After a year of sporadic negotiations, Denver and the Winter Park Recreational Association agreed in principle to renegotiate the association's lease with the city, which would give the city income of about $2 million a year.

Denver owns Winter Park/Mary Jane Ski Resort, which is operated by the recreational association. Last year, the resort had $3.7 million in profits on $31.4 million in revenues. Under a 100-year agreement signed by Mayor Bill McNichols in 1979, the city receives only $7,000 per year in rental fees from the association.

The nonprofit association uses the rest of the profits to improve the ski area. In addition, the group has accumulated $33 million in a reserve fund for development.

After learning that Denver got only $7,000 a year from the lease, Mayor Wellington Webb threatened to sell the ski resort for $55 million if the association's board of directors did not renegotiate the lease. Talks broke off several times during the last year and the plan to sell the ski area was vetoed by the city council.

The city council must still approve the deal, but no opposition has surfaced.

According to a document released by the city, Denver will receive $1 million a year in rent plus 3% of gross revenues. If revenues grow steadily until 2003, the city would receive $2.5 million, according to projections.

If Winter Park has a bad year, the association would not have to make payments to the city, but if the association missed payments in any two out of a five-year rolling period, the city could terminate the lease, the city said.

Another part of the deal would allow the board to exchange land options in Larimer and Grand Counties with the U.S. Forest Service for 80 acres of federal land at the base of the ski resort.

Although the resort has no debt, if the association did issue debt, payments on the debt would be senior to the lease payments to Denver, the city said.

Webb said he would like to see the ski money used for Denver's parks.

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