ORDA, Belleayre and Profitability

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God I hope you guys are right and I'm wrong.  

You all have heard enough of my side of this - someone please explain to me how Bell goes from a $4M loss to any kind of profit?

It's not something that's going to happen overnight, but it can happen.

For example, if ORDA does offer some kind of combination ticket, that includes Belleayre with a season pass for Gore and/or Whiteface, consider this scenario:

A NYC metro area resident, who has a Whiteface season pass, and regularly skis at Whiteface or Gore on weekends. Since he/she can now ski for free (or perhaps at a very discounted rate) at Belleayre, he or she may be inclined to take some midweek day trips to Belleayre. Since they're only doing a day trip, maybe they bring a couple of friends along, who need to purchase lift tickets. There's potential revenue that did not previously exist.

Furthermore, under ORDA, there may be a greater opportunity for capital investment in Belleayre that isn't available under DEC. In most businesses, the only way to make money and be successful is to invest in your business. Sometimes you have to spend money to make money. With the right kind of capital improvements, Belleayre could potentially become a "premiere" family ski area within the NYC metro area.

It's going to require some innovative thinking and investment. Belleayre was clearly languishing under DEC management.

Other than opposing ORDA taking over Belleayre, what's your solution to the Belleayre problem?

from what I understand they employed the staff full time year round, but didnt offer anything in the summer to generate revenue?  Theres a good start.  Either lay people off, or expand revenue generating offerings...

ausable skier wrote

 ...$4M loss...

I'm skeptical of this number.  But if it is true, I'd think ORDA could get that number down. Not without local pain for sure. Right or wrong, people build their lives around the assumption that things are permanent - we all do it.  This is where Joe Kelly's statement about protecting the employees would be tested.

AS - I've also seen a statement (by Bonacic?) about the "transfer of funding from DEC to ORDA" to run Belleayre. I know how you are losing sleep over this so I've been trying to track the article down. No luck finding it in a quick search, but I'm sure I saw it.

ORDA Infrastructure Perform lift maintenance, building maintenance, and repair critical infrastructure.
 4,000,000  

This sounds as if its really just the maitenance that they have deferred the last few years. Maintenance in real world buinsesses is not catagorized as capital improvements.  Lift Ops has been doing a great job holding things together with chewing gum and bailing wire but as some point that won't work.

Bell's $4M loss figure was from ADK Skiers saratoga skier web site reference.  The only way to stop that is to cut back on the DEC's much higher pay and benefits.  So lets run the math on this puppy

Lets say the can save $1M in employee costs - that is a heck of a lot for a small ski area - these guys already did a sick day action on presidents weekend so I doubt they are going to be happy campers about this.  

To make an extra $2M on season passes Orda would need to sell 4555 more passes at $439 per.  Would that many NJ and Southern NY skiers buy Orda season passes that had not this season???

Then to close that final $1M Bell would need to sell 17543 more lift tickets at their weekend pricing this year.

Looks pretty doubtful that this will be a profitable venture to me.  The only wayOrda can make this all balance out is less snow making and more lifts shut down midweek at all three.

As i said I really hope I'm wrong but this is likely to really suck

Losses of $4mm annually
This is all we get? Where is the back up?

The $4million is a bs number.

Belleayre says on the web site that they now draw over 175,000 skiers per year. Here is a conservative revenue calculation. If we assume 150,000 (out of 175,000) people pay an average of $30 (adult weekend/holiday $57/midweek $48) per ticket we come up with $4.5 million revenue. Let's drop $500,000 to get to $4million. Are we to assume that Belleayre spends $8 million per year to run the place?

That means that Belle spends about what Gore earns in recent seasons (around $8 million) and Gore is cash flow positive at more than 2 times the size of Belleayre.

I am not buying it.

x10003q wrote

Losses of $4mm annually
This is all we get? Where is the back up?

The $4million is a bs number.

Belleayre says on the web site that they now draw over 175,000 skiers per year. Here is a conservative revenue calculation. If we assume 150,000 (out of 175,000) people pay an average of $30 (adult weekend/holiday $57/midweek $48) per ticket we come up with $4.5 million revenue. Let's drop $500,000 to get to $4million. Are we to assume that Belleayre spends $8 million per year to run the place?

That means that Belle spends about what Gore earns in recent seasons (around $8 million) and Gore is cash flow positive at more than 2 times the size of Belleayre.

I am not buying it.

1st off the $4M loss comes from a ADK and saratoga skier blog not me.

your math is not correct because
1) i seriously doubt the 175K skier days figure - its way way too high for a dinky little hill.  There are at best 4 months worth of weekend days in the CATS ski season = 32  weekend days.  lets be generous and say Bell does 50K mid week days a season that leaves 125k  / 32 = averaging almost 4000 skiers on a weekend day - No fricking way.  A parking lot check can quickly confirm that - can Bells parking lots even hold 2000 cars - i doubt it.

2) skier days count season pass holders that probably only net a small fraction of the $30 a day figure.

3) Bell is well known to give away thousands of lift tickets a year and offer huge discounts as well further bringing down the take

Face it this place losses cash. Period - do the math.

Ausable - Bell has the most ridiculous and huge 3 parking lots you've ever seen. One main one, and then lower ones that I am SURE that Orda has their eyes on for condos/convention centers/casinos/sports stadiums. They have parking.

Your other claims don't really mean anything. Yes all of these numbers are so manipulated in terms of dollars, but I doubt the visits are. They were giving huge deals Wednesdays, Fridays, Birthdays, I feel like getting drunk days and that did equal visits.

They also claim to have topped out near 250K visits the last few years. and have been over 150K many times the last decade, but the math will never be clear.

All of these places lose cash. Tax payer cash. I don't think Belle is any bigger a dog than Gore/WF. It needs some improvements, probably has bigger upside due to the proximity of 35M people. I bet ORDA is stoked to have the ability to take so many people's money next year.

Two quick points, one I think I made last fall:

•Rode the lift with Bell GM Tony Lanza on a Saturday in January 2011.  During the ride he radioed the base and asked about skier visits for the day. It was around 10:30am. The answer was 5400.

•Also FYI I asked him that day what percentage of revenue came from passholders - he'd said around 7%. (For comparison Mike at Gore told me passholders accounted for about 20% of revenue.)

I wouldn't be surprised if Bell lost a lot this season. They did no marketing and from what I've seen skier visits were down far more at Bell than other ski areas. I've heard estimates for various other GMs that visits were down 15-25% and Bell was more than that by a significant number.

The 4 million number came from the SAGE report (Spending and Government Efficiency). I didn't read it cover to cover but I did a search for the word "Belleayre" and found only one occurrence of the word. It says Belleayre loses "$4 million annually."  Hey it could be true, but I wouldn't take one mention of that number as fact.  There are plenty other gov't sources who've quoted other numbers.

Harvey44 wrote

ausable skier wrote

 ...$4M loss...

I'm skeptical of this number.

x10003q wrote

Losses of $4mm annually
This is all we get? Where is the back up?

The $4million is a bs number.

See, that's one of the advantages of the Authority structure.  At least with ORDA there is public disclosure of externally audited financial statements.  Under DEC, Belleayre's losses are buried within the department's budget, so we never get to see the real numbers.

I agree with you guys that $4 mil seems high, but it's the only figure that I've seen published / disclosed directly by the State.  I've heard second-hand references to losses in the $1 to $4 million range, but those are undocumented.  One other thing, that SAGE document that I linked in my Saratoga Skier blog post (linked earlier in this thread) was dated May 2011 so the $4 mil loss obviously is not for the 11-12 season.  Regardless of whether $4 mil is right or wrong, the 11-12 result must be even worse than Belle's previous years.

Harvey44 wrote

There are plenty other gov't sources who've quoted other numbers.

Like I said, I've heard various numbers thrown around, but none that came directly from the State other than the SAGE documents.  Maybe you could post a couple links to the other government sources.

Harvey44 wrote

I wouldn't be surprised if Bell lost a lot this season. They did no marketing and from what I've seen skier visits were down far more at Bell than other ski areas.

I agree that the biggest opportunity to close Belle's budget gap lies in marketing.  I think this is one area where ORDA can excel compared to DEC.  The Belleayre website is just god-awful.

Harvey44 wrote

Two quick points

I think you made three or four points.  We won't hold it against you.

Make a Freedom of Information Law request to DEC and ORDA for any record or part of a record that shows how much $ was made or lost (WTH, ask for skier visits, too). That makes them search through the budget report OR disclose the document (that MUST exist, amirite?) that relates this info.

That's a pretty cool idea Sponge. I wonder if you could get it? How do you proceed?

There's a guy I follow on twitter named Andy Arthur:

https://twitter.com/#!/andyarthur

He's a dedicated outdoorsmen and he makes FOIL requests all the time about all kinds of things. Learned a lot by following him. He also the only person I've ever followed on FB or TW that speaks out on politics BUT considers BOTH sides of things.  I unfollow most who go political, because the constant drumbeat on one side is exhausting, predictable and boring (Joe Bastardi is a prime example).  But Andy really embraces interesting ideas from both sides of the isle.

Sorry for the drift. Maybe Andy has advice on how to do it.

Spongeworthy wrote

Make a Freedom of Information Law request to DEC and ORDA.

Yes, I suppose you could FOIL the information.  I have no idea how to go about doing so, and honestly I don't really care enough what the "real" Belleayre loss is to invest the effort.  Regardless of whether they lost $1 mil or $4 mil or some other amount, the point is that $4 million is the number cited in the documents that drove the Gov's decision to transfer Belle to ORDA.

In the end, what really counts is whether the budget/appropriation for Belle's revenue shortfall - whatever that number is - will be transferred to ORDA. I beleive that appropriation IS intended/expected to be transferred to ORDA, but I haven't found any official document from the State that verifies that appropriation.  I beleive Harv mentioned a few posts back that he had seen some form of confirmation, so maybe Harv could post a link to that source along with the above-mentioned links to his "other govt sources" for the alternate Belleayre loss figures.

Harvey44 wrote

That's a pretty cool idea Sponge. I wonder if you could get it? How do you proceed?

First of all, it's public information that anyone is entitled to see (and it must exist), so you can get it and you don't have to explain why you want to see it.

Send an e-mail to foil@orda.org and ask specifically for what you want: profit/loss, skier visits, etc. They should be able to e-mail it back to you.

I didn't mean to imply I have govt sources.  Just stuff I've read in the paper.  Did some quick googlin. Lake Placid News gives Bell's operating budget in 09-10 as 6.3 million:

http://www.lakeplacidnews.com/page/content.detail/id/509155.html

... seems like a reasonable number based on numbers I've seen for Whiteface/Gore in annual reports.  That's what made me think 4M is a big loss. It's a big percentage. Found $1.6 quoted as 2010 loss for Bell in 2010 in the Times Record:

http://www.recordonline.com/apps/pbcs.dll/article?AID=/20111127/NEWS/111270333/-1/rss01

...but that was another advocacy group. Not sure where they got that number.

In the same article a "DEC spokesman" said Bell loses were are "a few hundred thousand annually." That's the closest thing I've ever seen to anything official.

Guess you could FOIL DEC - I wonder if THEY even know.

Found these BRAG numbers. They are using it to make a case for investment in Belleayre (the righthand column), but you can see the numbers they used for the 2009-2010 season in the left column. In another spot in the doc, it says that 2009-10 skier visits were 169,000. Shows the $1.6 million loss:



I broke this thread out from the original question of when ORDA took over Gore. It ain't perfect but I think it's better.

The numbers are interesting.  Over what timeframe are they proposing to bump visitors up 22%?  I don't think that's a realistic 1-year increase.  Where will they save $1.8 million in salaries?  

ORDA won't yet have numbers for Belleayre because they they had nothing to do with it last year.  I spent time poking around DEC’s website and couldn’t find any financial documents.  ORDA makes the documents readily available but there’s not a lot of detail.  ORDA’s proposed ’12-’13 budget doesn’t take Belleayre into account, it hasn’t been updated since the budget passed.

How many freebees did the 169k skier days include?  

I love these proforma income statements that people use to make business cases.  There are several glaring issues with this.  I've been in these meetings at work where someone presents one of these plans and its like oh is this the point where the miracle happens. In this case 225K skier days??? you got to be kidding me - isn't that about what WF does?  They have a much shorter season.  Pigs will not only fly but fly helos and then go skiing before that happens.  



Note that they increase skier days by 33% but skier revenue increases by less than 20% so they clearly plan to discount heavily to make those numbers or sell a crap load of season passes.  The Orda plan only calls for $1M investment not the $6M that skier days increase 33%.  

The other thing wrong with this is it assumes that cost of goods sold is going to decrease by 20% per skier day while skier days increase 33%. If you think that can happen I have a nice ponzi scheme for you to invest in.

Assuming that labor costs can be reduced by 43% while increasing sales by by quite a bit - I heard that DEC paid more than Orda but that much more while you will need more employees to handle the bigger crowds?

Fantasy world stuff here. No bank in the real world would loan money much less the $6M they need according to this this business plan.  If the Gov bought this pile of crap as the reason to give this to Orda it would show why the state is so screwed up - the people running the state don't understand how business works.  

My point was not about the right-hand column. I posted the chart because of the data in the left hand column. I didn't mean to imply anything about the credibility of BRAGs scenario. Maybe I should have cut the right column off and saved AS an aneurism.

I believe Hunter and Windham "FOIL"ed Belleayre for the numbers on the BOGO free tickets and said the number was about 10% of total visits for the year - somewhere around 16,000 in 2009-10.  The DEC said the number was about 7% of total visits.  Either way that's significantly more than what other Catskill Mtns have given out for media and promos.

I can't imagine this continuing under ORDA.  The governor may well have other motives for the switch to ORDA, but he's got to know that it's going to save the state some money. If nothing else it may be political cover for the move.  One thing is certain... there is going to be some serious pain around Bell if salaries and benefits are cut in half.