Beaver County Attorney Von Christiansen said this week that the investigator, G. Wesley Dunlap of Fairfax, Va., told him he was under contract with the U.S. Department of Housing and Urban Development. Dunlap also talked to other county officials about the Mt. Holly Club, which plans the deluxe resort on the site of the former Elk Meadows ski area in the Tushar Mountains 18 miles east of Beaver.
Christiansen said Dunlap told him he was looking into whether Mt. Holly Club and its developers had violated the Interstate Land Sales Full Disclosure Act and whether HUD had jurisdiction on such a case.
Christiansen said the inquiry was spurred by the possibility the club had produced misleading advertising. Dunlap said "it would likely be some time before HUD took action," Christiansen said.
Mt. Holly Club issued a written statement Friday saying no one from HUD has contacted the resort and that the club is not subject to HUD registration.
"We are still awaiting county approval before selling lots," the statement said. "And our marketing is consistent with HUD regulations. Mt. Holly has been working with sophisticated counsel from Washington, D.C., for months with respect to all issues of HUD compliance and we will continue to do so."
A HUD spokesman in Washington, D.C., said the agency could not confirm an investigation is under way. Dunlap, however, also went to Beaver County's planning office, where he left a business card and a letter from HUD saying the federal agency had contracted him to conduct fact finding.
The developer, CPB Development of Salt Lake City, want to convert the ski resort into a private, exclusive community. Under the plan, the existing ski runs would be complemented by a Jack Nicklaus-designed golf course and luxury housing.
Public reaction has been mixed. Some Beaver County residents have praised the idea as an alternative to failed efforts to run Elk Meadows as an open-to-the-public resort. Others have said the plan is too lofty to succeed and will burden the county financially. Questions also have arisen about whether the expanded community would siphon water from the town of Beaver and whether current condo owners would be allowed access to Mt. Holly Club amenities.
On April 16, the Beaver County Commission will consider whether to approve a development agreement with the club.
HUD's attention might have been caught initially by U.S. Forest Service objections to a full-page advertisement that appeared in the Dec. 1 Wall Street Journal .
The ad said the resort could run ski lifts and snow cats up to 12,000-foot-high Mount Holly. However, the peak is on national forest land where motorized equipment is restricted, and the Forest Service asked the club to stop the advertisements.
The club's Web site, www.mthollyclub.com, contains photographs of scenery that does not appear to be at the resort. Mt. Holly Club spokesman Bill Quick said Friday he did not know where the photo was taken. There is also a sentence on the site saying: "Mt. Holly Club is the only private resort that offers ski-in, ski-out wintertime amenities and a signature Jack Nicklaus championship course all in a convenient golf cart community."
The golf course is not operational and Web site visitors need to click on a subhead to read a fact sheet that says the course is under construction. Visitors must click on the contact page to find a sentence reading: "This is not an offer."
The Interstate Land Sales Full Disclosure Act gives HUD authority over large residential real estate projects. The act also prohibits anyone selling or leasing a property from issuing advertising that is untrue or omits "material fact." The act carries possible civil penalties or criminal penalties of up to 5 years in prison.
The HUD investigator also called on Lynn Kitchen, district conservationist for the U.S. Natural Resource Conservation Service. Kitchen said Dunlap wanted to know much snow annually falls on Mount Holly and Elk Meadows. Kitchen said he supplied data.
On Friday morning, a fact sheet on Mt. Holly Club's Web site claimed the club "receives an average of 450 inches of fresh powder each year." When The Tribune reviewed the fact sheet again in the afternoon, the amount was lowered to 400 inches.
Kitchen said the area received 415 inches in 2005 - one of the heaviest years on record. A more typical annual figure is 200 to 300 inches, he said. But Kitchen added: "If people measure in a big snow drift, you could get about any figure you want."
Mt. Holly Club spokesman Quick said previous owners of Elk Meadows and publications have reported the resort receives 400 to 450 inches of snowfall per year. The fact sheet was amended Friday to reflect the lower end of that range, and because Mt. Holly Club talked with the conservation service to learn more about how resorts measure their snowfall, he said.
ncarlisle@sltrib.com
