Band of Nitwits Highjacks Gunstock, Ski Area’s Future Uncertain

To support independent ski journalism, please consider becoming a free or paid subscriber. Paid subscribers receive thousands of extra words of content each month, plus all podcasts three days before free subscribers. This coming Tuesday, two major megapass additions are dropping, and The Storm will have full breakdowns the instant those are live.

Share

On March 17, 2006, Nevada-based Boyce Hydro Power LLC purchased four Mid-Michigan dams. Stacked south to north along the Tittabawassee River, Sanford, Edenville, Smallwood, and Secord dams were built in the mid-1920s to generate electricity. But they also created lakes. Muddy lakes. Hazard-riddled lakes, depth unpredictable outside the river channel, often seaweed-choked and studded with century-old deadtrees that no one had bothered cutting down. But lakes nonetheless.

A lake – especially a lake large enough to accommodate motorboats – is a glorious thing. It defines a community. Without the lake, Sanford, where I grew up, would have been a backwater. Instead, it was a local destination of sorts, home to a lakeside park throttled on summer weekends with beachgoers from surrounding counties. Our green-paneled ranchhome sat in a quiet neighborhood less than a half mile from the shoreline, and on summer days my sister and I would bicycle to the beach with our mom and on weekends we would trailer the shiny brown Glastron five minutes to the boat launch and spend all day drinking Faygo and tubing and launching cannonballs off the backside. In 1992, my parents built a house on the lake, poised regally atop the ancient highbank, and we moved up there permanently. I left Sanford six years later, but my family remained, and the lake, for the next 22 years, was my sometime hideaway from life in the grinding city.

Meanwhile, Boyce had a hard time managing the dams. The Federal Energy Regulatory Commission (FERC) repeatedly fined the company for failure to upgrade the Edenville Dam's spillway capacity, and finally revoked Boyce's operating license in 2018. The State of Michigan assumed regulatory oversight of all four dams, and a group called the Four Lakes Task Force assembled, agreeing in January 2020 to buy the properties from Boyce for $9.4 million.

It was too late. On May 19, 2020, following several days of heavy rain, the 96-year-old Edenville Dam collapsed. Wixom Lake, nearly 2,000 surface acres and 66,200 acre-feet of water, emptied into Sanford Lake. Aerial video of the breach captures the deluge at its thundering source, a horizontal Niagara toppling full-grown trees like bowling pins (:40):

The surge was something out of Twain, the primeval river unleashed. Bridges collapsed. Unmoored boats and docks and hoists and campers and vehicles and houses twirled downstream in a waterborne stampede, all of it headed toward Sanford Dam. For a while, the dam held, the volume of water so immense it overtopped the earthen berm angling off the brickwork structure. But the dam was designed to fail and it did, a fuse plug in the dirt mound disintegrating, and, with it, the last manmade defense holding back two lakes worth of water. The village of Sanford, immediately below the dam, was destroyed.

The lakes were gone. What remained was the river, re-assigned to its ancient course, curling through a Transylvanian landscape of vast muddy plains, thousands of blackened tree stumps upthrust from the muck like demented cacti. Forest quickly reclaimed the lake bottoms.

The dams will be rebuilt, and, with them, the lakes will return. My parents should again be able to launch a boat from their dock in 2025, if all proceeds as scheduled. But the repair will cost $70.8 million for the Sanford Dam alone. Edenville will run $96.5 million. Smallwood, $36.2 million. Secord, $33.9 million. Tax dollars will finance the bulk of the construction.

Now let's go back to Boyce. The spillway capacity upgrades that FERC demanded for the Edenville Dam would have cost $8 million. Boyce said they could not afford this. And so the dam failed. Thousands of properties were destroyed. Lives upended. Hundreds of millions in damage.

It is reasonable to ask here why the operation of critical infrastructure was outsourced to a distant private company with no history of dam management. Especially one owned by a clown named Lee Mueller, whose other businesses, "Fountainhead Properties" and "Fountainhead Design Group" suggest a fidelity to Ayn Rand's preposterous Fountainhead, the nihilistic pseudo-bible for free market fundamentalists. We don't need no damn government to tell us when to upgrade our dams! The market will tell us when it's time to upgrade them!

This is by no means the only version of this story. Plenty of Boyce apologists contend that Michigan's Department of Environment, Great Lakes, and Energy's insistence on maintaining higher water levels to protect freshwater mussels led to the dam failures. The final 502-page independent report lays all the facts out for anyone interested, but it also concludes that, "If, many years before the May 2020 failure, the dams had become publicly owned or a public-private partnership had been established, sufficient funds would have been available to upgrade the spillway capacity to pass an extreme flood, and therefore the rise of the lake in May 2020 would have been limited and the failure would almost certainly have been prevented."

Allow me to reinterpret that: if you put a rich or powerful idiot in charge of something important, and they have no understanding of how to manage that important thing, they are likely to ruin it.

Which takes us to Gunstock.

Gunstock is a good mid-sized ski area in a state full of good mid-sized ski areas. At 227 acres, it is the seventh-largest resort in New Hampshire after Bretton Woods (464 acres), Loon (370 acres), Attitash (311), Cannon (285), Waterville Valley (265), and Mount Sunapee (233). A high-speed quad serves the mountain's 1,400-vertical-foot drop. Night skiing operations are extensive, making Gunstock an epicenter for racing and after-school learn-to-ski programs. Here's what she looks like:

Lately, Gunstock has been rolling. Under the leadership of industry veteran Tom Day, who arrived in January 2020, the resort has increased annual revenues from $12 million to $18 million. It has $7.5 million in the bank. Emboldened by this stability, ski area executives have invested $6.2 million into capital improvements. Last December, the resort, along with ski area master planners SE Group, unveiled a 31-trail, three-pod, three-lift expansion plan that would nearly double the resort's skiable acreage and resuscitate the lost Alpine Ridge ski area next door:

Gunstock has not always been so healthy. For many years, the ski area required an annual bridge loan from Belknap County, which owns the resort, to get through the offseason. Infrastructure investments have lagged peer resorts, relegating Gunstock to a tier below Boyne-owned Loon, glimmering with a brand-new eight-pack; Bretton Woods, with four high-speed quads and a new eight-passenger gondola; and Waterville Valley, which is upgrading its White Peaks Express from a high-speed quad to a six-pack this summer. But over the last two years, the ski area dispensed with the bridge loan request. Instead, Gunstock, revitalized and printing Ben Franklins, began returning 1.75 percent of gross income to the county, which amounted to $375,000 last year.

Day and his team were, by all objective measures, doing a standout job running a ski area that had not always cooperated with those attempting to run it. These were industry veterans, expertly navigating a challenging business in the impossible environment of freeze-thaw New England. Anyone with any brains or sense would have left them alone to keep doing what they were doing.

But this is not what the Gunstock Area Commission decided to do.

In 1959, the New Hampshire State Legislature created the Gunstock Area Commission to oversee the county-owned ski area. In its current form, the commission is a five-member panel appointed to five-year terms by the 18 state legislative representatives from Belknap County. Their mission, as defined on Gunstock's website, is as follows:

The Gunstock Area Commission is a 5-member board appointed by the Belknap County Delegation with the responsibility of managing Gunstock Mountain Resort (also known as Gunstock Area) as a financially independent, self-sustaining organization. Commissioners are appointed to a 5-year term. Not more than two of the members of the commission can be residents of the same municipality. At least one member must be an experienced skier and at least one member be experienced in the field of finance, banking, or accounting.

For most of its history, "responsibility of managing"* was interpreted to mean hire a professional management team and get out of the way. And for the first two years of Day's tenure – and for most of the past six decades – that is in fact how the commission operated.

Then, earlier this year, two new commissioners arrived: Doug Lambert, owner of a welding company, and David Strang, an ER doctor who, according to the Boston Globe, signed a 2020 letter "arguing that New Hampshire should secede and become a ‘Free and Independent State.’"

Day suddenly faced a hostile and suspicious commission, who believed that previous commissions had acted as "rubber stamps" for Gunstock management. In March, the commission halted all work on the master plan. Later that month, Strang and Ness shut down a pre-approved and in-progress conversion of the Stockade Lodge to a sit-down restaurant, a project that Gunstock had already invested $400,000 into (the commission later supported a revised plan that would incorporate the equipment). In May, Ness pushed for GAC approval of every legal expense by the ski area, as well as the implementation of a snowsports committee, even though ski school revenue had grown 40 percent in one year. The commission formed an audit committee, in spite of the fact that the ski resort's financials are audited annually and the report goes directly to the commission – management never sees it. The commission later requested personal contact information for every Gunstock employee, which Day refused to share.

While some of the commission's requests, such as a proposal to streamline legal services from eight firms to one, seemed innocuous, the overall tenor of the meetings tilted toward a re-ordering of the commission from what had functionally been an oversight board to a de facto management team heavily involved in day-to-day operations.

"We've been very successful financially, so we couldn't figure out why there would all of a sudden be this ‘let's get involved in running a ski area,’" Day told me on Friday. "I felt that it was an overreach of what they needed to do and I kept asking, ‘what's the problem? Why are there concerns about the finances?’ We were killing it. It just became this overreaching problem that totally took away from the whole operation."

Then, according to Day, at the monthly commission meeting in June, the commissioners asked, "Do you know who runs the ski area?"

"Yes," Day says he responded, "I do."

"No," Commissioner Strang responded, according to Day. "The Gunstock Area Commission runs the ski area."

The commission's meeting minutes from June 22, which are classified on Gunstock's website as a draft, do not capture this exchange. None of the commission members – Ness, Strang, Lambert, or Jade Wood – responded to requests for comment from The Storm Skiing Journal to clarify their intent on this or a number of other points.

Nonetheless, the commission amplified its perception of the power structure at its next monthly meeting, on July 20. When Gunstock's senior management team arrived, they found themselves relegated to the audience, with the commission seated at a table. The typical arrangement, Day told me, was a horseshoe shape, creating physical parity and suggesting comaraderie between management and the commissioners.

"We had decided going into the meeting that we were probably gonna resign, but we were gonna wait till the end of the meeting, to see how things went," Day said. "But as soon as we saw what they did, saying ‘you guys sit in the audience now, we're in charge, you’re not.’ It sent a message that it was time for us to say, ‘we're done.’"

After reciting the Pledge of Allegiance, Day stood and asked Chairman Ness about the seating arrangement. Ness replied that "we just did that to be more consistent with the way other delegations and committees work."

Day stayed upright. "I'd just like to say right now that I'd like to tenure my resignation. I'll be happy to facilitate whatever I can do. Obviously there's been a lot of change in what we think that we can do as far working with you guys to run the resort. I know there's been some discussion about what my role is and who runs the ski area and who doesn't. I had a great conversation with Doug, he was very nice about explaining to me that basically you guys are the boss. I understand that I answer to you, but that it seems that there's a lot more of the control that wants to come from your side of it. So I feel that my role here is diminished and you probably don't need me, so I'll be happy to, like I said, give you two weeks’ notice and then I will move on and help you transition to someone else."

The remainder of Gunstock's senior management then stood up one by one and resigned: CFO Cathy White, Director of Resort Services Robin Rowe, Snow Sports Director Peter Weber, HR director Rebecca LaPense, Facilities Operation Director Patrick McGonangle, and Marketing Director Kristen Lodge. It's a remarkable scene, captured in full below:

At the end, commissioner Gary Kiedaisch stands up and resigns in solidarity with the management team. "I would like to make a motion, Mr. Chairman," Kiedaisch says, addressing Ness, "that you and Mr. Strang and Mr. Lambert and Ms. Wood show up at six o'clock in the morning from now until you can find somebody to replace this talented team, which I highly believe you will not be able to find anybody that would be willing to work with you. And therefore I resign as well. And I'm disgusted by you. I'm disgusted by Dr. Strang. I'm shocked by Mr. Lambert. And I'm sad for Ms. Wood to be part of this political charade. Good luck."

They’re going to need it. Gunstock, which has extensive summer operations, has remained closed since Thursday. The commission declined senior management's offer of two-weeks’ notice. When Day and his team arrived on Thursday morning, they found sheriff's deputies waiting to supervise them as they cleared out their offices, and a locksmith present, changing the door locks.

"Gunstock is in trouble," Kiedaisch told The Boston Globe's Bill Donahue. "It lost its management team, and it's now being run by a bunch of commissioners who know nothing about ski area operation. If you’re a Gunstock skier, it's like you’re walking onto an airplane and being told that your pilot has never flown before."

Employees and passholders echoed that sentiment. "I can say with confidence that each individual here probably does the job of at least two to three people minimum," Marketing Manager Jennifer Karnan told The Laconia Daily Sun. "I think the challenge as these commissioners try to step in and assert their leadership, they're trying to decide a succession plan; who will be the ones to move up to a more senior level of management, and who will fill those positions of middle management. I think it's going to be a more difficult process than they anticipate with the amount of staff we have."

"I was shocked that it actually happened," said Tim Haarmann, a 12-year season passholder at Gunstock. "I’m optimistic that they’ll find a way to get open, but I’m extremely concerned. These commissioners don't have a plan. And on top of that, they don't have a senior leadership team. When we travel to other ski areas, we are constantly reminded just how competent the team at Gunstock is and how they do a lot with a little."

Without senior leaders, the ski area now has even less to work with. "I'm not sure that the commission understands how many moving parts there are to running a ski area," Day told me. "Winter approaches a lot faster in the ski business than it does in the normal person's world. I sincerely hope that the commission can recognize that they've got a large hole to dig themselves out of. We offered to stay for two more weeks as a transition period, but obviously they didn't feel that that discussion was worth having. So how will Gunstock operate this winter? I think they've got their hands full, and I wish the best of luck to our staff who bust their ass to make things run there. But winter comes fast and right now it's in total disarray."

The commission seems blithely unaware of how precarious their circumstance is. Qualified ski area general managers are difficult to find under the best circumstances. Tom Day was one of the best and most experienced in New England. He is well-connected and well-respected. It seems unlikely that any qualified manager is going to analyze the circumstance that Day just walked away from and say, "Yeah, that sounds like an interesting challenge."

"Right now you've got basically a ship that's loaded up the, the engine's failed, and there's no rudder," Day said. "So if someone is thinking of coming here, just remember that nothing's gonna change. You're still going to have as your bosses a commission that feels they need to be involved in pretty much everything that happens. The ski business is tough enough to deal with and hard enough to work with, and then when you have somewhat of an adversarial relationship and the entire staff you have to replace, I can't even imagine why anyone would think that's a good place to go make a career move."

Day and other senior leaders have stated that they would return if Ness and Strang are removed from the commission. Strang's term is up in November, Ness’ in 2024. It seems unlikely that either would be removed by the politicians who appointed them, and, in fact, with Kiedaisch's resignation, there is now an additional seat to fill, and it will be done by the same group that appointed Strang and Lambert.

Meanwhile, the GAC posted a statement on Gunstock's website that its "objectives are to remain open, continue employment of valuable staff, provide guests with exceptional experiences and fulfill the GAC's obligations to the taxpayers by securing financial stability of the Gunstock Mountain Resort."

So let's recap: a ski area that, under the leadership of a management team with decades of Gunstock and ski industry experience, had evolved from municipal liability to profit center in two years, grown revenue by 50 percent, and imagined an expansion that could have transformed it into a top 10 New England ski area has, in a matter of weeks, deteriorated into a locally self-interested bump run by a cabal of loudmouth know-nothings whose greatest ambition for the ski area is to "stay open."

Good job, Guys.

This is where decline begins. People with more power than brains asking the wrong questions, focusing on the wrong things, until small problems become big ones that cost far more than the initial solution would have. This is how you break dams, and this is how you ruin a ski area.

"I think the current commission has several people that should be removed," Day said. "They’re the reason that this is happening, and they've certainly gonna affect, I believe, the revenue production and the operation. There's already been a lot of turmoil with the commissioners coming and speaking to the staff and asking them, ‘how do we make a plan?’ and the staff saying, ‘how do you not have a plan?’"

With no plan, there is a chance that Gunstock could fail to open this winter. Once a ski area misses a season – once it loses staff and equipment sits idle and basic maintenance goes untended and skiers form different affiliations and habits – it is very, very hard to put it back together again. Forget about $6 million in profit. If Gunstock misses a season, it will have a hard time running a surplus anytime in the next decade.

Perhaps that's what these knuckleheads want. New Hampshire delegate Norm Silber, who is a member of the Belknap County delegation that selects the five commissioners, has for years advocated that the county sell or lease Gunstock. He repeated that sentiment this week. And while Boyne or Powdr or Alterra would likely do a fine job running Gunstock (Alterra manages Winter Park, which is owned by the City of Denver), firing the senior management team is an idiotic way to get their attention – none of these companies is interested in a fix-up job, and none of them is going to want to answer to a local board of micromanagers who know nothing about running a ski area. (Day said that the active commissioners had all publicly backed off of any suggestion that the ski area ought to be privatized.)

I hosted Tom Day on The Storm Skiing Podcast last year. His story was novel. He had worked in lift operations in the build-‘em-yourself days at Waterville Valley and worked his way up to general manager before, by turns, revitalizing a manufacturing business in Rhode Island, project managing construction of a pair of interstate rest stops, and inspecting resorts for Mountain Guard. Mixed in, he would ski 80 days per year from his Park City condo, enjoying ski bum semi-retirement. He took the top job at Gunstock because he thought it would be an interesting challenge. He struck me then as an interesting and cerebral guy, thoughtful and understated, but New England tough, with uncompromising ideals. He looks like the sort of dude you wouldn't step to in the bar, but he's open with his thoughts.

"This was the nuclear option," he said of resigning. "There's five people whose livelihood depended on those jobs there that made the decision that they felt strongly enough about it, that they needed to resign. I think that's a big statement. I don't think that the commissioners have taken this into consideration, cuz of course they're saying ‘they're petulant and spoiled. And because we actually asked questions, they decided to resign.’ Oh that's stupid. No one gives up their job because of that. They give up their job and their livelihood because they believe in honesty, integrity, respect. And that's not what we were seeing.

"I've never seen anything like this. When I was working at Waterville, we went through the original owner, Tom Corcoran, and then SKI bought us, then ASC bought us, and then Booth Creek bought us. And so I saw transitional leadership, and generally the GMs were the ones that went in that case, cuz they had other people that they put in the GM's position. But I've never seen in my ski career, and I don't think anyone else has, where the GM and the entire senior management resigned.

"It was the worst thing that ever happened in my career. It's so sad for Gunstock, and for the community, and for the employees. And obviously you don't do something like that – I reiterated this probably enough – unless you needed to make people understand that the commission got to a point where it wasn't reasonable for us to try to be management anymore."

Follow on Twitter

Follow on Instagram