Private Companies Keep Public Parks Open

October 9, 2013

In 2010, Arizona announced it would have to close Red Rock State Park near Sedona due to budget shortfalls. Despite collecting nearly $300,000 a year in admissions fees, the park needed hundreds of thousands of dollars of additional tax money to meet its operating costs -- money the state did not have. The park also had a growing maintenance backlog, as years of budget shortfalls forced park staff to skip critical repairs, says Warren Meyer, the founder and president of Recreation Resource Management.

Next door, the U.S. Forest Service owns Crescent Moon Ranch, a nearly identical public park with similar facilities, visitation and revenues. The fee revenue at this park, however, not only keeps the park fully maintained, it supports a visitor center down the road and adds more than $60,000 to the local Forest Service recreation budget -- all without requiring tax money to operate.

The solution for this has existed for decades. The Forest Service, like the National Park Service and other agencies, used private concessionaires to provide customer amenities such as lodges or boat rentals in public recreation areas. The Forest Service decided to take this one step further and experiment with private management groups operating entire units on a concession basis.

  • Today, more than 1,000 campgrounds and recreation areas are operated by private companies under the supervision of the Forest Service. All of these parks remain open and well-maintained without the need for tax money.
  • Under whole-park private concessionaire arrangements, the Forest Service retains ownership of the recreation area and maintains strict control of its character, facilities and services. The concessionaire leases the facilities and operates them for profit, using the gate fees at the park (and no public subsidies) to pay expenses.

Many fear the loss of their treasured parks to excessive private development. "Won't private operators just build a McDonald's in front of old Faithful?" is a popular question. But such an outcome is impossible under the terms of the contract between the public agency and the private concessionaire.

The partnership combines the oversight and protection of natural resources by the public agency with the operating efficiency and customer service of private companies, keeping public parks open and cared for into the next century.

Source: Warren Meyer, "A Tale of Two Parks," Property and Environment Research Center, September 2013.

 

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