Progress on Hermitage property, receiver says
"The property is beginning to show improvements after I received access to funding from the bank," he wrote in his report on the second site inspection on July 16.
Since his initial visit in June, Tantleff said he has set up a mechanism for the Hermitage to request funding for essential services. He can now approve funding for "concerning items" he finds during inspections such as "the deterioration of the golf course, the possibility for pest infiltration and the inoperable fire safety systems."
Judge John Treadwell appointed Tantleff of FTI Consulting as receiver in June after Berkshire Bank filed a foreclosure complaint against the Hermitage.
He is looking after more than 800 acres — including what had been a members-only ski resort at Haystack, a golf course, four inns and townhouses — with an eye toward potentially opening for the 2018-19 ski season if there is a buyer.
Tantleff said he has not received any documents from a club member who indicated he had put together a group of members who may want to lease the ski resort for the winter.
At minimum, he said, an agreement would need "evidence of adequate funding, indemnities, and court approval."
Since the first receiver report, Hermitage founder Jim Barnes has announced a new potential transaction that would see Oz Real Estate invest more than $50 million in the company and take care of the debt owed to Berkshire Bank as part of this foreclosure action as well as judgements ordered in court.
At the time of the new report, Berkshire Bank had not approved any spending on chair lift maintenance. Previously, the work had been expected to cost about $300,000 for a nine-month period.
Tantleff estimates the cost to repair lifts would be about $86,000.
"We discussed the possibility of collaborating with the lienholders of the Barnstormer Lift, which I understand was funded by a group of members," he wrote in the new report. "The director of mountain operations could accomplish the recommended maintenance either by rehiring an experienced lift mechanic or cross-training existing employees to assist if the project receives funding at any point."
To protect the golf course, Tantleff approved spending nearly $2,000 for unleaded and diesel fuel for maintenance equipment, $3,500 for chemicals and fertilizer for turf protection, and about $1,000 for mower and tractor repairs. He said he believes the course will soon be in better shape than it had been at the beginning of the receivership.
Negotiations are underway to keep propane tanks at the foreclosed properties, according to the report. About $90,000 was owed for 40 tanks at the time of the writing.
Earlier, that figure had climbed as high as $160,000, according to the report. But the bank paid off some of the debt.
"I have resisted the vendor's requests to repossess the propane tanks, as I view them as critical to maintaining the value of the bank's collateral," Tantleff wrote. "The bank made payments to both Suburban Propane and to Green Mountain Power as protective advances, however, neither utilities applied the payments to only the bank-mortgaged assets, as they were applied to all of the borrower's indebtedness. The parties need to work to resolve this discrepancy."
Tantleff said no payments have been made on leased snowmaking or grooming equipment. He received an email from a vendor claiming more than $150,000 is owed on snowmaking equipment.
The report says property repossessed by vendors or in the process of being repossessed also includes 74 electric golf carts, more than $370,000 worth of furnishings for the Hermitage Inn, solar panels located outside of the Clubhouse, vans, and more than 200 pieces of audio and video equipment.
Tantleff said he made arrangements for trash to be picked up at the Clubhouse at Haystack "after receiving reports of a worsening stench emanating from the Dumpster's food waste, a potentially dangerous condition."
Reach staff writer Chris Mays at email@example.com, at @CMaysBR on Twitter and 802-254-2311, ext. 273.
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