While warm temperatures brought little snow and big headaches to ski areas across the Green Mountains, Burke’s winter season woes went beyond the weather.
In a March 15 letter to state officials obtained through a public records request, Bill Stenger, an owner of the Q Burke Hotel and president of Jay Peak Resort, acknowledged that the delayed opening of the hotel and the economically damaging winter meant the resort would scale back its summer offerings — including mountain biking, food services and weddings — to weekends.
In the letter, Stenger called this winter “about as difficult a season as one could imagine.”
The resort announced last week that 180 workers would be laid off at the end of March, including 45 year-round employees at the 116-unit hotel and conference center.
In chatter on a Facebook page called Friends of Burke Mountain, workers and others said the layoffs had undermined the perception that the Burke resort developments would be an economic lifeline to the Northeast Kingdom.
On Wednesday the Vermont Department of Labor’s rapid response team visited the Sherburne Base Lodge at the ski area to provide assistance to affected workers.
A VTDigger reporter attended the Wednesday morning presentation, where a DOL staffer provided a dozen or so laid off employees with information on how to collect unemployment benefits.
A DOL rapid response specialist suggested that workers apply for fast food service jobs as a way to quickly regain employment. The department also recommended that laid off employees seek part-time work in order to extend unemployment benefits for a longer period of time. Workers can receive weekly payments from DOL and not get penalized for so-called “disregarded earnings.” In the coming week, DOL will hold individual appointments with laid off Burke workers.
About 10 minutes into the meeting, senior Burke staffers escorted a VTDigger reporter off the premises, citing the sensitive nature of the presentation and the need to protect the identities of laid off staffers. VTDigger was the only media outlet represented at the rapid response meeting.
Mike Pappalardo, the recently hired general manager at the mountain, said the meeting was closed, and that it was happening on private property. Outside the ski lodge, Pappalardo became emotional as he described the layoffs to VTDigger, which he attributed to problems with the hotel opening and the warm winter weather. He called the impact of these two unanticipated setbacks “the perfect storm.”
Pappalardo is the owner and CEO of MEI Electrical Contractors, a Jay-based business that served as the local electric subcontractor on recent developments at Jay Peak Resort.
As he finished speaking, Burke staffers then threatened legal action against VTDigger if any details or photos from the meeting were published.
VTDigger contacted the Department of Labor, Andy Barter, the contract human resources manager at Burke, and Quiros in advance of the meeting.
Annie Noonan, commissioner of the Vermont Department of Labor, said her staff was “stunned” by Q Burke’s decision to reject media coverage.
Rapid response events are often at public venues, although in some cases they are held at private companies. The meetings are typically covered by reporters, Noonan said, because the DOL is providing workers with “basic information,” that is “nothing secret.” DOL asks reporters to respect workers’ privacy by taking pictures of the backs of people’s heads and only using quotes with permission.
“I thought this was very odd,” Noonan said. “We were surprised this happened.”
Reporters have attended rapid response meetings held by IBM and at the Ethan Allen plant in Beecher Falls.
“I don’t understand why they are so defensive, I really don’t,” Noonan said. “Everyone is aware there is stuff going on at Q Burke. It’s a matter of what can be done for workers. This could have been a positive, instead of walking people off the property.”
Liens pile up
A total of 11 liens have been filed on the Q Burke hotel, totaling nearly $7 million in unpaid bills to building companies across New England.
The money owed is for labor and materials, as well as interest, penalties and legal fees incurred by the companies that filed the legal notices.
Two of the liens, from WHS Homes and Optimum Building Systems, have been recently discharged, presumably after payments were delivered.
The largest lien is from PeakCM, the Winooski-based general contractor, that is owed nearly $5.4 million.
Jerry Davis, president and CEO of PeakCM, said the owners of the hotel, Stenger and Ariel Quiros, have paid the $900,000 that they owed for November.
“The wire just came in today, but I don’t have exact confirmation,” Davis said on Friday. “There’s stuff coming in, that number [on the lien] is going down.”
Davis said on Tuesday that he would not make a decision about perfecting the lien until next week.
Stenger wrote in a text on Tuesday: “We are making substantial progress on gathering funds to pay the balance owed PeakCM. Within a short time all funds needed to pay PeakCM will be provided and any lien will be unnecessary.”
In a March 15 memo to the state Stenger said, “We expect by the end of April to have finished payment to the contractor.”
Davis said there is still no date for the hotel opening until all payments are released by the state.
“Now we are just waiting on the state to justify what they are doing,” he said.
The other $1.5 million in liens come from various subcontractors who are still owed payment for everything from lumber costs to work framing the building.
The owed parties consist of building companies based in Vermont and other neighboring states, with company receipts ranging from $11,000 to $300,000.
Quiros spoke briefly about the hotel in a phone call Wednesday, saying he was confident it would open, adding “I’m not worried about it anymore, it’s done” being built.
“There is a process, and everything will get done in due course,” Quiros said.
The majority of the lien documents were filed with the Burke Town Clerk in recent weeks, though three were placed late last year.
The documents show that, in some cases, payments have been outstanding for many months.
The Vermont Log & Timber Frame Builders, which filed a lien on September 30, 2015, has been waiting for $11,354 in payment from the mountain since early August of last year.
Lyndonville company Winterset Inc. has been owed $54,285 since September 1, 2015.
Gary Burrington, president of Winterset, said Burke attorneys had been in touch with his lawyers in the past few days about payment.
“I think we are very close to having it settled,” he said.
Editor’s note: Anne Galloway contributed to this report.
