Md. Whitewater Course Operator Defaults On Loans
HAGERSTOWN, Md. (AP) — The owner of a publicly funded, world-class whitewater course near Deep Creek Lake said Thursday it has defaulted on loan payments and is considering asking Garrett County or Garrett College to take over the mountaintop complex.
Officials of Adventure Sports Center International said the problem reflects the cascading effects of the weak economy.
Executive Director Matt Taylor said the nonprofit group defaulted on the loans more than 18 months ago after D.C. Development LLC, the struggling owner of the nearby Wisp ski resort, stopped making $180,000 annual payments to the center for marketing services. D.C. Development, a locally based property development and management group, filed for bankruptcy protection in October.
The sports center’s default on $3.2 million in private bank loans became publicly known Tuesday when the Garrett County Commissioners released a statement disavowing any county liability for the loans. County Administrator G. Lamont Pagenhardt said the commissioners will discuss the sports center Tuesday and release more information Feb. 7.
The county contributed $6.1 million toward construction of the $17.7 million center, which opened in 2007. The state contributed $5.8 million and the federal government $2.6 million. Taylor said unexpected construction costs led the center to borrow the $3.2 million from Susquehanna Bank and First United Bank & Trust.
Taylor said D.C. Development agreed in 2006 to pay the center $180,000 annually for 10 years but fell behind in 2008. Since then, the sports center’s staff has shrunk from 10 to three full-time workers, Taylor said.
“It becomes a negative spiral when you cut your marketing and group sales positions,” he said.
Besides tightening its belt, the center has contracted with a private vendor, nearby Rudy’s, to run its equipment shop and relied more on interns from the nearby community college to work as guides, he said.
The 1,700-foot recirculating whitewater course is the centerpiece of a complex that also offers rock climbing, bouldering, mountain biking and other activities on a nearby 550-acre, wooded parcel. The center derives most of its revenue by sending vacationing visitors down the whitewater course in rubber rafts. Although it has never achieved the projected 25,000 annual visitors — there were 9,500 rafters last year — Taylor said the center takes in a little more than $800,000 a year, about equal to its operating expenses.
The whitewater course, designed as an Olympic-caliber facility, is scheduled to play host to the 2014 international canoe slalom championships. Sports center officials said the facility is in no danger of closing.
Garrett College has been a partner in the center from the start. The nearby community college offers an associate’s degree in adventure-sports management, and it has a seat on the center’s board of directors. College President Richard MacLennan wasn’t available Thursday to discuss the center, his office said.
D.C. Development’s bankruptcy filing stemmed from slow sales of home sites near Wisp but the mild winter isn’t helping matters. Partner Karen Myers said the number of skier visits is down more than 40 percent from a year ago, when the resort had a record winter season. She said the resort has ample snow on its trails and good skiing conditions, thanks to its snowmaking and grooming systems.
(Copyright 2012 by The Associated Press. All Rights Reserved.)