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Hermitage avoids shutoff of utilities
The Hermitage Club paid its outstanding water and sewer bills.
KRISTOPHER RADDER - BRATTLEBORO REFORMER
Posted
Sunday,
January 7, 2018
4:45 pm
WILMINGTON — The Hermitage Club averted having its water and sewer services shut off at various properties by making a payment of past-due fees the day before a scheduled appeal hearing.
"Just received payment in full from the Hermitage, with a request from them to cancel tomorrow's appeal hearing," Cold Brook Fire District Administrator Kimberly Hicks wrote to the Reformer at about 2:30 p.m. on Friday.
The Hermitage runs a private ski resort at Haystack Mountain, a golf course, and inns and restaurants in the Deerfield Valley. The company owed Cold Brook about $87,000 for outstanding water and sewer bills going back six months.
The Prudential Committee, which governs the Cold Brook Fire District, expected to have an appeal hearing Saturday morning. An attorney for the Hermitage requested the appeal hearing after the company missed a deadline Wednesday to make the delinquent payments. The company's finance director had asked whether a minimal payment could be made. Citing Vermont statute, Hicks pointed to an appeal hearing as the only way to avoid shutting off the services.
Select Board Vice Chairman John Gannon, who is also a state representative, told the Hermitage a shutoff might be more expensive than the company understood because it would also shut down the fire suppression system.
In October, the Hermitage's financial struggles were blamed on poor weather during the 2015-2016 winter season and a slow membership drive. Membership dues have not been sufficient to cover operating costs and real estate operations were subsiding those costs, company officials had said.
Members were asked for a one-time due of $10,000 to help pay off vendors. Last month, company founder and CEO Jim Barnes reported having collected 75 percent of those dues.
Last week, Hermitage Finance Director Chad Bullock said the company is "working through all our payables."
by
Mike Eldred
view slideshow (2 images)
WILMINGTON- After a weekend of valley-wide speculation about the continued operation of the Hermitage Club, the private resort has curtailed operations and laid off 15% of its workforce.
According to Hermitage Club officials, the cutbacks are connected to this week’s warm weather, which nearly reached 70 degrees on Wednesday.
“The Hermitage is open for business,” said Hermitage Club Director of Public Relations Meridith Dennes. “The mountain will be closed midweek due to weather, and there has been a reduction in force appropriate for the services being offered.”
The speculation began on Friday, when word leaked that Hermitage Club employees were told not to cash their checks until Tuesday. A local Hermitage Club employee, who requested anonymity out of concern for possible workplace retaliation, confirmed the information. “We were told we had to hold our paychecks until Tuesday,” the employee said. “And that’s not OK for everyone, people have kids to feed.”
The news spread fast and, according to the local employee, members were upset, not only that the club’s continued operation was up in the air, but also that employees’ compensation was in question. “It was a very sad day,” the employee said. “I heard about one member who went around giving ski instructors $100 bills because he was so distraught and didn’t want to see the club go down. A lot of members cleaned out their lockers and took their equipment home because of the uncertainty. Members were hugging employees. The worst part was getting hugs from children who don’t know if they’re going to be back again. There’s a real sense of community here.”
An international employee working at the Hermitage Club on a temporary visa contacted The Deerfield Valley News, concerned that she was unable to cash her paycheck for the two-week pay period, and unsure of her employment. “I feel I am without a voice and now, it appears, without my hard-earned work compensation.”
In October, the club levied what they called a “one-time membership dues adjustment” of $10,000, effectively doubling dues for 550 members. At the time, the $5.5 million raised through the charge was said to be earmarked for vendor debt repayment, property tax payments, and operations.
The $3,000 dues charge to 550 members would raise an additional $1.65 million. However, Gannon said that, based on the reaction of members at the meeting, it appeared unlikely to succeed. Another source said members reacted to Barnes’ proposed $3,000 payment with raucous abuse, shouting accusations and demanding accountability.
Club officials declined to comment on the prospect of any offer for the sale of the club. Gannon says he fears the strategy is intended to counteract pressure from a sub-group of club members who have had their offers to purchase the club rebuffed by Barnes.
“As I understand it, the group of members have been trying to reach a deal for months and have made a number of proposals,” Gannon said. “I worry that an untenable offer is setting members up for the fall, to blame us when the club goes bankrupt and people don’t get paid.”
On Tuesday, Dennes said that payroll had been met, and employees were able to cash their checks, as they had been promised on Friday. A local employee confirmed that their paycheck was, eventually, cashed on Tuesday. “I got to the bank after 9 am on Tuesday and there was already a long line,” the employee said. “By the time I got there, the account was depleted, but later we were told to go back, and everyone I talked to was able to cash their check by the end of the day.”
On Wednesday, the Hermitage Club announced that it would be closed midweek due to unseasonably warm temperatures, and that 15% of the workforce had been laid off. The club also said that contracts with workers who have J1 and H2b visas would be honored. According to unconfirmed sources, however, international workers were among those who were eliminated, and one source suggested that their contracts do not guarantee employment for any specific time period.
According to Dennes, the club will provide support to individuals affected by the workforce reduction.
“The club will work with the local labor force who have been impacted by the restructuring,” she said. “We have brought in people from the Department of Labor to make sure people get placed in a timely manner. We’ll do everything to make sure individual needs are met in the interim. We care deeply about our employees, and understand the impact.”
Read more: Deerfield Valley News - Cash flow weather woes force Hermitage Club cuts
By Mike Eldred
WILMINGTON- Berkshire Bank filed a foreclosure complaint against the Hermitage Inn Real Estate Holding Company, the Hermitage Club, and Hermitage owner James Barnes in Windham Superior Court Friday afternoon.
Hermitage Club officials said that the bank's action was anticipated, and suggested it could spur ongoing negotiations. "This was fully expected and it is the next logical step in a process that will assist to bring all parties to the table to reach accord," said Hermitage Club public relations director Meridith Dennes. "We believe it was needed and will help us to reach an agreement that will ultimately benefit all stakeholders."
Berkshire Bank is seeking foreclosure on several Hermitage properties including the Hermitage Inn, Haystack Ski Resort and ski area lands, Haystack Base Lodge, Haystack Golf Course, Chamonix Townhouse Village, Haystack Golf Course, water rights to Mirror Lake, hundreds of acres of land, along with several smaller parcels. The foreclosure action also includes the Snow Goose Inn, the Horizon Inn, and the Doveberry Inn.
According to the complaint, Barnes and the Hermitage failed to meet their obligation to make payments on three loans, including a $15 million "base lodge" note signed in December 2014, a $1 million bridge loan in June 2016, and a second bridge loan of $1.1 million made in July 2017. Of the total $17.1 million in loans, the Hermitage and Barnes still owe $16,342,175.61 in principal, along with $213,799.76 in interest, and $43,603.79 in late charges.
The bank's complaint also notes that "all taxes, assessments, and other charges" on the mortgaged properties must be "paid current," and any unpaid taxes or other debts owed on the properties "become additional indebtedness owed by (the defendants)." According to Wilmington officials, checks presented for Hermitage property taxes on February 23 failed to clear, and property taxes due previously are delinquent. The failure to pay taxes on the properties "is a default under the mortgage, among other loan documents, by Hermitage Inn Real Estate Holding Company LLC, Hermitage Club LLC, and James R. Barnes."
The action also lists as defendants, along with Barnes and the Hermitage, about 45 individuals, businesses, and government entities that have filed liens or writs of attachment against Hermitage Club properties totalling more than $9.7 million. The amount includes a $1.5 million writ filed by Reinhart Food Service, two $1 million writs filed by individuals for residential properties, and $1.2 million in liens filed by the Vermont Department of Taxes. According to Berkshire Bank's complaint, the 45 creditors' claims are "junior and inferor to that of (Berkshire Bank)."
Boiler plate language in the complaint warns occupants of the properties that their right to remain on the premises may end when the foreclosure is completed.
Read more: Deerfield Valley News - Bank files for foreclosure on Hermitage properties
Ah! That might explain it.
State of Vermont Shuts Down The Hermitage Club
March 20, 2018Peter
Landsman5 Comments
Notices
posted on buildings at America’s second largest private ski resort are
clear. “Please take notice that Hermitage Club LLC failed to post the
bond required by the Vermont Commissioner of Taxes…and may not conduct any
business at this location.” News of the closure comes less than a month
after a Massachusetts bank filed a $16.6 million foreclosure complaint related
to three separate loans now in default.
The
Hermitage Club features one of only five bubble chairlifts with heated seats in
the United States. It opened just over two years ago.
The Hermitage owes the
State of Vermont more than $1 million in rooms, sales and meals taxes.
The two parties had been operating under a payment plan that allowed the ski
resort to open on weekends this winter. A $112,000 payment wired to the
state on Friday was enough to keep the lifts spinning until Sunday. A
note to members posted at the club yesterday says, “We are working diligently
to secure the funds to allow us to open for this coming weekend and will keep
you posted.” The local newspaper references some employees who said they were
escorted from the property by police. I can only imagine the frustration
they must feel losing their jobs after months of uncertainty.
Opened in 2011 on the
site of the defunct Haystack Mountain ski area, the Hermitage Club currently owns
a 2015 Doppelmayr bubble high-speed six place lift, two recent Skytrac quads, a
1985 Poma triple and a 1987 CTEC triple. As I wrote a few weeks ago, lots of legal maneuvering likely
lies ahead and many of these lifts could find new homes in the event of a
liquidation.
· If no
one purchases the Club, a la Tamarack or Spanish Peaks, the lifts will probably
be auctioned to cover debts. Someone’s going to get a steal on Barnstormer if
that happens.
If the club is
liquidated, Barnstormer would be the PERFECT replacement for the Barker
Mountain Express at Sunday River, and with Boyne reacquiring full ownership,
that could become a reality. That would be awesome if they could make out like
a bandit and grab Barnstromer for a fraction of the cost when new, truck it
over to the river, and use it to replace the aging Barker Quad, which as of
recently can only run at 700 fpm MAX and has become far too unreliable to be
one of SR’s main lifts.
Barnstormer could also be
used at Jay Peak to replace the Bonaventure Quad and provide a different
enclosed lift to get marginal skiers off the tram that have no business being
on that terrain.
The Barker lift at Sunday
River needs to go. 700 fpm is just too slow. Especially for one of the busiest
lifts on the mountain. But I think Boyne would rather just buy a brand new lift
than a re-tread.
I doubt anyone is going
to purchase the club and assume all debts. 16mil is a lot and the club has not
once been profitable.
Around the Valley, I have heard a number of people, "who heard from a friend of a friend of a friend who is the 2nd cousin twice removed from X at Peak" type rumors about Peak buying the Hermitage.... Nothing more concrete than that, and nothing like the multiple times that Peak management have said "no" when flat out asked if they're buying the Hermitage...