Coyote Blog

As readers will know, the US Forest Service has issued and unprecedented and unnecessary order to close over a thousand privately-funded campgrounds that don't take one dime of Federal money (example here).  All the 100+ parks we operate in the US Forest Service have been ordered closed.

But there appears to be more to this story.  There are several groups that operate parks on National Forest lands under agreements nearly identical to ours who appear to have been exempted from the closure order.

• Large corporations that run ski resorts and certain other large resort properties on National Forest lands have been exempted.  It should be noted that ski resorts operators, unlike campground operators, have full-time lobbyists stationed in Washington and can afford in-house staff lawyers to fight these kinds of orders.  My guess is that knowing they would immediately get sued if they ordered larger private firms to close, the USFS focused only on smaller and more helpless private firms.
• Many state parks, including at least 3 in Arizona and many in California, are actually on US Forest Service land and operate through special use permits almost identical to those we have with the USFS, yet none of these parks have been asked to close  (Slide Rock and Fool Hollow State Park in Arizona and Burney Falls SP in California are just a few examples of state parks that operate on US Forest Service land).

In other words, the US Forest Service seems to be issuing closure orders inconsistently, targeting only private operators who are too small to fight back.  The USFS has not been especially clear how they are justifying this order (perhaps since it can't be justified) but they have hinted that it is either because a) they can no longer "administer" these contracts, whatever that means since they have no day-to-day administration responsibilities or b) they are removing everyone from Federal lands.  Note, though, that both explanation "a" or "b" would apply equally to ski resorts and state parks operating on Federal land leases which are not being closed.

I will also add that the USFS is continuing to allow individuals to hike and camp in non-developed areas of the forests.  I have no problem with this -- there is no reason for the USFS to halt public access to public land just because their employees are getting a paid vacation.  But this just highlights how crazy and inconsistent their policies are.  People can camp in the National Forest everywhere except in developed campgrounds where private companies who take no Federal money normally have employees on site to clean up trash and provide security and prevent fires.  Many campers take good care of the land but some do not, and driving these campers out of privately-operated developed sites into dispersed areas where their impact cannot be mitigated is just another way these actions increase rather than decrease costs.

Fox Business has done an article on the government closing of privately funded parks.

One interesting note - many state parks operate on Federal land using almost exactly the same king of lease contract (called a special use permit) we have to privately operate parks and campgrounds.  If private parks with this type of lease with the USFS have to close, shouldn't state parks as well?  For example, both Slide Rock SP in Arizona and Burney Falls SP in California operation using the same kind of lease as we do.

The AZ Republic has an editorial today saying that privatization is not the answer for the Arizona State Parks budget woes.   On the plus side, they did actually call me for my opinion yesterday before they published it.  On the down side, they ignored everything I said.  Here is my response:

I run one of the larger private parks management companies in the country, which is based right here in Phoenix. Like many Arizona residents, I am a frequent visitor to our state parks and am sympathetic to their current budget pain. Further, I am not one to offer up privatization as a panacea for all the park's woes -- the state parks organization fulfills a variety of public missions that cannot be undertaken well privately. But I think you missed a couple of important considerations in your editorial today counseling against privatization options.

First, from my experience with public recreation agencies around the country, these budget pressures on parks organizations never really end. Recreation is almost always a key pawn in budget fights, and even if Arizona State Parks funding is restored this year, we likely will be fighting the same battles in a few years. Private concession management of parks has the advantage of taking parks off the budget, so they no longer can fall victim to budget fights. For example, in the famous 1995 federal government shutdown, private concession run facilities in the US Forest Service were the only federal recreation options that remained open through the whole budget battle.

Second, while small low-visitation parks, on a standalone basis, may not represent a very good business opportunity, there are a variety of ways to handle privatization of smaller parks. We run approximately 175 public parks and campgrounds across the country, and well fewer than half of these stand on their own as private business opportunities. But many public agencies have learned to package smaller, low-visitation parks with higher-visitation parks into multi-park packages that both provide operators a business opportunity as well as meet the public's goal of keeping all of its parks open. Further, states like California have found many creative ways to keep historic sites open using private management. These solutions, at places like Columbia State Park, not only keep historic buildings open to the public but also create events and services that bring history alive and make it more interesting, particularly to children.

I know that private management is often sloughed off with statements like, "they would just build a McDonald's or put in a bunch of billboards." But thousands of parks nationally are managed privately, and this never happens. In part, this is because business people should get some credit for intelligence, and they understand what attracts people to outdoor parks in the first place and don't want to mess with the ambiance. In addition, we often have 100+ page operating agreements in place that carefully set out the quality of our services and the approvals we must obtain to make any changes to the facilities.

Further, it is sometimes suggested that private companies would just jack up the price. Well, Arizona State Parks is proposing to raise the Slide Rock entrance fee to $20. In contrast, we run nearby picnic and day use areas at places like Grasshopper Point and we rapacious capitalists only charge $8.

I am not advocating that Arizona State Parks turn off the lights and throw the keys to a private company; but I do think that private concession management could offer a piece of the long-term solution to keeping state parks open, both now and in future budget battles.

For the last year, I have watched in total frustration as Arizona State Parks threaten closure after closure to fix budget problems.  This is, of course, when they are not begging for new taxes to be dedicated to them.

For those who don't know, my company is in the business of privatizing public recreation.  At the moment, we are so swamped with requests from public authorities to keep parks open that I don't really bother going out and seeking new business.  But it is frustrating for me as an Arizona resident to know that many of these parks could remain open  (and user fees kept reasonable) under some sort of private concession management.

I know this may seem weird to you given that I work so much with governments, but I have no idea how to lobby government.  Unlike, say, John Murtha related enterprises, we get all the business we need simply responding to inquiries from public authorities who need help and submitting proposals in response to RFP's**.  In fact, if I had to lobby to keep the business running I would shut it down first.

So I have had no idea how to approach those involved in the Arizona parks debate to tell them there are alternatives.   I get frustrated each day as I see folks in the parks organization tell the media that private management would not work because none of their parks would make good business opportunities, when I know for a fact this is not true  (I operate stores in two of the parks and am familiar with several others, and have sent them unsolicited management proposals to run these parks -- again, I am not necessarily seeking the business, but I want to give the lie to the statement that private companies would not be interested).  Interestingly, two of the largest private recreation managers in the country are located in the Phoenix area, and neither of us have ever gotten a media call on this issue.

Of course, I am not completely naive.  I know there is a tried and true kabuki dance here where parks departments threaten to close down the Washington Monument in a bid for public sympathy that will either deflect budget cuts or spur new taxes.  I also know that state parks directors have sworn a blood oath together never to let private concessionaires run whole parks, even if the parks have to be shut down  (our company runs whole parks for folks like the US Forest Service and TVA, but most state parks only let concessionaires run the store or marina, not the whole park).  I know this anti-private law of omerta exists, because our company once sponsored a breakfast at a national state parks directors conference and we were in the room (unknown to the speakers) when this no-private-company discussion was held.

I have called and sent letters to nearly everyone in the state, but have not gotten any response.  To assuage my frustration that no one is even reading them, I will reprint one here just to say that someone, even if it is a reader in Australia, actually looked at it:

Janice K. Brewer, Governor;   Reese Woodling, Chair, Arizona State Parks Board; Maria Baier, State Lands Commissioner; Rene Bahl, Arizona State Parks Director

Many of the state parks currently proposed for closure could easily be kept open to the public under private concession management.  I run one of the larger operators of public recreation concessions in the country, and our company is the current store and marina concessionaire at Patagonia Lake State Park and Slide Rock State Park.  I know from experience both with public recreation in general as well as with Arizona State Parks that these parks (as well as many other in the ASP system) could easily be operated by a company like ours, retaining high quality recreation options for the public while converting a liability for the state into a financial asset.

For years we have urged the management of Arizona State Parks to consider private operations of more than just the stores in these parks.  For example, we operate whole parks turnkey for the US Forest Service, the National Forest Service, the Tennessee Valley Authority, the United Water Conservation District (CA), and the Lower Colorado River Authority (TX).  By operating the park to high quality standards but at a lower cost, we are able to make a profit for ourselves and pay an annual rental fee (usually contracted as a percentage of sales) to the government authority that owns the park.

I find it tremendously frustrating that the private concession option has not even been put on the table for discussion, or gets sloughed off with tired clichés such as "private companies would just put up a McDonalds."  When we operate any public park, we operate under a strict and detailed operating agreement, typically running over 100 pages, that sets procedures for everything from bathroom cleaning frequency to approvals for fee changes.  We operate busy day use facilities such as Grasshopper Point and Crescent Moon along Oak Creek in Sedona side by side with Arizona State Parks at Slide Rock, and we maintain these facilities in at least as good a condition, while keeping fees to $8 (vs. $20 at Slide Rock) and still paying rent to the USFS for the concession.

I am not looking for any special consideration for our company.  I know such contracts must be competitively bid and we don't shy away from such competition.  However, I know that the management of Arizona State Parks has, for whatever reason, been resistant to the idea of private concession operations of entire parks, and I was afraid that this option may not have been presented to you as a viable alternative to closing these facilities.

I would be happy to discuss private concession management any time with you or your staff.

Sincerely,

Warren Meyer
President

Postscript: Interestingly, the most open state parks director to these ideas was Ruth Coleman in California.  Contrary to what one might expect, California State Parks is actually one of the more innovative and creative parks organizations out there in terms of privatizing certain functions and seeking private capital  (Texas, on the other hand, is one of the worst --  go figure).

Ms. Coleman was very supportive of our making investments in California Parks (example:  Cabins here) where no other park system has been so open.  She was nice enough to allow our company to sit on a panel of folks looking at potential solutions to the California Parks budget issues.  But her organization was openly hostile to any private participation, and essentially said they would rather see parks closed than remain open under private management.   For example, here was probably the most supportive comment we got:  "Well, I guess I could accept some private companies in the parks as long as we didn't allow them to make a profit."  Again, that was the least hostile statement.

**Footnote: The typical lifecycle of this business is that a public agency runs to us begging to take something over to keep it open.  We do so on a quickly negotiated contract, and then find ourselves spending a ton of money to fix all the deferred maintenance problems left by the public agency.   About when we finally get the place cleaned up and public trust restored and finally have the prospect to make a little money at the location, the public agency decides it is time to seek competitive bids.  Everyone who refused run the place when it was a mess now come out of the woodwork to bid on running the facility now that its fixed up, several of whom seem to have oddly close relationships with senior officials of the public agency.  We bid, some of which we win and some of which we lose.  If we win, we get to enjoy the fruits of our labor.  If we lose, we shrug and try again.

This week, an odd substance has been spotted in Arizona rivers.  Courtesy of a commenter badassredskin on Fark.com, some good Sedona flood before and after pictures:

Slide Rock Park, near Sedona before (note bathroom building for reference)

Same park, more recently:

This has made a real mess of the Oak Creek Canyon near Sedona, which by the way I consider one of the most beautiful spots on earth.  Slide Rock Park is a great park, though I am a bit biased since my company runs the concession store at Slide Rock Park.  Our building at this park is fine, but we have had several of our campgrounds in this canyon flooded.

Too bad the weather was not like this for these guys!