The Fall Line Meets the Bottom Line (Cont.)

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Outside Magazine November 2002

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The Fall Line Meets the Bottom Line (Cont.)

DOESN'T DEVELOPMENT OCCUR only in response to market demand? Perhaps. But in the real world, the ski industry operates outside the rules of Econ 101. Much of its growth is floated by exploitation of public lands (where the slopes are), which in turn creates traffic in the towns and private-property villages below. Half of all skier days are counted on land managed by the U.S. Forest Service. And this government agency, which most people think is responsible for environmental stewardship, is actively underwriting ski area expansion—even when there's no demonstrated need.

These days the most talked-about success stories are not the big guys, but the small fry that got squeezed in the 1980s and '90s. Local hills are bringing new skiers and boarders into the sport—and even making a profit.

In 1994 the Forest Service committed itself to the National Winter Sports Partnership, a recreation-promotion agreement that obliges the federal government to spend taxpayer dollars on behalf of the National Ski Areas Association, an industry group that represents 326 ski hills and accounts for 90 percent of skier days. One 1996 Forest Service memo put it bluntly: The agency's role, it said, was to "help our partners achieve business success."

That's a problematic goal, since the federal agency is also responsible for regulating the ski industry's use of Forest Service property. But growth remains job one. During the nineties, when Colorado skier days increased by only 2 percent annually, skiable terrain grew at 7 percent annually and doubled over the course of the decade.

Like partners in a bad marriage, the Forest Service and the ski industry are using each other, and neither partner is likely to rock the boat. For example, where was Smokey Bear, in 1998, when Vail Resorts sought to expand Breckenridge, already one of the most kitsch-heavy ski destinations in the United States? Vail Resorts, which operates the ski area on Forest Service property, had unveiled expansion plans for three new villages at the northern edges of this sprawling 2,043-acre resort, near an undeveloped alpine wetland called Cucumber Gulch. The expansion included 165 acres of trails. What was unstated, but seemed apparent to environmentalists, was that the company's private property around Cucumber Gulch would make a prime base area.

Vail Resorts publicly denied it had any specific plans for base village development around this spot, called Peak 7. It presented the expansion and new lift to the Forest Service as a freestanding proposal, unconnected to any future development. And the Forest Service approved it. Environmentalists appealed the decision, Vail stonewalled, and the appeal went nowhere.

But the U.S. Environmental Protection Agency smelled a skunk. Under serious EPA pressure, Vail Resorts came clean in March 1999 with drawings of a new village at Cucumber Gulch, complete with a five-screen movie theater, conference center, ice rink, retail shops, and restaurants, all connected by road and gondola to parking lots on the valley floor. All told, the proposal would add 853 new condos, town homes, and houses to the slopes, plus 63,000 square feet of commercial space.

As of September 2002, Vail Resorts and the still-wary citizens of Breckenridge had reached a tentative compromise for a $400 million development that included up to 500 condos, a gondola, two chairlifts, and about 15,000 square feet of retail space. The feds had signed off on that as well.

It's obvious what the ski industry gets out of such deals, but what does the Forest Service get? Not much. The agency collects $17 to $19 million a year in ski area land leases. That comes to between 71 and 80 cents per skier day; the Forest Service charges 1.5 to 4 percent of the gross revenues that are realized on its land (adjacent base village and real estate profits aren't counted).

The results of such expansions are often hugely detrimental to the Forest Service's other constituency: wildlife. On the I-70 corridor stretching from Vail west to Eagle, development has pushed wildlife to the brink. The area's elk have foundered, driven from their former wintering grounds in Bachelor Gulch, west of Beaver Creek, by a new spate of multimillion-dollar homes. Four times in three winters during the late 1990s, several hundred elk charged I-70, maddened by starvation. As drivers swerved and tires squealed, the herds surged across the four-lane highway in a panicked hunt for forage, looking for the last good place.

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