Choteau resident Charles Hlavac, the former manager of the Teton Pass Ski Resort, has purchased the ski area west of Choteau from owner Nick Wood of New Zealand and several other investors.
Hlavac, who managed the ski area from 2010 to 2017, announced on Sept. 6 that he had completed the purchase of the ski area assets through a contract-for-deed with Wood’s resort company and hopes to be able to open the ski area, located on the Helena-Lewis and Clark National Forest about 25 miles west of Choteau, for the 2019-20 ski season.
Hlavac said he is at the beginning of this process and does not want to get ahead of himself. “I want to approach this with humility and caution,” he said. “We have a tremendous amount of work ahead of us, from generators to websites.”
Wood who purchased the ski area in 2010 and invested in a major renovation of the lodge and facilities closed the area in December of 2017, saying the resort did not make money, and he and his partners, after suffering other financial setbacks, could not afford to open it for the 2017-18 season. He said the facility’s electrical generator failed in the 2016-17 season and would cost hundreds of thousands of dollars to replace.
Wood listed the ski area for sale, originally asking $3 million for the resort, operated on a 402-acre forest special-use permit. The resort includes three lifts, a lodge with a restaurant and liquor license, a ski gear rental shop and several outbuildings. Wood later dropped his asking price to $375,000.
The Choteau Area Port Authority (CAPA), a city-appointed board that works to promote economic development, sponsored meetings in Choteau to gather people interested in getting the ski area open again. The CAPA also secured a $66,000 federal grant to fund a feasibility study on different models for operating the ski area.
Consultant Claire Humber with SE Group, the engineering and consulting firm that won the contract to do the study, said the ski area could comfortably accommodate 530 guests per day. The last season it was open, she said, the use rate was only 17% where it would need to be at 25% to 35%.
A ski area this size should be generating about $500,000 in revenue, paying out about $400,000 in expenses and have about 15,000 skier days, she said, noting that the season-high of 7,000 skier days is less than half of what would be needed for financial stability.
Hlavac said he is looking forward to operating the ski area even though he is aware of the financial difficulties.
“My vision for the future of the ski area is that we need to go through a growth period. And I believe that starts with becoming sustainable,” he said. If he is successful in getting the ski area operable this season, he said skiers will likely see similar services to the last year that it was open. He has ideas for changes in the future, but time is too short to do them this fall.
He said he would focus on improving efficiency in the operation of the ski area, would work to grow community support and build the business to bring in more skiers. Future improvements could include additional chairlifts, but all future development will be done in a responsible, sustainable way, he said.
One big change already in the works is a new name for the ski area. There is already a Teton Pass ski area in Wyoming. Having two ski areas with the same name confuses skiers and hampers marketing, Hlavac said, adding, “We look to solve a little bit of that and to get a fresh start.”
Hlavac, who has been a board member and vice president of the Montana Ski Areas Association, has worked with many other ski area managers and owners and he has a huge amount of respect for the individual owners of several Montana ski area. He said his interest in Teton Pass is rooted in his desire to keep the ski area open. He said he’s not seeking financial rewards but wants the area to become sustainable.
“I do believe that Teton Pass can stand on its own two feet, operate in the black from year to year and be a small ski area that supports the employees who live and work and want to ski here and all the people who want to ski here,” he said.
He plans to explore possible summer operations and knows he may have to subsidize operations with revenue from his other two businesses.
And, he hopes he has some community buy-in and help. He reached out last week to the Choteau Area Port Authority and the cooperative steering committee group.
He said he is also considering the information put out in the comprehensive feasibility study by SE Group and has contacted the new nonprofit, Friends of the Teton, established to help the future operators of Teton Pass in anyway it can.
Hlavac came to Choteau as a 15-year-old and worked at Teton Pass through high school, starting in 1999. After graduating from Choteau High in 2003, he attended Montana Tech, earning a bachelor’s degree in mechanical engineering in 2007. He then worked full-time for the USFS in multiple western states and spent two years working as a civilian aerospace engineer for the U.S. Navy in San Diego, California, before returning to Choteau in 2010.
“I have a long history with Teton Pass and a long history with a love for winter sports,” Hlavac told the Acantha. “Throughout my time there, I’ve always felt a passion for it, and I could see the untapped potential.”
Through his engineering degree, he discovered a small niche in the engineering industry of engineers who build and design chairlifts for ski areas. That vision brought him back to Choteau to work for Wood.
“I really came to love Choteau,” he said. “I took that opportunity and ran with it, and found out that I really enjoy management, which was something I never thought I would.”
Hlavac said as soon as Wood put the business up for sale, he was interested in buying it but the $3 million price tag was well beyond his capacity. When Wood lowered the price, the possibility of ownership became more feasible. Hlavac opened his own business as a tree trimmer (Wind Mountain Tree Service) and started another business, Steepwater Engineering, consulting on chairlift design and installation for ski areas. And he saved his pennies.
“When the decision was made to close the operation two years ago, I basically started a long, arduous process of trying to figure out how I could financially pull this off,” he said.
Hlavac said there are substantial hurdles that have to be resolved before the ski area can open. The next step, he said, is to work with the USFS to obtain a new 40-year special-use permit for the ski area.
Wood holds the current 25-year special-use permit but the permit does not transfer with the sale of the ski area’s assets.
There are a few complications to that process, however. As the existing permit holder, Wood is responsible for cleaning up a diesel fuel overfill that happened at the ski area in 2013, but was not reported until the fall of 2018, by a former ski area employee.
Hlavac said he would work with the USFS and the Montana Department of Environmental Quality to assess the overfill, determine a remediation plan and do the cleanup. “We’re going to follow whatever DEQ says to do in the way of mediation,” he said.
Secondly, he said, he is working with the USFS and the federal Bureau of Alcohol, Tobacco and Firearms to establish that avalanche control rounds found in the upper reaches of the ski area by a hiker last summer are not unexploded dynamite. The USFS has closed the ski area to public access because of concerns about unexploded rounds and has brought the ATF in to investigate.
Hlavac said he has turned over the records of the ski area’s avalanche control program to the ATF and those records will show that since 2010, when Wood purchased a device called an Avalauncher, all explosives are accounted for and there are no unexploded rounds on the slopes.
What is on the slopes, Hlavac said, are dozens of inert rounds used every winter to sight in the Avalauncher. These inert rounds are filled with plaster or sand, he said.
Hlavac said he understands the USFS is acting with utmost caution to make sure no human life is endangered, and he will work with both federal entities to resolve the concern.
He also said that as the new owner, he will work with the USFS on any other concerns about how the ski area is operated. Since the fuel overfill in 2013, he noted, he had an automatic shut-off valve installed on the fuel dispenser.
USFS Rocky Mountain District Ranger Mike Munoz met with Hlavac on Monday and said they had a positive conversation to start the special-use permit application process. “It’s exciting news,” he said.
Munoz said the USFS is also working with Wood to resolve the fuel overfill and the avalanche control rounds issues as soon as possible. The public closure of the ski area will remain in effect until any threat to public safety has been addressed, Munoz said, and the new special-use permit Hlavac is seeking will have provisions for managing avalanche control using this device.
The ranger said he hopes to be able to give Hlavac an exemption to the closure so that he can bring in the engineers and inspectors needed to get the chairlift running in compliance with federal safety codes.
Munoz said he believes that at least one of the rounds the USFS found had explosives in it. Most of the rounds identified so far have been above North Gully in the upper reaches of the ski area. “We are going to take that with grave concern,” he said.
Munoz also had more good news: The federal government has approved funding to rebuild the first three to four miles of the North Fork Teton Road from the USFS boundary west. Construction would likely occur in the summer of 2020.
Once Hlavac obtains the permit, he will have to purchase and install a new diesel generator to run the ski area, maintain the chairlift and have it recertified for compliance with appropriate federal safety regulations, do maintenance on the slopes and prepare the lodge and outbuildings for operation.
He would also begin advertising for staff, and, he hopes, have a few volunteer work days where ski enthusiasts can come and help with some of the slope work.
CAPA Chairwoman Mary Sexton, who has been facilitating the steering committee looking at forming a cooperative, said Hlavac has reached out to the group. “We wish him well,” she said.
The steering committee group plans to continue meeting and move forward with developing a business plan. She said they would be more than happy to work with Hlavac as there could come a time in the future when having a cooperative would be useful.