LOOKING FOR A GOLD MINE : Top U.S. Ski Operator to Run Southland Resort

In 1955, where others saw only a steep, wooded hillside like so many others in central Vermont, Preston Leete Smith envisioned a ski resort. Not just any ski resort. Smith wanted to build the biggest. And he did.

Killington, which Smith opened in 1958, is now the East Coast’s largest ski area, and has spawned a surrounding town as well as a year-round tourist industry.

Now Smith, 57, is bringing his vision to Southern California.

Within the next two days, Ski Ltd., Smith’s publicly traded company, is expected to sign the final papers to acquire the Goldmine ski area, a somewhat tattered, outdated and under-used resort near Big Bear Lake in the San Bernardino Mountains.

Ski Ltd. is paying about $10 million for the 28-year-old, 27-trail resort and is prepared to spend at least another $10 million over the next five years to update and expand its facilities. The resort, located less than a two-hour drive from most of the Los Angeles basin, generally ranks as the third-most popular ski resort in the immediate Los Angeles region, behind Snow Summit and Mountain High.

At first blush, Ski Ltd.’s move might seem questionable since ski conditions in sunny and often snow-poor Southern California are a far cry from those in blustery and frigid Vermont, where Smith has spent the past 30-plus years. But Smith is optimistic.

Where others see a faded resort, perhaps a few years past its prime, Smith sees potential. An estimated 12.6 million people live in the Los Angeles metropolitan area, many of them affluent. The mountain roads are adequate, if not terrific. And skiers are known for spending money; industry experts estimate that the average skier spends $32 per day on lift tickets, lessons, rentals and meals.

“People in Southern California are very enthusiastic about skiing,” Smith maintains. “There are many more skiers than we have resorts.”

In fact, some observers are already betting that Smith’s proven formula in Vermont will change Southern California’s ski scene. “If he’s able to run Goldmine the way he runs Killington, it will be the No. 1 resort in Southern California, hands down,” says Cathy Robbins, of the National Ski Area Assn. in Springfield, Mass. “I think if I were the operator of Snow Summit or Mountain High, I’d be worried.”

According to Smith, the key to panning Goldmine, which served 147,000 visitors last season, is immediately installing much-needed snow-making equipment and larger, faster ski lifts.

Snow-making equipment is Smith’s first priority. Just as it was in Vermont.

Smith says that due to inadequate snow-making operations and uneven natural snowfall, Goldmine’s previous owners, a 120-member investment group known as Goldmine Associates, were unable to open all lifts all season long.

Smith faced the same problems at Killington and Mount Snow, the second Vermont resort Ski Ltd. owns and operates in Vermont. Even with Vermont’s abundant, 250-inch annual snowfall, Smith says Killington and Mount Snow have relied on artificial snow making almost exclusively for the past 25 years to keep the trails open, fresh and packed throughout the season.

Furthermore, the artificial snow has allowed Killington and Mount Snow to promote themselves as the resorts with the longest ski seasons on the East Coast. Most years, the resorts are open for skiing more than six months of the year, from November to early June.

“They’re the first to open and the last to close,” Robbins says. “They’ve gotten a lot of public relations out of that.”

Smith says the new snow-making equipment will be installed at Goldmine by next season.

For the future, Smith is also committed to installing new four-person lift chairs, considered to be the state-of-the-art equipment on the slopes these days. The new chairs, which would replace the three-person chairs now used at Goldmine, would increase traffic flow up the mountain by 33% and reduce long waits at the base, one of the primary complaints of skiers.

Furthermore, Smith says he will also begin installing computerized record-keeping--there are 370 terminals in the Vermont resorts--to help track the day-to-day details of running a ski area.

Smith’s attention to skiing basics and behind-the-scenes details, admirers say, is what has enabled him to build what is generally considered to be the one of the nation’s best ski resort operations and operate the nation’s only publicly traded company devoted exclusively to ski resorts. In national market system trading on the over-the-counter market Thursday, Ski Ltd. shares closed at $10.75, down 25 cents.

“Ski Ltd. does for ski resorts what Disney does for theme parks,” says Andrew Silton, an analyst with First Albany Corp. in Albany, N.Y. “Underneath all the fun, they run a tight business. But they don’t let the customer know because they don’t want to ruin the fun.”

Silton is not surprised by Smith’s move into Southern California and particularly not with his choice of Goldmine. Smith, Silton says, is known to prefer “turnaround” properties that can benefit from some judiciously spent renovation funds.

“It’s a terrific resort,” Smith says of Goldmine. “It just needs updating.”