Page AZ — Terrace Standard, Wednesday, May 2, 1990 TERRACE — Here's a breakdown of the regional district-Shames Mountain Ski Corporation proposal to convert the debt the latter owes into shares in the com- pany, * The regional district in the 1980s bought a lift and other equipment and opened up a ski operation on Kit- sumkalum Mountain. * That meant borrowing money through a debenture. Security for the debt came from the lift and other equip- ment. The debt won’t be paid back until the year 2000 and there is still $456, 000 outstanding. - ® The operation never made money and was closed by referendum in 1986. * Also in that year the Shames Mountain Ski Cor- poration bought the equip- ment for use. on Shames Mountain. The purchase price of $313,000 (it later rose to $322,000) was ta be paid back in annual -in- stallments. The debt is secured by a debenture on the equipment and on other assets of the ski corporation. ® Those installments were meant to help pay down the Ski deal story in point form regional district debt for the equipment, e The Shames corporation, except for one small pay- ment, did not meet the an- nual schedule, It has been renegotiated three times. ® Also owed by the corpora- tion is $94,000 in interest. * The proposal by the. Shames corporation would turn the debt into equity. by issuing shares to the regional district. This means’ the regional district would give up its security on the debt. The ski company also wants the interest forgiven. * Regional district directors from Terrace, Kitimat, Thor- nhil! and the rural area stret- ching south of Terrace must approve the proposal. That's because taxpayers in those areas are directly paying for the original district debt and because payments from the Shames corporation were to help pay down that debt, © The debt-to-shares pro- posal, as well as the proposal to forgive the interest payments, must first be ap- proved by the provincial government before the tegional district can vote. Directors favour TERRACE — The Shames Mountain Ski Corporation shares-for-debt proposal with the Kitimat-Stikine regional district appears certain judging from responses of district direc- tors. A poll of electoral area direc- tors indicates Les Watmough and Gordon Robinson will find themselves on their own in op-. posing the swap. It is still sub- ject to approval by the municipal affairs ministry.. - Kitimat and Terrace councils have already passed resolutions of support guaranteeing 12 favourable votes — double the number Watmough and Robin- son have between them. The re- maining directors responded as follows: Alice Maitland (Village of Hazelton - one vote) — Holding shares in Shames at least offers the possibility the communities which are paying off the Kit- sumkalum debt will get their money back and maybe more. "Ie seems like a good idea to me,”’ Harry Nyce (Nass Valley - one vote) — Development of a ski hil would be a good thing for the entire area and he therefore supports the project. How voting works TERRACE — The regional district will have to take two separate votes amongst its board members to approve the deal to change the Shames Mountain Ski Corporation debt into shares. The first of the votes, said district administrator Bob Marcellin, would be held bet- ween the four areas responsible for the debt incurred when the regional district bought equip- ment for its now-closed Kit- sumkalum ski hill. This vote is necessary because the equipment was subsequently sold to the Shames Mountain Ski Corporation. Money from that sale was to go to paying down the original Kitsumkalum debt. Although the Kitsumkalum operation closed in 1986, the regional district's debt for the equipment won’t be paid off until the year 200). Those four areas responsible for the original Kitsumkalum debt are through yearly payments by taxpayers are Kitimat, Terrace and electoral areas C (south of Terrace) and E (Thornhill). Kitimat and Ter- race both have two represen- tatives each on the Kit- sumkalum debt committee and the electoral areas one each. Given Kitimat and Terrace councils have both indicated | they are prepared to support the proposal, it appears certain the function’s recommendation will be to accept the swap, The second vote involves the entire regional district board as although the four areas are directly responsible, the entire district is liable and must ap- prove the deal, said Marcellin, He said directors will cast ballots based on the ‘weighted vote’’ system which gives one vote for every 2,000 population - or part thereof (1,999 people means. | vote, 2,001 means ~ two), . That gives each Kitimat and Terrace director three votes for a total of 12 between the two. communities. Electoral areas C, — E. and .B (Hazeltons areca’ | fem reserves) also have three votes each while the remaining five directors have one each for a total of 26. The municipal affairs ministry must approve the debt- to-shares. arrangement before it can be voted upon by the regional district. TERRACE - — - Following an im- passioned. plea by Shames Mountain Ski Corporation president Gerry Martin, Terrace council has decided te support a proposal ‘that would see the company pay off Its debt to the regional district with shares.” In doing so, aldermen. revers- ed an earlier committee of ‘the whole recommendation ~ the regional district instead agree to assist the corporation through yet another restructuring of the - debt repayment schedule, Expressing Shames’ “(disap- pointment’’ with ‘that recom. . mendation, Martin accused the city of dragging its feet and fail- ing to adequately support the corporation’s efforts to establish the facility. Martin said the shares for . debt swap was the idea of a _ bank with which the corpora- tion had been negotiating for additional financing as it would create additional equity in the ski venture. - ’ He warned council’s to support the proposal ‘‘will jeopardize the speed with which the project takes place,’’ creating the “distinct possibili- ty” there would be no skiing © this winter, Martin’ also suggested some corporation directors were so frustrated at the apparent lack of support from the city, another rebuff might prompt them to consider abandoning the project. That, maintained alderman deal Since they are paying the bill, it is the prerogative of Kitimat and Terrace to do ‘‘what they figure is best for the project.’ Dan Pakula (Telegraph Creek - one vote} — ‘As a develop- ment initiative, Shames is hard to beat.’ While the district should exercise caution in reaching a decision, he noted other argument it “‘could lose it all anyway’’ if it did not ap- prove the deal. — ‘Andy Burton (Stewart - one. § ‘We have.n0.money,in’- @: vote) — ‘ it so financially it’s nothing to us. If the people that are paying the bill have no problem with it, I certainly would have no quar- rel with it and I'm sure my council wouldn’: either,’’ Although Pete Weeber (New Hazelton - one vote) and Gor- don Sebastian (Hazeltons reserves - three votes) could not be reached for comment last week, Weeber has already ex- pressed support for the deal. A tally of the above indicates at least 17 of the total 26 votes to be cast will be in favour of accepting the Shames proposal. i delicious meals and snac "With Nutri/System, I permanently lowered my orto 126 Ibs. I lowered my cholestero The Nutri/System* Weight Loss Program includes a variety of nutrition light activity, and weight maintenance, tm Sinbeoms— Our Comprehensive weight lass help ine ONE MILLION chents this year. * SAFE, easy and parmanent weight loss * Professional . BR supervision ; B No catoria a counting No gimmic Tom Lintenmeyer. Over 1500 Centres Workhwide too.” and behavioral counseling, N Incfudes: Our client, lost 126 ibs. | weight loss centres | Yes that's $49 We want those phones to ring! CALL TODAY FOR A FREE wecen Canin, MEW COATS iy Ot ort eee hood, ts Apel 28, 1990 HO-OBLIGATION CONSULTATION _ 638-1800 TERRACE 4644 LAZELLE AVE. vald at particioating contres. New cients only, Gffér axpk failure . Danny Sheridan, would be “disastrous’” for the communi- ty. Proposing council support the swap deal in principle, he said the idea the debenture held by the regional district was ‘‘an extremely valuable commodity”* was an illusion, The value of the ski hill equipment was now’ far. . less than the amount owed and - if the project did not 0) ahead, the debenture would prove wor- thless, he said. Pointing out the repayment schedule had already been ° renegotiated a number of timés, alderman Mo Takhar’ added, ‘Who knows? Over the next 10 - years we'll probably be doing the same thing. If we get shares, . then we’re done with it)” ' Aldermen Ruth Hallock and THURSDAY “Dave Holl, however, remained | unmoved, While she had no ob- jection to individual aldermen ‘dipping into their own pockets and buying as many shares in Shames as they wish,” Hallock said she was “‘adamantly oppos- ed” to using taxpayers money to do'so,°. ' Echoing that view,: Hull said Shames’ own figures. suggested it’ would “have -no’ difficulty meeting the extended repayment schedule: put forward by the committee of the . whole. _ Describing the proposed new terms as ‘‘very generous’’, he added, “It would be hard to find a. sweeter deal.” _ The motion to support the _Share-swap deal passed four ‘votes, to two when aldermen THESE PRICES IN EFFECT FRIDAY Gerry Martin Darry! Laurent and Bob Cooper sided with Sheridan and Takhar. MAY MAY 4 SATURDAY _ 3 Family Pack BONELESS BOTTOM ROUND oTEAKS a1B. | 6.57 kg. ORANGES, 8 Ib. Bag. Bulk Dept. SWEET GREEN OR HOT DOG RELISH 100g Bakery Dept. | ASSORTED | STRUDELS 6 Pack. CARNATION EVAPO- RATED | @ 355 mL. Limit 6. ——- STORE HOURS: . Gam.- 8pm. Gam.- Spm. Dam.- Spm. {ft'am.- Sp. Skeena Mall Terrace. *Wa Reserva The Right : To Limit Oerites ‘