,750 investment and annual purchase requirement.
Will I ever have to pay any special assessments?
The Bylaws of the Cooperative and Articles of Incorporation do not authorize any assessment of any type to the shareholders for any reason whatsoever.
Can I sell my share?
Yes, you can sell your share(s) at anytime. However, you must sell them back to the Cooperative. As soon as your share is purchased by a new shareholder, you will receive the value of the share, not to exceed your purchase price. There is a $100 processing fee for tendering a share.
How many shares are available?
As of October 1, 2001, a total of 1949 shares have been sold. Our goal to operate the mountain on a long-term basis is to sell 2200 shares, but the Cooperative is allowed to sell up to 3,000 shares.
How many shareholders are there?
There are currently just under 1700 shareholders. The maximum number of shareholders permitted under the Cooperative Bylaws is 2000.
How well has the co-op managed the ski area?
Mad River Glen Ski Area has been in continuous operation for over 50 years. The Co-op assumed ownership in December 1995. Its management and staff have continued to run the mountain successfully with a financially conservative approach. After seven seasons, the Cooperative has paid of the debt to the former owner, has made substantial capital improvements (including a new Sunnyside Double chair lift) and just had the most successful season in the ski area's long history. One of the Cooperative's strengths is that its fiscal structure is designed to provide a cushion for lean years. Audited financial statements are available from the Administration Office if a potential shareholder would like a copy.
Can I second my own nomination??? A co-op sounds like it may be the only feasible remedy at this point!!! Can anyone suggest how to get this into a real plan...this way if nothing happens, we are already to present to the bank a business proposal with viable solutions.
Heather, of course you can . Using MRG's numbers and a WAG as to what it would cost to get the bank & state to listen, i think you'd need to sell 300 shares, or to look at it another way, 75 people willing to pay $200/mo for 36 months. That's the first step i think.
I know that this has been raised before on another thread, but - does anyone have a ballpark figure of the amount of $ still owed to Somerset Trust?