Spirit Mountain to ask Duluth for $235K to stay afloat
Weather woes hit ski hill's bottom line
DULUTH -- Unless the city of Duluth agrees to provide Spirit Mountain with a $235,000 subsidy, the ski hill will have only about enough money left in its coffers to meet payroll next Friday, Dec. 13, said Brandy Ream, the ski hill's executive director.
She said the requested funds are essential to Spirit Mountain's continued operation, in the wake of being forced to cancel most of the 2019 Amsoil Duluth National Snocross race this past weekend due to heavy snow, of all ironies.
"If that's not available, that means we are locking the doors. And that means we have $1.2 million in season pass revenue that will need to be paid back. That means we have hundreds of thousands of dollars in vacation our employees have earned that's going to have to be paid out. And we have payables that are currently on the books that we're responsible for," Ream said.
If unaddressed, Spirit Mountain's financial hardships threaten to knock it out of commission just as it's heading into what's typically its most profitable days of operation, surrounding the holidays.
The amount of the requested subsidy represents Spirit Mountain's loss of revenue from ticket sales for the professional snowmobile races, plus food and beverage sales, Ream said, noting that the operation also had to bear the cost of a $50,000 sanctioning fee it pays to ISOC (International Series Of Champions) to put on the event.
The Duluth City Council will take up Spirit Mountain's request Monday, Dec. 9. If approved, the money would come out of undesignated tourism tax funds. Wayne Parson, the city's chief financial officer, said the fund carried forward a reserve of about $500,000 from 2018, and collections for the current year are running more than $330,000 ahead of projections.
Ream said the $235,000 should carry Spirit Mountain into the holidays.
"I will state though, there is a very small margin for error," she said. "At this point in time, I'm feeling very good and strong about what we're looking at going into the Christmas week."
Yet she wouldn't rule out the prospect that Spirit Mountain may need more help in the future.
"When our weather dictates our business volume and how things unfold, there is always going to be the possibility that I am going to be back here needing to ask for assistance," Ream said.
Going forward, Ream commented that Spirit Mountain will need to take a hard look at its participation in the Snocross race. She said the event annually brings an estimated $6 million into the city of Duluth, while Spirit Mountain is fortunate to break even.