Welcome
Single Chair Capital Campaign FAQs
What is this Single Chair Capital Campaign all about?
The Mad River Glen Co-op shareholders have voted overwhelmingly to rebuild the Single (81%). The Single is a skiing Icon, and is legendary throughout the country. But much more than a mass of old iron, the Single is the key to preserving the Mad River skiing experience. Gnarly twisting trails, low skier density, natural snow and a quiet natural experience are important parts of this quality experience. The Single rebuild is designed to extend this experience for 50 more years, thus creating an opportunity for future skiers, say in 40+ years (possibly including our grandchildren), to again choose to shun the modern ski experience of other areas, and maintain the unique Mad River experience as it now exists.
Why does the Co-op need this campaign?
The Co-op could summon all of its present cash, then borrow the balance, to pay for this restoration. The Board has a loan commitment in place. However, the Co-op Board feels that repayment of the loan would consume almost all of the available cash the Co-op can generate for the next 7-10 years. This would stall most future capital expenses, and could possibly create some financial stress on the Co-op, should we have another bad year or two during that period. The Capital Campaign has been designed to take advantage of this unique opportunity to raise substantial funds outside of our normal sources of profits and share sales, hopefully eliminating the need to borrow for the restoration. If successful, this will substantially reduce the Co-op's risk factors, ensuring greater future success at carrying out the Co-op's mission.
How about selling more shares, or selling the old chairs, to raise this money?
The Capital Campaign includes 3 parts, each to be performed by different but supporting entities. The Co-op will expand its efforts to sell more shares (with shareholders being the best salespeople!). The Co-op will also make the original chairs available to collectors who want to have a piece of skiing history, both within the shareholder base, as well as the larger skiing community. The third part is to seek out individuals who are interested in supporting the restoration by making a direct contribution toward the project. However, a charitable contribution cannot be made directly to the Co-op, thus the Campaign includes a collaboration with two recognized 501(c)3's. Both the Preservation Trust of Vermont (PTV) and the Stark Mountain Foundation (SMF) are fully committed to this project.
Each of these fundraising components is needed, and each supports the whole Campaign. Like a 3-legged stool, each part is needed to help create a successful Capital Campaign.
I'd really prefer a double chair, so why should I support this?
The Single Chair campaign is about much more than saving a hunk of old iron. The Co-op shareholders have voted overwhelmingly to rebuild the Single. This will guarantee that present and future skiers will still be able to experience the same low density skier traffic and natural snow experience that the present MRG skiers have grown to love. Kids can snowplow slowly without looking over their shoulders for speeders. We can all stop without fear of being run-over from behind. We all have a chance to find a soft stash, even days after a storm. On the very steep trails, skiers typically wait their turn, so as to not disturb others. Skiing at Mad River is a quiet, natural experience, little changed from 1949 or so.
This is unique in 21st century skiing, without walking up an undeveloped mountain. All other American ski areas are committed to maximum uphill capacity, and thus are plagued by crowded trails and intersections, and worn out snow. They respond by making more snow, and grooming it smoother, and the result is an increase in average speeds of the crowds, with various dangers resulting.
Additionally, during the single/double debate, the staff, Board and committees weren't free to speculate that some future PTV/SMF type connection could be made that would allow for tax-free donations and thus the cash costs to the Co-op of a single and a double were stated as being comparable.
However, in hindsight, the debate could have been "Should the Co-op build a new double for 1.4 Mil, or do we do a historic rebuild of the Single that has a cash cost to the Co-op of only $_________", (Based on speculation of this Campaign's future success.)
As it was, the Co-op members had a fair apple-to-apple comparison and debate, and the Single won handily. Now we all have a chance to make this Capital Campaign successful, and leave the Balance Sheet in a nice safe balance, helping to ensure the future of the Mad River experience.
Shouldn't Mad River modernize, to ensure its future survivability?
Very few ski areas in the USA actually operate at a profit. The most "modern" areas are actually using real estate sales to make their bottom line look good. The cost of snowmaking, grooming, and new lifts has to be offset, and ticket sales cannot possibly come close to providing an ongoing profit. So, at this point in time, there is no real model of success to emulate. In fact, Mad River is considered the closest to a sustainable operation as could be found.
Yes, it's a niche business model, and the longer it stays the same, the more unique it becomes. However, the demographics, such as average skier age, yield per skier day, etc. are all very positive for a long future.
Shouldn't the Co-op run more like a business than a charity?
Ski areas are clearly a capital intensive business. All successful businesses would seek the lowest cost capital, and would seek out any opportunity to improve the balance sheet. The purpose of this capital campaign is to radically improve the Co-op's balance sheet, and make best use of every available opportunity to do so - in this case, by helping to preserve a nationally important historic structure.
Some see Mad River as an "institution." Many institutions can easily run well on their cash flow, yet need help on major capital projects. The benefits of this Campaign will affect all skiers in the short term, but will provide the greatest benefit to future generations.
Why do we need to collaborate?
While the Co-op and Mad River have many enthusiastic friends and patrons who want to help with "Saving the Single," our corporate structure does not allow the Co-op to receive a donation without it being a taxable event to both the giver and the receiver. The collaboration with two recognized charitable organizations will allow them to collect tax-deductible donations designated for the Single Restoration, and then pass them along in the form of an historical preservation/restoration grant to the Co-op. There is a myriad of legal "hoops" involved, and many professionals have worked hard to create a successful program. This involves both preparation work, as well as follow-up work that must be done to ensure that the funds are spent as intended, and that the preservation of the Single is guaranteed in the future. PTV is particularly well experienced in this process.
Who/what is PTV?
The Preservation Trust of Vermont is a private foundation wholly dedicated to preserving Vermont's historic architecture. As President, Paul Bruin has successfully led this organization for 40 years, and has been involved in hundreds of historical preservation projects all across Vermont. Some of these are small local projects, and some involve the famous names that are known throughout New England and beyond. PTV is a very well connected and professionally run organization, with the necessary expertise and credibility to help the Co-op make this a very successful Capital Campaign. Paul and his staff are very excited to be a part of this unique and important project.
Who/what is SMF?
The Stark Mountain Foundation is a familiar name to most Co-op shareholders. Very foresighted and active shareholders formed the SMF approximately 6 years ago. After some effort, SMF received IRS notification that it could have charitable status [501(c) 3], and could pursue fundraising for projects that have a somewhat parallel mission to the Co-op. They have been actively funding the Naturalist Program, numerous reforestation projects, renovations to the Stark's Nest (including a new deck and roof in 2006), and they created and maintain the Kent Thomas Nature Center. Some effort at grass root fundraising for the Single's restoration has already been quite successful, and the Co-op Board looks forward to having the SMF as a key part of the collaborative team effort for this Capital Campaign.
Who will the Campaign reach out to?
The Shareholders and others in the Mad River Community are very passionate about the Co-op's mission, and will be involved in the Capital Campaign all along the way. Additionally, this campaign has been designed to reach out beyond this core group, contacting individuals and Foundations that have an interest in other aspects of this restoration. They might include those with an interest or mandate to help save the history of skiing, or historical preservation of landmarks, or preservation of access to natural experiences, and others mandated to assist development of sustainability of both jobs and natural resources. The Board feels confident that Saving Our Single has national significance and notoriety that will open many doors.
What is this "covenant" all about and why?
The shareholders have chosen to restore the Single, with a design target of 50 years. Obviously, after spending all this money, there won't be a chance to change our minds for a long time. However, the tax laws require additional confirmation that the Single stays single as we have said it will, and experienced potential donors will expect that such a guarantee of the specified use of their funds will be in place. Your Board has proposed that a covenant on the deed to Stark Mt. will be enacted and recorded, with a lifespan of 50 years. This will restrict the present owners (and any possible future owners of Stark Mountain) to maintain this lift as a Single, in as close to the present configuration as is possible. Obviously, freedom to maintain, and update for safety, energy efficiency, etc. as needed will be allowed during this period, within the basic limitations of the Single being single, and the Chute and Lower Liftline not being the site of an additional parallel lift. As part of their collaboration, PTV will be named as the party that will monitor this covenant, as an independent (of the Co-op) observer.
Will this restrict the Co-op in the future?
Yes, absolutely, and it will restrict a future owner of Stark Mountain as well, should the present Co-op not exist for whatever reason. However, the covenant only refers to the Single and the corridor along the Liftline and the Chute. The major effect of the covenant's restrictions will be to "preserve and protect" the Single, and thus effectively preserve the unique Mad River experience, exactly in line with the Co-op's present mission, for 50 more years. Again, there will be a mechanism to effect needed changes as determined by the management and the Board, in collaboration with PTV.
Will this help the Co-op in the future?
PTV will essentially become a co-steward of the Single and the Mad River experience, a role which they are both familiar with and dedicated to. It's very realistic to imagine they could help the Co-op fend off future interventions by well meaning, but shortsighted government agencies, which might want the Co-op to conform to some present or future regulation. Additionally, they will carry on our Mission should the Co-op not be able to.
Will all of the Capital Campaign money go toward the Single?
Yes, this Capital Campaign will be totally dedicated to the Single Restoration and any excess that might be raised will be placed in a maintenance fund. There will be some expenses for the professionals who are assisting, as well as mailing and other normal campaign expenses, all of which are estimated at 7-9% depending on the success of the Campaign. Any donation to either SMF or PTV will pass through at 100% less these expenses. Funds from additional share sales cannot legally be tied to a specific project, but will be used for general business purposes, one of which is this restoration.
When will all this start to happen?
The major public campaign will be formally kicked off in the fall of this year, '06, and continue thru '07, which is the actual construction season. Prior to that, the committee members will seek out community leaders for support, both financial and general public leadership.
Can the deductible contribution be spread over a number of years?
Yes, a pledge made today can be spread out over three or four tax years, '06-'09.
Does this have support from the Co-op's Board?
The Mad River Glen Co-op's Board of Trustees, after considerable consultation with their committees and outside consultants, has voted unanimously to pursue the Capital Campaign as described, and they have all made a direct contribution, each in their own way. Their belief is that a successful Capital Campaign will ensure an extremely bright future for the Co-op, with a fully restored Single, and a very safe financial position with little or no debt. The future earnings of the Co-op will then be able to be applied to caring for the other parts of the "experience" and not applied towards debt and interest. The success of the Co-op's Mission will be secured for many years to come.
The Stark Mountain Foundation is a charitable 501(c)(3) organization.
Federal EIN# 03-0369897 VT Tax-Exempt# 450-030369897F-01