Breaking into snow business

By Tiffany Hsu

March 12, 2009 12 AM PT

At Mt. Waterman ski and snowboard park, the vintage two-seater chairlifts are a bit on the rickety side, and equipment pokes through the snow near a huddle of no-frills buildings and plastic picnic tables scattered halfway up the slope.

With none of the chaotic cacophony of larger resorts, the isolation is punctuated only by the soft swish of skis, the occasional darting flash of a boarder through the trees, the snow melting into the sky.

And that’s how the regulars like it.

“It’s more of a local resort, with a small-town feel,” said Rick Metcalf, who bought Mt. Waterman three years ago with his brother, Brien, and reopened it last year after a six-season closure. “We already have plenty of people coming here, and we don’t have grander plans to turn it into a big, major place.”

Southern California ski resorts have weathered the recession better than those elsewhere in the state, said Bob Roberts, executive director of the California Ski Industry Assn.

The proximity of the San Gabriel and San Bernardino mountains makes area resorts cheaper than parks that require visitors to fly in and stay in hotels, he said.

“Generally speaking, good snow conditions and proximity will trump a bad economy, like bowling and movies during the Depression,” Roberts said.

In an industry dominated by corporate-owned operations such as Big Bear Mountain Resorts and Mammoth Mountain, Mt. Waterman is part of a shrinking breed of small, family-run resorts.

Its owners -- jovial Brien, 46, and Rick Metcalf, 45, a hulking man in a black Mt. Waterman cap -- work in real estate in the San Diego area. Brien is a coastal property specialist; Rick is part-owner of a mortgage brokerage.

The pair grew up in La Canada Flintridge and skied at Waterman as children. Now, armed with a public ski resort operating permit from the U.S. Forest Service, they commute up on weekends to sell tickets or dig chairlifts out of snow.

The Metcalfs used much of their own money to buy the resort for an undisclosed sum. And although they have no debt, they have yet to recoup their investment, Rick said.

Between maintenance, operating licenses and renewed chairlift permits, running Waterman can get expensive. A percentage of ticket sales goes to Wells Fargo to pay the resort’s liability insurance.

In the 2008 season, when the mountain was open for only nine days, the resort’s revenue was less than 5% of the cost of purchasing the land, Brien Metcalf said. This year, the park might be open for 20 days, drawing an average of 300 visitors a day.

“I joke that it costs me $1,500 to come to work,” he said. “It’s been a huge undertaking and sometimes we’ve flown by the seat of our pants.”

For now, Waterman is earning enough for managers to start planning. The Metcalfs are hashing out permits, marketing and the higher insurance premiums associated with opening biking trails and are also negotiating with local companies to host retreats, benefits and even weddings.

Often in a recession, small-scale, family-owned companies maintain the upper hand over larger operations, said Thomas J. O’Malia, director of USC’s Lloyd Greif Center for Entrepreneurial Studies. Relatives volunteer time to save labor costs, and the pressures of unions and regulatory agencies often don’t apply.

“Smaller businesses are more agile,” O’Malia said. “Often, they’re the low-cost provider with better service.”

Waterman offers relatively cheap lift tickets at $200 for a season pass or $45 for a day pass. Adult lift tickets to Big Bear Mountain Resorts, which comprises Snow Summit and Bear Mountain, cost $66 for peak weekends and holidays; a season pass goes for $599.

But Waterman has no snow-making equipment. “It’s a big expense,” Rick Metcalf said. So even though it is well shaded by trees and faces north, away from the sun, erratic snowfall means the resort can’t guarantee regular seasons.

“The snow-making, which became de rigueur in California 15 years ago, has always been the Achilles’ heel of Waterman,” said Roberts of the ski association. “The bigger resorts have flourished because they have equipment.”

Waterman also doesn’t stock rentals, and 80% of the trails are advanced or intermediate, making it less friendly to beginners. The park operates only on weekends, but Rick Metcalf says managers are considering opening on weekdays.

“People here go to the other resorts too, but more are realizing we’re back,” he said. “We’re closer, so people don’t burn as much gas coming, and with fewer crowds, there aren’t traffic jams going home.”

An hour past opening one recent Saturday, the slopes already were latticed with slicing lines as snowboarders zoomed down. Cashiers in the ticket trailer yelled over the churning gurgle of the lift, which operators slowed for children.

Since the reopening, Stephen Glaab, 43, has visited nearly a dozen times. The Moorpark relocation sales agent said he “grew up” at Waterman and was a ski instructor there in the late 1980s.

He loves the terrain, although there’s no naked expanse of bunny slope for his son Alex, 12. Instead, trees and rocks poke through fluffy piles of powder.

“Other resorts bring L.A. up to the mountain, but here, it’s just mountain people,” Glaab said. “I don’t need the zoo.”

In 1939, adventurer Lynn Newcomb Sr. built the resort’s first rope tow, then set up one of the state’s first chairlifts in 1942. It promptly broke down, forcing riders to jump off.

His son, Lynn Newcomb Jr., sold Waterman in 1999 to a group of local businessmen. Ambitious plans, including newer facilities and snow-making, were stymied by years of lackluster snowfall, problems acquiring operating permits and slim cash flow.

In 2006, Mt. Waterman seemed doomed: The California Department of Forestry planned to restore the steep glades to their natural state. The day before the master permit was to expire, the Metcalfs bought the resort. Later, three friends joined as investors.

The Metcalfs also own the closed Kratka Ridge ski area nearby but “don’t have the time or resources for it, so it’s staying in limbo,” Brien said.

They spent more than $1 million getting Waterman back up to par, carting off 40 massive containers of trash and load-testing the lifts. They bought new snowmobiles and grooming machines and replaced rotted wood on the buildings. The Metcalfs say they’re ready for a long stay.

“It’s gone pretty smoothly, considering that there’s no ‘Snowboarding for Dummies’ book,” Rick said. “There are a lot of moving parts.”

Bob Levin, chief financial officer at Harvard-Westlake School, has been skiing at Waterman since he stumbled on the resort 28 years ago. A road blockage kept him from getting to Mountain High Resort, so he settled for what looked like a “pathetic little ski area.”

Waterman has since grown on the Sherman Oaks resident.

“I’ve skied all over, and this is the best terrain,” Levin said. “It doesn’t get any better on planet Earth.”

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(BEGIN TEXT OF INFOBOX)

Snow days

Business: The Mt. Waterman ski and snowboard park in the Angeles National Forest reopened last year after a six-season closure. The 235-acre ski area, on a mountain more than 8,000 feet high, has a vertical drop of more than 1,000 feet and 65 runs, including Wallbanger and Kiss-n-Run.

Owners: Brothers Brien and Rick Metcalf and three investors

History: Opened in 1939 by Lynn Newcomb Sr. and his son, Lynn Newcomb Jr.

Employees: 10 to 20, depending on need

Investment: The Metcalfs and their partners have spent more than $1 million to improve the resort, which they bought for an undisclosed sum. They have yet to recoup their money.

Transport: The three chairlifts, installed between 1978 and 1986, are diesel-powered. The resort may switch to more eco-friendly bio-diesel by the end of the season. There are no stairs, so more than 300 daily visitors have to huff up a snowbank.

Perks: Employees get ski breaks during the day. Members of local sheriff’s departments, search and rescue teams and Caltrans workers get free passes.

Source: Times research