NCPA - National Center for Policy Analysis

Private Fix for Public Parks

June 28, 2012

California is close to finalizing bids from private companies to take over day-to-day operations of six state parks in an unprecedented step by the state to prevent mass park closures after stiff budget cuts. The companies will manage the properties for five years while ownership of the lands continues to reside with the state's government, says the Wall Street Journal.

Ruth Coleman, director of California's state parks, emphasizes that the bids from private companies amount to a "reprieve" for the park system, not a permanent fix. Nevertheless, the stopgap measure is without precedent in the area of public parks, and offers much-needed financial assistance to a cash-strapped state government.

  • California, which has the second largest public parks system by area after Alaska, was scheduled to close 70 of its 278 state parks starting July 1.
  • The closings were necessitated by state budget cuts: annual funding has been slashed by $23 million (20 percent) since 2009.
  • Of those 70, 46 will now remain open due to the fundraising efforts of municipalities, private donors and nonprofits.
  • Because of corporate partnerships, six parks (in addition to the 46) will now remain open.
  • The state's first corporate agreement will be with American Land & Leisure Co., a firm that operates campgrounds in multiple states, which will take over operations of three state parks.
  • Three other state parks also are slated for private management, which covers running all concessions, visitor services, security and parks' legal liabilities.

Within the bidding process, interested firms will offer the state either a flat payment or a negotiated revenue-sharing scheme in order to compensate the state for the business opportunity.

Some local residents have expressed hesitance regarding the change in management, citing fears that user fees will be raised in order for profits to be maximized. This problem did not exist when the parks were under state management, which offers an explanation for why some parks were operated at substantial annual losses.

Source: Max Taves, "Private Fix for Public Parks," Wall Street Journal, June 17, 2012.

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