County objects to Mountain Creek, Vernon settlement

13 Feb 2019 | 01:27

    The agreement between Mountain Creek and Vernon Township to resolve the resort’s $28 million dollar debt could be in danger as the Sussex County Board of Chosen Freeholders have filed an objection to the agreement for violations of the Multiple Utilities Authority Act.
    The motion, which was filed in bankruptcy court on Jan. 31 and Feb. 5 alleges that under the settlement, there is no mechanism for Vernon Township to put a lien on the resort’s property.
    According to Vernon Township Mayor Harry Shortway, the settlement agreement, approved in late December, features an immediate payment of $918,00 from Mountain Creek. It creates a revenue stream from Mountain Creek through ticket sales to pay obligations, a $200,000 cash collateral trust fun to be replenished for any amount that is withdrawn. Pump House 2 is to replaced by the township but Mountain Creek to repay the township.
    Mountain Creek filed for bankruptcy in May of 2017, and in July sought to relieve itself of $28 million owed specifically to the VTMUA.
    All five regular members of the VTMUA voted in favor of approving the settlement. The township council reached a 4-1 vote, with Councilwoman Sandra Ooms being the lone holdout. She did not publicly state a reason.
    Under the MUA Act, the township can lien or, if necessary, foreclose on real property of any defaulting user or assess taxes against every resident whether they use the system or not to make up the shortfall.
    There will be a hearing on the objection on March 5 at 2:30 p.m.