March 8, 2024

Phoenix – “an immortal bird that cyclically regenerates or is otherwise born again.”

We have written about Jay Peak before. (See our article from November 2022 on the sale of Jay Peak – Jay Peak Finally Sold). It remains one of our favorite ski resorts in North America. Tucked away in the northern wilds of Vermont, it is difficult to get to and much of its terrain is out of the reach of the lower intermediate skier. It isn’t known for groomed terrain, and, in fact, their claim to fame historically has been its glades. The place has an international feel given that on any given day half the skiers are French Canadian (it being so close to the Canadian border). It helps that it gets more snow than any area east of the rockies. As you might suspect, these are all the reasons why we love it, and it became our go to area when the kids were growing up. If you can ski the woods at Jay you can pretty much ski anything.

Jay Peak has been on a roller coaster ride. For much of the early part of the last two decades it undertook major developments that seemed out of place for the northern woods of Vermont. Much of the build out – a huge water park, skating rinks, soccer fields, and a new golf course – was aimed at making the area into the ever elusive four season resort. While some of us thought more of the money could have been plowed into the infrastructure of the ski area itself, we were glad to see they left the glades and trails pretty much untouched.

What’s the old phrase – “If it’s too good to be true it probably isn’t”? While it is true that these developments took place, the first downward spiral in the roller coaster ride was where the money was coming from to fund these changes. For years Jay Peak, through the efforts of its long term president, Bill Stenger, had been raising money through a federal program called EB-5. The program allows foreign investors to fund US businesses, and as long as new jobs are created as a result, the investors and certain family members become eligible for green cards. Whether you like the aspect of essentially buying green cards or not, it is a perfectly legitimate program. Legit that is until you use the money to buy a condo in the Trump Tower.

I was on a ski road trip with a couple ski buddies years ago (2014/2015 winter maybe). The real aim was to ski some of the smaller areas in eastern Canada – Mont Sutton and Mont Orford in particular. But lo and behold – Jay Peak was on the way there. As I was standing in the lobby of the swanky (for the north woods) Hotel Jay waiting to check in I saw a picture of a Mr. Quiros. I knew the name because he had become the major investor in Jay Peak in 2008. I had never seen his picture, and it only took a quick glance to know something was amiss. I reached for my wallet to make sure he hadn’t stolen it.

Fast forward to 2016. That is actually when the roller coaster screeched to a halt. It turns out that Mr. Q, with at least a blind eye and perhaps direct help from Bill Stenger, had siphoned off approximately $200 million dollars of the EB-5 money for non ski area use. And yes, the condo in Trump Tower belonged to Mr. Q. There are no outward signs that Mr. Stenger personally benefitted and, to this day I have arguments with friends as to what he knew and when he knew it. I have met Stenger several times and have had brief conversations with him in the early 2000’s when he was trying to put a group together to buy the resort. I think he is an operational genius, but, like many, is not facile in the ways of the investment world, and I think got taken for a good ride. He should have known better but…

Amazingly though the area thrived even though it was essentially being operated under a bankruptcy type structure. The infrastructure had been built, and it was being used year round. But then the other shoe dropped. Imagine running a business where at least half your users literally overnight are no longer customers. Remember March 17, 2020? That was the day Vail announced they were closing all their North American resorts due to Covid-19. The rest of the ski industry closed nano seconds later. And for the next two winters Canadians could not cross the border and Vermont had very restrictive covid rules for out of state skiers. Jay’s skier visits dropped by over two thirds.

Somehow though Jay Peak has been able to pull off its Phoenix act once again. It has come out of receivership, been sold and seems to be on solid footing. Covid restrictions are long gone and skier visits are back up. Being in the ski industry in the northeast, particularly this winter, is tough, but perhaps their combination of high quality skiing (when it snows) and the focus on four seasons may be the winning ticket. There have been several interesting articles on Jay in the “mainstream” press recently. For a good article on the EB-5 fraud mess see The Rural Ski Slope Caught Up in an International Scam and for a travel piece reflecting their rebound see How Jay Peak Roared Back.

Be Well; Ski Well.

By Kevin Dennis
conSKIerge co-founder

Kevin Dennis is a life long ski bum with a 34 year legal career on the side. Now retired, he skis 80+ days a year. While he lives in Alta UT in the winters, he has traveled extensively through skiing and has skied almost every major resort in North America (and many you have never heard of). He continues to hit the road often throughout the western United States and Canada and trips over the last several years have included ventures in British Columbia, Montana and Colorado. Whether you want to know about the behemoths like Aspen or Squaw or are interested in the road less travelled (Lost Trail Powder Mountain in Montana or Whitewater in BC anyone?), Kevin has been there, has an opinion and you will most likely have to tell him to shut up after a half hour!