Slippery Slopes Fight For Control Of Ski Hill Heats Up

Mt. Spokane Skiing Corp. has sweetened its bid to keep the concession to run the Mount Spokane Ski Area by offering to build a new ski lift.

Gregg Sowder, president of the family-owned business that manages the ski hill, mailed the new proposal to the state last week. It represents the latest counterpunch in the long battle for control of the ski concession located on state park land northeast of Spokane.

Since spring of 1994, Mount Spokane Skiing Corp. has fought to win the next 20-year concession the Washington Parks & Recreation Commission grants for the right to run the hill.

Pushing hard in the other corner stands the Mount Spokane 2000 Study Group, a sampling of regional business and civic leaders bent on pushing Sowder out. They want to turn the ski hill into a non-profit operation.

Under the new proposal, Mount Spokane Skiing Corp. would spend $750,000 to build a new double-chair ski lift that would open up a quarter more of the mountain.

Sowder wants to get the attention of the commission, which has been working mostly with the study group to get a new concession deal. He feels the prospect of bringing thousands of more skiers makes his bid more competitive.

The catch: Sowder builds only if he keeps the concession.

Plans for expansion have been pondered for some time, Sowder said. With the state taking its time with awarding the new concession, Sowder sent his new proposal to Wayne McLaughlin, contracts manager for the parks commission.

The company needs the state to OK the new lift, and wants to sell the trees cleared for the new runs to help cut construction costs. It can do none of this without the concession in hand, Sowder said.

But McLaughlin said the concession process will likely wrap up before any decision is made on the proposed Vista Lift.

“It would take quite some time,” McLaughlin said. “Especially if it’s going on a part of the mountain that’s previously undeveloped.”

The concession negotiations are far from over. Several sticky issues have delayed the process so long that the state had to extend Mt. Spokane Skiing Corp.’s lease another year so someone would be in control of the ski hill this season. Sowder believes the issue could push into next season as well.

The concession itself works this way: The operator pays the state between 3 percent and 4 percent of gross revenue each year. Conceivably, if more people skied at Mount Spokane with a new lift, the state would get more money, making Sowder’s bid more lucrative.

The decision of who gets to operate Mount Spokane for the next 20 years appears to rest on these unresolved issues:

Possessory Interest. If the study group were to take over the concession as a non-profit, it would need to buy out Sowder. The state would have to place a value, called possessory interest, on Sowder’s equipment at the ski area.

An appraisal last year showed the equipment to be worth about $3.5 million. The study group blanched at this amount and wants binding arbitration to settle on an amount. The state indicates that will likely be the method to establish the possessory interest.

Right of First Refusal. When potential bidders for the concession looked at the fine print on the state’s contract, some were horrified to see that Sowder has the right to match the contract as holder of the concession.

The parks commission will meet Friday in Olympia, McLaughlin said, and he’ll update them on where the negotiations stand. He plans to have a finished proposal for Sowder to look at sometime after that commission meeting, he said. “Things are moving along pretty well.”

In a July parks commission meeting in the Spokane Valley, the commission endorsed the study group’s vision of a non-profit organization running the ski area, and authorized McLaughlin to make a deal.

But Sowder will have the last word.

Sowder has 90 days to respond after receiving the finished proposal, he said.

Snow Plowing. The state currently plows the roads leading to the park, but budget crunching at the state level has bureaucrats in Olympia getting creative, Sowder said.

If the parks commission can persuade its concessionaires to do more maintenance, it pockets the savings. That compares to the concession fees the state charges, which go straight into the state’s general fund, Sowder said.

The state wants the Mount Spokane concessionaire to chip in for road upkeep in both summer and winter, Sowder said. If the amount that the state and the study group come up with is too large - in the hundreds of thousands per year, for example - “it could be a deal-breaker for us,” Sowder said.

Beyond those issues, both Sowder and the study group continue to feel each other out as to what each will offer the state. That’s where the new lift idea ups the ante somewhat.

Sowder doesn’t believe the study group has plans for similar large-scale improvements on the mountain. Just how the study group will pay for the possessory interest and operation of the mountain if it eventually assumes the concession could unfold in different ways.

Earlier this fall the Spokane County Commission created the Mount Spokane Public Development Authority, with the study group members poised to become directors on its board.

The authority cannot tax or levy, but it can issue bonds. Public development authorities control places such as the Pike Place Public Market in Seattle. Bonds issued by the authority would go toward buying out Sowder and possibly toward area improvements, said Ted Stiles, a Spokane attorney and spokesman for the group.

However, the legality of the development authority was challenged in early October by Sowder and Stephen Eugster, a prominent Spokane attorney who specializes in fighting government liaisons with private entities.

Depositions for the suit took place last week, Stiles said. Challenges to a public development authority are not uncommon, he said. The suit should be resolved in a few months and will not affect the concession negotiation process, he said.

But the state continues to negotiate directly with the study group, and not the new development authority.

Without a way to issue bonds, the money to buy out Sowder would have to come from the study group’s pockets. Those pockets are deep: the group includes such prominent civic leaders as David Clack and Allison Cowles.

Stiles said this week that he couldn’t reveal the fine details of the agreement being hammered out between the group and the state.

The group commissioned a study in 1992 to examine the Ski Corp.’s management of the area. Based on that report, which suggested things could be better, the study group pushed forward for change.

The study group’s efforts have centered on more programming for kids, seniors and other special skiers at the ski area. The group wants more input from the community on how to run the ski area.

Sowder refutes the group’s claims that skiers are disappointed with the ski area. The ski school under his management is among the most active of any in the region, he said.

“We get groups from every church group and organization you can imagine,” he said. “We get more groups up here than you could name.”

Some skiers complain about the lack of modern lodging facilities and the general “skier-unfriendliness” of the area.

“We get a lot more compliments than complaints,” Sowder responded. “Like any ski area, occasionally we might stumble or not do quite as good a job with customer service as you would like to. But I don’t know that we have any more problems than any other ski resort around here.”

McLaughlin believes the end is in sight for getting a new concession deal.

For Sowder, whose family has run the ski area since 1976, getting the issue resolved one way or another remains his top priority. His nine full-time and roughly 200 seasonal employees are anxious to see who wins as well.

“We need to get this issue resolved soon because the people who work here need to know what the future holds,” Sowder said. “Many of them think this is the last year they’ll work in Spokane.”

, DataTimes ILLUSTRATION: Color Photo; Graphic: Mount Spokane’s proposed “Vista Lift”