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Phoenix, AZ – Adopting a public/private management strategy used successfully for decades by The U.S. Forest Service can ensure that endangered Arizona state parks remain open, are properly and professionally maintained, and are available to the public for years to come.
Due to the state budget crisis, millions of dollars allocated for parks operations were diverted to the state’s general fund. As a result, state parks are suffering, and three parks have closed, according to a member of the Arizona State Parks Board.
“We don’t have any money for fixing buildings, or fixing trails, or fixing bathrooms. We are in a desperate situation,” said Reese Wooding, of the state parks board, to the Tucson Weekly.
The fund cuts in the state budget are so drastic that the agency will have difficulty making payroll on July 1. A statement from The Arizona State Parks Foundation says the proposed 3.5 million in sweeps, “May be fatal to a system on the verge of collapse.”
“It doesn’t have to be this way,” says Warren Meyer, president of Phoenix-based Recreation Resource Management (RRM), a $10M company that manages public parks and recreation areas throughout the U.S.
“With a public-private partnership model used by the US Forest Service (USFS) for thirty years and in over 40 federally-owned parks in Arizona alone, the government retains ownership of the land and control of the use and character of the park while handing over operational tasks that are time, money, and labor intensive to a more cost-effective private company.”
When operating public parks in these partnerships, private companies typically provide visitor services, routine maintenance and repairs (such as bathroom cleaning), landscaping, trash removal and payment of utilities.
“While these operational tasks by no means constitute all the work required to keep parks open, they account for the vast majority of the money spent by the state parks organization in the field,” says Meyer.
“In these contracts, private concessionaires pay for all these costs solely out of the gate fees paid by the public, without further taxpayer subsidy. We pay the public agency a concession fee of 5 percent to 25 percent of park revenues, often converting a money-loser to a moneymaker for the government.”
In these arrangements, the public agency maintains the land in the condition and character the public expects.
“This USFS program is already working in over 40 locations in Arizona,” states Meyer.
“Our expertise combined with an excellent cost position allows us to make the best possible use of the gate fees paid by the public. In the 35 Arizona public parks we manage, this efficiency stretches the gate fees paid by the public so we can continue to invest in needed maintenance and repair.”
“Over the last few years, our company, guided by the Forest Service’s wish lists, have invested in improvements such as new composting rest rooms at Crescent Moon, new shower buildings at Cave Springs and Pinegrove campgrounds, renovations to the Oak Creek Visitor Center, and ADA enhancements at nearly every facility,” says Meyer.
In part because of this attention to keeping facilities clean and in good repair, the public parks RRM operates are consistently ranked among the Top 100 Family Campgrounds in America since 2003, and are recognized as among the best in the state by third-party reviewers such as Sunset Magazine and CampArizona.com.
Many public agencies considering such partnerships worry that this approach might not be applicable to their smaller parks. Allaying this concern, the USFS in Arizona, in order to keep parks open, is successfully bundling large and small parks together in contracts for a general geographic area. The parks are kept open using economies of scale, where profits from more lucrative properties are passed on to the less profitable locations
“The goal of such concession arrangements,” said Meyer “is to keep these special pieces of land beautiful, accessible and available to the public for generations. The objective is to form a partnership combining the public oversight and unique environmental knowledge of the state parks agency with the efficiency and customer service of a private company that can clean and maintain the parks without the need for a taxpayer subsidy. In doing so, we can help achieve financial sustainability for the public parks system.
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Fact Sheet – Public-Private Partnerships for Parks
How it works
- The public retains ownership of the land. Private companies must maintain the desired character and facilities in the park. Typical concession agreements include extremely detailed operational requirements and restrictions.
- The Parks Agency retains responsibility for strategic planning, habitat development and restoration, facilities planning, environmental sciences, rule-making, oversight, and fee approval.
- The private company takes on operational tasks (from maintenance to bathroom cleaning) that consume much of the state parks budgets but don’t impinge on these strategic tasks.
- Private company’s expenses, and therefore most park operations expenses, are paid out of park visitor fees without any additional payments from the state. In return for retaining these user fees, the company pays a competitively-bid rent to the state.
- The state may use this rent to help cover its other expenses, or may reinvest the rent, as does the US Forest Service, in catch-up maintenance and park improvements.
- The substantially lower cost position of private companies allows park operations as well as major maintenance to be performed using existing visitor fees without taxpayer subsidies. For example, the 35 USFS parks run by RRM in Arizona are up to date on their maintenance, while AZ state parks have years of deferred maintenance in their parks.
- More efficient management also allows for lower use fees – for example, while Slide Rock SP summer day use rates rose to $20 last year, RRM lowered the day use rates at neighboring public parks it operates from $10 to $9.
- Private concessionaires have incentives that are well-matched to the public – they make money only if happy and satisfied visitors come back to the park. As a result, the parks operated in AZ by RRM receive very high marks from customers and in third-party surveys such as CampArizona.com. In fact, per dollar of revenue paid by visitors, RRM typically has more people actually working in the parks to serve visitors than does most state parks agencies.
- If the public agency wants to improve the facilities in parks, private companies can be a critical source of capital. RRM has invested in new facilities requested by the US Forest Service in a number of Arizona parks (from shower buildings near Sedona and Flagstaff to completion of the Oak Creek Visitor Center), and have invested more than $3 million across the country helping parks catch up with deferred maintenance and improve the visitor experience.
Even smaller parks can benefit from this model – the US Forest Service has learned to combine small, financially-challenged parks with larger more successful parks -creating regional bundles. There are six successful bundling areas in Arizona to ensure quality management of smaller parks. They are: Sedona/Oak Creek Canyon, Flagstaff, Payson, Mount Lemmon near Tucson, and properties around Kaibab and Show Low. Of the 35-plus sites Meyers runs, only perhaps seven could make money on their own.
“Others make money because they are grouped with other parks,” he said. “In other words, they would lose money as a stand alone but make money in a group because they benefit financially from sharing a manager, equipment, reporting, and excellent operational practices.”
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