Duluth OKs $235K bailout of Spirit Mountain ski hill

DULUTH – The City Council voted Monday night to give the financially struggling Spirit Mountain $235,000, but the decision spurred calls for discussions about the local ski hill's financial sustainability.

A handful of residents urged council members to approve the spending, presenting Spirit Mountain as an economic asset for the tourism industry and a beloved park holding years of locals' memories.

The City Council voted 8-1 to fulfill the ski hill's request, using excess tourism tax dollars that had not been set aside for other projects.

But before voting on the measure, council members announced their support for the emergency funding with a contingency: Something must change down the road.

Council Member Arik Forsman called the ski hill a "cornerstone" of Duluth that "must sit upon a solid foundation. This is a short-term fix."

Spirit Mountain's financial woes run much deeper than the bailout.

Skier visits have fallen dramatically in recent years. In 2018, skier visits were about one-third the level of four years earlier, and the number of season passes sold has dropped nearly 40% since 2009. At the same time, the mountain's expenses have exceeded its revenue even with city tourism tax support, forcing it to draw down cash balances, state auditor documents show.

So when the Amsoil Snocross National race had to be canceled due to the Thanksgiving weekend blizzard, the budget didn't have much room to absorb the losses.

Executive Director Brandy Ream told the City Council on Thursday that upon seeing the forecast for that weekend, "My first immediate thought was: 'This is going to be the demise of Spirit Mountain.' "

Ream said without a cash infusion of $235,000 to cover the losses, the mountain would close.

Spirit Mountain has already budgeted a $388,500 loss for this season including depreciation, and that assumes a 10% increase in revenue over last season. Last season's net loss was estimated at more than $500,000.

Ream did not immediately respond Monday to questions about the operation's long-term viability.

Council President Noah Hobbs said the ski hill "drives hotel stays, it provides a place for our high schools to practice their snow sports."

Because the city's subsidy comes from tourism taxes and not from the same pot of money that pays for police or plows, Hobbs said it is a justifiable expense, though he called the "11th-hour" request "inappropriate."

The question of planning for and avoiding financial emergencies like this remains. Council members suggested exploring ways it could run more like a business, sitting a City Council member or city staff member on its board of directors and even looking into options to lease or sell the park.

But many, including Forsman, said closing the ski hill was not on the table. "I can't think of a Duluth without Spirit Mountain," he said.

Staff writer Katie Galioto contributed to this report. Brooks Johnson • 218-491-6496