Last June, an Australian-based development company, the Majella Group, announced that they would be buying Maine's Saddleback Ski Area, which has been closed since 2015, promising to make it "the premiere ski resort in North America." Last week, however, in an audio clip received by News Center Maine, it appears the company's interest in the resort may have some ulterior motives.
"Opening Saddleback resort is not a primary concern for us. The EB-5 program is the reason we are buying Saddleback," says Majella CEO Sebastian Monsour in the audio recording. "The mountain and opening the mountain is something we'd like to achieve, but if we don't, we are not going to lose any sleep with regards to it."
The EB-5 program Monsour in reference is the U.S. government's Immigrant Investor Program, which provides lawful permanent residence to immigrant investors and their immediate family who invest at least $500,000 into a new commercial enterprise, or, in Saddleback's case, a previously existing troubled business. The program also stipulates the investor must create or maintain 10 full-time jobs in the invested business within two years.
This winter marks Saddleback's third straight season not opening for business, after the failure to raise $3 million in funding for a new chairlift pushed their closure in 2015. Its current owners, Bill and Irene Berry, bought the mountain in 2003 and invested $40 million in improvements over 12 years. Located in the small, rural town of Rangeley, Maine, initial interest by Monsour and his group in revitalizing the ski area gave a lot of hope to the town's 1,200 residents. Before it closed, Saddleback was the third largest employer in its county every winter, supporting 300 staff. With 2,000 feet of vertical and an average of 200 inches of annual snowfall across it's 440 acres, Saddleback saw between 80,000 and 100,000 yearly skier visits before shutting down in 2015. Upgraded infrastructure and lifts spinning again would provide a much-needed boost to the town's economic stability.
While Monsour has come forward and denied these accusations, claiming the alleged audio recording was taken out of context of a larger group discussion with his company, the damage has been done, leaving a bad taste in the mouths of many Rangeley locals and Saddleback supporters.
"Saddleback has a lot to offer the area," said Rangeley local Ginny Nuttall in an interview with local newspaper the Press Herald.”I would like to see the opportunity for somebody else to purchase it because it doesn't appear that this group is going to be able to go forward. The Berry family did what they could. They worked hard to make the mountain a good family skiing area, but we need it open again."
Over the past few years, the EB-5 program has also been the subject of scrutiny. In 2013, the U.S. Securities and Exchange Commission issued an alert to investors about developers exploiting the EB-5 program, with some cases involving developers pocketing investor money and bailing on projects, leaving foreign investors without their money or a visa. The Securities and Exchange Commission is currently investigating the family business of Jared Kushner, Donald Trump's son-in-law, over their use of the EB-5 program.
Now eight months after the initial deal was made between the owners of Saddleback and Majella, the official sale of the resort has yet to be finalized. Monsour is reportedly low on funds, and still working to secure the proper investments to buy the ski area, leaving an uncertain path for the future of Saddleback Ski Area.