Two years after Mayor Wellington Webb tried to sell the Winter Park ski resort to the Winter Park Recreational Association for as little as $24.5 million, an appraisal commissioned by the city itself has valued the resort at nearly three times that amount.
The Webb administration won't make the appraisal public, although it was completed more than four months ago. But Denver parks manager Bruce Alexander has given a copy to the WPRA.
Alexander, who served as the ski area's private banker before being appointed to the Webb cabinet, says he gave resort officials the appraisal in order to live up to a deal cut with the WPRA. Under that agreement, which Alexander describes as "perfectly reasonable," the Webb administration agreed to let WPRA officials delete "confidential information" from the document before it is released to the public.
The appraisal, performed by Hospitality Valuation Services at a cost of $40,000, was paid for entirely with public money.
Denver owns the Winter Park ski area, which is operated by the WPRA as an agent of the city. But in 1993, Webb, Alexander and City Attorney Dan Muse cut a secret deal to sell the highly profitable resort to the WPRA, whose $193,000-per-year president, Gerald Groswold, contributed to Webb's 1991 campaign.
Under that privatization plan, ultimately rejected by the Denver City Council, the ski area could have bought the resort for $52.7 million over a period of sixteen years. Analysts in the city auditor's office, however, said a loophole would have allowed the WPRA to take ownership for just $24.5 million if it paid cash.
In its 1994 financial report, the WPRA reported that the ski area had a "fund balance"--an accounting term that reflects its net worth--of $36.7 million.
In their initial purchase negotiations with the WPRA, Webb officials relied on an earlier appraisal commissioned by the resort itself. That drew fire from critics such as parks advisory boardmember Tony Trampler, who pressured the administration to have its own appraisal done. "You don't take the buyer's appraisal and say, `Yeah, that sounds good,'" says Trampler. "That's what the city was ready to do."
Now vice-chair of the parks advisory board, Trampler says he's been eagerly awaiting the release of the city's appraisal ever since. According to Trampler, Alexander told him late last year that Denver's appraisal had been received and that it put the value of Winter Park at $69 million. Alexander says that figure is "about right," but he refuses to provide a copy of the appraisal to Westword.
The appraisal's release has been held up not only by the WPRA's review of the document, Alexander says, but by his own request that the appraiser go back and add "a lot of information and statistics." The accumulation of that data will help the city and the WPRA plan for development at the ski area, he adds.
Development at Winter Park has long been a goal for Alexander, who as president of the old First National Bank personally approved a $7.5 million line of credit for the WPRA in 1979. He has strongly supported the WPRA's longstanding wish to take the resort private. But now that that option appears politically infeasible, Alexander has focused on helping his old friends at the WPRA turn Winter Park into a destination resort complete with modern hotels, restaurants and other skier amenities. He and Webb took a major step in that direction last year when they agreed to give the WPRA ninety acres of city land and allow the resort to develop it through a real estate subsidiary.
While Alexander has been sitting on the $69 million appraisal, Webb has been using Winter Park as one of his chief campaign issues. The mayor has trumpeted the fact that under the terms of a new lease agreement signed in May 1994, the city now receives roughly $1 million per year from the ski resort, plus 3 percent of the WPRA's total revenues. Webb hasn't mentioned that the new arrangement was reached only after critics blasted his secret deal and councilmembers balked at putting a charter amendment on the ballot authorizing the city to sell the resort.
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And though Webb has emphasized the increased revenues that resulted from the 1994 agreement, he has downplayed a clause in the same document that smooths the way for the transfer of ninety acres of city land worth approximately $7.5 million to the WPRA. That land includes the Vintage Hotel, a privately owned luxury resort that was built on public property under a 1982 lease approved by the WPRA.
Though the WPRA is legally an agent of the city, it has sued Denver in Grand County District Court in an attempt to get its hands on the ninety acres without having to put the matter to a public vote. That "friendly" lawsuit is still pending.
The only public entity that has aggressively opposed the WPRA's various maneuverings has been the Moffat Tunnel Commission, an obscure state agency that owns the land on which the ski area's base facilities are located. Earlier this year, the tunnel board sued the WPRA in an effort to void a 98-year lease, negotiated by a previous panel of commissioners, that allows the ski area to operate on the commission's land without paying rent. Winter Park responded by backing a bill in the recent legislative session that would have abolished the tunnel board outright. Despite vigorous lobbying by the ski area and the Webb administration, the bill stalled in the state Senate.
Bruce Alexander now says he expects a copy of the city's Winter Park appraisal to be made public "sometime in the middle of June"--presumably sometime after June 6, the date of the runoff election in the mayor's race.