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Audit finds problems with Cannon Mountain Ski Area

  • Skiers enjoy a quiet weekday ski at Cannon Mountain Ski Area in Franconia in 2008. AP file



Monitor staff
Monday, February 15, 2016
State-owned Cannon Mountain Ski Area lost $27,000 in sales when it failed to fix problems with its credit card billing system in 2013, failed to take advantage of “over one third of the discounts to which it was entitled” from vendors in 2014 and operated its internet e-commerce system, which generated some $800,000 in annual sales, partly through the password and username of an employee who had left the company.

The area also had limited information about how many free ski passes were given out and about highly discounted season passes designed for employees and other “team members,” even though such passes constituted almost one-fifth of season passes sold in 2014.

Those are among the findings of a state audit of the iconic ski area’s operations. The state audit led to a series of recommended changes to the ski mountain’s operation, some of which are covered by a proposed new law, but it didn’t trigger an avalanche of outrage.

“There’s no skullduggery that we saw. We’re trying to clean up procedures,” said Rep. Chris Christensen, a Republican from Merrimack and chairman of the House Resources, Recreation and Development Committee. That committee has recommended the full House pass House Bill 1172, “relative to corrective action implementation of audit findings concerning Cannon Mountain.”

“There was no evidence of any inappropriate activity. It’s more a matter of if you do things this way, we can track better,” Christensen said.

The government performance and financial audit for the fiscal year from July 1, 2013, through June 30, 2014, was released last summer. It was the first such audit done since 2002 for Cannon Mountain, which is operated as part of the state’s parks system.

The audit reports that the state concurs with the findings, and describes a number of steps that are being taken in response. It can be read online.

Among the issues raised by the audit was a lack of oversight of free ski passes, or discounts for employees and others.

“Cannon Mountain does not accumulate, track, analyze, or report information about special daily and seasonal passes that are issued at no cost,” said the audit, performed by the Office of Legislative Budget Assistant.

The audit said that last winter the mountain issued 731 passes to employees and volunteers for $25 or less, making up “at least 18 percent” of total season passes, yet couldn’t provide a list of who received them. The audit said Cannon also sold “an unknown number” of season passes at a 50 percent discount.

The audit also says it found weakness in oversight of benefits for seasonal employees, who are the bulk of Cannon’s employees, and in oversight of an agreement with Franconia Ski Club to raise money and perform improvements related to Mittersill, a backcountry ski mountain bordering Cannon Mountain.

The major actions of the bill resulting from the audit are to change reporting schedules on some ski area funds and eliminate a position of marketing and ski service administrator, which had been mandated by the Legislature in the past.

“It was created by the Legislature some years back and the Legislature doesn’t really, most times, create positions like that – they should be at the discretion of the commission of the department, and a budget function,” Christensen said.

“Over time things change, you spend money in different ways, systems put in place by the Legislature aren’t always able to keep up. . . . For example, if we had to set the rate for ski passes in the law every year, we could never keep up. Bringing rules up to date through the audit process is the best way to handle this,” he said.

The bill also removes “Mount Sunapee” from the existing law, a reflection of how long it has been since the law changed: The state stopped operating Sunapee in 1998, when it leased that ski area to a private company.

Christensen commented that some issues raised by the audit are long-standing, such as loose controls over passes.

“I grew up skiing at Cannon Mountain because it was a bargain” back in the 1960s, he said. “If you were a legislator, back then your family could ski for free. I had a friend whose father was in the Legislature” and Christensen made frequent use of that pass.

Since that time, the law was changed: Legislators no longer get free passes.



(David Brooks can be reached at 369-3313, dbrooks@cmonitor.com, or on Twitter @GraniteGeek.)