Iron Range agency names new management company for Giants Ridge resort

In a bid to revitalize the struggling Giants Ridge ski and golf resort, the state's Iron Range economic development agency has hired a professional manager to oversee all of the resort's operations.

It's a momentous step for the Iron Range Resources and Rehabilitation Board (IRRRB), which has run Giants Ridge since it bought the resort decades ago.

The agency has been undertaking reforms since state Legislative Auditor Jim Nobles clobbered it in a 2016 audit.

Guest Services Inc., based in Fairfax, Va., will begin managing the Biwabik resort May 1. The hospitality management company also works with the National Park Service and manages such properties as the National Mall and Memorial Park in Washington, D.C.

The IRRRB announced the five-year contract Tuesday, calling Giants Ridge the "crown jewel of the Iron Range." The IRRRB will continue to own Giants Ridge.

Guest Services will team with national golf course manager Billy Casper Golf in Reston, Va., to manage Giants Ridge's two championship golf courses, the Quarry and the Legend. It will replace Troon Golf Midwest, which managed the courses for years.

It's too early to say whether big strategic changes are in store, said Scott Shepherd, Guest Services' chief commercial officer . He would only say he wants to "deliver a spectacular visitor experience."

The IRRRB, financed largely by taconite taxes that mining companies pay in lieu of property taxes, bought the ski hill in 1984 as a way to stimulate the northeastern Minnesota economy. It has labored for years to build Giants Ridge into a year-round destination, but its location in a remote area 200 miles north of the Twin Cities has proved a challenge.

In 2015, a Star Tribune analysis showed Giants Ridge had lost nearly $40 million in the previous decade and that the IRRRB was heavily subsidizing it. Asked if he expects it to start breaking even, IRRRB Commissioner Mark Phillips said: "That would be a nice outcome."

An independent economic impact report that concluded Giants Ridge directly and indirectly injects $44 million into nearby ZIP codes, he noted.

Giants Ridge now employs about 150 people, including 15 full-time state employees.

In his audit of the IRRRB, Nobles devoted a chapter to the agency's questionable management of Giants Ridge and the resort's growing losses. The IRRRB has been subsidizing Giants Ridge operating losses by an average of $1.9 million a year, it found.

Nobles said having lawmakers run a state agency may violate the state Constitution's separation-of-powers clause prohibiting lawmakers from holding another public office.

Lawmakers are still working to fix that problem. Bills by Rep. Sandy Layman, R-Cohasset, and Sen. Tom Bakk, DFL-Cook, aim to shift the IRRRB's board to a more advisory role.