For most of our company’s 30 year life, our primary business has been the turnkey operation (and sometimes refurbishment) of public parks and campgrounds.  Today we operate over 150 recreation areas under this model, managing most all the operations and paying all the expenses in exchange for a revenue share payment to the recreation agency.

As with all great new business ideas, we basically were dragged into this new cabin business by our customers.  The first to do so was California State Parks, whose director told me that they didn’t want or need someone to operate the entire campground at McArthur-Burney Falls SP, but they could potentially use some help refurbishing a dated and unpopular camping loop of 24 sites.

You can find the entire case study here, but in short we eventually agreed to convert this primitive camping loop into a cabin loop.  We installed 24 cabins (plus a campsite for our live-on-site host) for about $550,000.  The cabins became property of CSP and we also pay CSP a revenue share, which was over $71,000 in 2017.  The state got a valuable amenity for visitors and a large new revenue stream for no cost, no risk, and no extra operational hassle.

Unfortunately, I can be a bit slow at times and so it took a second customer, Alabama State Parks (case study here) asking for the same thing to convince use that there was a real need among cash-strapped public agencies to get private help to provide new amenities to visitors.  Our web site for this business is at park-cabins.com, and over the coming weeks I will describe more about how it works.

Any of you who read about parks and recreation have heard the noise that our National Parks are “woefully” underfunded, that there are decades of deferred maintenance backlogs, that they are threatened by overuse and so on. And nominally, all of that is true. But consider that the Great Smoky National Park is THE MOST visited park in the entire national park system … and it’s not even close. It gets almost triple the amount of visits as the Grand Canyon! From talking to a ranger, he thinks they get over 11 million visitors per year at the park.

And they charge each of these visitors … zero. Mind you, most visitors who come there are spending an inordinate amount of money to get to the park and to stay and eat and recreate near the park. If you’ve ever been to Gatlingburg and Pigeon Forge, you know what I mean (I’ll leave that rant for some other time). Needless to say, if a family of four is staying at a decent place near the main entrance to the park (there are other less busy entrances, I was over by Wear Cove) and they eat out once per day and they avail themselves of some of the absurd Vegas-like places, they are dropping an easy $2,000 just to be there. Yet, to “ensure access to all” the park remains free. I spend some of the most glorious recreational days of my life in the park this past week and paid zero dollars for it. Compared to everything else I was doing, it was worth well north of $500 to me.

In this brief, 13-minute presentation, I discuss our experience re-opening, refurbishing, and expanding two large TVA campgrounds.  In these examples we invested over a million dollars of private capital in exchange for a revenue-sharing operating agreement for the park.  Here is the story (You have to watch just to find out why this case study video uses the image below:)

In addition to a lot of new content and news, expect a new look at this site soon.  We have already revamped our recreation partnership services website and have a lot more exciting changes in the works.

By the way, if you will be at the NRPA conference in September 2018 in Indianapolis, come by booth 2512 and say hi.

Pretty much no one that I know of is advocating for a full privatization of public campgrounds.  It is not what we do, certainly.   We privatize the operation of public campgrounds, which is different in important ways, as described here:  http://parkppp.com/2012/09/essay-response-should-national-parks-be-privatized/I don’t mind folks being skeptical of things I am passionate about, but I do think this bit of your article was deceptive.  Let me quote it in full:

Private companies are contractually obligated to maintain the properties they operate in national parks. But the Center for American Progress found this doesn’t always happen. Instead, the organization said, some private companies have skirted these obligations and instead further added to the backlog of maintenance for which taxpayers are responsible.

All but one of New Mexico’s national parks had hundreds of thousands of dollars in deferred maintenance as of 2016, totaling more than $213 million, according to National Park Service documents. Carlsbad Caverns National Park has the highest backlog, with $44 million in deferred maintenance, about half for a modernized elevator system. Of the overall total, $16 million in maintenance is considered critical, according to the federal budget. The backlog at Bandelier National Monument is $23 million and it’s $17 million at Chaco Canyon National Historical Park.

The implication is that the second paragraph follows from the first, that these are examples of private companies not keeping up with regular maintenance in parks, but in fact this is untrue.  These are examples of the public agency not keeping up with deferred maintenance.  In fact, the deferred maintenance in privately-operated public facilities tends to be way lower than in publicly operated facilities

The reason the government can charge low fees for camping is in part because these fees do not cover the full costs of operating these camping areas. Oddly, in the same article you sort of brag about low public camping fees in NM while complaining about the amount of deferred maintenance, but you never connect the two.  Have you ever seen a free BLM campground after the campers leave? The cleaning and trash pick-up bill alone is enormous. That is why we get deferred maintenance in public campgrounds, because use fees do not cover the full costs or operation and maintenance while budget appropriations have fallen and the difference is made up by not fixing things. The American Society of Civil Engineers recently estimated the total deferred maintenance at state and Federal parks at $114 billion. Our company operates a number of Forest Service campgrounds in New Mexico and across the country — the total deferred maintenance for which we are responsible at these locations is essentially zero.

This deferred maintenance issue in publicly-operated parks is made worse by the administrative bloat in public agencies.  Rather than use the money they have to provide services on the ground for visitors, much of their budget goes to off-site administrative staff.  My company has 350 employees, two of which are not located in a park (one of whom is me).  Arizona State Parks, which I have studied, has about the same number of employees but over half sit in off-site offices away from parks. Even when these agencies get more appropriated money, they spend it on more administrative staff and not on working down their maintenance backlog.  Well over 90% of the money our company collects in fees gets spent right back in the park itself — no government agency can say that.  Even the concession fees we pay to the government generally go back into the park in the form of capital improvements due to the smart structure of US Forest Service concession agreements.  And when government budget crunch time hits and park funds get swept up into the general fund for other purposes, fees paid to private operators are protected and still go to the parks.

I would distrust private companies to fully control the character and access of parks.  Given a choice, if I had a really nice piece of public land, I might make more money turning it into an exclusive Ritz Carlton resort.  But that is not how these contracts work.  The government retains control of the development and character of its concession-operated parks, so Forest Service campgrounds are always going to be a lightly-developed in a natural setting with total public access for all.  Given that, what we are talking about is whether the bathrooms are cleaned by efficient private companies or by civil service employees with large expensive administrative staffs.

In California, the state parks agency operates its own campgrounds and charges $35 a night (soon to go up I hear) for a primitive campsite without any utilities.  My company operates many public campgrounds in California, many right next door to state parks, and we charge no more than $24 a night and often less for the same site.  And we receive no subsidy of any sort, while California State Parks also gets $400 million or so of taxpayer money in addition to their fees.  And we have no deferred maintenance, while California State Parks have deferred maintenance of $1.2 billion growing at $120 million a year (an older estimate but still probably close to the mark).

The other argument I hear frequently is that government employees are bound to do a better job because they are motivated only by helping the public rather than by crass profit.  But while individual government workers may have a gung-ho interest in public service, their agencies as a whole tend to have a different focus.  Lack of competition, inability to fire poor performers, and few (or no) customer service metrics tend to lead to deteriorating service, as in this great example at the Washington Metro.

One example cited in this article is the decision by the Washington Metro to terminate its service contracts with private escalator maintenance companies and to bring escalator maintenance in-house, where it was said it could be done cheaper and better.   There does not seem to have been any really good analysis on this point at the time of the decision, and one suspects this was more an accommodation to a public employees union eager to increase its membership base.  But, for whatever reason the decision was taken, it has been a disaster:

On the list were Sabrina (CA), Big Pine Creek (CA), Cave Springs (AZ) and Sleepy Grass (NM).  We always love getting positive feedback, of course, but are particularly thrilled in this case since the frequent criticism of private operation of public campgrounds is that private companies will somehow ruin the recreation areas for profit.  Exactly how we would make money by destroying the natural beauty which draws paying visitors to these parks is never explained.  But it is good to have confirmation that we private operators are doing a good job.

I have our trade group counting up the total number of privately-operated public recreation areas on the list and I will post the number here when I have it.

All their lawyers’s actions have done is convince me that it is more important than ever that other business people get good information about what they are getting into before signing up with Applied Underwriters.

To that end, if you are considering workers compensation providers, please see my Applied Underwriters Insurance review here.

The latter point has been the source of many arguments between myself and government parks agencies.  I know parks where the parks manager has one and only one metric for their staff — how many citations did they write each week.  This is crazy.  McDonald’s and Marriott do not give their customers parking tickets.

I thought I had seen every bit of craziness, but I guess I was wrong:

Chaparral-covered hillsides dotted with oaks surround both sides of a barbed-wire fence with signs reading: “U.S. boundary.” John Gladwin, whose Australian cattle dog, Molly, runs freely through the idyllic Simi Hills on a Sunday afternoon, is careful not to cross this border into the federal territory called the Santa Monica Mountains National Recreation Area.

If he’s caught with so much as a foot in the park, which stretches 50 miles from the Hollywood Hills to Point Mugu, the 69-year-old retiree will go to jail. Even more unusual, Gladwin cannot leave a seven-county area, for any reason, without permission from his probation officer.

“The probation department doesn’t even take it seriously,” he snickers. “They deal with gangbangers, drug dealers, murderers. And here I am, for a dog leash.”

The crime for which Gladwin has twice been convicted is a dog-leash citation, violation of Title 36, Volume 1, Section 2.15, Part 2 of the National Park Services’ remarkably detailed regulations: “failing to crate, cage, restrain on a leash, which shall not exceed 6 feet in length, or otherwise physically confine a pet at all times.”

A year of Federal probation for an off-leash dog in a park?  This is just insane.  I understand that leash rules are hard to enforce — everyone thinks leash laws are written for all those other peoples’ dogs.  THEIR dog is an exception.  But our company manages to get compliance without ever handing out even a citation.   A year of Federal probation?  Wow.

Supervisory Park Ranger Bonnie Clarfield, of the U.S. Department of Interior, testified against Gladwin at his November 2013 and April 2014 trials. Colleagues have teasingly dubbed her the “dog narc” — for her strict enforcement of leash laws during her 33 years on the job.

This is not an aberration.  It is incredibly typical or government park management that a park manager has built a reputation not on environmental stewardship or visitor service but on aggressive enforcement of petty ordinances.

Full-time administrators now outnumber full-time faculty. And when times get tough, schools have a disturbing tendency to shrink faculty numbers while keeping administrators on the payroll. Teaching gets done by low-paid, nontenured adjuncts, but nobody ever heard of an “adjunct administrator.”

Replace “faculty” with “people actually working in a park” and administrators with “headquarters staff” and he has described the management of public parks exactly.  Most parks agencies are suffering from administrative bloat, with more people in headquarters than out in the field actually running parks.  When they have layoffs, it is always of field staff and not headquarters administrators.   In the parks world they will even ignore major maintenance needs in favor of making sure they have the funds to keep paying headquarters staff.

It is just absurd.  Of course, in our case, we make a business out of this.  We operate public parks, and have 300 field employees actually in the parks and 2 in headquarters.  It allows us to cut costs while simultaneously doing a better job.