Minnesota’s Economic News – W/E 4/9/21
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There’s plenty of snow for skiing at Spirit Mountain following the nearly two feet of white stuff that fell a week ago in Duluth. Yet despite prime conditions, the city-operated ski resort faces the possibility of shutting down before the season has hardly gotten underway without an immediate infusion of $235,000 in taxpayer cash, according to KBJR-TV.
Spirit Mountain representatives said without that extra funding, they would be able to make payroll one more time, but might have to close indefinitely.
During a press conference at the ski hill on Friday, Spirit Mountain’s executive director Brandy Ream said the city’s tourism tax fund was created to help out places like Spirit Mountain when necessary.
“Spirit Mountain was never created to be completely self-funded and running as a private facility, without that assistance and the help from the City of Duluth,” Ream said.
The latest cash crunch at the city’s subsidized ski hill follows the cancellation of the Amsoil Duluth National Snocross race due to the recent blizzard. Unlike most businesses, the management at Spirit Mountain apparently has no contingency plan or reserve funds in place to weather unforeseen financial storms that inevitably hit at some point.
But as a city-operated enterprise, Spirit Mountain does have access to taxpayer funds that have kept it up and running for years. So the Duluth City Council will be asked to tap into the city’s tourism tax fund once again on Monday night in order to keep the lights on the ski hill’s slopes.
City Councilor Arik Forsman says before the council makes a decision, he wants to see financial records.
“I’m hopeful that this is a one time thing. That’s what I really want to make sure. Let’s take a look at the long-term financial performance and projections for Spirit Mountain and say, ‘how do we set it up for success,’ because I do think it’s a valuable asset, and part of the quality of life in Duluth,” Forsman said.
It’s just the latest infusion of taxpayer funds for the city ski hill authorized by the Minnesota Legislature in the early 1970s. Duluth dedicates $500,000 in tourism taxes annually to pay for bonds for improvements at the ski slope and provides a $1.2 million line of credit with the city. A few years ago state taxpayers also chipped in $3.4 million to a snow-making system for Spirit Mountain. Yet Spirit Mountain’s management just keeps coming back for more.
Spirit Mountain is worried that if they don’t receive this funding, they might have to make some tough decisions – but they’re staying optimistic.
“I’ll do everything in my power – I am not closing this hill. If that’s what the question is – we are not closing Spirit Mountain,” Ream said.