Attorneys for Talisker Land Holdings, which leases 2,852 acres of ski terrain to PCMR, said the bond should be closer to $123.9 million.
It marked the first time that calculation almost 20 times PCMR's top-end estimate was revealed publicly. The number previously was redacted from court records.
"It would be best for me to wait a week," the judge said after considering the matter in chambers for more than an hour. He said he would set the bond amount Sept. 3.
In the meantime, Park City business owners and employees will be on edge.
If the bond amount is not acceptable to PCMR, Talisker can move forward with eviction. In that event, the resort would sit idle. That, most likely, would have a crippling effect on the area's economy.
Attorneys for both sides argued Wednesday about how much rent should be charged annually to PCMR for the upper mountain acreage a figure key to determining the bond amount. The company gave up its bargain $155,000 annual lease fee when it missed a renewal deadline April 30, 2011.
Talisker now wants $14.8 million for the ski terrain in question. That would go up to $16 million the following year.
PCMR says the annual rent should be between $226,000 and $1 million, based on its assessment of market rates.
PCMR attorney Alan Sullivan told the judge that without his client's base acreage and facilities, Talisker's land would be severely devalued.
"Without the base facilities, Talisker doesn't own a going concern," he said. "Standing alone, the land would earn very little."
Sullivan further argued that Talisker could not base the lease rate on a percentage of PCMR's earnings.
According to attorneys for Talisker, $14.8 million would be equivalent to 27 percent of PCMR's annual earnings. But PCMR attorneys said $14.8 million was more like 50 percent to 60 percent of earnings before taxes. Such lease rates would drive PCMR out of businesses, they argued.
Talisker countered that the land in question is worth $11.4 million based on what Vail is now paying for it. According to Talisker attorney Howard Shapiro, Vail's annual payment of $25 million to Talisker includes $13.6 million for Canyons Resort and $11.4 million for the 2,852 acres of ski terrain at PCMR.
But the judge didn't buy that reasoning.
"That fails the eyeball test," he said. "They paid $25 million for the whole shootin' match. ... The $11.4 million looks like a litigation-manufactured number."
Shapiro, though, argued that two independent parties made the deal, therefore, that sum establishes the land's market value.
In addition, Shapiro said PCMR's own experts noted that without the acreage in question, the resort would lose $16.9 million in annual earnings.
"It has been worth a lot to them," he added.
James Quinn, representing PCMR, told the judge Vail's deal with Talisker was nothing more than a thinly disguised attempt to take over PCMR.
"Rob Katz [CEO of Vail] wanted that land so he could use it to acquire PCMR," Quinn said. "That's the only reason he wanted to pay the above-market value for Canyons."
Although the parties appear miles apart on an agreement, they have until 5 p.m. Friday to nail down a mediated settlement. Those negotiations are separate from the bond, which would allow PCMR to operate until an agreement is reached or litigation is exhausted.
Park City resident Steve Pettison watched Wednesday's court proceedings with interest.
"The whole economy related to Park City requires we have the functioning ski resorts," he said. "If PCMR is not going to operate, it will have a devastating impact on Park City."
Bill Malone, executive director of the Park City Chamber/Bureau, said in a recent interview that the dispute hasn't yet hurt bookings for the upcoming ski season, but warned that it will if not resolved soon.
Mike Sweeney, whose family owns the plaza at the base of the Town Lift, said the outcome of the bond hearing, as well as the mediated negotiations, are crucial to Park City.
If no bond agreement is reached, he said, "it will not be a very pretty sight."