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Posted: January 28, 2009

Ski industry faces challenges from all sides

It’s not just the economy

Edyn Jessup

When people think of Colorado, snow-capped peaks and dreams of skiing through untracked powder often come to the forefront of their minds. The ski industry is not only of central importance to our state's identity, but it is also a driver of the state's economy, bringing in a huge portion of Colorado's tourism dollars.

Like all sectors of the U.S. economy, the recent economic downturn has adversely affected the ski industry (from real estate and commercial development to vacation rentals and ticket sales). By now, we've all heard countless bleak reports on the economy and its effects on various industries. Aside from the economy, what are the other hot issues that are facing the Colorado ski industry today?

Climate change
Stemming carbon dioxide emissions and forestalling global warming is a huge priority for Colorado ski resorts, which rely on a consistent climate and steady snowfall for their livelihood. It is predicted that climate change will drastically affect the state's ski industry over the next 50 years, reducing snowfall, raising the snowline and increasing needs for snow-making operations.

Consequently, U.S. ski areas are lobbying Congress for a mandatory CO2 cap to slow global warming. In addition to lobbying activities, ski resorts are taking an active role in greening their own industry, investing in renewable energy credits and implementing recycling programs.

According to the National Ski Areas Association, more than 60 resorts across the country are investing in renewable energy credits to offset the energy used in their operations and their CO2 output. Resorts are also instituting recycling programs (which often present challenges to resorts in remote areas without recycling facilities), and many participate in the "Sustainable Slopes" program, championed by the NSAA.

Immigration
Colorado ski areas were hit hard by the reduction in H-2B visas, which are visas for intermittent or seasonal employment for skilled and unskilled workers. In September 2007, Congress failed to renew an exemption in the H-2B visa process for returning workers, which drastically cut back on the number of visas available.

Colorado ski areas, which have typically used foreign workers to fill many of their seasonal winter jobs, including ski instructor jobs, felt the crunch. Ski areas have begun taking advantage of the Q Visa, a cultural exchange visa, to bring workers into the country.

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And this is one area where the bad economy may be helping, as American workers are more willing to accept seasonal jobs when faced with rising unemployment rates. New recruiting tactics have provided ski resorts more luck when staffing from the local work force. As the economy picks up, however, the ski industry will be closely watching and weighing in on the immigration debate.

Terrain parks
Another key concern for ski resorts around the world is balancing the competing considerations of popularity and safety with respect to terrain parks. The popularity and variety of terrain parks have increased in recent years, as have the lawsuits associated with them.

In the spring of 2007, a jury awarded $14 million to a skier paralyzed in a terrain park accident at Summit at Snoqualmie, Wash. To combat these huge liabilities, resorts are looking at ways to make their parks safer by assessing park design and changing snow conditions and by warning users of the risks.

One Canadian company, Resorts of the Canadian Rockies, has even eliminated all jumps in its terrain parks this season to meet safety concerns. While Colorado's Ski Safety Act includes terrain parks in its list of inherent dangers of skiing, providing a safer experience for terrain-park users is still a key concern for many areas.

While it is difficult to predict how Colorado ski resorts will ultimately resolve these issues, environment, immigration and skier safety challenges are sure to be hot topics over the coming years as they try to preserve and grow an industry that is central to the state's identity.

See you on the slopes!

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Edyn Jessup is an attorney with the Boulder office of Holland & Hart LLP.  Ms. Jessup’s practice focuses on real estate finance and development transactions including resort development work.  She can be reached at (303) 473-2708 or eejessup@hollandhart.com.

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