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Op-ed: Park City impasse needs resolution before ski season

Published August 22, 2014 6:22 pm

This is an archived article that was published on sltrib.com in 2014, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

It is astounding that the Talisker/Vail vs. Park City Mountain Resort civil war has gotten this far without township vigilantes arriving at their door with torches burning, demanding an end to this threatened shutdown of PCMR's upcoming ski season.

What's at stake: If PCMR generates 35 percent of the winter visitor overnights in Summit County, that's 582,780 overnights. Times $378 average daily expenditure of overnight visitors. Times a conservative 5-times multiplier, which measures how tourism dollars radiate into the community. Suffice it to say all Utah is facing a billion dollar penalty if fairness does not take over the stalemated negotiations.

There is no question PCMR screwed up in forgetting to file formal notice that they intended to continue their lease. Now there is no question that Talisker/Vail is using this clerical error to force ownership away from PCMR. This must be why Vail is leasing The Canyons from Talisker for $25 million a year. The only way to justify that astounding sum would be the opportunity to own the Park City Mountain Resort.

A telling glimpse behind the curtain came with last week's exchange of letters from Talisker/Vail lawyers with the city attorney, and the response from PCMR lawyers. Made public by The Park Record, these letters detail an intent that is painfully clear.

To wit: Talisker/Vail hedge-funders "redact" all the numbers and hide in shadows of secrecy. Talisker/Vail has not participated in good faith negotiations and refuses to even address the basic issues of fair market values.

In the exchange of letters, PCMR lawyer Alan Sullivan hints at the bad faith on the part of Talisker/Vail from the very beginning: "…Talisker demanded that PCMR's rent be increased to an unsustainable level, far beyond the property's fair rental value."

Sullivan writes, "Talisker also demanded that PCMR turn over ownership of PCMR's base facilities, parking lots, water rights, intellectual property and other assets – all at no cost to Talisker."

The irony, writes Sullivan " … is that Talisker has resisted our efforts to make [their demands] public, insisting that it should be kept secret …"

Sullivan's now very public offer: "… as a way of resolving this case, [PCMR] is prepared to pay Talisker rent well in excess of the fair rental value, and it is prepared to do so today. PCMR has also repeatedly offered to purchase the leased property at a premium over its fair market value. But since Vail Resorts has taken over the litigation on Talisker's behalf, it has refused to consider renewal of the lease or the sale of the property."

Are we asking the impossible, that hedge-funders repress their greedy nature and for once act in the best interest of the community?

The Park City Ski Resort has had a long succession of wonderfully responsive owners. As President of the original United Park City Mines, our uncle Jim Ivers moved the dying mining company into the ski business. Our dad, Jack Gallivan landed the first federal Area Redevelopment Administration loan for the Park City Ski Area, which launched the new business dream. Park City has come from Utah's most ghostly town to the state's most prosperous community. John Cumming and his Powdr Corporation have been excellent stewards of this economic engine that now drives thousands of Utah aligned businesses and individual jobs.

But now it appears that Vail Corporation and Talisker are willing to kill Park City if they can't own it.

Please, Talisker/Vail and PCMR, agree to binding arbitration to assure fair market-based outcomes. In the meantime, immediately declare business as usual for the 2014-2015 ski season so that our whole Utah community can depend on this vital source of industry.

Jack Gallivan Jr. is a Utah businessman, former news director of KUTV and a director at ABC Sports and ABC News. Mickey Gallivan is a former economic development director for the state of Utah, and for 30 years a principal in advertising Utah tourism. They trace their Park City roots back four generations.