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Timber!

Tempestuous political winds are blowing through Colorado's busiest forest.

Much of this new ski terrain would be on prime wildlife habitat; private property with development potential is also adjacent to most of these sites. Beaver Creek, for instance, has been eyeing a possible expansion into McCoy Park, but Colorado Wild's Jeff Berman says this would destroy a prime wildlife area. "McCoy Park is very important elk habitat," he says. "There aren't many places left for elk in the Vail Valley. They need lower elevation sites in the winter. The elk and deer need the locations the ski areas want for private profiteering."

The only reasonable explanation for expansions like these in the face of declining lift-ticket sales is the real-estate bonanza that follows the opening of a new ski run, he adds. "It doesn't have anything to do with providing recreational opportunities to the American public."

Vail Resorts' annual report makes it clear that the company sees its future profits coming from outside the lift line. Non-lift-ticket sales now constitute 68 percent of the company's revenues, and Vail has added twelve hotels, ninety restaurants, over eighty retail stores and 2,000 condominiums to its portfolio; last year Vail Resorts had total revenues of $431 million. The company is also spending $26 million on real-estate development, building golf courses, conference centers, private clubs, retail stores and hotels. The annual report boasts that 15.2 percent of total revenues come from hotels -- a figure that's nearly doubled in just three years -- while restaurants owned by Vail brought in 14.5 percent of revenue and retail ventures brought in 18 percent.

Vail Resorts Development Company, the wholly owned subsidiary of Vail Resorts, coordinates much of the firm's real-estate investment. To minimize risk from residential real-estate ventures, the annual report notes that Vail often sells land to developers and takes a cut of the profits: "In many cases, [the company] contracts to sell development sites to third-party developers who undertake the construction and financial obligations of the residential units. Vail Resorts, in turn, receives an up-front cash payment for the land and a share in the developer's profit."

The report also describes the company's golf courses -- it owns four and has two more in the planning stages -- and details plans for Red Sky Ranch, a new golf community that will be built ten miles west of Beaver Creek.

Vail Resort's Witt acknowledges that the company is involved in real-estate development, but he says that makes up only about 10 percent of the firm's revenues. "Real estate is not a driving factor in our ski operations," he claims. "Obviously there's a relationship between the ski areas and real-estate development. We do both things. But to say expansion is being driven by real estate is a fallacy."

According to Witt, Vail's headlong rush into the hotel, restaurant and retail business doesn't count as real-estate development. "The restaurants are on-mountain restaurants, and the hotels are in base areas," he says. "We haven't built anything. We bought existing lodges."

In the last few years, the company has acquired the Breckenridge Hilton, the Lodge at Vail and the Village at Breckenridge. Last fall Vail announced an agreement with Ritz-Carlton to develop a hotel in Beaver Creek, and the company has also entered into a retail partnership with Specialty Sports Inc. to develop sporting-goods stores.

Critics of the ski industry scoff at the idea that Vail Resorts isn't pushing massive new real-estate ventures. "These people know exactly what their plans are for developing the private land," says Ted Zukoski of the Land and Water Fund of the Rockies. "It's all about real estate and capturing the off-mountain dollar."

Another issue that's emerged in the controversy over the White River plan is water rights. The Forest Service has proposed requiring those who currently have permits to divert water from the forest to surrender 10 percent of their water claim as a condition of getting those permits renewed. Known as a "bypass flow," the idea is to make sure the creeks inside the forest don't dry up and aquatic life doesn't die off.

McInnis's reaction to this has been vitriolic. "Let me be clear: The Forest Service will not establish a national bypass flow precedent on the White River National Forest without a political fight from me and a likely legal challenge from Colorado water users," he wrote in his letter to the Forest Service. He and his allies claim that Colorado water law already assures a constant flow of water in forest streams and that the federal government has no authority over state waters. The hundreds of water lawyers based in Denver are proof of the volatility of water issues in the West, and legal wrangling over the Forest Service proposal could go on for years.

"Folks who don't like the Forest Service policy on in-stream flows are acting like this is a big water grab," says the Wilderness Society's Jones. "It's not. The Forest Service is just saying we need to have a stream here. It's as simple as this: Do you want your trout streams to have water in them?"


At the start of the twentieth century, Republicans were leading the charge to protect the West's forests.

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