Outdoors/Business Reporter
Sneak Peek of the Week
Lots of questions around the Nederland deal for Eldora
$100 million to $200 million
Estimated bond revenue Nederland will need to buy Eldora
When Nederland earlier this year said it was planning to buy Eldora ski area from Powdr, there was a lot of smirking in the industry. How could a rural town of 1,500 with an annual budget around $3 million buy a ski area for somewhere between $100 million and $200 million?
That smirking turned to head-scratching last week when Nederland proudly announced it had persuaded Powdr to consider its deal. Details are light right now, and the town’s statements around the plan raise a ton of questions.
It’s a very unique deal. There are community nonprofit ski areas in the West — Montana’s Bridger Bowl and Mt. Ashland in Oregon, as well as several in Colorado, including Ski Cooper outside Leadville and Steamboat Springs’ Howelsen Hill — but the Eldora deal appears to be a for-profit plan with Nederland partnering with investors and squeezing revenue out of the ski area.
Both sides are being exceptionally quiet right now as they work through due diligence before reaching a final purchase agreement with a plan to issue municipal revenue bonds to fund Nederland’s acquisition and operation of the ski area. No one has shared the price for the ski area. Last week the town said if due diligence unfolds as planned, it could possibly sell the bonds and close the deal by October.
“It’s pretty exciting,” said Andy Daly, who ran Eldora in the late 1980s with a plan to purchase the resort and build a collection of smaller ski areas.
Daly moved on to run Vail Associates as it evolved into the publicly traded Vail Resorts empire and he just sold his majority interest of Powderhorn ski area on the Grand Mesa to the Pacific Group Resorts out of Park City. He does not know any of the details on the Nederland-Powdr deal.
But he’s fascinated by the disruptive ownership plan that defies the growing trend of resorts either selling to or partnering with industry giant Vail Resorts or Alterra Mountain Co.
“In this day and age, what ski towns are finding is that being in bed with Vail Resorts or Alterra, particularly Vail Resorts, tends to change the vibe in the community,” Daly said. “You lose the sense of having a partner you can work with toward the betterment of the community and the success of the ski area. I’m excited to see how Nederland can make this work. Their challenge will be providing the leadership needed to run a for-profit business while having a willingness to commit the capital needed to keep Eldora competitive. Skiing is an extraordinarily capital-intensive business and … is Nederland capable of making those investments?”
The town has faced some financial challenges recently. Its police department endured a series of resignations in 2022 and voters that year approved increased taxes to support the local police department.
The acquisition plan includes Powdr, which acquired Eldora in 2016, remaining at the helm of the ski area for two years as Nederland transitions to ownership. After those two years, the 303 Ski team — including former Vail Resorts executives, Powdr’s former general counsel Emily Smith and Boulder investor Justin Gold, who sold Justin’s Nut Butter to food giant Hormel in 2016 for $280.9 million — will “support the mountain,” according to the town. Does that mean 303 Ski will run the ski area? Work as an advisor for the town? Will 303 Ski make operational decisions and will those decisions be vetted by town leaders?
It is unclear how that public-private management strategy will work but the initial plan calls for Nederland, which has about 25 workers, to employ more than 700 at the ski area at the peak of the ski season. The town says it will be hiring a deputy manager to handle ski area operations.
Powdr, which is not a particularly chatty business, is not saying much. A spokesperson noted that “a lot needs to happen” between now and the closing of the deal.
Nederland plans to pay for all this with municipal revenue bonds. A list of details on the town website says mountain revenue will cover payments for those bonds — at 6% to 8% interest — while building a reserve of $10 million to cover payments if revenues drop in a low snow year. The town said early projections show the town generating “some excess cash flow” but nothing meaningful until subordinate bonds are paid off in the first 10 years.
“After that, free cash flow will fall between $2 million and $5 million and we can reinvest those funds in streets, sidewalks and water infrastructure,” reads the town’s Frequently Asked Questions post from July 8.
Municipal bonds are an emerging tool for rural communities tackling big projects. The town of Vail collected $126 million from a municipal bond sale in May to support construction of a 268-unit housing project. The housing revenue bonds — with a long-term interest cost of $387 million — will be paid back with rental revenue from the town-owned units.
The town of Vail last month said the demand from investors far exceeded the number of bonds available for sale.
There’s a lack of vocal community or industry cheering around the Nederland plan, which is surprising considering the recent swell of mountain-town angst directed toward corporate resort operators who are keenly focused on profits and pass sales.
Isaac Stokes has been skiing Eldora for nearly 25 years, teaching his kids to ski there and logging somewhere close to 500 days at the ski area. He’s wary. Even worried.
When he saw the news that Nederland was buying Eldora, “I was sure it was an Onion headline,” he said, referring to the satirical news site.
Stokes suggested a better headline: “Eldora buys Nederland.” Powdr did an incredible job running Eldora, he said. How can a small town keep pace with a 30-year resort operator? Stokes asked.
“I mean come on. Nederland can’t even run their own police department,” said Stokes. “This is going to be a train wreck of epic proportions. Dollars to doughnuts this ends up bankrupt.”
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Breaking Trail
Plants “holding their breath” during wildfires
The smoke from four wildfires on the Western Slope has triggered air quality warnings for Mesa, Delta and Montrose counties, warning folks to reduce huffing and puffing outdoors until skies clear. A report by Colorado State University researchers shows wildfire smoke may be equally threatening to trees far from flames.
CSU chemistry professor Delphine Farmer and atmospheric science researcher Mj Riches were studying plant emissions during the particularly fiery summer of 2020 in Colorado. They wanted to better understand how plants — through photosynthesis — emitted certain organic compounds, like the pine scent in conifer forest, when they noticed “that the leaves weren’t ‘breathing’ — they weren’t inhaling the carbon dioxide they need to grow and weren’t exhaling the chemicals they usually release.”
After closer scrutiny of what appeared to be plants shutting their windows and holding their breath in reaction to wildfire smoke, Farmer and Riches are thinking their research could help farmers better understand how to help their crops handle these increasingly frequent smoky months.
“There is a clear need to better understand how plants will respond to this threat in our changing climate not just for the health of our forests, but also for our ability to grow food,” Farmer told The Sun’s Tracy Ross.
>> Click over to The Sun next week to read Tracy’s story
The Guide
Ibogaine emerges as the next natural medicine for Colorado’s healing centers
13
Number of healing centers approved in Colorado so far this summer, including 2 standard and 11 micro centers, with 18 applications pending
The Psychedelic Sciences conference in Denver last month revealed clear camps of medicinal cheerleaders. The mushroom boosters. The ketamine clan. All varieties of champions of DMT, LSD and other transformative chemicals. The ibogaine folks were particularly eager to get their medicine spread far and wide.
Derived from the root of a bush that has been used by indigenous West Africans for centuries, ibogaine is emerging as an effective treatment for addictions, depression, anxiety and even traumatic brain injuries. It’s particularly intense, with some experiences lasting days, versus hours for other psychedelics.
In Colorado, ibogaine is likely the next natural medicine to land in healing centers that just started offering psilocybin sessions a few months ago. The 2023 Natural Medicine Regulation and Legalization Act, decriminalized three other plant-derived psychedelic drugs: ibogaine, dimethyltryptamine, or DMT, and mescaline. The law specified that regulators cannot consider DMT or mescaline for healing centers until at least 2026. But there are no such limits on ibogaine.
Ean Seeb, Gov. Jared Polis’ special advisor on cannabis and natural medicine, said that the lack of restrictions was reflective of lawmakers’ optimism about ibogaine.
“Recognizing the unique benefits associated with this medicine and the extreme promises that it is showing, in terms of treatment for a myriad of different challenges, we have an opportunity to accelerate introducing ibogaine as a regulated medicine,” he said during a panel at Psychedelic Science.
Polis also mentioned ibogaine during a keynote speech at the conference.
“We’re looking at opportunities to consider adding ibogaine treatments as efficiently as possible,” he said.
Colorado Sun freelancer Gabe Allen talked with several ibogaine researchers and people who have used the medicine. Gabe’s reporting shows some risks — there are several reports of people during an ibogaine experience — and how Colorado regulators are carefully planning how to integrate the powerful psychedelic into the state’s regulatory system as early as next year. The state is planning ways to incorporate indigenous practitioners and traditional knowledge around the medicine into the administration of ibogaine.
And once again, Colorado appears poised to lead the nation with the regulation and use of drugs that are federally illegal, potentially setting up either a shift in federal laws or a significant scrap over the role of states in drug policy reform.
>> Click over to The Sun next week to read Gabe’s story
Farm-to-camp backpacking meal business thriving in Durango
$250,000
Grant from Colorado OEDIT’s Advanced Industries Accelerator Program for Durango’s Farm to Summit
The crew at Farm to Summit collects bruised and imperfect vegetables grown within 20 minutes of the company’s headquarters in Durango. They save the edible crops from the landfill and don’t really worry too much about appearances, considering every morsel ends up in a dehydrator.
Today the team is shucking kale before blanching it in a 40-gallon tilt skillet and tossing it in the dehydrator. Soon it will be mixed with other moisture-free ingredients to a Thai Red Curry.
The 3-year-old Durango company is finding a niche in the busy realm of backpacking meals and recently moved into a larger production facility thanks to a $250,000 grant from the Colorado Office of Economic Development and International Trade. The company also has a deal with retail giant REI to distribute its backpacker meals.
“I think that our brand really just hits people in the right spot of like, it’s farm to table for backpacking or for camping,” said Louise Barton, who co-founded Farm to Summit in 2022 after selling meals at the Durango Farmers Market. “Meaning that it tastes good and it’s supporting small farms, regenerative agriculture.”
Barton says her meals appeal to backcountry travelers who want their camp eats to match their mountain views.
“We go to these really beautiful places, right? Like, we spend weeks planning a trip, and then we’re eating garbage,” Barton told Sun freelancer Ryan Simonovich. “Like, it doesn’t make any sense. People want to eat something really high quality that supports their ethics.”
>> Click over to The Sun next week to read Ryan’s story
— j
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