Members of the Golden Nordic Ski Club Society (GNSC) are invited to a Special Meeting
Tuesday July 21, 2020, 7:00 PM Location: The Island Restaurant, 101 Gould's Island, 10th Avenue, Golden BC, Upper floor Measures will be taken to provide appropriate social distancing. Members are free to remain at The Island to socialize after the meeting. As a courtesy and to assist with planning, please email Annette at secretary@goldennordicclub.ca if you plan to attend.
The Special Meeting concerns borrowing funds to partially finance the purchase of a groomer.
The Special Meeting is to hold a vote of the Members on the following question:
Shall the Directors of the Golden Nordic Ski Club Society be authorized to apply to Columbia Valley Credit Union for a loan in the amount of $110,000 as partial funding for the purchase of a new Prinoth Bison Groomer at a total cost of $465,000, where the loan is required to demonstrate, as part of an application for a Capital Projects Grant, that the Club is able to self-fund at least 50% of the purchase price? The Club currently has $130,000 allocated for the purchase. The terms of the loan are that the monthly payment be no more than $2,000 per month, the interest rate be the CVCU Prime Rate, the term of the loan be between 5 years and 10 years and that collateral for the loan shall be the Bison grooming machine. The loan is to be drawn upon only as necessary and only if a Capital Projects Grant is made to the Club by British Columbia Lottery Corporation.** In favour of loan: Yes or No
Vote by Proxy
Members may vote in person or by submitting a Proxy (see attachment) as a PDF or photo emailed to secretary@goldennordicclub.ca no later than 4:00 PM on Monday July 20, 2020**
BACKGROUND
Why we need a new Groomer
The primary groomer used by GNSC is a 1989 BR 400 groomer originally used by the Whitetooth Ski Club for the downhill runs. The BR 400 is well past its expected service life: a ski resort would usually retire a groomer after 5,000 to 10,000 hours, and the BR 400 has almost 17,000 hours on it. In the 2018-2019 ski season, the BR 400 was out of service due to mechanical problems for 28 days and required costly repairs. We were lucky in 2019-2020, but reliability remains a serious concern. It is time to purchase a new grooming machine. A committee of the Board has identified a Prinoth Bison as the preferred option. It is a modern machine, it is compatible with some of the grooming accessories owned by the GNSC, and it is the same make as used by Kicking Horse Mountain Resort, making it much easier to get service by the same vendor.
Funding the new Groomer
A new Prinoth Bison will cost $465,000, including accessories, freight and HST.
PRINOTH BISON
Base Price $ 393,850.00
Accessories $ 13,280.00
Freight $ 8,000.00
Total w/o HST $ 415,130.00
HST $ 49,815.60
TOTAL PURCHASE PRICE $ 464,945.60
The GNSC is in the process of applying for a BC Lottery Corporation “Capital Projects Grant” to fund 50% of the purchase price. In order to apply for a Capital Projects Grant, GNSC must be able to demonstrate that it can self-fund 50% of the purchase price, or about $233,000. GNSC has accumulated $130,000 as an equipment replacement reserve for the purchase of a new Groomer. GNSC seeks to borrow the balance, about $103,000, from Columbia Valley Credit Union (CVCU). The combined equipment replacement reserve and the loan will be sufficient to satisfy the 50% self-funding requirement. About three months after purchase, GNSC will receive a rebate of the GST paid on the purchase, in the amount of about $21,000, which can be applied toward the loan. The deadline for applying for a Capital Projects Grant is August 14, 2020. Funding decisions are made in October, and the plan is to purchase the Groomer before the 2021-2022 season. No money will be borrowed unless a Capital Projects Grant is available to GNSC.
About the Proposed Loan
Discussions with CVCU indicate that the term of a loan for equipment of this type is typically 5 or 6 years, but an exception may be possible to extend to 10 years. The interest rate would be the CVCU prime rate. Payment of principal can be made at any time, without penalty. Payments would be no more than $2,000 per month. Collateral for the loan would be the Bison Groomer. The Board is satisfied that the payments are within its financial capacity. The By-Laws of GNSC require any borrowing by the GNSC to be approved by the Members at a meeting or by proxy. Two Thirds of votes (not two thirds of all members) must be in favour. By-Law:
- (a) The Society may, if deemed expedient for carrying out its objectives, borrow, raise and secure the repayment of money pursuant to a resolution to that effect passed at a general meeting of the Society by a majority of not less than TWO THIRDS of the members present in person or by proxy.
Fundraising
The Board proposes that the loan be the backstop for purchase of a Groomer, but that a fundraising program be started to raise funds to help with the purchase and to pay down any loan. The Directors are currently pursuing a number of funding agencies for grants directly for the Groomer or to support other budgeted programs so as to free up funds for the Groomer. We look forward to your attendance at the meeting. The Directors, Golden Nordic Ski Club Society