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Victoria’s alpine resorts are being propped up by millions of dollars in emergency taxpayer funding as the state government prepares to privatise the operations of two loss-making mountains.
Despite the sector contributing $2.14 billion to the state economy annually, the managing body of Victoria’s six snow resorts, Alpine Resorts Victoria (ARV), is on financial life support and reliant on a Treasury “letter of comfort” to stay afloat.
The Victorian government wants to sell the operating rights to its Mount Baw Baw and Lake Mountain alpine resortCredit: Nine
In a bid to stem the losses, the authority is moving to privatise operations at Mount Baw Baw and Lake Mountain after decades of operating in the red.
According to the Alpine Resorts Victoria annual report, tabled to state parliament weeks late on Friday, a $13 million taxpayer subsidy helped the authority post a modest technical surplus of $4.39 million. Without the government’s intervention, the authority would have faced a multimillion-dollar deficit.
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“The ability of ARV to continue as a going concern and discharge its liabilities in the ordinary course of business is dependent upon the continuing financial support of the Victorian State Government,” the report states.
“This funding, provided via a Letter of Comfort, recognises the long-term impacts of COVID-19 on our cash reserves, the increased cost of resort operations, the ongoing need to subsidise operations at Lake Mountain and Mt Baw Baw, and the revenue loss associated with a limited winter 2024 season.”
Alpine Resorts Victoria was established in 2022, combining four separate resort management boards, to increase the sustainability of the six resorts: Mount Buller, Falls Creek, Mount Stirling, Mount Baw Baw, Lake Mountain and Mount Hotham.
A formal expression-of-interest process was launched in December 2024 to offload the management of Mount Baw Baw and Lake Mountain to the private sector.
While the land would remain state owned, the government is seeking “suitably qualified entities” to take over the commercial and essential services of the resorts in their entirety.
Alpine Resorts Victoria, which manages mountains including Falls Creek, is reliant on government funding to remain solvent. Credit: Toby Royce
Skifields and snow activities on Mount Buller, Falls Creek and Mount Hotham are already operated by private companies, but Baw Baw and Lake Mountain have remained a significant drain on public funds.
Both have operated in deficit for more than 20 years, and Alpine Resorts Victoria said that despite significant changes to increase revenue and reduce costs, they continued to need propping up from the government.
Alpine Resorts Victoria said that commercial entities might be “better positioned” to run the resorts efficiently and had the capital to invest in a “vibrant and sustainable future”.
The financial strain has forced a reduction in public access. During the 2024 winter season, Lake Mountain abandoned its seven-day-a-week schedule, closing every Tuesday and Wednesday outside of school holidays to reduce costs.
In November, Alpine Resorts Victoria said it would cease operating the only childcare centre in Falls Creek, which services the town’s permanent population of about 320 people, due to financial pressures.
The organisation said the economic shortfall from the childcare centre was expected to reach $177,000 by the end of the year.
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The annual report said the organisation’s ability to remain operating as a “going concern” – an accounting term meaning it can meet its financial obligations without the threat of liquidation – was dependent on continuing financial support from the state government and its letter of comfort.
Opposition Leader and shadow treasurer Jess Wilson accused the Allan government of badly mismanaging the six alpine resorts.
“Under Labor, Victoria’s alpine resorts are on financial life support and significant uncertainty surrounds their future,” she said.
“Alpine Resorts Victoria is yet another in a growing list of state government agencies under Labor that are reliant on emergency financial support to pay the bills and remain solvent.
“Labor cannot manage money, and Victorians are paying the price.”
The government bailout for the alpine resorts comes after it was revealed Greater Western Water had also been granted a letter of support from the government to remain operating as a going concern.
A state government spokeswoman said the search for a private operator was to help draw more visitors to Lake Mountain and Mount Baw Baw.
She said the government continued to work with Alpine Resorts Victoria on its financial sustainability, including consideration of further funding and letters of comfort if required.
The current letter of financial support is due to expire in April.
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