Less than two years after signing a $2.2 million lease-purchase agreement with DK Consulting, Westlock County will now enter into an operator’s agreement with the company to run the Pine Valley Ski Resort until 2018.
Councillors voted 5-1 following an in-camera session Feb. 28 to sign the new agreement, which will be in place until September 2018.
This agreement will see the county pay DK Consulting an undisclosed amount of money and replaces the previous three-year agreement signed in December 2015. DK Consulting owner Dom Kriangkum signed the new agreement within the last two weeks, county reeve Don Savage said.
“That’s one major change. That means that the individual corporation is managing it as an operator and no longer holds lease rights,” said chief administrative officer Leo Ludwig, who would not say how much the county is paying DK Consulting.
He added that the purchase option of the previous deal was also removed.
“To put it bluntly, the original arrangement was set up almost to fail,” Ludwig said.
Savage said the taxes Kriangkum had to pay on the building, which were required under the MGA, were “outrageous,” considering he could only operate three months of the year due to the short ski season.
“Dom had to have something different. It was not affordable for him. It’s Tawatinaw and the traffic isn’t out there and he couldn’t afford to pay. It added up to be a lot of money every year just to pay in taxes and rent.”
Ludwig confirmed that the outstanding arrears owed on taxes and rent had been handled in the negotiations and were no longer an issue. DK Consulting’s payments on the property to the county had been suspended in June because of the arrears, but were reinstated in December.
Financial statements presented to county council Dec. 22 showed that the ski hill has an annual rent of $18,000, plus property taxes.
Ludwig explained that because it’s now operator’s agreement, the land has reverted back to its non-taxable status. He noted that the original contract with DK Consulting had not been terminated, so there was no reason to put the operator’s agreement up for tender.
“This was a change to an existing contractual arrangement,” he said. “The original contract was done through public process.”
The CAO declined to comment on whether the county would release details of the agreement, including how much the municipality is paying DK.
“I’ll have to look at that and see where the Freedom of Information and Protection of Privacy Act (FOIP) applies and where it doesn’t apply,” he said, adding that DK will also receive the lift fees and any money made at the concession.
When reached by the Westlock News, Kriangkum declined to comment.
Coun. Bud Massey, who was the lone vote in opposition, requested the recorded vote. Coun. Mel Kroetsch was absent from the meeting.
“I voted against the deal because I did not think it was a good deal for the ratepayers of Westlock County,” said Massey.
“I believe that the taxpayers of Westlock County are tired of spending more and more money and government’s willingness to treat them like a bottomless money pit.”
Massey said that details of the agreement should be made public.
“Everything is supposed to be public record,” he said. “Council does not have the right to operate behind closed doors. The people have a right to know how their money is spent.”
Ultimately Savage expressed relief that the county was finally able to get an agreement signed.
“Tawatinaw is a very important part of our recreation plans. In reality the Municipal Government Act (MGA) dictates that we spend five per cent of our budget on leisure time,” he said.
We all have to realize that it’s not 10 miles out of St. Albert. It’s there to serve people of more than one county. I feel that it’s a very beautiful ski hill and I believe that a lot of our taxpayers are proud of having it there.”
Although the ski hill has always been owned by Westlock County, a volunteer group operated it until 2006.
Westlock County then took over management of the Tawatinaw Valley Alpine and Nordic Centre as the volunteer board folded.
The county then contracted a private business to run facility until 2015 when the lease-purchase agreement was signed with DK Consulting.
Savage suggested that the county was filling a void left by a lack of volunteer participation.
“Tawatinaw built the hill as part of their 100th anniversary celebration. That was their centennial project, in 1967. What’s happening is what’s happening in a lot communities. We sold the hall off to Dom. There were no board members left and it was decided to sell the hall back about 15 years ago.
“The same thing happened with the ski club, that’s why the county ended up with it.”
Ludwig echoed Savage’s concerns.
“Volunteers are a lot harder to come by for a lot of projects, not just in Alberta,” he said.
“The demands to run facilities keep coming down, so a lot of these smaller rural facilities have had to find different ways to survive.”
With winter almost over, Ludwig predicted that council would look at potentially working on the resort over the summer months.
“Probably in the spring or early summer we’ll look at any proponents for further operations or there could be other things that happen between now and then that council may look at for options going forward,” said Ludwig.
