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formation on areas which do lease government on private lands. 

 The findings of this survey, which we believe covers every large 

 size, non-national forest ski area in North America, are contained 

 in an appendix to my testimony. 



This confirms, in our opinion, that the Forest Service has been 

 a fairly tough negotiator and has set rental fees that are signifi- 

 cantly higher than most other government or private rates. For ex- 

 ample, and I am going to be speaking about both Canada and the 

 United States here, 25 areas in British Columbia, Canada, includ- 

 ing the two largest resorts in Canada, Whistler and Blackcomb, are 

 located on provincial land and pay a flat fee of 2 percent of lift rev- 

 enues. 



Five areas in British Columbia located on park land pay a 2 per- 

 cent fee. Four areas in Alberta, Canada, on national park land pay 

 2 percent. Mt. Tremblant ski area in Quebec pays a flat rate of 

 $5,000 per year to the province. In British Columbia, the fees are 

 paid only on lift revenues. No fees are paid on ski school, res- 

 taurant, ski shop, and other nonlift revenues which typically aver- 

 age about 30 percent of gross income. 



In the United States, fewer comparables exist, but those that do 

 exist, the Alpine Meadows Ski Area in California pays the same 

 proportionate rent to the Nature Conservancy as it does to the For- 

 est Service. Wachusett Mountain in Massachusetts, which is lo- 

 cated on commonwealth land, pays 2 percent of gross revenues to 

 the State. Deer Valley in Utah, one of the newest resorts in North 

 America, pays a combined rate of 1.25 percent of lift ticket sales. 



There are many more examples, but as you can see, we could not 

 find a lessor that does not own or invest in mountain or base facili- 

 ties. Further, as the ski area revenue growth nationwide has been 

 exceeding the annual Consumer Price Index, and is expected to 

 continue to do so, more and more ski areas will enter into the 2.75 

 percent to 4 percent brackets, so the effective rate should increase 

 above the 2.4 percent estimate. 



We found a few lease situations where effective rates were slight- 

 ly higher, one in Washington State and several in Vermont. How- 

 ever, in both cases, the State builds or owns buildings, parking 

 lots, roads or other facilities which are part of the lease. In addi- 

 tion, the tenure of the lease is 60 to 99 years versus the 30 to 40 

 years of the Forest Service. 



It is also worthy to note that many States and communities, smd 

 to a lesser degree, private corporations make their land available 

 for skiing at a subsidized or heavily discounted rate. I see my time 

 is up. 



There is the third analysis. It focuses on a comparison to land- 

 holding costs and compares the ski areas' annual rental fee to what 

 it would cost a ski area to finance a mortgage if it owned the land. 

 An evaluation for a ski area at Valbois in Idaho was evaluated at 

 $632 an acre. I have given additional examples in my written testi- 

 mony of what it would cost for ski areas that were sold, the date 

 of sale, the amount per acre, and other comparables in the market- 

 place. 



In summary, Mr. Chairman, it is our belief as supported by the 

 data recited in this testimony and my written testimony that fair 

 market value returned to the United States for the use of the land 



