Telski CEO Dave Riley, who sits on the Telluride Mountain Village Owners Association Board of Directors, raised the question about gondola operators’ wages at Wednesday’s TMVOA meeting. The subject came up when Mountain Village Finance Director Erin Neer presented the board with the 2008 gondola-operating budget.
Under the terms of a contract between the TMVOA and the town, the TMVOA is responsible for funding gondola operations and pays the town for the everyday operations. Neer proposed in the 2008 budget a wage increase for gondola operators from $12 to $13/hour with an added $1/hour bonus for those who complete the ski season. Currently the operators’ starting pay is $12/hour, with the added bonus for season completion. The town recently paid an outside consultant to analyze town pay rates. The conclusion was to increase the wages, but for Riley, it is too much for the TMVOA to fund.
“We have had some discussion over wage survey that the town had done,” Riley told Neer at the meeting. “The gondola operators are currently paid $11 plus $1 bonus to stay the whole season, so essentially it is a $12 an hour wage. The proposal is to raise the wage to $13 plus $1 bonus takes it to $14.
“The National Ski Areas Association comparable position and the national wage for that job is $8.06. Only 36 percent of the ski areas provide an end-of-season bonus. So I really question the wages that are being currently paid and are being proposed to being paid that are clearly in excess in what our state pays and what the country pays. The point is, it is excessive. I think that we are driving the budget increases with excesses like this.”
Town Manager Greg Sparks defended the wage increase.
“I know just from the four months that I have been here that we have been in a constant hiring process for operators,” Sparks told the board. “We know from our employee base that we have got a lot of gondola operators coming in from Ship Rock, Cortez and Montrose and all places in between. At $11 and $12 an hour, we are not filling those slots. From our standpoint, we are not looking to add cost to the gondola operation, we are looking for the best way to retain full-time employment and seasonal staff. I don’t know how much you want to manage how the town pays its employees.”
Councilmember Jonathan Greenspan echoed Sparks comments.
“There is not one job in the newspaper that is $8, $9, $10 an hour,” Greenspan told the board. “The employee turnover rate will be astronomical [at a lower wage].”
Although Mayor Bob Delves was not present during this point of the discussion, he did show up at the meeting later to caution the board on comparing the operators to ski lift operators and to defend the proposed 2008 gondola budget.
“The national average [wage] and regional average, those things don’t work here,” Delves told the board. “I would encourage us to be cautious on deciding what is the right amount to pay the operators. The gondola system operators, as Chris Colter said, is best compared to a bus driver. I think that is right for a variety of reasons. They are drug and alcohol tested and they are people that always show up for shifts and are very reliable. They tend to be coming from further away. The guy at the top of Lift 10 is often asleep, people are constantly loading and unloading the gondola. I am just saying, let’s be careful what we do here.”
Riley told the board that it was possible a private entity could operate the gondola more efficiently than the town. “I think that another thing that would be very interesting is if we threw an RFP (request for proposal) to the private sector for operating the gondola,” Riley said. “It would at least give us another basis of comparison for what these things could cost.”
The gondola operators’ wages were not the only thing that the TMVOA board questioned in the proposed 2008 gondola budget. Riley also challenged TMVOA’s contractual liability for capitol improvements to the gondola, saying that in the contract, “I found words like operations and maintenance in this agreement,” and that there is, “not a compelling argument that we provide a reserve for replacement.”
TMVOA President Mike Wisniewski agreed with Riley.
“I have to agree with Dave that there is no capitol reserve is the contract and I am reluctant that we spend the money,” Wisniewski said. “I think if there is some agreement to building [the gondola to capacity], I would like to see it.”
According to Neer, the 2007 gondola-operating budget came in at approximately $3.5 million, 2 percent under budget. The proposed budget for 2008 will be 14 percent higher, or closer to $4 million.
In the end, the TMVOA board was unsatisfied with the town’s proposed budget, leaving it unclear what the town will do regarding the gondola operators wage. Wisniewski asked the town to return with a budget that reflected the TMVOA board’s concerns.
“We are going to request that you submit to us a revised budget,” Wisniewski told Neer. “I would like it to take into account a decreased amount for the proposed wages for operators, a true understanding of administrative overhead costs and how you would calculate them based on actual costs occurred. Capitol is a unique concept in that our agreement does not require us to fund capitol. We are liable for operations and maintenance. Our sense is that capitol is not required under the gondola agreement. I want to make sure that we get the best bang for our buck, we have our fiduciary responsibility.”