[Federal Register Volume 65, Number 87 (Thursday, May 4, 2000)]
[Notices]
[Pages 26052-26086]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-10984]



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Part III





Department of the Interior





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National Park Service



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Standard Concession Contract; Revision; Notice

Federal Register / Vol. 65, No. 87 / Thursday, May 4, 2000 / 
Notices

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DEPARTMENT OF THE INTERIOR

National Park Service


Standard Concession Contract; Revision

ACTION: Final Revision of the National Park Service Standard Concession 
Contract.

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SUMMARY: The National Park Service (NPS) authorizes certain business 
entities to operate concessions in areas of the national park system. 
The agreements embodying these authorizations are concession contracts 
(and, previously, concession permits) that incorporate NPS terms and 
conditions established by law and prudent contract administration. In 
1998, Public Law 105-391 (the 1998 Act) was enacted which in many 
significant ways affects the content of concession contracts to be 
entered into after its effective date. Accordingly, NPS amends its 
existing standard concession contract to conform to the requirements of 
the 1998 Act and to otherwise make improvements to the standard form.
    NPS, although not required to do so by law, sought by publication 
in the Federal Register on September 3, 1999, public comments on the 
proposed standard concession contract to assist it in the development 
of a final version as a matter of public policy. Similarly, NPS sought 
public comment on the proposed exhibits to the contract and amended 
environmental language by publication in the Federal Register on 
February 23, 2000. NPS, after consideration of public comments, adopts 
a new standard concession contract. NPS points out that the new 
standard concession contract is only an internal guideline for the form 
of concession contracts. The form may be changed by the Director in his 
discretion to accommodate the circumstances of any particular 
contracting situation or otherwise as long as the contract form used is 
consistent with the 1998 Act and 36 CFR part 51.

EFFECTIVE DATE: June 5, 2000.

FOR FURTHER INFORMATION CONTACT: Cindy Orlando, Concession Program 
Manager, National Park Service, 1849 ``C'' Street, NW., Washington, DC 
20240 (202/565-1219).

SUPPLEMENTARY INFORMATION: The 1998 Act, among other matters, amended 
the statutory policies and procedures under which NPS operates its 
concession program. The new law requires adoption of new regulations 
governing the award, content and management of concession contracts. On 
June 30, 1999, NPS published for public comment proposed regulations 
implementing the new law. The final new regulations were published in 
the Federal Register on April 17, 2000. The final standard concession 
contract set forth in this notice reflects the requirements of the 1998 
Act and the requirements of the amended 36 CFR part 51. It also 
reflects a variety of improvements NPS wishes to make to its standard 
concession contract, including a new organizational structure for the 
sake of clarity.

Public Comments

    Fifteen public comments were received in response to the public 
notice, all but one from existing concessioners or their attorneys. For 
the most part, the comments were negative, some going so far as to 
state that ``no one'' will submit proposals under the terms of the new 
concession contract. NPS disagrees. It believes that the new contract 
form is appropriate in light of the 1998 Act and proper administration 
of the NPS concessions program. NPS also believes that it will have no 
difficulty attracting qualified business to submit proposals for new 
concession contracts. NPS concession businesses are profitable and 
enjoyable. NPS considers that many qualified companies will seek to 
become concessioners under the terms of the 1998 Act, the amended 36 
CFR Part 51 and the new standard concession contract.
    Several commenters philosophically objected to the special terms 
that NPS concession contracts contain, terms that are required in order 
to give NPS the ability to properly preserve and protect the resources 
of areas of the national park system and their visitors. These include 
the ability to describe and modify the nature of concessioners' 
operations from time to time and the ability to terminate the contract 
when necessary for resource and visitor protection. NPS appreciates 
that these types of authorities are not typical in commercial leasing 
or contracting arrangements. However, they are essential to achieving 
the NPS mission of protecting and preserving park areas and their 
visitors.
    NPS points out that the provisions objected to for the most part 
are not new provisions but have been successfully implemented over many 
years in a cooperative relationship with concessioners that share the 
goals of preservation and protection of park areas and visitors. A 
concession contract is a special form of government contract that 
requires the contractor to accept terms and conditions necessary to 
achieve these goals. NPS does not expect every businessperson to be 
willing to accept these terms and conditions. However, NPS considers 
that, as in the past, it will be able to attract qualified 
businesspersons, committed to the objectives of park area protection, 
to become NPS concessioners.
    Another general comment was to the effect that the NPS standard 
contract is a ``contract of adhesion,'' i.e., a prospective 
concessioner is not given an opportunity to negotiate the terms of a 
contract. NPS disagrees. If a prospective concessioner seeks 
authorization to operate within the park, he must agree to the 
conditions placed on such operation by the federal agency charged with 
protecting and preserving the national park resources.
    Several comments objected to including contract provisions by 
reference to 36 CFR part 51. The leasehold surrender interest 
provisions of 36 CFR part 51 were cited by reference to protect against 
inadvertent changes to the rules by individual contracts, to shorten 
the contract, and to make the contract easier to understand. However, 
in response to this comment, and to ensure clarity, NPS has included as 
Exhibit A to the final contract relevant leasehold surrender provisions 
contained in 36 CFR part 51 as express terms of the contract rather 
than incorporating these terms by reference to 36 CFR part 51.
    A number of comments expressly incorporated by reference objections 
the commenters had made on the proposed amendment to 36 CFR part 51. 
Those comments are not addressed here unless necessary in relation to 
the new standard contract. The preamble to the final 36 CFR part 51 
addresses public comments on the proposed regulatory amendment.
    A concessioner organization with some 150 existing concessioner 
members made extensive comments on the proposed concession contract. 
Reference in the analysis to comments from the ``general concessioner 
organization'' refers to this incumbent concessioner organization and 
to any individual concessioners that endorsed the comments of the 
general concessioner organization.
    An environmental consulting firm suggested inclusion of references 
to environmental management matters in a number of places in the 
contract. NPS considers these suggested changes to be redundant for the 
most part, as the environmental protection provisions of the contract 
are comprehensive. A further discussion of these issues is contained in 
section 6.
    NPS has made several editorial and conforming changes to the 
proposed

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contract form in addition to the changes discussed below. It has also 
re-labeled the exhibits to the contract to reflect their final sequence 
in the contract and defined ``days'' as used in the contract as 
calendar days. Two new general provisions have been added to section 
19, a standard non-waiver clause and a reference to 28 U.S.C. 2514 with 
respect to claims arising from the contract. In addition, for the sake 
of clarity, the final contract includes the definition of 
``subconcessioner'' as set forth in 36 CFR part 51.

Section-by-Section Analysis of Comments and Changes

    The following discusses significant comments made on the several 
sections of the proposed standard contract. Where no discussion is 
included, no significant comments were received or comments received 
primarily were concerned with related provisions of the proposed 
concession regulations.

Opening Paragraph

    A commenter objected to the description of the parties to the 
contract on the grounds that it suggests that all partners of a 
partnership must execute the contract. This is not the case. However, a 
clarifying change has been made in the final contract.

Purpose and Authorities

Section 1. Term of Contract

    A commenter objected to the use of the word approximately in this 
provision. It has been deleted from the final contract. It also 
objected to the fact that the contract term may be shortened if the 
concessioner does not complete required improvements under the terms of 
the contract for reasons beyond its control. This provision has been 
retained as a necessary and prudent contract term. However, a sentence 
has been added expressly referencing the authority of NPS to extend the 
completion date for reasons beyond the control of the concessioner.

Section 2. Definitions

2(a). Applicable Laws
    Several commenters objected to this definition as being overly 
broad because of possible changes in law. NPS considers this concern to 
be unfounded. Changes in law frequently have applicability to existing 
government contracts. Furthermore, this concept is not new and has been 
standard in NPS concession contracts for many years.
Section 2(b). Areas
Section 2(c). Capital Improvement
Section 2(d). Concession Facilities
    Several commenters suggested that the contract should spell out in 
more detail the concessioner's responsibility for maintenance of 
Concession Facilities. The Maintenance Plan that is attached to each 
NPS concession contract describes in detail the maintenance 
responsibilities of the concessioner.
Section 2(e). Director
Section 2(f). Exhibit or Exhibits
Section 2(g). Gross Receipts
    The general concessioner organization objected to the definition of 
gross receipts on several grounds, stating, among other matters, that 
NPS should have no ``right'' to receive a franchise fee on the 
activities of the concessioner outside of park areas. However, the 
definition of gross receipts refers to receipts generated ``pursuant to 
the rights granted by this contract.'' It is entirely appropriate that 
NPS seek a franchise fee in the form of a percentage of the 
concessioner's gross receipts for all receipts generated pursuant to 
the rights granted by the concession contract.
    The commenter requested a change to exclusion (ix), renumbered (9), 
to clarify that payments from leasehold surrender interest are excluded 
from gross receipts. No change has been made because the definition, as 
proposed, does not include the concept that payments of leasehold 
surrender interest are included in gross receipts.
    Item (x), renumbered (10), has not been changed as requested by the 
commenter. The commenter misunderstands it. The provision applies to 
taxes that are added to approved sale prices that are collected by the 
concessioner and remitted to the taxing authority.
    Most of the other technical suggestions made by the commenter have 
been considered and rejected as inappropriate. Particularly, the terms 
of the definition preclude the concern that gross receipts include 
payments to the concessioner for work the concessioner may perform for 
NPS. Any such payments would necessarily be under the terms of a 
procurement contract and not a concession contract.
    Another commenter requested that the definition of gross receipts 
be changed so as to state that the franchise fee for outfitters and 
guides is calculated only on activities conducted within park area 
boundaries pursuant to the rights granted by the contract. NPS has not 
made this change as it considers that it has a right and an obligation 
to collect franchise fees on all revenues of a concessioner derived 
from the rights granted by the contract regardless of where the 
activities occur. The commenter, however, argues that some NPS field 
managers attempt to calculate franchise fees based on all receipts of a 
concessioner, no matter how derived. If this is true, it is a 
management error, not a matter that requires changes to the standard 
contract.
Section 2(h). Gross Receipts of Subconcessioners
    The general concessioner organization states that the gross 
receipts of subconcessioners should have the same exclusions as 
concessioner gross receipts. NPS has changed this section in the final 
contract to make clear that the gross receipts of subconcessioners 
reported to the concessioner are not subject to exclusions but that the 
general exclusions applicable to the concessioners' gross receipts 
extend to its gross receipts generated by the subconcessioner.
Section 2(i). Leasehold Surrender Interest
Section 2(j.) Leasehold Surrender Interest Value
Section 2(k). Major Rehabilitation
Section 2(l). Possessory Interest
Section 2(m). Real Property Improvements
Section 2(n). Superintendent
Section 2(o). Visitor Services
    A commenter states that the words ``Section 3(a)'' should be 
removed so as to include services provided by the concessioner no 
matter where referenced in the contract. However, Section 3(a) is the 
only place in the standard contract that describes visitor services.
    NPS has also added a new definition, (f), to this section to 
clarify that the term ``days'' used throughout the contract refers to 
calendar days. This section has been re-lettered accordingly.

Section 3. Services and Operations

Section 3(a). Required and Authorized Visitor Services
    A commenter suggested that the inclusion of the instruction under 
this section to the effect that a concessioner may only provide 
unspecified visitor services ``incidental'' to the specified visitor 
services will stifle innovative concession programs and the 
concessioner's ability to meet the expectations of the public. NPS

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disagrees, and notes that this instruction has been standard in NPS 
concession contracts for many years. In addition, concession contracts 
may be amended by agreement of the parties to add additional services 
in certain circumstances. NPS, in the amendment to 36 CFR part 51, has 
addressed the scope of additional services that may be added to a 
concession contract by contract amendment in response to public 
comments. In light of 36 CFR part 51, the sentence regarding incidental 
services has been deleted in the final contract.
Section 3(b). Operation and Quality of Operation
    Several commenters objected to this section on the grounds that it 
is too vague, i.e., operations must be conducted to the satisfaction of 
NPS. NPS disagrees. In the first instance, it notes that all existing 
NPS concession contracts contain this provision in one form or another, 
including the contracts of all of the members of the general 
concessioner organization. NPS is unaware of any litigation at least 
since 1965 based on the alleged vagueness of this term. A comment also 
suggests that the phrase ``except as may be provided by the Director'' 
be added to the second sentence of this provision. NPS has made a 
change to reflect this comment.
Section 3(c). Operating Plan
    Several commenters objected to this provision as it gives the 
Director authority to amend the terms and conditions of a contract's 
Operating Plan. However, NPS notes that this circumstance is required 
by the obligations of NPS under law to ensure that a concessioner's 
operations are not detrimental to the resources of the area or to park 
visitors.
    The concept that NPS and the concessioner could agree ten or twenty 
years in advance as to the details of the concessioner's operations in 
the future is untenable. For example, circumstances may occur where, in 
an effort to protect the safety of park visitors, NPS needs to limit 
the hours that a hotel or restaurant may be open. If NPS had agreed in 
an Operating Plan that a hotel or restaurant would be open certain 
hours, and any change in the Operating Plan was subject to agreement by 
the concessioner, NPS could be effectively precluded from adequately 
and appropriately protecting park visitors to reflect the changed 
circumstances.
    Accordingly, the Operating Plan is necessarily subject to change by 
NPS so that it may carry out its responsibilities under law for the 
proper management of park areas. However, the provision expressly 
states that changes may not be inconsistent with the terms and 
conditions of the main body of the contract. NPS notes that this 
concept is contained in the prior NPS standard concession contract. It 
is not a new provision. NPS has modified this provision in the final 
contract, in response to comments, to make clear that any changes to an 
operating plan must not only be consistent with the terms of the main 
body of the contract but must also be reasonable and in furtherance of 
the purposes of the contract.
Section 3(d). Merchandise and Services
Section 3(d)(1)
    The general concessioner organization states that this provision is 
too broad. However, this same (or similar) provision is contained in 
all existing concession contracts, including the contracts of all of 
the members of the organization. NPS does not consider it to be too 
broad; rather, it provides the NPS the ability to carry out its 
responsibilities under law for the proper management of park areas.
Section 3(d)(2)
    A commenter objected to this provision on the grounds that it is 
too broad, suggesting that it applies to confirmation of reservations 
and other day-to-day activities of a concessioner. In response, NPS has 
included the word ``promotional'' to modify ``material'' in the final 
contract. As requested by the general concessioner organization, the 
phrase ``in connection with the services provided under the Contract'' 
has been included in the final contract.
Section 3(d)(3)
    The general concessioner organization objected to the term ``all'' 
as contained in this section. NPS has deleted the word in the final 
contract.
Section 3(e). Rates
    The general concessioner organization requests that the standard 
contract contain provisions that allow the concessioner pricing 
flexibility without gaining the approval of NPS. NPS does not generally 
include in concession contracts rate approval provisions except by way 
of reference to NPS rate approval guidelines. However, the NPS rate 
approval guidelines do provide for pricing flexibility without NPS 
approval in certain circumstances.
Section 3(f). Impartiality as to Rates and Services
    NPS has added the phrase ``subject to Section (f)(2) and (f)(3) 
below'' to this provision as requested by the general concessioner 
organization. It also notes that Exhibit C was published for public 
comment on February 23, 2000. It has also changed Section 3(e)(2) to 
make clear that any modification of a pricing policy by NPS will be in 
the course of the general rate approval program.

Section 4. Concessioner Personnel

Section 4(a)(1)
Section 4(a)(2)
    The general concessioner organization and others objected to this 
section on the grounds that Exhibit C may be unlawful as a result of a 
judicial decision. The Exhibit C included in the standard concession 
contract meets all legal requirements.
Section 4(a)(3)
Section 4(a)(4)
    Several commenters objected to this section as being too 
burdensome. NPS has limited its application in the final contract to 
persons to whom a job has been offered. It has not deleted the word 
``appropriate'' as requested by one commenter. The word indicates that 
the level of effort regarding background checks is to be commensurate 
with the circumstances.
Section 4(a)(5)
    Several commenters objected to this section on the grounds that it 
is impracticable to achieve. It has been deleted from the final 
contract.
Section 4(a)(6)
Section 4(a)(7)
    The general concessioner organization objected to this section on 
the grounds that it may require a concessioner to fire an employee. 
That is correct. It may be necessary to for a concessioner to fire an 
employee, e.g., an employee that is stealing from guestrooms, in order 
to correct the situation. However, the word ``fully'' has been deleted 
in the final contract as unnecessary.
Section 4(a)(8)
    Several commenters objected to the requirement that concessioners 
maintain a drug free workplace to the ``greatest extent possible.'' 
NPS, however, considers that most concessioners and the American public 
share this goal.
Section 4(a)(9)
Section 4(a)(10)
    In response to a comment by the general concessioner organization, 
NPS has changed this section in the final contract to make clear that 
it is

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operative only when an employee is found to be in violation of 
controlled substance laws.
Section 4(b). Employee Housing
    NPS has changed this section, in response to comments, to limit it 
to the reasonableness of rates a concessioner charges employees for 
housing. It has also changed the requirements for employee recreational 
activities in response to comments.

Section 5. Legal, Regulatory and Policy Compliance

Section 5(a)
    The general concessioner organization objected to this section ``if 
it purports to give the government the right to renege on vested 
contract rights.'' NPS considers that the section is appropriate and in 
accordance with existing law regarding the rights of the Congress or an 
executive agency to amend statutes or regulations promulgated under 
statutes. NPS does not consider that this section gives NPS the ability 
to alter vested contract rights.
Section 5(b)
    The existing concessioner organization suggested that this section 
be changed to make clear that it applies to violations of law by the 
concessioner. NPS has made a change in the final contract in response 
to this comment.

Section 6. Environmental and Cultural Protection

    On February 23, 2000, NPS published a revised proposed version of 
this section (and minor modifications to related sections) for public 
comment. Thirteen public comments were received and are responded to as 
follows (except for comments that were repetitive of comments received 
earlier on the proposed concession contract and regulations).
1. Addition of a New ``Whereas Clause''
    One comment suggested that this introductory clause is superfluous. 
NPS disagrees. The clause sets forth an understanding of the 
environmental objectives of the contract. It is included in the final 
contract.
2. Modification of the Definition of ``Applicable Laws''
    No comments discussed this definition except as a reiteration of 
earlier comments.
3. Addition of a Definition of ``Best Management Practices''
    The general concessioner organization objected to the concept of 
``Best Management Practices'' to the extent that implementation of BMPs 
as defined would not provide the concessioner a financial return. NPS 
considers that in many instances the implementation of BMP's will 
provide a specific return on investment. In other circumstances, NPS 
considers that investment in BMPs is likely to enhance the quality of 
the concessioner's operations and, therefore, indirectly provide 
financial return.
    Another commenter stated that it considers the definition to be 
vague. NPS does not consider this to be the case. The concept of BMPs 
is not new; it is well known in many commercial settings. The commenter 
also asked several specific questions regarding implementation of BMPs. 
However, the applicability of the BMP concept to particular 
circumstances cannot be done in the abstract. NPS does note, however 
that the BMP implementation is required only to the extent reasonable 
in light of the particular circumstances of the contract.
    Another commenter suggested a change to the definition to the 
effect that BMPs are practices not required by law or are used in the 
absence of regulatory requirements. NPS does not consider this 
definition to be accurate.
    The definition of BMPs as proposed by NPS is contained in the final 
contract.
4. Proposed Change to Section 5
    A comment suggested that requiring notice of violation of 
environmental laws and taking corrective action is ambiguous and 
burdensome. NPS does not consider either to be the case. The provision 
is included in the final contract.
5. Proposed Changes to Section 6
    Section 6(a). Environmental Management Objectives. A comment 
suggested that NPS adopt a corresponding obligation to incorporate BMPs 
in its activities. This is being done administratively in the form of 
new environmental management policies and practices being developed for 
management of the national park system.
    Section 6(b). Environmental Management Program. A comment 
questioned how NPS intends to take into account the costs associated 
with the development of an Environmental Management Program by NPS. NPS 
considers that the costs of environmental management activities are 
costs of doing business by all commercial entities that engage in 
activities that may affect the environment. NPS does not consider that 
associated costs for these purposes require any more consideration by 
NPS than a concessioner's other costs, e.g., insurance, maintenance, 
personnel, etc.
    A comment suggested that this subsection should be amended to allow 
for other methods of measuring environmental performance. NPS, however, 
considers that the identification of specific goals and targets is the 
best means to achieve the purposes of the Environmental Management 
Program.
    A commenter suggested that the goals for the Environmental 
Management Program should be established by NPS rather than the 
concessioner and that they must meet minimums set by NPS. This, 
however, is not the intention of NPS. The plan is to be developed by 
the concessioner to meet the objectives set forth in Section 6(a).
    Several comments objected to the term ``environmental audits'' as 
used in this section as having unintended legal implications. An 
environmental consulting firm suggested changing the term to 
environmental ``self-assessments.'' This change has been made in the 
final provision.
    The environmental consulting firm also suggested that the provision 
require environmental outreach programs to be conducted by the 
concessioner. NPS considers this to be an appropriate objective but 
believes that it should be achieved through encouragement rather than 
by contractual obligations. The same is true with the comment's 
suggestion for concessioner employee award programs for exceptional 
environmental performance.
    Section 6(c). Environmental Performance Measures. A commenter 
suggested that a new provision be added to this section requiring the 
concessioner to comply with the NPS environmental audit program. This 
comment misunderstands the nature of this program.
    Section 6(d). Environmental Data, Reports, Notifications, and 
Approvals. A commenter suggested that the responsibility for 
notifications of discharges should be limited to discharges on lands 
assigned to the concessioner. NPS disagrees. Discharges anywhere in the 
vicinity of the park area are of concern to NPS.
    The same commenter suggested that a concessioner should not have to 
submit private communications with counsel to NPS. However, section 
(d)(5) does not state such a requirement.
    A comment suggested that the term ``waste stream'' is vague. NPS 
disagrees and notes that the types of waste a concession operation will 
generate will vary from park to park. No other

[[Page 26056]]

comments suggested that the term was vague.
    The same comment suggested that section (d)(3) may require notice 
of any type of waste, not just hazardous substances. However, the 
section only applies to waste that is subject to regulation under 
applicable law.
    A comment suggested that notifications be protected against public 
disclosure. Usual public availability rules (under the Freedom of 
Information Act) will apply to notifications received by NPS.
    A comment suggested that the requirement for a concessioner to give 
NPS notice of violations may be inconsistent with laws that give States 
environmental enforcement responsibilities in certain areas. The NPS 
requirement is not inconsistent with these laws. NPS has a right as 
owner of the property to be made aware of violations of law by a 
concessioner, irrespective of the law's enforcement authority.
    A comment stated that requiring notice of any ``threatened'' notice 
of violation is too broad. NPS has changed this section to make clear 
that it applies only to written communication from appropriate 
authorities.
    Section 6(f). Corrective Action. A comment, referring to comments 
on the initial proposed section 6, requested the deletion of the word 
``clean up'' on the grounds that only clean up required by law or 
specific guidelines incorporated into the contract should be allowed. 
NPS disagrees. NPS has the right, as the owner of the property, to 
require concessioners to clean up in the event of environmental 
accidents. As to guidelines for clean up, they will be dealt with as 
necessary in operation and maintenance plans and NPS policies. The 
comment also requested a clarification that this section does not apply 
to the removal of building materials already incorporated into 
structures. This may generally be the case, but, if required by 
Applicable Laws, such removal must be undertaken.
    Several comments suggested that it is unclear that this section is 
intended to be applicable only to violations of Applicable Laws. NPS 
considers that the section is clear that this is the case. Another 
comment suggests that the phrase ``response actions necessary to 
remediate the release is vague.'' NPS disagrees and notes that only two 
duplicative comments made this point.
    This section was incorrectly numbered and is now subsection (e) in 
the final contract.
    Section 6(g). Indemnification and Cost Recovery for Concession 
Environmental Activities. A comment suggested that subsection (g)(2) be 
amended to clarify that NPS orders for environmental clean up or 
corrective action may not be inconsistent with requirements of 
enforcement authorities. NPS agrees and has made a clarification to 
this effect.
    A comment suggested that the indemnification clause of this section 
should be mutual. NPS, however, even if this were appropriate, does not 
have legal authority to enter into indemnification provisions. The same 
comment suggested that the indemnification clause should make clear 
that the indemnification does not extend to losses caused by the United 
States. NPS considers that the clause is clear in this respect. The 
comment also states that costs to be assessed must be reasonable. NPS 
considers that this is implicit in the provisions. Finally, the comment 
suggests that the provision should include a clause to the effect that 
it does not foreclose the concessioner's right to collect costs from a 
responsible third party. NPS has included such a provision in the final 
contract.
7. Adding a New Subsection to Section (a)(3)
    No express comments were received on this change. It has been 
included in the final contract.
8. Amendment of Proposed Section 15(b)
    No express comments were received on this section. It has been 
added to the final contract.
9. Amending Section 16 of the Proposed Contract
    No express comments were received in response to this proposed 
change.

Section 7. Interpretation of Area Resources

Section 7(a)
    The general concessioner organization objected to this section as 
being too vague. It has been modified in the final contract to address 
the concerns of the commenter.
Section 7(c)
    This section has been deleted as unnecessary in the final contract.

Section 8. Concession Facilities Used in Operations by the Concessioner

Section 8(a). Assignment of Concession Facilities
    Several commenters objected to this section on the grounds that it 
permits NPS to assign additional lands or buildings to the concessioner 
without its consent. The section, however, does not say this. Adding 
additional concession facilities to the concessioner's land assignment 
would require mutual agreement.
Section 8(b). Concession Facilities Withdrawals
    The general concessioner organization objected to this section on 
the same grounds it objected to Section 8(a). However, Section 8(b) is 
different. It permits NPS to withdraw land assignments without the 
agreement of the concessioner in limited circumstances, i.e., that 
withdrawal is necessary for the enhancement or protection of park area 
resources or visitor protection and enjoyment, the operations utilizing 
the land have been terminated, or the land is no longer necessary for 
the concession operation.
    NPS notes that this provision is unchanged from the prior standard 
contract with respect to resource and visitor concerns. The right to 
withdraw assignment in these circumstances is necessary in order to 
carry out NPS's responsibilities for management of park areas. However, 
in response to the comment, NPS has deleted the word ``enhancing'' in 
the final contract. NPS has not deleted the right to withdraw land when 
it is no longer necessary for the purposes of the concessioner's 
operations.
    Commenters objected to this right; however, it is necessary to 
permit NPS to carry out its statutory responsibility to only permit 
``necessary and appropriate'' concession facilities and activities on 
parklands. Circumstances change over time so that land assigned to a 
concessioner as ``necessary'' may cease to be necessary at a later 
date.
    However, NPS, in response to comments, has included in Section 8(c) 
the provision that the concessioner may terminate the concession 
contract in the event of permanent land assignment withdrawals by the 
Director which the concessioner considers are essential for the 
concessioner to provide the visitor services required by the contract.
Section 8(c). Effect of Withdrawal
    The general concessioner organization requested that the word 
``partial'' be included before the word ``termination'' in the first 
sentence. However, the commenter apparently misunderstands this 
section. NPS would be obliged to pay the concessioner for any leasehold 
surrender interest it may have in any permanently withdrawn capital 
improvement. The organization also asked that provisions be included in 
the contract for payment to the concessioner

[[Page 26057]]

for any personal property associated with withdrawn Concession 
Facilities.
    NPS does not consider this to be appropriate. Except in special 
circumstances, personal property is owned by the concessioner and may 
be disposed of as the concessioner sees fit.
    This section is unchanged in concept from the current standard 
concession contract.
Section 8(d). Right of Entry
    The general concessioner organization objects to this section on 
the grounds that it is overbroad. NPS considers the provision necessary 
to properly carry out its responsibilities for administration of the 
park area. It also notes that the United States is the owner of all 
Concession Facilities within the boundaries of the park area.
Section 8(e). Personal Property
    The general concessioner organization and others objected to this 
section on the grounds discussed under 8(c) and also on the grounds 
that this section gives NPS too much authority to withdraw 
improvements. However, the section by its terms only applies to 
personal property, not real property improvements.
Section 8(f). Condition of Concession Facilities
    The general concessioner organization objects to this section on 
the grounds that a concessioner should not be responsible for 
deficiencies in a building assigned to it by the government.
    However, the responsibility for maintenance of government assigned 
property is discussed in Section 10 of the contract. The prospective 
concessioner should take steps to be aware of the condition of the 
facilities to be assigned to it prior to submitting a proposal for a 
contract. As discussed under section 8(a) above, the concessioner 
cannot be assigned additional lands or buildings under the contract 
without the concessioner's consent. NPS, in these circumstances, 
considers this provision to be appropriate.
Section 8(g). Utilities Provided by the Director
    The general concessioner organization objected to this section, 
stating that it should be more specific about what utilities may be 
provided by NPS and at what cost. NPS has not made these changes as it 
would be difficult to describe all possible types of utilities that may 
be applicable to the circumstances of particular park areas. NPS also 
notes that it cannot commit to make utilities available to a 
concessioner, as NPS cannot predict to what extent it will have funds 
available to construct and operate utilities. This section has been 
changed to provide that rates for utilities shall be established in 
accordance with applicable laws. NPS is not in a position to establish 
prospectively by concession contract the rates of utility services that 
a concessioner may wish to purchase over the term of a concession 
contract.
Section 8(h). Utilities Provided by the Concessioner
    The general concessioner organization objected to this section on 
the grounds that a concessioner should have a right to obtain utilities 
from a third party without the consent of NPS and to grant utility 
companies access to park property without the consent of NPS. These 
suggestions manifestly conflict with the responsibilities of NPS 
regarding protection of park areas.
Section 8(h)(1)
    The general concessioner organization objects to this section on 
the grounds that it requires a concessioner to purchase water rights 
and turn them over to NPS. The section, however, does not say this. 
Rather, it states that a concessioner shall acquire necessary water 
rights through applicable State procedures and assign any rights 
obtained to NPS. The section does not require purchase of existing 
water rights by the concessioner. This section has been in NPS 
concession contracts for many years.
Section 8(h)(2)
    The general concessioner organization objected to this section on 
grounds that it is unfair that the concessioner must provide utilities 
to the Director at cost. NPS does not consider it good business to 
authorize a concessioner to install utilities in a park area and make a 
profit on the utilities when provided to the government. This section 
has been in NPS concession contracts for many years.
Section 8(h)(3)
    This section refers to appliances and machinery installed in 
connection with utility systems. NPS does not believe these terms to be 
ambiguous. However, the general concessioner organization objected to 
this section on the grounds that it is ambiguous. NPS has not changed 
this section in the final contract as NPS believes that it is not vague 
or ambiguous. This section has not been materially altered from 
previous versions of the standard contract.

Section 9. Construction or Installation of Real Property Improvements

Section 9(a). Construction of Real Property Improvements
    A comment suggested that this section should make clear that it 
only applies to construction on government property. NPS considers that 
the text of this section makes this clear.
Section 9(b). Removal of Real Property Improvements
    The general concessioner organization objected to this section on 
the grounds that NPS, not the concessioner, owns salvage from 
demolished Capital Improvements. NPS has changed this section in the 
final rule in response to this comment.
    The organization also objects to being required to restore land it 
occupies during a concession contract to a natural condition. NPS 
disagrees. Land disturbed for the purposes of a concession operation 
should be subject to restoration by the concessioner.
Section 9(c). Leasehold Surrender Interest
Section 9(d). Concession Facilities Improvement Program
Section 9(d)(1)
    The general concessioner organization suggests that this section be 
changed to reference the Department of Labor's CPI-U Index. NPS has 
made this change in the final contract. The organization also requests 
that a ceiling on improvement costs be included. NPS has not accepted 
this suggestion. A concessioner is able to make its own cost estimates 
in advance of contract award.
Section 9(d)(2)
Section 9(d)(3)
    The general concessioner organization argues that this section is 
too vague. NPS disagrees and notes that the substance of most of this 
section has been contained in NPS concession contracts for many years. 
The provisions clearly state the obligations of the parties regarding 
commencement of construction.

Section 10. Maintenance

Section 10(a). Maintenance Obligation
    Several commenters objected to this section on grounds that it is 
too vague. They suggest that the contract should cover in detail all 
aspects of maintenance. NPS disagrees with this. Maintenance needs will 
change from time to time and cannot possibly be fully anticipated over 
the life of a long-term concession contract.

[[Page 26058]]

Section 10(b). Maintenance Plan
    Several commenters objected to this section for the reasons 
discussed above with respect to Operating Plans, i.e., that it allows 
NPS to revise Maintenance Plans without the agreement of the 
concessioner. The NPS response is the same. NPS must have the ability 
to specify maintenance obligations of a concessioner over the term of a 
contract in order to carry out its responsibilities to protect and 
preserve park resources and visitors. Maintenance requirements are not 
static.
    For example, it may be determined during the term of a contract 
that the use of a certain type of paint is detrimental to a native 
plant species located in the vicinity of a hotel. Unless the use of the 
paint was determined to be unlawful under Applicable Laws, NPS would 
not necessarily be in a position to effectively require that use of the 
paint be stopped if a change to the Maintenance Plan required the 
agreement of the concessioner.
    Accordingly, no change has been made with respect to the general 
ability of NPS to modify maintenance plans. However, in response to 
comments, NPS has changed this section in the final contract to state 
that changes to a Maintenance Plan must reflect reasonable requirements 
in furtherance of the purposes of the contract.
Section 10(c). Repair and Maintenance Reserve
    The general concessioner organization argues that this provision is 
illegal for the reasons discussed in its comments on the proposed NPS 
concession contracting regulations. These comments are addressed in the 
preamble to the final regulations.
    NPS has made a change in this section in response to comments. This 
is to permit any funds left in the account at the end of the contract 
to remain the property of the concessioner upon the expiration or 
termination of the contract. However, this section has also been 
changed to expressly state that any failure by the concessioner to 
expend funds from the reserve in accordance with its purposes will be 
considered as a material breach of the contract.
    The general concessioner organization made a number of other 
comments regarding this section that were duly considered by NPS. To 
the extent that they did not repeat legal arguments made in comments on 
the proposed concession regulations, NPS does not consider them to be 
of merit.
    One commenter suggested that this provision constitutes an illegal 
taking of property. However, the provision merely requires a 
concessioner to maintain government property assigned to it and to 
escrow sufficient funds for this purpose. This is standard practice in 
commercial leases.

Section 11. Fees

Section 11(a). Franchise Fees
    The general concessioner organization requested deletion of the 
second sentence of this section on the grounds that a concessioner 
should have a right to request a waiver of franchise fees under section 
407(b) of the 1998 Act. This is not the case. section 407(b) refers to 
an adjustment of franchise fees, not a waiver. Section 407(b) is 
reflected in the terms of Subsection 11(d) of this section.
Section 11(b). Payments Due
    The general concessioner organization suggests that any franchise 
fee overpayments due a concessioner at the expiration of a concession 
contract should be remitted to the concessioner by NPS. NPS has made 
this change in the final contract.
Section 11(c). Interest
    The general concessioner organization suggests that NPS should have 
discretion not to charge interest on overdue payments. NPS disagrees. 
In fact, it has a legal obligation to charge interest on overdue 
payments to the government. The commenter also objects to the last 
sentence as vague and overbroad. However, all the sentence states is 
that the Director may impose penalties for late payments in accordance 
with applicable law. NPS does not consider this sentence to be vague or 
overbroad.
Section 11(d). Reconsideration of Franchise Fees
    NPS has made several changes to this section in response to the 
comments of the general concessioner organization (and has used the 
term ``adjustment'' of franchise fees to track the term used in the 
1998 Act).
    First, NPS has made all aspects of the adjustment process (except 
arbitration of an appropriate adjusted fee if the parties agree that 
extraordinary, unanticipated changes have occurred) subject to mutual 
agreement so that no advantage is given NPS. This is consistent with 
changes in the final concession regulations. Second, it has provided 
for prospective adjustments only, as requested by the general 
concessioner organization. Third, NPS has amended the time periods in 
accordance with the suggestions of the commenter. Other conforming 
changes have been made to this section in the final contract.
    NPS notes that several commenters objected to the arbitration 
procedures to be followed. The section has been amended to state that 
the procedures are to be agreed to by the parties or are to be 
established by the arbitration panel.

Section 12. Indemnification and Insurance

Section 12(a). Indemnification
    The general concessioner organization objected to the 
indemnification provision as being too broad. NPS has considered the 
views of the commenter but believes the terms of the indemnification 
provision are appropriate. Nevertheless, NPS has changed the phrase 
``relating to'' to ``connected with'' in this section to address this 
concern. Another commenter suggested that a concessioner should not be 
required to indemnify NPS if the injury arose from the negligence of 
NPS. NPS does not consider that the indemnification provision as 
written suggests this.
Section 12(b). Insurance in General
    Several commenters objected to this on the grounds that it permits 
the Director to alter the contract's insurance requirements. However, 
the liabilities of a concessioner necessarily will change over time as 
a result of new construction, new concessioner activities or means to 
implement activities, or changing visitor patterns and activities. NPS 
must have the authority to require changes to the concessioner's 
insurance program to reflect changing conditions in order to properly 
provide for the protection of park resources and visitors. NPS, in 
response to comments, has added a sentence to this section in the final 
contract setting forth the scope of any changes that may be required.
Section 12(c). Commercial Public Liability
    NPS has amended subsection (4) in response to public comments. 
However, NPS has an obligation to park visitors to make sure that 
concessioners carry adequate insurance. Levels and types of insurance 
necessarily change over time.
Section 12(d). Property Insurance
    Several comments were made regarding this section. NPS has duly 
considered them and has made a change to the final contract to make 
clear that replacement cost coverage is the basis of required property 
insurance. In addition, it has changed the final contract to make clear 
that the concessioner may obtain additional

[[Page 26059]]

insurance other than that required by NPS or in higher amounts. Also, 
it has changed the final contract to clarify that the concessioner is 
responsible for repair or replacement of damaged property even if 
insurance proceeds are not sufficient.
    The general concessioner organization argued that monies a 
concessioner spends to repair or replace property over and above 
insurance proceeds should result in leasehold surrender interest. NPS 
agrees with this to the extent that the concessioner may construct or 
install a capital improvement within the meaning of 36 CFR Part 51 with 
its own funds (not insurance proceeds).
    Finally, NPS has changed this section in the final contract to 
provide that any additional insurance NPS may require must be 
consistent with industry practices.

Section 13. Bonds and Liens

Section 13(a)
    The general concessioner organization states that historically NPS 
has not required bonds. However, NPS concession contracts for many 
years have contained a bond provision. NPS has changed this section in 
the final contract to make clear that bond amounts are to be reasonable 
in response to a comment.
Section 13(b). Liens
    The general concessioner organization objects to this section only 
to the extent that it should not include personal property of a 
concessioner located outside the boundaries of the park area. NPS has 
amended this section in the final rule to reflect this comment. Another 
commenter suggested that the government's lien is unworkable in the 
marketplace. However, this lien provision has been included in NPS 
concession contracts at least since 1965. NPS considers it to be 
workable.

Section 14. Accounting Records and Reports

Section 14(a). Accounting System
    The general concessioner organization considers that the $250,000 
threshold for accrual method accounting is too low. NPS disagrees. NPS 
has a direct interest in the accounting methods of concessioners that 
pay a franchise fee on gross receipts. NPS does not consider that the 
benefits of the accrual method are outweighed by any additional costs 
that the general concessioner organization asserts may result from use 
of accrual method accounting.
    The general concessioner organization reads subsection (3) of this 
section as suggesting that it is not proper for a concessioner to 
purchase services from an affiliate or allocate overhead. This is not 
the case. The provision only states that the concessioner must keep its 
books in such a manner that no diversion or concealment of profits may 
result from such arrangements. This has been a standard provision (in 
the General Provisions section) of concession contracts for many years.
Section 14(b).--Annual Financial Report
    The general concessioner organization requested several changes to 
this section. In response, NPS has changed the time period in 
subsection (1) to 120 days. It has not changed the thresholds for 
accounting by certified independent accountants in order to protect the 
interests of the United States in the collection of franchise fees.
Section 14(c). Other Financial Reports
    The general concessioner organization objected to the last sentence 
of subsection (1) on the grounds that the concepts of useful life and 
book value are irrelevant because of leasehold surrender interest. NPS 
has changed the section in accordance with this comment.

Section 15. Other Reporting Requirements

    The general concessioner organization objected to this section as 
overbroad. NPS has considered these comments but believes that the 
described reporting requirements are necessary for the proper 
administration of the park area.

Section 16. Suspension and Termination

Section 16(a). Suspension
    The general concessioner organization objected to the circumstances 
in which NPS may suspend a concessioner's operations under this 
section. NPS notes that this provision is the same as in its current 
standard contract. However, NPS has modified this section in the final 
contract in response to this comment and to more directly track 36 CFR 
Part 51.

Section 16(b). Termination

Section 16(b)(1)
    A commenter suggested that there is no authority for NPS to have 
the ability to terminate concession contracts ``nor is such power 
provided any government agent under general contract law.'' This, 
however, is not the case. NPS clearly has not only the authority but 
the obligation to include termination provisions in concession 
contracts in circumstances, among others, where park area and visitor 
protections so require. NPS also notes that government procurement 
contracts almost always contain a ``termination for convenience'' 
clause which permits the government to terminate the contract for any 
reason whatsoever. The termination clause contained in most current NPS 
concession contracts and in the final new contract is significantly 
more restrictive (to the benefit of the concessioner) than the standard 
government termination for convenience clause. NPS also notes that this 
section is the same as contained in the current NPS standard contract. 
However, NPS has modified this section in the final contract in 
response to this comment and to more directly track 36 CFR part 51. It 
has also included the modifier ``material'' with respect to contract 
breaches in response to a comment.
Section 16(b)(2)
    The general concessioner organization objected to this section on 
the grounds that it should not permit partial termination of a 
concession contract by NPS. NPS notes that this section has been 
contained in NPS concession contracts for many years. However, in 
response to this comment, NPS has deleted reference to partial 
termination.
Section 16(b)(3)
    The general concessioner organization objected to this section with 
respect to the ``sole discretion'' provided to NPS. NPS has deleted 
this phrase in the final contract. NPS has also, in response to the 
comments of the general concessioner organization, defined ``repeated 
breaches'' in the final contract.
Section 16(b)(3)
    The general concessioner organization stated that this section 
should permit the concessioner an appropriate time period in which to 
obtain the dismissal of such filings. NPS has not made this change, as 
termination in these circumstances is discretionary, not mandatory.
Section 16(c). Bankruptcy
    In response to the comments of the general concessioner 
organization, NPS has amended this section in the final rule to provide 
for notification of NPS in the event of the filing of a petition in 
bankruptcy and to make clear that the description of a concession 
contract with respect to bankruptcy law is the position of NPS.

[[Page 26060]]

Section 16(d). Requirements in the Event of Termination
Section 16(d)(1)
    NPS has included the phrase ``in accordance herewith'' after the 
word ``contract'' in this section as requested by the general 
concessioner organization.
Section 16(d)(2)
Section 16(d)(3)
    The general concessioner organization objects to this provision 
which requires a concessioner, if requested by NPS, to continue to 
operate for a period of time after contract expiration or other 
termination. This has been a standard provision of concession contracts 
for many years. However, in light of NPS's new authorities under the 
1998 Act, NPS does not consider this provision to be necessary and has 
deleted it from the final contract.
Section 16(d)(4)
    NPS has considered the comments of the general concessioner 
organization and does not believe that this section should be changed. 
The provision provides adequate compensation to a prior concessioner 
for the temporary use by a new concessioner of the prior concessioner's 
personal property. NPS notes, in response to a comment, that the 
compensation provisions for temporary use of a concessioner's property 
are generally the same or even more beneficial to the concessioner than 
those that have been contained in NPS concession contracts at least 
since 1965.

Section 17. Compensation

Section 17(a). Just Compensation
    The general concessioner organization states that this provision 
requires the concessioner to accept the compensation provided by 
Section 17 even if NPS breaches the concession contract.
    However, the provision is only applicable to the circumstances 
described in the provision, which do not reference breach of contract 
by NPS.
Section 17(b). Compensation for Contract Expiration or Termination
    Section 17(b) has been reworded for clarity, to reflect the 
deletion of subsection (c), and to delete its last sentence as 
unnecessary.
Section 17(c). Compensation When Contract Terminated for Default
    The general concessioner organization objected to this provision on 
the grounds that NPS may not offset leasehold surrender interest 
payments based on damages caused by a concessioner's breach of 
contract. NPS does not necessarily agree with this comment but has 
deleted this section in the final contract as unnecessary.
Section 17(d). Procedures for Establishing the Value of a Leasehold 
Surrender Interest
    This provision has been changed in accordance with the terms of the 
final amendment to 36 CFR part 51 and for clarity.
Section 17(e). Compensation for Personal Property
    NPS has modified this section in response to comments from the 
general concessioner organization. Particularly, the contract now 
provides 30 days in most cases for a concessioner to remove its 
personal property from a park area after contract expiration or 
termination. This provision has been moved to Section 16(d). However, 
NPS does not agree that concession contracts should provide 
compensation for a concessioner's personal property for the reasons 
discussed above.

Section 18. Assignment, Sale, or Encumbrance of Interests

    This section has been clarified in the final contract to make clear 
that a sale or transfer is subject to all applicable laws, including, 
without limitation, 36 CFR Part 51. Several commenters were concerned 
that this provision (and other provisions of the contract) permits NPS 
to change the conditions for sales and transfers by amending 36 CFR 
Part 51. Amendments to 36 CFR Part 51, however, or to other laws or 
regulations, may be made applicable to existing contracts only to the 
extent permissible under law.

Section 19. General Provisions

Section 19(a)
Section 19(b)
    The general concessioner organization suggests that this provision 
requires NPS to release concessioner information. The provision, 
however, merely states the fact that information provided to NPS by a 
concessioner is subject to public release if required or authorized by 
law. NPS has clarified this provision in the final contract in this 
connection.
Section 19(c)
    NPS has modified this section in the final contract in response to 
a comment from the general concessioner organization that it should be 
clarified to make clear that it only applies to arrangements where a 
third party is to provide visitor services. In addition, NPS has 
deleted the sentences in this section that permitted subconcessions in 
limited circumstances. To the extent that NPS may permit subconcessions 
in the circumstances of a particular concession contract, a contract 
amendment would be negotiated with the concessioner.
Section 19(d)
Section 19(e)
Section 19(f)
Section 19(g)
Section 19(h)
Section 19(i)
    This section has been deleted in the final contract as unnecessary.
Section 19(k)

Exhibits

    On February 23, 2000, NPS published for public comments proposed 
exhibits to the proposed standard concession contract. Thirteen 
comments were received and responded to as follows. An environmental 
consulting firm made a number of comments on the exhibits requesting 
that many references to environmental concerns be included in them. 
Some changes have been made in response to these comments.
Exhibit A. Non-Discrimination (Exhibit C in the Final Contract)
    A comment suggested deleting reference to the term ``permit.'' This 
change has been made in the final contract.
    A comment suggested that the posting requirements of this section 
might be redundant with other federal requirements. The inclusion of 
this provision in the contract, however, is required by law.
Exhibit B. Existing Facilities (Exhibit D in the Final Contract)
    A comment pointed out that the land assignment under this section 
is limited to ``housekeeping purposes.'' The term ``housekeeping'' has 
been deleted in the final contract.
Exhibit C. Assigned Government Personal Property (Exhibit E in the 
Final Contract)
Exhibit D. Leasehold Surrender Interest as of the Effective Date of the 
Contract (Exhibit G in the Final Contract)
Exhibit E. Insurance Requirements (Exhibit I in the Final Contract)
    The general concessioner organization made a number of suggestions 
regarding this section. Several changes have been made in the final 
contract in response

[[Page 26061]]

to these comments. However, in general, NPS notes that this Exhibit E 
is intended to be tailored on a case by case basis to fit the needs of 
particular concession operations.
    A comment objected to the $5,000 self-insured retention as being 
inconsistent with some concessioners' business practices. This may be 
the case, but NPS, in order to protect its interests and those of park 
visitors, considers this limit to be appropriate.
    One commenter objected to the concessioner being required to 
provide NPS with copies of insurance policies. However, this only 
occurs upon the express request of NPS.
    Several comments objected to the specific deductibles required by 
this Exhibit. NPS, however, considers that relatively low deductibles 
are necessary in order to assure that the concessioner will have 
sufficient resources to cover losses.
    The proposed requirement for professional liability insurance has 
been deleted in response to comments.
    A comment stated that flood and other forms of insurance are not 
always available. NPS notes that the insurance exhibit will be tailored 
to fit the needs of particular concession operations. If insurance is 
not obtainable, as determined by the Director, it will not be required.
Exhibit F. Sample Maintenance Plan (Exhibit H in the Final Contract)
    The published maintenance plan was a sample only. None of its 
provisions (except for its introduction) are required. Rather, a 
maintenance plan will be developed for each concession operation on the 
basis of the circumstances of that operation. Accordingly, the final 
contract includes only the required introductory paragraph of the 
maintenance plan but not any of the sample provisions. A number of 
comments objected in general to the fact that this plan may be changed 
from time to time by the Superintendent. Such comments were also made 
in response to the initial publication of the proposed contract. They 
are discussed in the response to comments on Section 10(b). In 
addition, in response to a comment, it is noted that NPS administrative 
guidelines will provide an administrative appeal by the concessioner to 
the appropriate NPS Regional Director with respect to changes to a 
Maintenance Plan proposed by a superintendent of a park area.
    The plan has been amended to include reference to the fact that 
amendments to it must be reasonable and in furtherance of the purposes 
of the contract.
Exhibit G. Operating Plan (Exhibit B in the Final Contract)
    The published operating plan is a sample only. None of its 
provisions (except for its introduction) are required. An operating 
plan will be developed for each concession operation on the basis of 
the circumstances of that operation. Accordingly, the final contract 
includes only the required introductory paragraph of the operating plan 
but not any of the sample provisions. A number of comments objected in 
general to the fact that this plan may be changed from time to time by 
the Superintendent. Such comments were also made in response to the 
initial publication of the proposed contract. They are discussed in the 
response to comments on Section 3(c). In addition, in response to a 
comment, it is noted that NPS administrative guidelines will provide an 
administrative appeal by the concessioner to the appropriate NPS 
Regional Director with respect to changes to an Operating Plan proposed 
by a superintendent of a park area.
    The plan has been amended to include reference to the fact that 
amendments to it must be reasonable and in furtherance of the purposes 
of the contract.
Exhibit H. Concessioner Construction and Repair and Maintenance Project 
Procedures (Exhibit F in the Final Contract)
    A number of comments were made on this exhibit that duplicated 
comments made on the proposed contract with respect to leasehold 
surrender interest provisions and related matters.
    These comments are responded to under the leasehold surrender 
interest provisions. In addition, Exhibit H has been changed in the 
final contract to reflect the changes made to the leasehold surrender 
interest provisions of the final contract and regulations.
    A comment suggested that there is no definition of repair and 
maintenance projects. Further definitions have been included in the 
final exhibit in this connection.
    A comment suggested that the identification of individuals by 
function should permit an individual to perform more than one function. 
NPS considers that this ability is implicit in the terms of the 
Exhibit.
    A comment suggested that the two separate plans should be combined. 
NPS disagrees. There are clear distinctions between the plans.
    A comment suggested that the requirements for identification of 
projects is vague and subjective. The language has been changed in the 
final contract to make it more specific.
    A comment suggested that the procedures for conferences and review 
are unduly burdensome. NPS does not believe this to be the case, at 
least in the circumstances of construction in areas of the national 
park system. The comment suggested that the complete procedures only be 
applicable to construction projects. NPS disagrees. Repair and 
maintenance projects may have the same impacts as construction 
projects.
    A comment suggested that wording should be added providing 
compensation to the concessioner if a project is not permitted to 
proceed. NPS does not consider this appropriate. Concessioners are 
aware that a number of legal and policy considerations must be dealt 
with before any binding commitment to permit construction on park lands 
may be made. The risk that proposed construction or repair and 
maintenance projects may not be approved is a cost of doing business as 
a concessioner.
    A comment suggested that the terms regarding total project cost and 
total project price do not define what costs and expenses are included. 
This would be difficult and non-productive in a generic document such 
as Exhibit H. The expenses and costs associated with projects will be 
identified on a case by case, subject to the limitations of leasehold 
surrender interest cost as described in Exhibit A to the contract.
    A comment suggested that the exhibit provide for a simplified 
process in emergency situations. No change has been made but the 
Superintendent would have such authority in emergency situations.

Suggestions for Additional Provisions

    Several commenters requested that additional provisions not 
mentioned in the above discussion be included in concession contracts.
    A commenter suggested that a dispute resolution clause be included 
in the contract. NPS does not consider this appropriate in light of the 
several arbitration requirements of the contract. In circumstances 
where a dispute is not subject to arbitration, the matter is subject to 
resolution under applicable legal procedures.
    A commenter also suggested that the contract contain a clause that 
permits the parties to agree to alternative dispute resolution 
procedures by mutual agreement. NPS considers that this ability exists 
under the terms of the

[[Page 26062]]

contract as drafted and general contract law.
    A commenter suggested that the concession contract contain an 
exclusivity clause. NPS disagrees for the reasons discussed in response 
to comments on the amendment to 36 CFR part 51.
    A commenter suggested that performance standards should be 
contained in the contract or in an exhibit. NPS is considering the 
possibility of adding additional performance measures to concession 
contracts. For the present, however, NPS considers that the standard 
contract and its exhibits, particularly the operating and maintenance 
plans, are adequate for this purpose. NPS also notes that it has 
previously published for public comment its concessioner evaluation 
program currently in place.
    A commenter suggested that the contract include as an exhibit a 
standard document equivalent to a non-disturbance and attornment 
agreement. NPS disagrees that such a document should be included as 
part of the standard concession contract in light of the greatly 
varying circumstances of concession contracts with respect to the 
scopes of activities.
    Several commenters suggested including a provision referring to the 
preferential right to renewal of certain concession contracts that NPS 
is to grant to some concessioners under certain conditions pursuant to 
the terms of section 403(7) of the 1998 Act. NPS considers, however, 
that inclusion of a contractual provision referring to a possible 
preferential right to renewal under the terms of the 1998 Act would 
only create confusion as it is impossible to know, upon execution of 
any particular concession contract, whether the contract will be 
renewed at all or, if renewed, whether NPS is to give a preferential 
right of renewal to the concessioner under the terms of the 1998 Act in 
light of the conditions applicable to the exercise of such preference.
    A commenter, in response to the notice regarding the revised 
section 6 and exhibits, requested that the standard concession contract 
be republished for further public comment. NPS does not believe this to 
be in the public interest for the reasons discussed in the preamble to 
the final regulations (which are equally applicable to the standard 
contract).
    Based on the foregoing, NPS adopts the following standard form 
concession contract for use in its concession management program, with 
the understanding that it is only an internal guideline. The Director, 
in his discretion, may utilize any form of concession contract he/she 
may choose consistent with the requirements of the 1998 Act and 36 CFR 
part 51.

UNITED STATES DEPARTMENT OF THE INTERIOR

NATIONAL PARK SERVICE

----------------------------------------------------------------------
[Name of Area]

----------------------------------------------------------------------
[Site]

----------------------------------------------------------------------
[Type of Service]

CONCESSION CONTRACT NO._____

----------------------------------------------------------------------
[Name of Concessioner]

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[Address, including email address and phone number]

Doing Business As

Covering the Period

through____------------------------------------------------------------

Concession Contract

Table of Contents

Identification of the Parties
Sec. 1. Term of Contract
Sec. 2. Definitions
Sec. 3. Services and Operations
    A. Required and Authorized Visitor Services
    B. Operation and Quality of Operation
    C. Operating Plan
    D. Merchandise and Services
    E. Rates
    F. Impartiality as to Rates and Services
Sec. 4. Concessioner Personnel
    A. Employees
    B. Employee Housing and Recreation
Sec. 5. Legal, Regulatory, and Policy Compliance
    A. Legal, Regulatory, and Policy Compliance
    B. Notice
    C. How and Where to Send Notice
Sec. 6. Environmental and Cultural Protection
    A. Environmental Management Objectives
    B. Environmental Management Program
    C. Environmental Management Measurement
    D. Environmental Data, Reports, Notifications, and Approvals
    E. Corrective Action
    F. Indemnification and Cost Recovery for Concessioner 
Environmental Activities
    G. Weed and Pest Management
    H. Protection of Cultural and Archeological Resources
Sec. 7. Interpretation of Area Resources
    A. Concessioner Obligations
    B. Director Review of Content
Sec. 8. Concession Facilities Used in Operation by Concessioner
    A. Assignment of Concession Facilities
    B. Concession Facilities Withdrawals
    C. Effect of Withdrawal
    D. Right of Entry
    E. Personal Property
    F. Condition of Concession Facilities
    G. Utilities Provided by the Director
    H. Utilities Not Provided by the Director
Sec. 9. Construction or Installation of Real Property Improvements
    A. Construction of Real Property Improvements
    B. Removal of Real Property Improvements
    C. Leasehold Surrender Interest
    D. Concession Facilities Improvement Program
Sec. 10. Maintenance
    A. Maintenance Obligation
    B. Maintenance Plan
    C. Repair and Maintenance Reserve
Sec. 11. Fees
    A. Franchise Fee
    B. Payments Due
    C. Interest
    D. Adjustment of Franchise Fee
Sec. 12. Indemnification and Insurance
    A. Indemnification
    B. Insurance in General
    C. Commercial Public Liability
    D. Property Insurance
Sec. 13 Bonds and Liens
    A. Bonds
    B. Lien
Sec. 14. Accounting Records and Reports
    A. Accounting System
    B. Annual Financial Report
    C. Other Financial Reports
Sec. 15. Other Reporting Requirements
    A. Insurance Certification
    B. Environmental Reporting
    C. Miscellaneous Reports and Data
    Sec. 16. Suspension, Termination, or Expiration
    A. Suspension
    B. Termination
    C. Notice of Bankruptcy or Insolvency
    D. Requirements in the Event of Termination or Expiration
Sec. 17. Compensation
    A. Just Compensation
    B. Compensation for Contract Expiration or Termination
    C. Procedures for Establishing the Value of a Leasehold 
Surrender Interest
    D. Compensation for Personal Property
Sec. 18. Assignment, Sale or Encumbrance of Interests
Sec. 19. General Provisions
Exhibits
    Exhibit A: Leasehold Surrender Interest
Exhibit B: Operating Plan
Exhibit C: Nondiscrimination.
Exhibit D: Assigned Land, Real Property Improvements
Exhibit E: Assigned Government Personal Property
Exhibit F: Concessioner Construction, Major Rehabilitation, and 
Repair and Maintenance Project Procedures
    Exhibit G: Leasehold Surrender Interest
    Exhibit H: Maintenance Plan
    Exhibit I: Insurance Requirements

[Corporation]

    THIS CONTRACT is made and entered into by and between the United 
States of America, acting in this matter by the Director of the 
National Park Service, through the Regional Director of the __ Region, 
(hereinafter referred to as the ``Director''), and ________________, a 
corporation

[[Page 26063]]

organized and existing under the laws of the State of __________ 
(hereinafter referred to as the ``Concessioner''):

[Partnership]

    THIS CONTRACT is made and entered into by and between the United 
States of America, acting in this matter by the Director of the 
National Park Service, through the Regional Director of the __ Region, 
hereinafter referred to as the ``Director'', and ________________ a 
partnership organized under the laws of the State of __________, 
hereinafter referred to as the ``Concessioner'':

[Sole Proprietorship]

    THIS CONTRACT made and entered into by and between the United 
States of America, acting in this matter by the Director of the 
National Park Service, through the Regional Director of the __ Region, 
hereinafter referred to as the ``Director,'' and, ________________, an 
individual of, doing business as ________________, hereinafter referred 
to as the ``Concessioner'':

Witnesseth:

    That Whereas, [Name of Park, Recreation Area, etc.] is administered 
by the Director as a unit of the national park system to conserve the 
scenery and the natural and historic objects and the wildlife therein, 
and to provide for the public enjoyment of the same in such manner as 
will leave such Area unimpaired for the enjoyment of future 
generations; and
    Whereas, to accomplish these purposes, the Director has determined 
that certain visitor services are necessary and appropriate for the 
public use and enjoyment of the Area and should be provided for the 
public visiting the Area; and
    Whereas, the Director desires the Concessioner to establish and 
operate these visitor services at reasonable rates under the 
supervision and regulation of the Director; and
    Whereas, the Director desires the Concessioner to conduct these 
visitor services in a manner that demonstrates sound environmental 
management, stewardship, and leadership;
    Now, Therefore, pursuant to the authority contained in the Acts of 
August 25, 1916 (16 U.S.C. 1, 2-4), and November 13, 1998 (Pub. L. 105-
391), and other laws that supplement and amend the Acts, the Director 
and the Concessioner agree as follows:

Sec. 1. Term of Contract

    This Concession Contract No. ______ (``CONTRACT'') shall be 
effective as of __________, and shall be for the term of ______ (__) 
years until its expiration on __________, 20 ____ [if the Concessioner 
satisfactorily completes the Concession Facilities Improvement Program 
described in Section 9(e) of this CONTRACT. If the Concessioner fails 
to complete this program to the satisfaction of the Director within the 
time specified, then this CONTRACT shall be for the term of ______ (__) 
years until its expiration on ________________. The Director may extend 
this shortened term (but not beyond the original date of expiration of 
this CONTRACT) in circumstances where the Director determines that the 
delay resulted from events beyond the control of the Concessioner.]

Sec. 2. Definitions

    The following terms used in this CONTRACT will have the following 
meanings, which apply to both the singular and the plural forms of the 
defined terms:
    (a) ``Applicable Laws'' means the laws of Congress governing the 
Area, including, but not limited to, the rules, regulations, 
requirements and policies promulgated under those laws (e.g., 36 CFR 
Part 51), whether now in force, or amended, enacted or promulgated in 
the future, including, without limitation, federal, state and local 
laws, rules, regulations, requirements and policies governing 
nondiscrimination, protection of the environment and protection of 
public health and safety.
    (b) ``Area'' means the property within the boundaries of [Name of 
Park Unit].
    (c) ``Best Management Practices'' or ``BMPs'' are policies and 
practices that apply the most current and advanced means and 
technologies available to the Concessioner to undertake and maintain a 
superior level of environmental performance reasonable in light of the 
circumstances of the operations conducted under this CONTRACT. BMPs are 
expected to change from time to time as technology evolves with a goal 
of sustainability of the Concessioner's operations. Sustainability of 
operations refers to operations that have a restorative or net positive 
impact on the environment.
    (d) ``Capital Improvement'' shall have the meaning set forth in 
Exhibit A to this CONTRACT.
    (e) ``Concession Facilities'' shall mean all Area lands assigned to 
the Concessioner under this CONTRACT and all real property improvements 
assigned to or constructed by the Concessioner under this CONTRACT. The 
United States retains title and ownership to all Concession Facilities.
    (f) ``Days'' shall mean calendar days.
    (g) ``Director'' means the Director of the National Park Service, 
acting on behalf of the Secretary of the Interior and the United 
States, and his duly authorized representatives.
    (h) ``Exhibit'' or ``Exhibits'' shall mean the various exhibits, 
which are attached to this CONTRACT, each of which is hereby made a 
part of this CONTRACT.
    (i) ``Gross receipts'' means the total amount received or realized 
by, or accruing to, the Concessioner from all sales for cash or credit, 
of services, accommodations, materials, and other merchandise made 
pursuant to the rights granted by this CONTRACT, including gross 
receipts of subconcessioners as herein defined, commissions earned on 
contracts or agreements with other persons or companies operating in 
the Area, and gross receipts earned from electronic media sales, but 
excluding:
    (1) intracompany earnings on account of charges to other 
departments of the operation (such as laundry);
    (2) charges for employees' meals, lodgings, and transportation;
    (3) cash discounts on purchases;
    (4) cash discounts on sales;
    (5) returned sales and allowances;
    (6) interest on money loaned or in bank accounts;
    (7) income from investments;
    (8) income from subsidiary companies outside of the Area;
    (9) sale of property other than that purchased in the regular 
course of business for the purpose of resale;
    (10) sales and excise taxes that are added as separate charges to 
sales prices, gasoline taxes, fishing license fees, and postage stamps, 
provided that the amount excluded shall not exceed the amount actually 
due or paid government agencies; and
    (11) receipts from the sale of handicrafts that have been approved 
for sale by the Director as constituting authentic American Indian, 
Alaskan Native, Native Samoan, or Native Hawaiian handicrafts.
    All monies paid into coin operated devices, except telephones, 
whether provided by the Concessioner or by others, shall be included in 
gross receipts. However, only revenues actually received by the 
Concessioner from coin-operated telephones shall be included in gross 
receipts. All revenues received from charges for in-room telephone or 
computer access shall be included in gross receipts.
    (j) ``Gross receipts of subconcessioners'' means the total amount 
received or realized by, or accruing to, subconcessioners from all 
sources, as a result of the exercise of the rights conferred by a 
subconcession contract. A subconcessioner will report all of its gross 
receipts to the

[[Page 26064]]

Concessioner without allowances, exclusions, or deductions of any kind 
or nature.
    (k) ``Leasehold Surrender Interest'' shall have the meaning set 
forth in Exhibit A to this CONTRACT.
    (l) ``Leasehold Surrender Interest Value'' or the ``value'' of a 
Leasehold Surrender Interest shall have the meaning set forth in 
Exhibit A to this CONTRACT.
    (m) ``Major Rehabilitation'' shall have the meaning set forth in 
Exhibit A to this CONTRACT.
    (n) ``Possessory Interest'' shall have the meaning set forth in 
Exhibit A to this CONTRACT.
    (o) ``Real Property Improvements'' shall have the meaning set forth 
in Exhibit A to this CONTRACT.
    (p) ``Subconcessioner'' means a third party that, with the approval 
of the Director, has been granted by a concessioner rights to operate 
under a concession contract (or any portion thereof), whether in 
consideration of a percentage of revenues or otherwise.
    (q) ``Superintendent'' means the manager of the Area.
    (r) ``Visitor services'' means the accommodations, facilities and 
services that the Concessioner is required and/or authorized to provide 
by section 3(a) of this CONTRACT.

Sec. 3. Services and Operations

(a) Required and Authorized Visitor Services

    During the term of this CONTRACT, the Director requires and 
authorizes the Concessioner to provide the following visitor services 
for the public within the Area:
    (1) Required Visitor Services. The Concessioner is required to 
provide the following visitor services during the term of this 
CONTRACT:

[Provide a detailed description of required services. Broad 
generalizations such as ``any and all facilities and services 
customary in such operations'' or ``such additional facilities and 
services as may be required'' are not to be used.]

    (2) Authorized Visitor Services. The Concessioner is authorized but 
not required to provide the following visitor services during the term 
of this CONTRACT:

[Provide detailed description of authorized services. See note in 
subsection (a)(1) above.]

(b) Operation and Quality of Operation

    The Concessioner shall provide, operate and maintain the required 
and authorized visitor services and any related support facilities and 
services in accordance with this CONTRACT to such an extent and in a 
manner considered satisfactory by the Director. Except for any such 
items that may be provided to the Concessioner by the Director, the 
Concessioner shall provide the plant, personnel, equipment, goods, and 
commodities necessary for providing, operating and maintaining the 
required and authorized visitor services in accordance with this 
CONTRACT. The Concessioner's authority to provide visitor services 
under the terms of this CONTRACT is non-exclusive.

(c) Operating Plan

    The Director, acting through the Superintendent, shall establish 
and revise, as necessary, specific requirements for the operations of 
the Concessioner under this CONTRACT in the form of an Operating Plan 
(including, without limitation, a risk management program, that must be 
adhered to by the Concessioner). The initial Operating Plan is attached 
to this CONTRACT as Exhibit B. The Director in his discretion, after 
consultation with the Concessioner, may make reasonable modifications 
to the initial Operating Plan that are in furtherance of the purposes 
of this CONTRACT and are not inconsistent with the terms and conditions 
of the main body of this CONTRACT.

(d) Merchandise and Services

    (1) The Director reserves the right to determine and control the 
nature, type and quality of the visitor services described in this 
CONTRACT, including, but not limited to, the nature, type, and quality 
of merchandise, if any, to be sold or provided by the Concessioner 
within the Area.
    (2) All promotional material, regardless of media format (i.e. 
printed, electronic, broadcast media), provided to the public by the 
Concessioner in connection with the services provided under this 
CONTRACT must be approved in writing by the Director prior to use. All 
such material will identify the Concessioner as an authorized 
Concessioner of the National Park Service, Department of the Interior.
    (3) The Concessioner, where applicable, will develop and implement 
a plan satisfactory to the Director that will assure that gift 
merchandise, if any, to be sold or provided reflects the purpose and 
significance of the Area, including, but not limited to, merchandise 
that reflects the conservation of the Area's resources or the Area's 
geology, wildlife, plant life, archeology, local Native American 
culture, local ethnic culture, and historic significance.

(e) Rates

    All rates and charges to the public by the Concessioner for visitor 
services shall be reasonable and appropriate for the type and quality 
of facilities and/or services required and/or authorized under this 
CONTRACT. The Concessioner's rates and charges to the public must be 
approved by the Director in accordance with Applicable Laws and 
guidelines promulgated by the Director from time to time.

(f) Impartiality as to Rates and Services

    (1) Subject to Section (f)(2) and (f)(3), in providing visitor 
services, the Concessioner must require its employees to observe a 
strict impartiality as to rates and services in all circumstances. The 
Concessioner shall comply with all Applicable Laws relating to 
nondiscrimination in providing visitor services to the public 
including, without limitation, those set forth in Exhibit C.
    (2) The Concessioner may grant complimentary or reduced rates under 
such circumstances as are customary in businesses of the character 
conducted under this CONTRACT. However, the Director reserves the right 
to review and modify the Concessioner's complimentary or reduced rate 
policies and practices as part of its rate approval process.
    (3) The Concessioner will provide Federal employees conducting 
official business reduced rates for lodging, essential transportation 
and other specified services necessary for conducting official business 
in accordance with guidelines established by the Director. 
Complimentary or reduced rates and charges shall otherwise not be 
provided to Federal employees by the Concessioner except to the extent 
that they are equally available to the general public.

Sec. 4. Concessioner Personnel

(a) Employees

    (1) The Concessioner shall provide all personnel necessary to 
provide the visitor services required and authorized by this CONTRACT.
    (2) The Concessioner shall comply with all Applicable Laws relating 
to employment and employment conditions, including, without limitation, 
those set forth in Exhibit C.
    (3) The Concessioner shall ensure that its employees are hospitable 
and exercise courtesy and consideration in their relations with the 
public. The Concessioner shall have its employees who come in direct 
contact with the public, so far as practicable, wear a uniform or badge 
by which they may be

[[Page 26065]]

identified as the employees of the Concessioner.
    (4) The Concessioner shall establish pre-employment screening, 
hiring, training, employment, termination and other policies and 
procedures for the purpose of providing visitor services through its 
employees in an efficient and effective manner and for the purpose of 
maintaining a healthful, law abiding, and safe working environment for 
its employees. The Concessioner shall conduct appropriate background 
reviews of applicants to whom an offer for employment may be extended 
to assure that they conform to the hiring policies established by the 
Concessioner.
    (5) The Concessioner shall ensure that its employees are provided 
the training needed to provide quality visitor services and to maintain 
up-to-date job skills.
    (6) The Concessioner shall review the conduct of any of its 
employees whose action or activities are considered by the Concessioner 
or the Director to be inconsistent with the proper administration of 
the Area and enjoyment and protection of visitors and shall take such 
actions as are necessary to correct the situation.
    (7) The Concessioner shall maintain, to the greatest extent 
possible, a drug free environment, both in the workplace and in any 
Concessioner employee housing, within the Area.
    (8) The Concessioner shall publish a statement notifying employees 
that the unlawful manufacture, distribution, dispensing, possession, or 
use of a controlled substance is prohibited in the workplace and in the 
Area, and specifying the actions that will be taken against employees 
for violating this prohibition. In addition, the Concessioner shall 
establish a drug-free awareness program to inform employees about the 
danger of drug abuse in the workplace and the Area, the availability of 
drug counseling, rehabilitation and employee assistance programs, and 
the Concessioner's policy of maintaining a drug-free environment both 
in the workplace and in the Area.
    (9) The Concessioner shall take appropriate personnel action, up to 
and including termination or requiring satisfactory participation in a 
drug abuse or rehabilitation program which is approved by a Federal, 
State, or local health, law enforcement or other appropriate agency, 
for any employee that is found to be in violation of the prohibition on 
the unlawful manufacture, distribution, dispensing, possession, or use 
of a controlled substance.

(b) Employee Housing and Recreation

    (1) If the Concessioner is required to provide employee housing 
under this CONTRACT, the Concessioner's charges to its employees for 
this housing must be reasonable.
    (2) If the visitor services required and/or authorized under this 
CONTRACT are located in a remote or isolated area, the Concessioner 
shall provide appropriate employee recreational activities.

Sec. 5. Legal, Regulatory, and Policy Compliance

(a) Legal, Regulatory and Policy Compliance

    This CONTRACT, operations thereunder by the Concessioner and the 
administration of it by the Director, shall be subject to all 
Applicable Laws. The Concessioner must comply with all Applicable Laws 
in fulfilling its obligations under this CONTRACT at the Concessioner's 
sole cost and expense. Certain Applicable Laws governing protection of 
the environment are further described in this CONTRACT. Certain 
Applicable Laws relating to nondiscrimination in employment and 
providing accessible facilities and services to the public are further 
described in this CONTRACT.

(b) Notice

    The Concessioner shall give the Director immediate written notice 
of any violation of Applicable Laws by the Concessioner, including its 
employees, agents or contractors, and, at its sole cost and expense, 
must promptly rectify any such violation.

(c) How and Where to Send Notice

    All notices required by this CONTRACT shall be in writing and shall 
be served on the parties at the following addresses. The mailing of a 
notice by registered or certified mail, return receipt requested, shall 
be sufficient service. Notices sent to the Director shall be sent to 
the following address:

Superintendent
Park name
Address
Attention:

    Notices sent to the Concessioner shall be sent to the following 
address:

Concessioner
Address
Attention:

Sec. 6. Environmental and Cultural Protection

(a) Environmental Management Objectives

    The Concessioner shall meet the following environmental management 
objectives (hereinafter ``Environmental Management Objectives'') in the 
conduct of its operations under this CONTRACT:
    (1) The Concessioner, including its employees, agents and 
contractors, shall comply with all Applicable Laws pertaining to the 
protection of human health and the environment.
    (2) The Concessioner shall incorporate Best Management Practices 
(BMPs) in its operation, construction, maintenance, acquisition, 
provision of visitor services, and other activities under this 
CONTRACT.

(b) Environmental Management Program

    (1) The Concessioner shall develop, document, implement, and comply 
fully with, to the satisfaction of the Director, a comprehensive 
written Environmental Management Program (EMP) to achieve the 
Environmental Management Objectives. The initial EMP shall be developed 
and submitted to the Director for approval within sixty days of the 
effective date of this CONTRACT. The Concessioner shall submit to the 
Director for approval a proposed updated EMP annually.
    (2) The EMP shall account for all activities with potential 
environmental impacts conducted by the Concessioner or to which the 
Concessioner contributes. The scope and complexity of the EMP may vary 
based on the type, size and number of Concessioner activities under 
this CONTRACT.
    (3) The EMP shall include, without limitation, the following 
elements:
    (i) Policy. The EMP shall provide a clear statement of the 
Concessioner's commitment to the Environmental Management Objectives.
    (ii) Goals and Targets. The EMP shall identify environmental goals 
established by the Concessioner consistent with all Environmental 
Management Objectives. The EMP shall also identify specific targets 
(i.e., measurable results and schedules) to achieve these goals.
    (iii) Responsibilities and Accountability. The EMP shall identify 
environmental responsibilities for Concessioner employees and 
contractors. The EMP shall include the designation of an environmental 
program manager. The EMP shall include procedures for the Concessioner 
to implement the evaluation of employee and contractor performance

[[Page 26066]]

against these environmental responsibilities.
    (iv) Documentation. The EMP shall identify plans, procedures, 
manuals, and other documentation maintained by the Concessioner to meet 
the Environmental Management Objectives.
    (v) Documentation Control and Information Management System. The 
EMP shall describe (and implement) document control and information 
management systems to maintain knowledge of Applicable Laws and BMPs. 
In addition, the EMP shall identify how the Concessioner will manage 
environmental information, including without limitation, plans, 
permits, certifications, reports, and correspondence.
    (vi) Reporting. The EMP shall describe (and implement) a system for 
reporting environmental information on a routine and emergency basis, 
including providing reports to the Director under this CONTRACT.
    (vii) Communication. The EMP shall describe how the environmental 
policy, goals, targets, responsibilities and procedures will be 
communicated throughout the Concessioner's organization.
    (viii) Training. The EMP shall describe the environmental training 
program for the Concessioner, including identification of staff to be 
trained, training subjects, frequency of training and how training will 
be documented.
    (ix) Monitoring, Measurement, and Corrective Action. The EMP shall 
describe how the Concessioner will comply with the EMP and how the 
Concessioner will self-assess its performance under the EMP, at least 
annually, in a manner consistent with NPS protocol regarding audit of 
NPS operations. The self-assessment should ensure the Concessioner's 
conformance with the Environmental Management Objectives and measure 
performance against environmental goals and targets. The EMP shall also 
describe procedures to be taken by the Concessioner to correct any 
deficiencies identified by the self-assessment.

(c) Environmental Performance Measurement

    The Concessioner shall be evaluated by the Director on its 
environmental performance under this CONTRACT, including, without 
limitation, compliance with the approved EMP, on at least an annual 
basis.

(d) Environmental Data, Reports, Notifications, and Approvals

    (1) Inventory of Hazardous Substances and Inventory of Waste 
Streams. The Concessioner shall submit to the Director, at least 
annually, an inventory of federal Occupational Safety and Health 
Administration (OSHA) designated hazardous chemicals used and stored in 
the Area by the Concessioner. The Director may prohibit the use of any 
OSHA hazardous chemical by the Concessioner in operations under this 
CONTRACT. The Concessioner shall obtain the Director's approval prior 
to using any extremely hazardous substance, as defined in the Emergency 
Planning and Community Right to Know Act of 1986, in operations under 
this CONTRACT. The Concessioner shall also submit to the Director, at 
least annually, an inventory of all waste streams generated by the 
Concessioner under this CONTRACT. Such inventory shall include any 
documents, reports, monitoring data, manifests, and other documentation 
required by Applicable Laws regarding waste streams.
    (2) Reports. The Concessioner shall submit to the Director copies 
of all documents, reports, monitoring data, manifests, and other 
documentation required under Applicable Laws to be submitted to 
regulatory agencies. The Concessioner shall also submit to the Director 
any environmental plans for which coordination with Area operations are 
necessary and appropriate, as determined by the Director in accordance 
with Applicable Laws.
    (3) Notification of Releases. The Concessioner shall give the 
Director immediate written notice of any discharge, release or 
threatened release (as these terms are defined by Applicable Laws) 
within or at the vicinity of the Area (whether solid, semi-solid, 
liquid or gaseous in nature), of any hazardous or toxic substance, 
material, or waste of any kind, including, without limitation, building 
materials such as asbestos, or any contaminant, pollutant, petroleum, 
petroleum product or petroleum by-product.
    (4) Notice of Violation. The Concessioner shall give the Director 
in writing immediate notice of any written threatened or actual notice 
of violation from other regulatory agencies of any Applicable Law 
arising out of the activities of the Concessioner, its agents or 
employees.
    (5) Communication with Regulatory Agencies. The Concessioner shall 
provide timely written advance notice to the Director of 
communications, including without limitation, meetings, audits, 
inspections, hearings and other proceedings, between regulatory 
agencies and the Concessioner related to compliance with Applicable 
Laws concerning operations under this CONTRACT. The Concessioner shall 
also provide to the Director any written materials prepared or received 
by the Concessioner in advance of or subsequent to any such 
communications. The Concessioner shall allow the Director to 
participate in any such communications. The Concessioner shall also 
provide timely notice to the Director following any unplanned 
communications between regulatory agencies and the Concessioner.

(e) Corrective Action

    (1) The Concessioner, at its sole cost and expense, shall promptly 
control and contain any discharge, release or threatened release, as 
set forth in this section, or any threatened or actual violation, as 
set forth in this section, arising in connection with the 
Concessioner's operations under this CONTRACT, including, but not 
limited to, payment of any fines or penalties imposed by appropriate 
agencies. Following the prompt control or containment of any release, 
discharge or violation, the Concessioner shall take all response 
actions necessary to remediate the release, discharge or violation, and 
to protect human health and the environment.
    (2) Even if not specifically required by Applicable Laws, the 
Concessioner shall comply with directives of the Director to clean up 
or remove any materials, product or by-product used, handled, stored, 
disposed, or transported onto or into the Area by the Concessioner to 
ensure that the Area remains in good condition.

(f) Indemnification and Cost Recovery for Concessioner Environmental 
Activities

    (1) The Concessioner shall indemnify the United States in 
accordance with section 12 of this CONTRACT from all losses, claims, 
damages, environmental injuries, expenses, response costs, allegations 
or judgments (including, without limitation, fines and penalties) and 
expenses (including, without limitation, attorneys fees and experts' 
fees) arising out of the activities of the Concessioner, its employees, 
agents and contractors pursuant to this section. Such indemnification 
shall survive termination or expiration of this CONTRACT.
    (2) If the Concessioner does not promptly contain and remediate an 
unauthorized discharge or release arising out of the activities of the 
Concessioner, its employees, agents and contractors, as set forth in 
this section, or correct any environmental self-

[[Page 26067]]

assessment finding of non-compliance, in full compliance with 
Applicable Laws, the Director may, in its sole discretion and after 
notice to the Concessioner, take any such action consistent with 
Applicable Laws as the Director deems necessary to abate, mitigate, 
remediate, or otherwise respond to such release or discharge, or take 
corrective action on the environmental self-assessment finding. The 
Concessioner shall be liable for and shall pay to the Director any 
costs of the Director associated with such action upon demand. Nothing 
in this section shall preclude the Concessioner from seeking to recover 
costs from a responsible third party.

(g) Weed and Pest Management

    The Concessioner shall be responsible for managing weeds, and 
through an integrated pest management program, harmful insects, rats, 
mice and other pests on Concession Facilities assigned to the 
Concessioner under this CONTRACT. All such weed and pest management 
activities shall be in accordance with Applicable Laws and guidelines 
established by the Director.

(h) Protection of Cultural and Archeological Resources.

    The Concessioner shall ensure that any protected sites and 
archeological resources within the Area are not disturbed or damaged by 
the Concessioner, including the Concessioner's employees, agents and 
contractors, except in accordance with Applicable Laws, and only with 
the prior approval of the Director. Discoveries of any archeological 
resources by the Concessioner shall be promptly reported to the 
Director. The Concessioner shall cease work or other disturbance which 
may impact any protected site or archeological resource until the 
Director grants approval, upon such terms and conditions as the 
Director deems necessary, to continue such work or other disturbance.

Sec. 7. Interpretation of Area Resources

(a) Concessioner Obligations

    (1) The Concessioner shall provide all visitor services in a manner 
that is consistent with and supportive of the interpretive themes, 
goals and objectives of the Area as reflected in Area planning 
documents, mission statements and/or interpretive prospectuses.
    (2) The Concessioner may assist in Area interpretation at the 
request of the Director to enhance visitor enjoyment of the Area. Any 
additional visitor services that may result from this assistance must 
be recognized in writing through written amendment of Section 3 of this 
CONTRACT.
    (3) The Concessioner is encouraged to develop interpretive 
materials or means to educate visitors about environmental programs or 
initiatives implemented by the Concessioner.

(b) Director review of content

    The Concessioner must submit the proposed content of any 
interpretive programs, exhibits, displays or materials, regardless of 
media format (i.e. printed, electronic, or broadcast media), to the 
Director for review and approval prior to offering such programs, 
exhibits, displays or materials to Area visitors.

Sec. 8. Concession Facilities Used in Operation by the Concessioner

(a) Assignment of Concession Facilities

    (1) The Director hereby assigns the following Concession Facilities 
to the Concessioner for the purposes of this CONTRACT:
    (i) certain parcels of Area land as described in Exhibit D upon 
which, among other matters, the Concessioner may be authorized to 
construct real property; and
    (ii) certain real property improvements described in Exhibit D in 
existence as of the effective date of this CONTRACT, as may be modified 
from time to time to include additional real property improvements 
completed in accordance with the terms and conditions of this CONTRACT.
    (2) The Director shall from time to time amend Exhibit D to reflect 
changes in Concession Facilities assigned to the Concessioner, 
including, without limitation, amending Exhibit D to reflect the 
addition of real property improvements completed in accordance with the 
terms and conditions of this CONTRACT and to reflect the withdrawal of 
concession facilities as set forth below.

(b) Concession Facilities Withdrawals

    The Director may withdraw all or portions of these Concession 
Facilities assignments at any time during the term of this CONTRACT if:
    (1) the withdrawal is necessary for the purpose of conserving, 
preserving or protecting Area resources or visitor enjoyment or safety;
    (2) the operations utilizing the assigned Concession Facilities 
have been terminated or suspended by the Director; or
    (3) land or real property improvements assigned to the Concessioner 
are no longer necessary for the concession operation.

(c) Effect of Withdrawal

    Any permanent withdrawal of assigned Concession Facilities which 
the Director or the Concessioner considers to be essential for the 
Concessioner to provide the visitor services required by this CONTRACT 
will be treated as a termination of this CONTRACT pursuant to Section 
16. The Concessioner will be compensated pursuant to Section 17 for the 
value of any Leasehold Surrender Interest it may have, if any, in 
permanently withdrawn Concession Facilities. No other compensation is 
due the Concessioner in these circumstances.

(d) Right of Entry

    The Director shall have the right at any time to enter upon or into 
the Concession Facilities assigned to the Concessioner under this 
CONTRACT for any purpose he may deem necessary for the administration 
of the Area.

(e) Personal Property

    (1) Personal Property Provided by the Concessioner. The 
Concessioner shall provide all personal property, including without 
limitation removable equipment, furniture and goods, necessary for its 
operations under this CONTRACT, unless such personal property is 
provided by the Director as set forth in subsection (e)(2).
    (2) Personal Property Provided by the Government. The Director may 
provide certain items of government personal property, including 
without limitation removable equipment, furniture and goods, for the 
Concessioner's use in the performance of this CONTRACT. The Director 
hereby assigns government personal property listed in Exhibit E to the 
Concessioner as of the effective date of this CONTRACT. This Exhibit E 
will be modified from time to time by the Director as items may be 
withdrawn or additional items added. The Concessioner shall be 
accountable to the Director for the government personal property 
assigned to it and shall be responsible for maintaining the property as 
necessary to keep it in good and operable condition. If the property 
ceases to be serviceable, it shall be returned to the Director for 
disposition.

(f) Condition of Concession Facilities

    The Concessioner has inspected the Concession Facilities and any 
assigned government personal property, is thoroughly acquainted with 
their condition, and accepts the Concession Facilities, and any 
assigned government personal property, ``as is.''

[[Page 26068]]

(g) Utilities Provided by the Director

    The Director may provide utilities to the Concessioner for use in 
connection with the operations required or authorized hereunder when 
available and at rates to be determined in accordance with Applicable 
Laws.

(h) Utilities Not Provided by the Director

    If the Director does not provide utilities to the Concessioner, the 
Concessioner shall, with the written approval of the Director and under 
any requirements that the Director shall prescribe, secure necessary 
utilities at its own expense from sources outside the Area or shall 
install the utilities within the Area with the written permission of 
the Director, subject to the following conditions:
    (1) Any water rights deemed necessary by the Concessioner for use 
of water on Area or other federal lands must be acquired at the 
Concessioner's expense in accordance with applicable State procedures 
and law. Upon expiration or termination of this CONTRACT for any 
reason, the Concessioner must assign these water rights to the United 
States without compensation, and these water rights will become the 
property of the United States;
    (2) If requested by the Director, the Concessioner must provide to 
the Director any utility service provided by the Concessioner under 
this section to such extent as will not unreasonably restrict 
anticipated use by the Concessioner. Unless otherwise agreed by the 
Concessioner and the Director in writing, the rate per unit charged the 
Director for such service shall be approximately the average cost per 
unit of providing such service; and
    (3) All appliances and machinery to be used in connection with the 
privileges granted in this subsection, as well as the plans for 
location and installation of such appliances and machinery, shall first 
be approved by the Director.

Sec. 9. Construction or Installation of Real Property Improvements

(a) Construction of Real Property Improvements

    The Concessioner may construct or install upon lands assigned to 
the Concessioner under this CONTRACT only those real property 
improvements that are determined by the Director to be necessary and 
appropriate for the conduct by the Concessioner of the visitor services 
required and/or authorized under this CONTRACT. Construction or 
installation of real property improvements may occur only after the 
written approval by the Director of their location, plans, and 
specifications. The form and content of the application and the 
procedures for such approvals, as may be modified by the Director from 
time to time, are set forth in Exhibit F. All real property 
improvements constructed or installed by the Concessioner will 
immediately become the property of the United States and be considered 
Concession Facilities.

(b) Removal of Real Property Improvements

    (1) The Concessioner may not remove, dismantle, or demolish real 
property improvements in the Area without the prior approval of the 
Director.
    (2) Any salvage resulting from the authorized removal, severance or 
demolition of a real property improvement within the Area shall be the 
property of the United States.
    (3) In the event that an assigned real property improvement is 
removed, abandoned, demolished, or substantially destroyed and no other 
improvement is constructed on the site, the Concessioner, at its 
expense, shall promptly, upon the request of the Director, restore the 
site as nearly as practicable to its original condition.

(c) Leasehold Surrender Interest

    (1) This CONTRACT hereby provides the Concessioner, subject to all 
applicable definitions, requirements and limitations of this CONTRACT 
and Exhibit A, a Leasehold Surrender Interest in Capital Improvements 
constructed by the Concessioner under the terms of this CONTRACT, 
including, but not limited to, those Capital Improvements constructed 
as part of the Concession Facilities Improvement Program and those 
Capital Improvements which result from the Major Rehabilitation of an 
existing real property improvement. Upon completion of a Major 
Rehabilitation by the Concessioner, an existing real property 
improvement assigned to the Concessioner in which the Concessioner had 
no Leasehold Surrender Interest prior to the Major Rehabilitation shall 
be considered as a Capital Improvement for all purposes of this 
CONTRACT.
    (2) This CONTRACT may provide the Concessioner a Leasehold 
Surrender Interest in real property improvements resulting from 
possessory interest obtained under the terms of a possessory interest 
concession contract. Exhibit G describes the real property 
improvements, if any, in which the Concessioner has such a Leasehold 
Surrender Interest and states the value of this Leasehold Surrender 
Interest as of the effective date of this CONTRACT.
    (3) The Concessioner shall not obtain Leasehold Surrender Interest 
under this CONTRACT except as may be provided in Exhibit A and Exhibit 
F. Among other matters, no Leasehold Surrender Interest shall be 
obtained as a result of expenditures from the Repair and Maintenance 
Reserve described in this CONTRACT, and this CONTRACT does not provide 
a Leasehold Surrender Interest as a result of expenditures for repair 
and maintenance of Concession Facilities of any nature.

(d) Concession Facilities Improvement Program

    (1) The Concessioner shall undertake and complete an improvement 
program (hereinafter ``Concession Facilities Improvement Program'') 
costing not less than $________ as adjusted for each project to reflect 
par value in the year of actual construction in accordance with the 
appropriate indexes of the Department of Labor's CPI-U Index, as 
published by the Department of Labor.
    (2) The Concession Facilities Improvement Program shall include:
    [Provide detailed description of the Concession Facilities 
Improvement Program.]
    (3) The Concessioner shall commence construction under the 
Concession Facilities Improvement Program on or before ________ in a 
manner that demonstrates to the satisfaction of the Director that the 
Concessioner is in good faith carrying the Concession Facilities 
Improvement Program forward reasonably under the circumstances. No 
construction may begin until the Concessioner receives written approval 
from the Director of plans and specifications in accordance with 
Exhibit F. During the period of construction, the Concessioner shall 
provide the Director with such evidence or documentation, as may be 
satisfactory to the Director, to demonstrate that the Concession 
Facilities Improvement Program duly is being carried forward.
    (4) The Concessioner shall complete and have the real property 
improvements available for public use on or before ________. The 
Director may extend this date in circumstances where the Director 
determines that the delay resulted from events beyond the control of 
the Concessioner.

Sec. 10. Maintenance

(a) Maintenance Obligation

    The Concessioner shall be solely responsible for maintenance, 
repairs, housekeeping, and groundskeeping for

[[Page 26069]]

all Concession Facilities to the satisfaction of the Director.

(b) Maintenance Plan

    For these purposes, the Director, acting through the 
Superintendent, shall undertake appropriate inspections, and shall 
establish and revise, as necessary, a Maintenance Plan consisting of 
specific maintenance requirements which shall be adhered to by the 
Concessioner. The initial Maintenance Plan is set forth in Exhibit H. 
The Director in his discretion may make reasonable modifications to the 
Maintenance Plan from time to time after consultation with the 
Concessioner. Such modifications shall be in furtherance of the 
purposes of this CONTRACT and shall not be inconsistent with the terms 
and conditions of the main body of this CONTRACT.

(c) Repair and Maintenance Reserve

    [No Repair and Maintenance Reserve is included in this CONTRACT.] 
OR
    (1) The Concessioner shall establish and manage a Repair and 
Maintenance Reserve. The funds in this Reserve shall be used to carry 
out, on a project basis in accordance with Exhibits F and H, repair and 
maintenance of Concession Facilities that are non-recurring within a 
seven-year time frame. Such projects may include repair or replacement 
of foundations, building frames, window frames, sheathing, subfloors, 
drainage, rehabilitation of building systems such as electrical, 
plumbing, built-in heating and air conditioning, roof replacement and 
similar projects. Projects will be carried out by the Concessioner as 
the Director shall direct in writing in advance of any expenditure 
being made and in accordance with project proposals approved by the 
Director. No projects may be commenced until the Concessioner receives 
written approval from the Director.
    (2) Projects paid for with funds from the Repair and Maintenance 
Reserve will not include routine, operational maintenance of facilities 
or housekeeping and groundskeeping activities. Nothing in this section 
shall lessen the responsibility of the Concessioner to carry out the 
maintenance and repair of Concession Facilities or housekeeping and 
groundskeeping responsibilities as required by this CONTRACT from 
Concessioner funds exclusive of the funds contained in the Repair and 
Maintenance Reserve.
    (3) The Concessioner shall establish within its accounting system a 
Repair and Maintenance Reserve. The Concessioner shall debit to this 
Reserve, within fifteen (15) days after the last day of each month that 
the Concessioner operates a sum equal to: ______ percent (______%) of 
the Concessioner's gross receipts for the previous month. If the 
Concessioner fails to make timely debits to the Repair and Maintenance 
Reserve, the Director may terminate this CONTRACT for default or may 
require the Concessioner to post a bond in an amount equal to the 
estimated annual Repair and Maintenance Reserve allocation, based on 
the preceding year's gross receipts.
    (4) The balance in the Repair and Maintenance Reserve shall be 
available for projects in accordance with the Reserve's purpose. For 
all expenditures made for each project from the Repair and Maintenance 
Reserve, the Concessioner shall maintain auditable records including 
invoices, billings, canceled checks, and other documentation 
satisfactory to the Director. Failure to expend Repair and Maintenance 
Reserve Funds when directed by the Director shall be considered as a 
material breach of this CONTRACT for which the Director may seek 
monetary damages and other legal relief, including, without limitation, 
termination of this CONTRACT.
    (5) Repair and Maintenance Reserve funds shall not be used for a 
major rehabilitation as defined in this CONTRACT. The Concessioner 
shall obtain no ownership, Leasehold Surrender Interest, or other 
compensable interest as a consequence of the expenditure of Repair and 
Maintenance Reserve funds.
    (6) Any Repair and Maintenance Reserve funds not duly expended by 
the Concessioner as of the termination or expiration of this CONTRACT 
shall be retained by the Concessioner (subject to otherwise applicable 
terms and conditions of this CONTRACT).

Sec. 11. Fees

(a) Franchise Fee

    (1) For the term of this CONTRACT, the Concessioner shall pay to 
the Director for the privileges granted under this CONTRACT a franchise 
fee equal to ______ percent (______ %) of the Concessioner's gross 
receipts for the preceding year or portion of a year.
    (2) Neither the Concessioner nor the Director shall have a right to 
an adjustment of the fees except as provided below. The Concessioner 
has no right to waiver of the fee under any circumstances.

(b) Payments Due

    (1) The franchise fee shall be due on a monthly basis at the end of 
each month and shall be paid by the Concessioner in such a manner that 
the Director shall receive payment within fifteen (15) days after the 
last day of each month that the Concessioner operates. This monthly 
payment shall include the franchise fee equal to the specified 
percentage of gross receipts for the preceding month.
    (2) The Concessioner shall pay any additional fee amounts due at 
the end of the operating year as a result of adjustments at the time of 
submission of the Concessioner's Annual Financial Report. Overpayments 
shall be offset against the following year's fees. In the event of 
termination or expiration of this CONTRACT, overpayments will first be 
offset against any amounts due and owing the Government, and the 
remainder will be paid to the Concessioner.
    (3) All franchise fee payments consisting of $10,000 or more, shall 
be deposited electronically by the Concessioner using the Treasury 
Financial Communications System.

(c) Interest

    An interest charge will be assessed on overdue amounts for each 
thirty (30) day period, or portion thereof, that payment is delayed 
beyond the fifteen (15) day period provided for above. The percent of 
interest charged will be based on the current value of funds to the 
United States Treasury as published quarterly in the Treasury Fiscal 
Requirements Manual. The Director may also impose penalties for late 
payment to the extent authorized by Applicable Law.

(d) Adjustment of Franchise Fee

    (1) The Concessioner or the Director may request, in the event that 
either considers that extraordinary, unanticipated changes have 
occurred after the effective date of this CONTRACT, a reconsideration 
and possible subsequent adjustment of the franchise fee established in 
this section. For the purposes of this section, the phrase 
``extraordinary, unanticipated changes'' shall mean extraordinary, 
unanticipated changes from the conditions existing or reasonably 
anticipated before the effective date of this CONTRACT which have or 
will significantly affect the probable value of the privileges granted 
to the Concessioner by this CONTRACT. For the purposes of this section, 
the phrase ``probable value'' means a reasonable opportunity for net 
profit in relation to capital invested and the obligations of this 
CONTRACT.
    (2) The Concessioner or the Director must make a request for a

[[Page 26070]]

reconsideration by mailing, within sixty (60) days from the date that 
the party becomes aware, or should have become aware, of the possible 
extraordinary, unanticipated changes, a written notice to the other 
party that includes a description of the possible extraordinary, 
unanticipated changes and why the party believes they have affected or 
will significantly affect the probable value of the privileges granted 
by this CONTRACT.
    (3) If the Concessioner and the Director agree that extraordinary, 
unanticipated changes have occurred, the Concessioner and the Director 
will undertake good faith negotiations as to an appropriate adjustment 
of the franchise fee.
    (4) The negotiation will last for a period of sixty (60) days from 
the date the Concessioner and the Director agree that extraordinary, 
unanticipated changes occurred. If the negotiation results in agreement 
as to an adjustment (up or down) of the franchise fee within this 
period, the franchise fee will be adjusted accordingly, prospectively 
as of the date of agreement.
    (5) If the negotiation does not result in agreement as to the 
adjustment of the franchise fee within this sixty (60) day period, then 
either the Concessioner or the Director may request binding arbitration 
to determine the adjustment to franchise fee in accordance with this 
section. Such a request for arbitration must be made by mailing written 
notice to the other party within fifteen (15) days of the expiration of 
the sixty (60) day period.
    (6) Within thirty (30) days of receipt of such a written notice, 
the Concessioner and the Director shall each select an arbiter. These 
two arbiters, within thirty (30) days of selection, must agree to the 
selection of a third arbiter to complete the arbitration panel. Unless 
otherwise agreed by the parties, the arbitration panel shall establish 
the procedures of the arbitration. Such procedures must provide each 
party a fair and equal opportunity to present its position on the 
matter to the arbitration panel.
    (7) The arbitration panel shall consider the written submissions 
and any oral presentations made by the Concessioner and the Director 
and provide its decision on an adjusted franchise fee (up, down or 
unchanged) that is consistent with the probable value of the privileges 
granted by this CONTRACT within sixty (60) days of the presentations.
    (8) Any adjustment to the franchise fee resulting from this Section 
shall be prospective only.
    (9) Any adjustment to the franchise fee will be embodied in an 
amendment to this CONTRACT.
    (10) During the pendency of the process described in this Section, 
the Concessioner shall continue to make the established franchise fee 
payments required by this CONTRACT.

Sec. 12. Indemnification and Insurance

(a) Indemnification

    The Concessioner agrees to assume liability for and does hereby 
agree to save, hold harmless, protect, defend and indemnify the United 
States of America, its agents and employees from and against any and 
all liabilities, obligations, losses, damages or judgments (including 
without limitation penalties and fines), claims, actions, suits, costs 
and expenses (including without limitation attorneys fees and experts' 
fees) of any kind and nature whatsoever on account of fire or other 
peril, bodily injury, death or property damage, or claims for bodily 
injury, death or property damage of any nature whatsoever, and by 
whomsoever made, in any way connected with or arising out of the 
activities of the Concessioner, its employees, agents or contractors 
under this CONTRACT. This indemnification shall survive the termination 
or expiration of this CONTRACT.

(b) Insurance in General

    (1) The Concessioner shall obtain and maintain during the entire 
term of this CONTRACT at its sole cost and expense, the types and 
amounts of insurance coverage necessary to fulfill the obligations of 
this CONTRACT as determined by the Director. The initial insurance 
requirements are set forth below and in Exhibit I. Any changed or 
additional requirements that the Director determines necessary must be 
reasonable and consistent with the types and coverage amounts of 
insurance a prudent businessperson would purchase in similar 
circumstances. The Director shall approve the types and amounts of 
insurance coverage purchased by the Concessioner.
    (2) The Director will not be responsible for any omissions or 
inadequacies of insurance coverages and amounts in the event the 
insurance purchased by the Concessioner proves to be inadequate or 
otherwise insufficient for any reason whatsoever.
    (3) At the request of the Director, the Concessioner shall at the 
time insurance is first purchased and annually thereafter, provide the 
Director with a Certificate of Insurance that accurately details the 
conditions of the policy as evidence of compliance with this section. 
The Concessioner shall provide the Director immediate written notice of 
any material change in the Concessioner's insurance program hereunder, 
including without limitation, cancellation of any required insurance 
coverages.

(c) Commercial Public Liability

    (1) The Concessioner shall provide commercial general liability 
insurance against claims arising out of or resulting from the acts or 
omissions of the Concessioner or its employees, agents or contractors, 
in carrying out the activities and operations required and/or 
authorized under this CONTRACT.
    (2) This insurance shall be in the amount commensurate with the 
degree of risk and the scope and size of the activities required and/or 
authorized under this CONTRACT, as more specifically set forth in 
Exhibit I. Furthermore, the commercial general liability package shall 
provide no less than the coverages and limits described in Exhibit I.
    (3) All liability policies shall specify that the insurance company 
shall have no right of subrogation against the United States of America 
and shall provide that the United States of America is named an 
additional insured.
    (4) From time to time, as conditions in the insurance industry 
warrant, the Director may modify Exhibit I to revise the minimum 
required limits or to require additional types of insurance, provided 
that any additional requirements must be reasonable and consistent with 
the types of insurance a prudent businessperson would purchase in 
similar circumstances.

(d) Property Insurance

    (1) In the event of damage or destruction, the Concessioner will 
repair or replace those Concession Facilities and personal property 
utilized by the Concessioner in the performance of the Concessioner's 
obligations under this CONTRACT.
    (2) For this purpose, the Concessioner shall provide fire and 
extended insurance coverage on Concession Facilities for all or part of 
their replacement cost as specified in Exhibit I in amounts no less 
than the Director may require during the term of the CONTRACT. The 
minimum values currently in effect are set forth in Exhibit I.
    (3) Commercial property insurance shall provide for the 
Concessioner and the United States of America to be named insured as 
their interests may appear.

[[Page 26071]]

    (4) In the event of loss, the Concessioner shall use all proceeds 
of such insurance to repair, rebuild, restore or replace Concession 
Facilities and/or personal property utilized in the Concessioner's 
operations under this CONTRACT, as directed by the Director. Policies 
may not contain provisions limiting insurance proceeds to in situ 
replacement. The lien provision of Section 13 shall apply to such 
insurance proceeds. The Concessioner shall not be relieved of its 
obligations under subsection (d)(1) because insurance proceeds are not 
sufficient to repair or replace damaged or destroyed property.
    (5) Insurance policies that cover Concession Facilities shall 
contain a loss payable clause approved by the Director which requires 
insurance proceeds to be paid directly to the Concessioner without 
requiring endorsement by the United States. The use of insurance 
proceeds for repair or replacement of Concession Facilities will not 
alter their character as properties of the United States and, 
notwithstanding any provision of this CONTRACT to the contrary, the 
Concessioner shall gain no ownership, Leasehold Surrender Interest or 
other compensable interest as a result of the use of these insurance 
proceeds.
    (6) The commercial property package shall include the coverages and 
amounts described in Exhibit I.

Sec. 13. Bonds and Liens

(a) Bonds

    The Director may require the Concessioner to furnish appropriate 
forms of bonds in amounts reasonable in the circumstances and 
acceptable to the Director, in order to ensure faithful performance of 
the Concessioner's obligations under this CONTRACT.

(b) Lien

    As additional security for the faithful performance by the 
Concessioner of its obligations under this CONTRACT, and the payment to 
the Government of all damages or claims that may result from the 
Concessioner's failure to observe any such obligations, the Government 
shall have at all times the first lien on all assets of the 
Concessioner within the Area, including, but not limited to, all 
personal property of the Concessioner used in performance of the 
CONTRACT hereunder within the Area and any Leasehold Surrender Interest 
of the Concessioner.

Sec. 14. Accounting Records and Reports

(a) Accounting System

    (1) The Concessioner shall maintain an accounting system under 
which its accounts can be readily identified with its system of 
accounts classification. Such accounting system shall be capable of 
providing the information required by this CONTRACT, including but not 
limited to the Concessioner's repair and maintenance obligations. The 
Concessioner's system of accounts classification shall be directly 
related to the Concessioner Annual Financial Report Form issued by the 
Director.
    (2) If the Concessioner's annual gross receipts are $250,000 or 
more, the Concessioner must use the accrual accounting method.
    (3) In computing net profits for any purposes of this CONTRACT, the 
Concessioner shall keep its accounts in such manner that there can be 
no diversion or concealment of profits or expenses in the operations 
authorized under this CONTRACT by means of arrangements for the 
procurement of equipment, merchandise, supplies or services from 
sources controlled by or under common ownership with the Concessioner 
or by any other device.

(b) Annual Financial Report

    (1) The Concessioner shall submit annually as soon as possible but 
not later than one hundred twenty (120) days after the last day of its 
fiscal year a financial statement for the preceding fiscal year or 
portion of a year as prescribed by the Director (``Concessioner Annual 
Financial Report'').
    (2) If the annual gross receipts of the Concessioner are in excess 
of $1,000,000, the financial statements shall be audited by an 
independent Certified Public Accountant in accordance with Generally 
Accepted Auditing Standards (GAAS) and procedures promulgated by the 
American Institute of Certified Public Accountants.
    (3) If annual gross receipts are between $250,000, and $1,000,000, 
the financial statements shall be reviewed by an independent Certified 
Public Accountant in accordance with Generally Accepted Auditing 
Standards (GAAS) and procedures promulgated by the American Institute 
of Certified Public Accountants.
    (4) If annual gross receipts are less than $250,000, the financial 
statements may be prepared without involvement by an independent 
Certified Public Accountant, unless otherwise directed by the Director.

(c) Other Financial Reports

    (1) Balance Sheet. Within ninety (90) days of the execution of this 
CONTRACT or its effective date, whichever is later, the Concessioner 
shall submit to the Director a balance sheet as of the beginning date 
of the term of this CONTRACT. The balance sheet shall be audited or 
reviewed, as determined by the annual gross receipts, by an independent 
Certified Public Accountant. The balance sheet shall be accompanied by 
a schedule that identifies and provides details for all capital 
improvements in which the Concessioner claims a Leasehold Surrender 
Interest. The schedule must describe these capital improvements in 
detail showing for each such capital improvement the date acquired, 
constructed or installed.
    (2) Statements of Reserve Activity. [No Repair and Maintenance 
Reserve is included in this CONTRACT.] OR
    [The Concessioner shall submit annually, not later than one hundred 
twenty (120) days after the end of the Concessioner's accounting year, 
a statement reflecting total activity in the Maintenance Reserve for 
the preceding accounting year. The statement must reflect monthly 
inflows and outflows on a project by project basis.]

Sec. 15. Other Reporting Requirements

    The following describes certain other reports required under this 
CONTRACT:

(a) Insurance Certification

    As specified in Section 12, the Concessioner shall, at the request 
of the Director, provide the Director with a Certificate of Insurance 
for all insurance coverages related to its operations under this 
CONTRACT. The Concessioner shall give the Director immediate written 
notice of any material change in its insurance program, including 
without limitation, any cancellation of required insurance coverages.

(b) Environmental Reporting

    The Concessioner shall submit environmental reports as specified in 
Section 6 of this CONTRACT, and as otherwise required by the Director 
under the terms of this CONTRACT.

(c) Miscellaneous Reports and Data

    The Director from time to time may require the Concessioner to 
submit other reports and data regarding its performance under the 
CONTRACT or otherwise, including, but not limited to, operational 
information.

[[Page 26072]]

Sec. 16. Suspension, Termination, or Expiration

(a) Suspension

    The Director may temporarily suspend operations under this CONTRACT 
in whole or in part in order to protect Area visitors or to protect, 
conserve and preserve Area resources. No compensation of any nature 
shall be due the Concessioner by the Director in the event of a 
suspension of operations, including, but not limited to, compensation 
for losses based on lost income, profit, or the necessity to make 
expenditures as a result of the suspension.

(b) Termination

    (1) The Director may terminate this CONTRACT at any time in order 
to protect Area visitors, protect, conserve, and preserve Area 
resources, or to limit visitor services in the Area to those that 
continue to be necessary and appropriate.
    (2) The Director may terminate this CONTRACT if the Director 
determines that the Concessioner has materially breached any 
requirement of this CONTRACT, including, but not limited to, the 
requirement to maintain and operate visitor services to the 
satisfaction of the Director, the requirement to provide only those 
visitor services required or authorized by the Director pursuant to 
this CONTRACT, the requirement to pay the established franchise fee, 
the requirement to prepare and comply with an Environmental Management 
Program, the requirement to duly expend funds from the repair and 
maintenance reserve and the requirement to comply with Applicable Laws.
    (3) In the event of a breach of the CONTRACT, the Director will 
provide the Concessioner an opportunity to cure by providing written 
notice to the Concessioner of the breach. In the event of a monetary 
breach, the Director will give the Concessioner a fifteen (15) day 
period to cure the breach. If the breach is not cured within that 
period, then the Director may terminate the CONTRACT for default. In 
the event of a nonmonetary breach, if the Director considers that the 
nature of the breach so permits, the Director will give the 
Concessioner thirty (30) days to cure the breach, or to provide a plan, 
to the satisfaction of the Director, to cure the breach over a 
specified period of time. If the breach is not cured within this 
specified period of time, the Director may terminate the CONTRACT for 
default. Notwithstanding this provision, repeated breaches (two or 
more) of the same nature shall be grounds for termination for default 
without a cure period. In the event of a breach of any nature, the 
Director may suspend the Concessioner's operations as appropriate in 
accordance with Section 16(a).
    (4) The Director may terminate this CONTRACT upon the filing or the 
execution of a petition in bankruptcy by or against the Concessioner, a 
petition seeking relief of the same or different kind under any 
provision of the Bankruptcy Act or its successor, an assignment by the 
Concessioner for the benefit of creditors, a petition or other 
proceeding against the Concessioner for the appointment of a trustee, 
receiver, or liquidator, or, the taking by any person or entity of the 
rights granted by this CONTRACT or any part thereof upon execution, 
attachment or other process of law or equity. The Director may 
terminate this CONTRACT if the Director determines that the 
Concessioner is unable to perform the terms of CONTRACT due to 
bankruptcy or insolvency.
    (5) Termination of this CONTRACT for any reason shall be by written 
notice to the Concessioner.

(c) Notice of Bankruptcy or Insolvency

    The Concessioner must give the Director immediate notice (within 
five (5) days) after the filing of any petition in bankruptcy, filing 
any petition seeking relief of the same or different kind under any 
provision of the Bankruptcy Act or its successor, or making any 
assignment for the benefit of creditors. The Concessioner must also 
give the Director immediate notice of any petition or other proceeding 
against the Concessioner for the appointment of a trustee, receiver, or 
liquidator, or, the taking by any person or entity of the rights 
granted by this CONTRACT or any part thereof upon execution, attachment 
or other process of law or equity. For purposes of the bankruptcy 
statutes, NPS considers that this CONTRACT is not a lease but an 
executory contract exempt from inclusion in assets of Concessioner 
pursuant to 11 U.S.C. 365.

(d) Requirements in the Event of Termination or Expiration

    (1) In the event of termination of this CONTRACT for any reason or 
expiration of this CONTRACT, the total compensation due the 
Concessioner for such termination or expiration shall be as described 
in Section 17 of this CONTRACT. No other compensation of any nature 
shall be due the Concessioner in the event of a termination or 
expiration of this CONTRACT, including, but not limited to, 
compensation for losses based on lost income, profit, or the necessity 
to make expenditures as a result of the termination.
    (2) Upon termination of this CONTRACT for any reason, or upon its 
expiration, and except as otherwise provided in this section, the 
Concessioner shall, at the Concessioner's expense, promptly vacate the 
Area, remove all of the Concessioner's personal property, repair any 
injury occasioned by installation or removal of such property, and 
ensure that Concession Facilities are in at least as good condition as 
they were at the beginning of the term of this CONTRACT, reasonable 
wear and tear excepted. The removal of such personal property must 
occur within thirty (30) days after the termination of this CONTRACT 
for any reason or its expiration (unless the Director in particular 
circumstances requires immediate removal).
    (3) To avoid interruption of services to the public upon 
termination of this CONTRACT for any reason, or upon its expiration, 
the Concessioner, upon the request of the Director, shall consent to 
the use by another operator of the Concessioner's personal property, 
excluding inventories if any, not including current or intangible 
assets, for a period of time not to exceed one (1) year from the date 
of such termination or expiration. The other operator shall pay the 
Concessioner an annual fee for use of such property, prorated for the 
period of use, in the amount of the annual depreciation of such 
property, plus a return on the book value of such property equal to the 
prime lending rate, as published by the Federal Reserve System Board of 
Governors, effective on the date the operator assumes managerial and 
operational responsibilities. In such circumstances, the method of 
depreciation applied shall be either straight line depreciation or 
depreciation as shown on the Concessioner's Federal income tax return, 
whichever is less. To avoid interruption of services to the public upon 
termination of this CONTRACT for any reason or its expiration, the 
Concessioner shall, if requested by the Director, sell its existing 
inventory to another operator at the purchase price as shown on 
applicable invoices.

Sec. 17. Compensation

(a) Just Compensation

    The compensation provided by this Section shall constitute full and 
just compensation to the Concessioner for

[[Page 26073]]

all losses and claims occasioned by the circumstances described below.

(b) Compensation for CONTRACT Expiration or Termination

    If, for any reason, including CONTRACT expiration or termination, 
the Concessioner shall cease to be authorized by the Director to 
conduct operations under this CONTRACT, the Concessioner shall convey 
to a person designated by the Director (including the Director if 
appropriate) any Leasehold Surrender Interest it has under the terms of 
this CONTRACT and the Director shall, subject to the terms and 
conditions of this CONTRACT, assure that the Concessioner is paid the 
Leasehold Surrender Interest Value.

(c) Procedures for Establishing the Value of a Leasehold Surrender 
Interest

    At any time during the term of this CONTRACT, the Concessioner 
shall, when requested by the Director, enter into negotiations with the 
Director as to the value of the Concessioner's Leasehold Surrender 
Interest under this CONTRACT. In the event that such negotiations fail 
to determine an agreed upon value within a reasonable period of time as 
determined by the Director, the Director or the Concessioner may 
initiate arbitration proceedings to determine such value upon written 
request to the other party. Such arbitration proceedings shall be 
conducted in accordance with the arbitration procedures set forth in 
Exhibit A. In these circumstances, the Concessioner and the Director 
shall each select an arbiter. The two arbiters, within thirty (30) days 
of selection, must agree to the selection of a third arbiter to 
complete the arbitration panel in accordance with Exhibit A. The 
arbitration panel shall consider the written submissions and any oral 
presentations made by the Concessioner and the Director and shall 
determine the value of the Leasehold Surrender Interest consistent with 
the terms of this CONTRACT, including without limitation Exhibit A. The 
arbitration panel shall also provide a means to calculate the change in 
the value of such Leasehold Surrender Interest as may occur for up to 
two (2) years from the date of the initial determination. The 
determination of the arbitration panel shall be binding on the Director 
and the Concessioner.

(d) Compensation for Personal Property

    No compensation is due the Concessioner from the Director or a 
successor concessioner for the Concessioner's personal property used in 
operations under this CONTRACT. However, the Director or a successor 
concessioner may purchase such personal property from the Concessioner 
subject to mutually agreed upon terms. Personal property not removed 
from the Area by the Concessioner in accordance with the terms of this 
CONTRACT shall be considered abandoned property subject to disposition 
by the Director, at full cost and expense of the Concessioner, in 
accordance with Applicable Laws. Any cost or expense incurred by the 
Director as a result of such disposition may be offset from any amounts 
owed to the Concessioner by the Director to the extent consistent with 
Applicable Laws.

Sec. 18. Assignment, Sale or Encumbrance of Interests

    (a) This CONTRACT is subject to the requirements of Applicable 
Laws, including, without limitation, 36 CFR Part 51, with respect to 
proposed assignments and encumbrances, as those terms are defined by 
Applicable Laws. Failure by the Concessioner to comply with Applicable 
Laws is a material breach of this CONTRACT for which the Director may 
terminate this CONTRACT for default. The Director shall not be obliged 
to recognize any right of any person or entity to an interest in this 
CONTRACT of any nature, including, but not limited to, Leasehold 
Surrender Interest or operating rights under this CONTRACT, if obtained 
in violation of Applicable Laws.
    (b) The Concessioner shall advise any person(s) or entity proposing 
to enter into a transaction which may be subject to Applicable Laws, 
including without limitation, 36 CFR Part 51, of the requirements of 
Applicable Law and this CONTRACT.

Sec. 19. General Provisions

    (a) The Director and Comptroller General of the United States, or 
any of their duly authorized representatives, shall have access to the 
records of the Concessioner as provided by the terms of Applicable 
Laws.
    (b) All information required to be submitted to the Director by the 
Concessioner pursuant to this CONTRACT is subject to public release by 
the Director to the extent provided by Applicable Laws.
    (c) Subconcession or other third party agreements, including 
management agreements, for the provision of visitor services required 
and/or authorized under this CONTRACT are not permitted.
    (d) The Concessioner is not entitled to be awarded or to have 
negotiating rights to any Federal procurement or service contract by 
virtue of any provision of this CONTRACT.
    (e) Any and all taxes or assessments of any nature that may be 
lawfully imposed by any State or its political subdivisions upon the 
property or business of the Concessioner shall be paid promptly by the 
Concessioner.
    (f) No member of, or delegate to, Congress or Resident Commissioner 
shall be admitted to any share or part of this CONTRACT or to any 
benefit that may arise from this CONTRACT but this restriction shall 
not be construed to extend to this CONTRACT if made with a corporation 
or company for its general benefit.
    (g) This CONTRACT is subject to the provisions of 43 CFR, Subtitle 
A, Subpart D, concerning nonprocurement debarment and suspension. The 
Director may recommend that the Concessioner be debarred or suspended 
in accordance with the requirements and procedures described in those 
regulations, as they are effective now or may be revised in the future.
    (h) This CONTRACT contains the sole and entire agreement of the 
parties. No oral representations of any nature form the basis of or may 
amend this CONTRACT. This CONTRACT may be extended, renewed or amended 
only when agreed to in writing by the Director and the Concessioner.
    (i) This CONTRACT does not grant rights or benefits of any nature 
to any third party.
    (j) The invalidity of a specific provision of this CONTRACT shall 
not affect the validity of the remaining provisions of this CONTRACT.
    (k) Waiver by the Director or the Concessioner of any breach of any 
of the terms of this CONTRACT by the other party shall not be deemed to 
be a waiver or elimination of such term, nor of any subsequent breach 
of the same type, nor of any other term of the CONTRACT. The subsequent 
acceptance of any payment of money or other performance required by 
this CONTRACT shall not be deemed to be a waiver of any preceding 
breach of any term of the CONTRACT.
    (l) Claims against the Director (to the extent subject to 28 U.S.C. 
2514) arising from this CONTRACT shall be forfeited to the Director by 
any person who corruptly practices or attempts to practice any fraud 
against the United States in the proof, statement, establishment, or 
allowance thereof within the meaning of 28 U.S.C. 2514.
    In Witness Whereof, the duly authorized representatives of the 
parties have executed this CONTRACT as of the________day of __ __,____.

[[Page 26074]]

Concessioner

United States of America

BY__________
(Title),
(Company Name).
BY__________
Director,
National Park Service.

[Corporations]

ATTEST:
BY:__________

TITLE:__________

[Sole Proprietorship]

WITNESSES:
NAME__________
ADDRESS____________

TITLE____________
NAME____________

ADDRESS__________

TITLE____________

[Partnership]

WITNESSES AS TO EACH:
[Concessioner]
NAME____________ ____________
ADDRESS
(NAME)
NAME____________
ADDRESS ____________
NAME

Exhibit A

Leasehold Surrender Interest

    This Exhibit A to this CONTRACT establishes certain terms and 
conditions of the CONTRACT regarding the nature, scope and applicable 
conditions of leasehold surrender interest. In event of any 
inconsistency between this Exhibit A and Exhibit F of this CONTRACT 
this Exhibit A shall prevail.

Section 1. Definitions

    ``Arbitration'' means binding arbitration conducted by an 
arbitration panel. All arbitration proceedings conducted under the 
authority of this Exhibit A will utilize the following procedures 
unless otherwise agreed by the Concessioner and the Director. One 
member of the arbitration panel will be selected by the Concessioner, 
one member will be selected by the Director, and the third (neutral) 
member will be selected by the two party-appointed members. The neutral 
arbiter must be a licensed real estate appraiser. The expenses of the 
neutral arbiter and other associated common costs of the arbitration 
will be borne equally by the Concessioner and the Director. The 
arbitration panel will adopt procedures that treat each party equally, 
give each party the opportunity to be heard, and give each party a fair 
opportunity to present its case. Determinations must be made by a 
majority of the members of the panel and will be binding on the 
Concessioner and the Director.
    A``capital improvement'' is a structure, fixture, or non-removable 
equipment provided by the Concessioner pursuant to the terms of this 
CONTRACT and located on lands of the United States within the area. A 
capital improvement does not include any interest in land. 
Additionally, a capital improvement does not include any interest in 
personal property of any kind including, but not limited to, vehicles, 
boats, barges, trailers, or other objects, regardless of size, unless 
an item of personal property becomes a fixture as defined in this 
Exhibit A.
    ``Construction cost'' of a capital improvement means the total of 
the incurred eligible direct and indirect costs necessary for 
constructing or installing the capital improvement that are capitalized 
by the concessioner in accordance with Generally Accepted Accounting 
Principals (GAAP).
    ``Consumer Price Index'' means the national ``Consumer Price 
Index--All Urban Consumers'' published by the Department of Labor. If 
this index ceases to be published, the Director will designate another 
regularly published cost-of-living index approximating the national 
Consumer Price Index.
    ``Depreciation'' means the loss of value in a capital improvement 
as evidenced by the condition and prospective serviceability of the 
capital improvement in comparison with a new unit of like kind.
    ``Eligible direct costs'' means the sum of all incurred capitalized 
costs (in amounts no higher than those prevailing in the locality of 
the project), that are necessary both for the construction of a capital 
improvement and are typically elements of a construction contract. 
Eligible direct costs may include, without limitation, the costs of (if 
capitalized in accordance with GAAP and in amounts no higher than those 
prevailing in the locality of the project): building permits; 
materials, products and equipment used in construction; labor used in 
construction; security during construction; contractor's shack and 
temporary fencing; material storage facilities; power line installation 
and utility costs during construction; performance bonds; and 
contractor's (and subcontractor's) profit and overhead (including job 
supervision, worker's compensation insurance and fire, liability, and 
unemployment insurance).
    ``Eligible indirect costs'' means, except as provided in the last 
sentence of this definition, the sum of all other incurred capitalized 
costs (in amounts no higher than those prevailing in the locality of 
the project) necessary for the construction of a capital improvement. 
Eligible indirect costs may include, without limitation, the costs of 
(if capitalized in accordance with GAAP and in amounts no higher than 
those prevailing in the locality of the project): architectural and 
engineering fees for plans, plan checks; surveys to establish building 
lines and grades; environmental studies; if the project is financed, 
the points, fees or service charges and interest on construction loans; 
all risk insurance expenses and ad valorem taxes during construction. 
The actual capitalized administrative expenses (in amounts no higher 
than those prevailing in the locality of the project did) of the 
Concessioner for direct, on-site construction inspection are eligible 
indirect costs. Other administrative expenses of the Concessioner are 
not eligible indirect costs.
    ``Fixtures and non-removable equipment'' are manufactured items of 
personal property of independent form and utility necessary for the 
basic functioning of a structure that are affixed to and considered to 
be part of the structure such that title is with the Director as real 
property once installed. Fixtures and non-removable equipment do not 
include building materials (e.g., wallboard, flooring, concrete, cinder 
blocks, steel beams, studs, window frames, windows, rafters, roofing, 
framing, siding, lumber, insulation, wallpaper, paint, etc.). Because 
of their special circumstances, floating docks (but not other types of 
floating property) that may be constructed by the Concessioner pursuant 
to the terms of this CONTRACT are considered to be non-removable 
equipment for leasehold surrender interest purposes only. Except as 
otherwise indicated in Exhibit A, the term ``fixture'' includes the 
term ``non-removable equipment.''
    ``Leasehold surrender interest'' solely means a right to payment in 
accordance with this CONTRACT for related capital improvements that the 
Concessioner makes or provides within the area on lands owned by the 
United States pursuant to the terms and conditions of this CONTRACT. 
The existence of a leasehold surrender interest does not give the 
Concessioner, or any other person, any right to conduct business in a 
park area, to utilize the related capital improvements, or to prevent 
the Director or another person from utilizing the related capital 
improvements. The existence of a leasehold surrender interest does not 
include any interest in the land on which the related capital 
improvements are located.
    ``Leasehold surrender interest value'' means the amount of 
compensation the

[[Page 26075]]

Concessioner is entitled to be paid for a leasehold surrender interest 
in capital improvements in accordance with this CONTRACT. The leasehold 
surrender interest value in existing capital improvements under the 
terms of this CONTRACT is an amount equal to:
    (1) The initial construction cost of the related capital 
improvement;
    (2) Adjusted by (increased or decreased) the same percentage 
increase or decrease as the percentage increase or decrease in the 
Consumer Price Index from the date the Director approves the 
substantial completion of the construction of the related capital 
improvement to the date of payment of the leasehold surrender interest 
value;
    (3) Less depreciation of the related capital improvement on the 
basis of its condition as of the date of termination or expiration of 
this CONTRACT, or, if applicable, the date on which the Concessioner 
ceases to utilize a related capital improvement (e.g., where the 
related capital improvement is taken out of service by the Director 
pursuant to the terms of this CONTRACT).
    ``Major rehabilitation'' means a planned, comprehensive 
rehabilitation of an existing structure that:
    (1) The Director approves in advance and determines is completed 
within 18 months from start of the rehabilitation work (unless a longer 
period of time is approved by the Director in special circumstances); 
and
    (2) The construction cost of which exceeds fifty percent of the 
pre-rehabilitation value of the structure.
    ``Pre-rehabilitation value'' of an existing structure means the 
replacement cost of the structure less depreciation.
    ``Real property improvements'' means real property other than land, 
including, but not limited to, capital improvements.
    ``Related capital improvement'' or ``related fixture'' means a 
capital improvement in which the Concessioner has a leasehold surrender 
interest.
    ``Replacement cost'' means the estimated cost to reconstruct, at 
current prices, an existing structure with utility equivalent to the 
existing structure, using modern materials and current standards, 
design and layout.
    ``Structure'' means a building, dock, or similar edifice affixed to 
the land so as to be part of the real estate. A structure may include 
both constructed infrastructure (e.g., water, power and sewer lines) 
and constructed site improvements (e.g., paved roads, retaining walls, 
sidewalks, paved driveways, paved parking areas) that are permanently 
affixed to the land so as to be part of the real estate and that are in 
direct support of the use of a building, dock, or similar edifice. 
Landscaping that is integral to the construction of a structure is 
considered as part of a structure. Interior furnishings that are not 
fixtures are not part of a structure.
    ``Substantial completion of a capital improvement'' means the 
condition of a capital improvement construction project when the 
project is substantially complete and ready for use and/or occupancy.

Section 2. Obtaining a Leasehold Surrender Interest

    The Concessioner will obtain leasehold surrender interest in 
capital improvements constructed in accordance with the terms and 
conditions of this CONTRACT, including, without limitation, the terms 
and conditions of this Exhibit A to the CONTRACT.

Section 3. Authorizing the Construction of a Capital Improvement

    The Director may only authorize or require the Concessioner to 
construct capital improvements on area lands in accordance with the 
terms and conditions of this CONTRACT and for the conduct by the 
Concessioner of visitor services, including, without limitation, the 
construction of capital improvements necessary for the conduct of 
visitor services.

Section 4. Requirements for Beginning To Construct a Capital 
Improvement

    Before beginning to construct any capital improvement, the 
Concessioner must obtain written approval from the Director in 
accordance with the terms of this CONTRACT, including the terms and 
conditions of this Exhibit A and Exhibit F. The request for approval 
must include appropriate plans and specifications for the capital 
improvement and any other information that the Director may specify. 
The request must also include an estimate of the total construction 
cost of the capital improvement. The estimate of the total construction 
cost must specify all elements of the cost in such detail as is 
necessary to permit the Director to determine that they are elements of 
construction cost as defined in this Exhibit. (The approval 
requirements of this and other sections of this CONTRACT also apply to 
any change orders to a capital improvement project and to any additions 
to a structure or replacement of fixtures as described in this 
CONTRACT.)

Section 5. Requirements After Substantial Completion of a Capital 
Improvement

    Upon substantial completion of the construction of a capital 
improvement in which the Concessioner is to obtain a leasehold 
surrender interest, the Concessioner must provide the Director a 
detailed construction report in accordance with the terms and 
conditions of this CONTRACT, including without limitation Exhibit A and 
Exhibit F. The construction report must be supported by actual invoices 
of the capital improvement's construction cost together with, if 
requested by the Director, a written certification from a certified 
public accountant. The construction report must document, and any 
requested certification by the certified public accountant must 
certify, that all components of the construction cost were incurred and 
capitalized by the Concessioner in accordance with GAAP, and that all 
components are eligible direct or indirect construction costs as 
defined in this Exhibit. Invoices for additional construction costs of 
elements of the project that were not completed as of the date of 
substantial completion may subsequently be submitted to the Director 
for inclusion in the project's construction cost.

Section 6. Determining Construction Cost for Purposes of Leasehold 
Surrender Interest Value

    After receiving the detailed construction report (and 
certification, if requested), from the Concessioner, the Director will 
review the report, certification and other information as appropriate 
to determine that the reported construction cost is consistent with the 
construction cost approved by the Director in advance of the 
construction and that all costs included in the construction cost are 
eligible direct or indirect costs as defined in this Exhibit A. The 
construction cost determined by the Director will be the construction 
cost for purposes of the leasehold surrender interest value in the 
related capital improvement unless the Concessioner requests 
arbitration of the construction cost under Section 7 of this Exhibit A. 
The Director may at any time amend a construction cost determination 
(subject to arbitration under Section 7 of this Exhibit A) if the 
Director determines that it was based on false, misleading or 
incomplete information.

Section 7. Arbitrating the Construction Cost of a Capital Improvement

    If the Concessioner requests arbitration of the construction cost 
of a

[[Page 26076]]

capital improvement determined by the Director, the request must be 
made in writing to the Director within 3 months of the date of the 
Director's determination of construction cost under Section 6 of this 
Exhibit A. If a timely request is not made, the Director's 
determination of construction cost under Section 6 shall be the final 
determination of the construction cost. The arbitration procedures are 
described in Section 1 of this Exhibit A. The decision of the 
arbitration panel as to the construction cost of the capital 
improvement will be binding on the concessioner and the Director.

Section 8. Actions the Concessioner May or Must Take Regarding 
Leasehold Surrender Interest

    The Concessioner:
    (a) May encumber a leasehold surrender interest in accordance with 
the terms of this CONTRACT;
    (b) Where applicable, must transfer its leasehold surrender 
interest in connection with any assignment, termination or expiration 
of this CONTRACT; and
    (c) May waive or relinquish a leasehold surrender interest.

Section 9. Extinguishment of a Leasehold Surrender Interest

    A leasehold surrender interest may not be extinguished by the 
expiration or termination of this CONTRACT and a leasehold surrender 
interest may not be taken for public use except on payment of just 
compensation. Payment of leasehold surrender interest value pursuant to 
the terms of this CONTRACT will constitute the payment of just 
compensation for leasehold surrender interest within the meaning of 
this CONTRACT and for all other purposes.

Section 10. Leasehold Surrender Interest Under a New Concession 
Contract

    If the Concessioner under this CONTRACT is awarded a new concession 
contract by the Director, and the new concession contract continues a 
leasehold surrender interest in related capital improvements, then the 
Concessioner's leasehold surrender interest value (established as of 
the date of expiration or termination of this CONTRACT) in the related 
capital improvements will be continued as the initial value of the 
Concessioner's leasehold surrender interest under the terms of the new 
concession contract.

Section 11. Payment for Leasehold Surrender Interest if the 
Concessioner is not Awarded a New Concession Contract

    (a) If the Concessioner is not awarded a new concession contract 
after expiration or termination of this CONTRACT, or, the Concessioner, 
prior to such termination or expiration, ceases to utilize under the 
terms of this CONTRACT capital improvements in which the Concessioner 
has a leasehold surrender interest, the Concessioner will be entitled 
to be paid its leasehold surrender interest value in the related 
capital improvements. The leasehold surrender interest will not be 
transferred until payment of the leasehold surrender interest value. 
The date for payment of the leasehold surrender interest value, except 
in special circumstances beyond the Director's control, will be the 
date of expiration or termination of this CONTRACT, or the date the 
Concessioner ceases to utilize related capital improvements under the 
terms of this CONTRACT. Depreciation of the related capital 
improvements will be established as of the date of expiration or 
termination of this CONTRACT, or, if applicable, the date the 
Concessioner ceases to utilize the capital improvements under the terms 
this CONTRACT.
    (b) In the event that extraordinary circumstances beyond the 
control of the Director prevent the Director from making the leasehold 
surrender interest value payment as of the date of expiration or 
termination of this CONTRACT, or, as of the date the Concessioner 
ceases to utilize related capital improvements under the terms of this 
CONTRACT, the payment when made will include interest on the amount 
that was due on the date of expiration or termination of this CONTRACT 
or cessation of use for the period after the payment was due until 
payment is made (in addition to the inclusion of a continuing Consumer 
Price Index adjustment until the date payment is made). The rate of 
interest will be the applicable rate of interest established by law for 
overdue obligations of the United States. The payment for a leasehold 
surrender interest value will be made within one year after the 
expiration or termination of this CONTRACT or the cessation of use of 
related capital improvements under the terms of this CONTRACT.

Section 12. Process for Determining Leasehold Surrender Interest Value

    In the event that the Concessioner and the Director cannot reach 
agreement as to a leasehold surrender interest value where required by 
the terms of this CONTRACT, the leasehold surrender interest value will 
be determined by arbitration upon request of the Director or the 
Concessioner. The arbitration procedures are described in Section 1. A 
prior decision as to the construction cost of capital improvements made 
by the Director or by an arbitration panel in accordance with this 
Exhibit A are final and not subject to further arbitration.

Section 13. Payment of Leasehold Surrender Interest by a New 
Concessioner

    A new concession contract awarded to a new concessioner will 
require the new concessioner to pay the Concessioner its leasehold 
surrender interest value in existing capital improvements as determined 
under Section 12.

Section 14. Obtaining Additional Leasehold Surrender Interest by 
Undertaking a Major Rehabilitation or Adding to a Structure in Which 
the Concessioner has a Leasehold Surrender Interest

    If the Concessioner, with the written approval of the Director, 
undertakes a major rehabilitation or adds a new structure (e.g., a new 
wing to an existing building or an extension of an existing sidewalk) 
to an existing structure in which the Concessioner has a leasehold 
surrender interest, the Concessioner will increase its leasehold 
surrender interest in the related structure, effective as of the date 
of substantial completion of the major rehabilitation or new structure, 
by the construction cost of the major rehabilitation or new structure. 
The Consumer Price Index adjustment for leasehold surrender interest 
value purposes will apply to the construction cost as of the date of 
substantial completion of the major rehabilitation or new structure. 
Approvals for major rehabilitations and additions to structures are 
subject to the same requirements and conditions applicable to new 
construction as described in this CONTRACT.

Section 15. Obtaining Additional Leasehold Surrender Interest by 
Replacing a Fixture in Which the Concessioner has a Leasehold Surrender 
Interest

    If the Concessioner replaces an existing fixture in which the 
Concessioner has a leasehold surrender interest with a new fixture, the 
Concessioner will increase its leasehold surrender interest by the 
amount of the construction cost of the replacement

[[Page 26077]]

fixture less the construction cost of the replaced fixture.

Section 16. Obtaining a Leasehold Surrender Interest in Existing Real 
Property Improvements in which no Leasehold Surrender Interest Exists

    (a) If the main body of this CONTRACT requires the Concessioner to 
replace fixtures in real property improvements in which there is no 
leasehold surrender interest (e.g., fixtures attached to an existing 
government facility assigned by the Director to the Concessioner), a 
leasehold surrender interest will be obtained by the Concessioner in 
such replacement fixtures subject to the approval and determination of 
construction cost and other conditions contained in CONTRACT.
    (b) If the main body of this CONTRACT requires the Concessioner to 
undertake a major rehabilitation of a structure in which there is no 
leasehold surrender interest (e.g., a government-constructed facility 
assigned to the Concessioner), upon substantial completion of the major 
rehabilitation, the Concessioner will obtain a leasehold surrender 
interest in the structure. The initial construction cost of this 
leasehold surrender interest will be the construction cost of the major 
rehabilitation. Depreciation for purposes of leasehold surrender 
interest value will apply only to the rehabilitated components of the 
related structure.

Section 17. No Leasehold Surrender Interest Results from Repair and 
Maintenance of Real Property Improvements

    The Concessioner will not obtain initial or increased leasehold 
surrender interest as a result of repair and maintenance of real 
property improvements unless a repair and maintenance project is a 
major rehabilitation.

Exhibit B

(Sample) Operating Plan

I. Introduction

    This Operating Plan between ________ (hereinafter referred to as 
the ``Concessioner'') and [Park Unit Name] (hereinafter referred to as 
the ``Service'') shall serve as a supplement to Concession Contract CC-
xxxxnnnn-yy (hereinafter referred to as the ``CONTRACT''). It describes 
specific operating responsibilities of the Concessioner and the Service 
with regard to those lands and facilities within [Park Unit Name] which 
are assigned to the Concessioner for the purposes authorized by the 
CONTRACT.
    In the event of any conflict between the terms of the CONTRACT and 
this Operating Plan, the terms of the CONTRACT, including its 
designations and amendments, shall prevail.
    This plan will be reviewed annually by the Superintendent in 
consultation with the Concessioner and revised as determined necessary 
by the Superintendent of [Park Unit Name].
    Any revisions shall not be inconsistent with the main body of this 
CONTRACT. Any revisions must be reasonable and in furtherance of the 
purposes of the CONTRACT.
    [From this point on, this document is tailored to the requirements 
of each individual park.]

Exhibit C

Nondiscrimination

Section I: Requirements Relating to Employment and Service to the 
Public

A. Employment
    During the performance of this CONTRACT the Concessioner agrees as 
follows:
    (1) The Concessioner will not discriminate against any employee or 
applicant for employment because of race, color, religion, sex, age, 
national origin, or disabling condition. The Concessioner will take 
affirmative action to ensure that applicants are employed, and that 
employees are treated during employment, without regard to their race, 
color, religion, sex, age, national origin, or disabling condition. 
Such action shall include, but not be limited to, the following: 
Employment upgrading, demotion, or transfer; recruitment or recruitment 
advertising; layoff or termination; rates of pay or other forms of 
compensation; and selection for training, including apprenticeship. The 
Concessioner agrees to post in conspicuous places, available to 
employees and applicants for employment, notices to be provided by the 
Secretary setting forth the provision of this nondiscrimination clause.
    (2) The Concessioner will, in all solicitations or advertisements 
for employees placed by on behalf of the Concessioner, state that all 
qualified applicants will receive consideration for employment without 
regard to race, color, religion, sex, age, national origin, or 
disabling condition.
    (3) The Concessioner will send to each labor union or 
representative of workers with which the Concessioner has a collective 
bargaining agreement or other contract or understanding, a notice, to 
be provided by the Secretary, advising the labor union or workers' 
representative of the Concessioner's commitments under Section 202 of 
Executive Order No. 11246 of September 24, 1965, as amended by 
Executive Order No. 11375 of October 13, 1967, and shall post copies of 
the notice in conspicuous places available to employees and applicants 
for employment.
    (4) Within 120 days of the commencement of a contract every 
Government contractor or subcontractor holding a contract that 
generates gross receipts which exceed $50,000 and having 50 or more 
employees shall prepare and maintain an affirmative action program at 
each establishment which shall set forth the contractor's policies, 
practices, and procedures in accordance with the affirmative action 
program requirement.
    (5) The Concessioner will comply with all provisions of Executive 
Order No. 11246 of September 24, 1965, as amended by Executive Order 
No. 11375 of October 13, 1967, and of the rules, regulations, and 
relevant orders of the Secretary of Labor.
    (6) The Concessioner will furnish all information and reports 
required by Executive Order No. 11246 of September 24, 1965, as amended 
by Executive Order No. 11375 of October 13, 1967, and by the rules, 
regulations, and orders of the Secretary of Labor, or pursuant thereto, 
and will permit access to the Concessioner's books, records, and 
accounts by the Secretary of the Interior and the Secretary of Labor 
for purposes of investigation to ascertain compliance with such rules, 
regulations, and orders.
    (7) In the event of the Concessioner's noncompliance with the 
nondiscrimination clauses of this CONTRACT or with any of such rules, 
regulations, or orders, this CONTRACT may be canceled, terminated or 
suspended in whole or in part and the Concessioner may be declared 
ineligible for further Government concession contracts in accordance 
with procedures authorized in Executive Order No. 11246 of September 
24, 1965, as amended by Executive Order No. 11375 of October 13, 1967, 
and such other sanctions may be imposed and remedies invoked as 
provided in Executive Order No. 11246 of September 24, 1965, as amended 
by Executive Order No. 11375 of October 13, 1967, or by rule, 
regulation, or order of the Secretary of Labor, or as otherwise 
provided by law.
    (8) The Concessioner will include the provisions of paragraphs (1) 
through (7) in every subcontract or purchase order unless exempted by 
rules, regulations,

[[Page 26078]]

or orders of the Secretary of Labor issued pursuant to Section 204 of 
Executive Order No. 11246 of September 24, 1965, as amended by 
Executive Order No. 11375 of October 13, 1967, so that such provisions 
will be binding upon each subcontractor or vendor. The Concessioner 
will take such action with respect to any subcontract or purchase order 
as the Secretary may direct as a means of enforcing such provisions, 
including sanctions for noncompliance: Provided, however, that in the 
event the Concessioner becomes involved in, or is threatened with, 
litigation with a subcontractor or vendor as a result of such direction 
by the Secretary, the Concessioner may request the United States to 
enter into such litigation to protect the interests of the United 
States.
B. Construction, Repair, and Similar Contracts
    The preceding provisions A(1) through A(8) governing performance of 
work under this CONTRACT, as set out in Section 202 of Executive Order 
No. 11246 of September 24, 1965, as amended by Executive Order No. 
11375 of October 13, 1967, shall be applicable to this CONTRACT, and 
shall be included in all contracts executed by the Concessioner for the 
performance of construction, repair, and similar work contemplated by 
this CONTRACT, and for that purpose the term ``CONTRACT'' shall be 
deemed to refer to this instrument and to contracts awarded by the 
Concessioner and the term ``Concessioner'' shall be deemed to refer to 
the Concessioner and to contractors awarded contacts by the 
Concessioner.
C. Facilities
    (1) Definitions: As used herein:
    (i) Concessioner shall mean the Concessioner and its employees, 
agents, lessees, sublessees, and contractors, and the successors in 
interest of the Concessioner;
    (ii) facility shall mean any and all services, facilities, 
privileges, accommodations, or activities available to the general 
public and permitted by this agreement.
    (2) The Concessioner is prohibited from:
    (i) publicizing facilities operated hereunder in any manner that 
would directly or inferentially reflect upon or question the 
acceptability of any person because of race, color, religion, sex, age, 
national origin, or disabling condition;
    (ii) discriminating by segregation or other means against any 
person.

Section II: Accessibility

    Title V, Section 504, of the Rehabilitation Act of 1973, as amended 
in 1978, requires that action be taken to assure that any ``program'' 
or ``service'' being provided to the general public be provided to the 
highest extent reasonably possible to individuals who are mobility 
impaired, hearing impaired, and visually impaired. It does not require 
architectural access to every building or facility, but only that the 
service or program can be provided somewhere in an accessible location. 
It also allows for a wide range of methods and techniques for achieving 
the intent of the law, and calls for consultation with disabled persons 
in determining what is reasonable and feasible.
    No handicapped person shall, because a Concessioner's facilities 
are inaccessible to or unusable by handicapped persons, be denied the 
benefits of, be excluded from participation in, or otherwise be 
subjected to discrimination under any program or activity receiving 
Federal financial assistance or conducted by any Executive agency or by 
the U.S. Postal Service.
A. Discrimination Prohibited
    A Concessioner, in providing any aid, benefit, or service, may not 
directly or through contractual, licensing, or other arrangements, on 
the basis of handicap:
    (1) Deny a qualified handicapped person the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (2) Afford a qualified handicapped person an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (3) Provide a qualified handicapped person with an aid, benefit, or 
service that is not as effective as that provided to others;
    (4) Provide different or separate aids, benefits, or services to 
handicapped persons or to any class of handicapped persons unless such 
action is necessary to provide qualified handicapped persons with aid, 
benefits, or services that are as effective as those provided to 
others;
    (5) Aid or perpetuate discrimination against a qualified 
handicapped person by providing significant assistance to an agency, 
organization, or person that discriminates on the basis of handicap in 
providing any aid, benefit, or service to beneficiaries of the 
recipient's program;
    (6) Deny a qualified handicapped person the opportunity to 
participate as a member of planning or advisory boards; or
    (7) Otherwise limit a qualified handicapped person in the enjoyment 
of any right, privilege, advantage, or opportunity enjoyed by others 
receiving an aid, benefit, or service.
B. Existing Facilities
    A Concessioner shall operate each program or activity so that the 
program or activity, when viewed in its entirety, is readily accessible 
to and usable by handicapped persons. This paragraph does not require a 
Concessioner to make each of its existing facilities or every part of a 
facility accessible to and usable by handicapped persons.

Exhibit D

Assigned Land and Real Property Improvements (Concession 
Facilities)

Land Assigned

    Land is assigned in accordance with the boundaries shown on the 
following map[s]:

Real Property Improvements Assigned

    The following real property improvements are assigned to the 
concessioner for use in conducting its operations under this CONTRACT:
Building Number
Description
Approved, effective ________, 20____
By: ____________
Regional Director, ________ Region

Exhibit E

Assigned Government Personal Property

    Government personal property is assigned to the Concessioner for 
the purposes of this CONTRACT as follows:
Property Number
Description of Item
Effective, this ____day of ________, 20 ____.
By:____________
Regional Director,____Region

Exhibit F

Concessioner Construction, Major Rehabilitation, and Repair and 
Maintenance Project Procedures

A. Introduction

    This exhibit presents step-by-step procedures for the 
administration of Concessioner building projects (construction, major 
rehabilitation, and repair and maintenance projects) within the park 
Area. Important terms are defined first. Project planning and design 
are presented second, followed by guidelines for project supervision. 
All projects undertaken by the Concessioner require a coordinated 
effort between the Concessioner and the Superintendent. This exhibit 
applies to

[[Page 26079]]

the building of new structures or facilities, major rehabilitations, 
and the repair and maintenance (``R&M projects'') of existing 
Concession Facilities that change the nature, appearance or value of 
existing Concession Facilities. Rehabilitation projects that are not 
major rehabilitations as defined in the Contract are considered as R&M 
projects. Facility operations, custodial and preventive maintenance and 
maintenance needed for facility operations are not considered R&M 
projects subject to these procedures. Repair and maintenance is also 
not to be considered as a project subject to these procedures when the 
activity does not change the nature, appearance or value of existing 
Concession Facilities. All projects must be proposed, approved, and 
accomplished under these procedures. In the event of any inconsistency 
between this exhibit and the main body of this CONTRACT and Exhibit A, 
the main body of the CONTRACT and Exhibit A will prevail.
    In accordance with the Contract, only certain new construction and 
major rehabilitation projects may qualify for leasehold surrender 
interest (LSI). Following these administrative procedures for both LSI 
and non-LSI projects will enable NPS to approve LSI, as well as to 
ensure that all requirements of law and NPS policy are undertaken with 
respect to any project.
    In addition, these procedures will enable the appraisal of LSI to 
occur in an orderly way. The documentation collected and organized by 
the use of these guidelines will provide a record of decision or 
``paper trail'' of project development and implementation that will 
assist the park and concessioner in future planning and facility 
appraisal.
    All project activities shall be directed and managed as presented 
in the ``Annual Construction and Repair and Maintenance Management 
Plan'' (CMP). In addition to these activities, the CMP is also to 
present scheduled project development and implementation, as presented 
below under Item C, Project Planning and Design, paragraph 1. 
Individual projects included in the CMP will be authorized by NPS 
through an approved Project Statement (PS).
    Projects may be required to be reviewed under the National 
Environmental Policy Act (NEPA) of 1969, as amended. Projects within 
historic and culturally significant areas may require certain building 
management methods established under the National Historic Preservation 
Act of 1966, as amended. All construction shall comply with codes and 
building requirements adopted by NPS, including without limitation and 
where applicable, the most recent International Building Code (IBC), 
National Fire Protection Association (NFPA) codes, the Americans with 
Disabilities Act (ADA) requirements, and NPS management policies.
    The Concessioner is responsible for all aspects of project 
development and implementation. The role of the NPS is to provide 
direction, authorization and oversight. The Concessioner and the Park 
staff must work closely together to successfully complete construction 
projects in a manner that achieves the goals and objectives of the park 
Area and the NPS.

B. Definition of Terms

    ``Annual Construction and Repair and Maintenance Management Plan'' 
(CMP): A written document presenting all construction, major 
rehabilitation and R&M projects to be undertaken by the Concessioner 
during the following calendar year after the final submittal date.
    ``Approved Project Documents'': Project drawings and specifications 
approved by the Park Superintendent and used by the Concessioner to 
direct a contractor in the type, size and quality of projects.
    ``Change Order'': A written agreement between the ``Construction 
Supervisor'' and the Contractor or Consultant that changes the contract 
documents or scope of project work as agreed upon contractually.
    ``Construction'': The removal or assembly of a building, road, 
utility or any other facility part or material that changes the nature, 
appearance, or value of that facility.
    ``Construction Supervisor'': A Concessioner employee designated to 
administer and coordinate day-to-day projects representing the 
interests of the Concessioner and NPS and assuring quality work is 
performed that meets the design and specifications of the project. This 
person must have the authority to direct the contractor in any way that 
may change the contractual agreement between the Concessioner and the 
contractor.
    ``Conventional Design-Bid-Build Methods'': Construction developed 
and implemented under several separate agreements managed and 
coordinated directly by the Concessioner.
    ``Contact Person'': A Concessioner employee designated as the 
person to contact with regard to a specific matter, concern, or issue.
    ``Facilitator'': A Concessioner employee designated to have the 
role of providing structure and agendas for meetings with NPS and who 
records meeting discussions and outcomes.
    ``Guaranteed Maximum Price Design-Build Construction Methods'': An 
industry recognized type of construction where project consultants and 
contractors form an agreement to work as one entity providing facility 
construction in response to a developed request for proposal issued by 
the Concessioner. (Reference: Design Build Institute of America).
    ``Licensed Contractor'': An entity performing construction 
certified or licensed by the State to perform construction services 
within that State.
    ``Major Rehabilitation'': (Defined in the CONTRACT).
    ``Project Coordinator'': A Concession employee vested with the 
authority to direct consultants and contractors in the expenditure of 
construction and R&M funds.
    ``Project Statement'' (PS): An agreement between NPS and the 
Concessioner approved by the Park Superintendent that authorizes the 
development and implementation of individual projects identified in a 
CMP.
    ``Registered Technical Professionals'': Architects, engineers, or 
any subject area expert either certified or licensed by the State to 
perform specialized services or certified by a widely recognized 
industry regulator held responsible for quality and standard 
application of technical subject matter.
    ``Substantially Complete'': (Defined in the CONTRACT).
    ``Total Project Cost'': The total of all actual project 
expenditures (invoiced and paid) for completion of a project.
    ``Total Project Price'': The total of all estimated project 
expenditures for completion of a project.

C. Project Planning and Design

(1) Submit an Annual Construction and Repair and Maintenance Plan (CMP)
    Before approval to proceed with any project is granted by NPS, the 
Concessioner must submit a CMP for implementation the following year. 
Some projects may require several years of planning and design before 
construction. The purpose of the plan is to identify the need and 
tentative scope of projects a complete year in advance of actual work 
to allow adequate time to prepare for project commencement. The CMP 
should include any intended projects. Projects shown in the plan must 
include at least a project title; project concept description; a brief 
statement of justification; and anticipated NEPA and Section 106 
planning and compliance established in collaboration with NPS staff.

[[Page 26080]]

(2) Notify NPS of Intent-to-Proceed
    The Concessioner shall formally notify the Park Superintendent in 
writing of intent to proceed with any facility planning, design and/or 
projects. The project must be identified in the CMP the calendar year 
before to assist the NPS in sequencing and scheduling necessary support 
staff. The time of notification shall be sufficiently in advance of any 
Concessioner budget formulation to assure the requirements of the Park 
Superintendent are included in the project scope before the project is 
funded.
(3) Identify a Project Coordinator
    The Concessioner project coordinator must be identified for each 
project. This person should have the authority to obligate project 
expenditures and hire and direct consultants and contractors, and 
concessioner support staff.
(4) Prepare a Proposed Project Statement (PS)
    Arrange and facilitate a project planning conference with NPS staff 
and prepare a proposed PS to be submitted to the Park Superintendent 
for review. The conference should be performed on the proposed project 
site, if needed.
    (a) Conference goal and product. The primary goal of the conference 
is to clearly identify the project concepts and scope at sufficient 
detail to carry the project through to completion without significant 
deviation from an approved PS. The product of the conference should be 
an approved PS prepared by the Concessioner resulting from 
collaboration between the Concessioner and the Park Superintendent.
    (b) Project Statement Content. The PS shall include the following 
as a minimum: Project description; justification; scope of work, 
including NEPA and Section 106 planning and compliance; estimated Total 
Project Price; proposed schedule; milestones of NPS design review and 
third party project inspection and certification. The elements of the 
PS will function as check points of accountability and will vary in 
frequency and scope, contingent upon the nature, complexity and scope 
of the proposed project.
    (c) Leasehold Surrender Interest. If the Concessioner seeks 
leasehold surrender interest as a result of a construction project, the 
Concessioner must request and receive the written approval of the 
proposed construction project by the Park Superintendent in accordance 
with the terms of this leasehold surrender interest concession 
contract. An estimate of the amount of leasehold surrender interest 
shall be identified in advance if the Concessioner requests leasehold 
surrender interest. The estimated leasehold surrender interest costs 
shall be separately identified as part of the Total Project Price and 
substantiated, if requested, with written and competitively acquired 
price proposals or construction contracts. Not all projects qualify for 
LSI. LSI is only granted under the terms of this CONTRACT, including, 
without limitation, its Exhibit A.
    (d) Methods of Establishing the Expected Value of Leasehold 
Surrender Interest. A number of methods are available to estimate the 
Concessioner's leasehold surrender interest as long as eligible direct 
and indirect costs are specified. The methods of identifying the 
expected value of leasehold surrender interest include guaranteed 
maximum price design-build construction methods, conventional design-
bid-build methods, and construction price estimates professionally 
prepared by subject area experts.
    (e) Professional Services and Construction. The Concessioner must 
assure the park in its project statement that for any project requiring 
professional services, such services shall be acquired from appropriate 
registered technical professionals. Licensed contractors shall perform 
all project work unless otherwise approved in writing by the 
Superintendent. The Concessioner shall provide for registered technical 
professionals to perform project inspection and/or facility 
certification, or any other service needed for project implementation 
at the request of the Park Superintendent.
    (f) NPS Operations. Any aspect of the proposed project where the 
scope of work interfaces with NPS operations such as utility service 
connections or road maintenance operations must be clearly identified 
in the PS.
(5) Submit Project Statement for NPS Review
    The proposed PS shall be submitted in written correspondence from 
the Concessioner to the Park Superintendent requesting review. A PS 
signed by the Park Superintendent constitutes official authority for 
the Concessioner to continue further project development to the level 
specified in written correspondence from the Superintendent. The 
Concessioner may obtain authority to complete a project when sufficient 
planning and design has been completed to meet the interests of the 
park. Projects that do not have the level of required planning are 
likely to receive only conceptual approval with authorization to 
proceed with further planning and/or design as required to assure park 
objectives are met.
    (a) Project Statements Containing Claims for Leasehold Surrender 
Interest. A PS must present an estimate of project expenditures to be 
claimed for LSI purposes. The eligibility of any expenditures for LSI 
will not be identified until all project planning is complete to the 
satisfaction of the Park Superintendent, including NEPA and Section 106 
compliance, if required. An approved PS serves only as a guide for 
further project development to the level specified in the PS. The Park 
Superintendent shall only approve final LSI costs after project 
completion and written project close-out.
    (b) Design Required for Leasehold Surrender Interest Eligibility 
and Value. The Park Superintendent may require an appropriate level of 
design to determine whether a project is eligible for LSI, and if so, 
its estimated cost. The level of project planning and design required 
may include completion of concept design, schematic design, or 
preliminary engineering design, to clearly identify the elements 
eligible for LSI. Some projects may require the completion of 
construction drawings and specifications before the proposed LSI is 
documented to the satisfaction of the Park Superintendent. All 
improvements for which LSI is claimed must be defined in record ``as-
built'' construction drawings and specifications when the Concessioner 
submits its request for LSI at Project Close-out.
(6) Establish a Project File
    A file of all project documents shall be held by the Concessioner 
as a chronological audit trail of all project decision-making activity 
for each project from concept development to completion and NPS 
acceptance. Each project shall be identified with a unique project 
number assigned by the Park. All documents entered into the file should 
have the project identification number clearly displayed on it as part 
of document identity.
    (a) Leasehold Surrender Interest Project File. The Project File 
will become an LSI project file when the Concessioner requests approval 
of LSI. It shall be established and maintained by the Concessioner and 
shall include all of the documents identified in section 6(C) of this 
Exhibit. This file shall be submitted at the time of Project Close-out 
to the Park Superintendent as the basis for the leasehold surrender 
interest request. As part of this file, the Concessioner must maintain 
auditable records of all expenditures attributable to each project and 
have them available

[[Page 26081]]

for review if requested by NPS personnel. Invoices shall contain 
sufficient information to identify the tasks completed or products 
delivered as agreed upon in contracts presenting a full scope of work. 
The file shall clearly provide a ``paper trail'' between expenditures 
eligible for LSI purposes and the payment of those expenses.
    (b) Typical Project File. The organization of a typical project 
file is presented in the following sections:
    Section A. Project Statement. The approved PS, scope of work, and a 
copy of the notice-to-proceed letter, authorizing planning and design, 
sent to the Concessioner by the Park Superintendent should be filed in 
this section.
    Section B. Planning. This section should contain documents 
pertaining to any project planning. Typical documents include those 
produced for NEPA and Section 106 compliance. Also contained in this 
section should be any concept design, preliminary design, or schematic 
design correspondence and documents. When the Park Superintendent 
grants approval for any of the above stages of project development, 
correspondence from the Park Superintendent should be filed in this 
section.
    Section C. Assessment. This section should contain a record of any 
assessment performed during project implementation. Soil, vegetation, 
floodplain, structural, electrical assessments, for example, should be 
filed in this section. Any other existing site or facility 
investigative reports, and all quality assurance documents such as 
third party project inspection, testing and certification should also 
be filed in this section.
    Section D. Design. This section should contain a record of 
documents produced and decisions made during the design phase of a 
project. The design phase typically occurs when project activity has 
shifted from conceptual discussion to organizing detailed direction 
provided to a contractor for construction. Correspondence from the Park 
Superintendent providing design approval should be in this section.
    Section E. Project Work. This section should contain a record of 
decisions made during project work. The letter from the Park 
Superintendent granting notice-to-proceed with the project should be in 
this section. All contractor proposals, change-orders, design 
modification documents, daily construction activity records, weekly 
meeting minutes, etc. should be in this section. Documentation for 
larger projects should be organized according to subcontractor activity 
or standard specification enumeration. The final document filed in this 
section should be the NPS correspondence sent to the Concessioner 
providing project acceptance and close-out.
    Section F. Financial. This is a very important section where a copy 
of all contracts and contract modifications should be filed. It is 
important to assure that all expenditures are accounted for. All 
expenditures must have sufficient supporting documentation cross-
referenced with documents in other file sections, if necessary. Monthly 
financial detail reports shall be prepared and filed in this section 
with copies of all project budget documents. This section must contain 
all correspondence supporting LSI with appropriate cross reference to 
other sections for clarity of the LSI ``paper trail.'' (For example, 
cross reference tabs). Also contained in this section shall be a copy 
of the project acceptance and close-out letter from the Park 
Superintendent that specifies the amount of leasehold surrender 
interest, if any, applicable to the project.
    Section G. Photo Documentation. Complete documentation, including 
before-and-after photos, records of any special situations or 
conditions requiring changes, documentation of methods used, etc., 
should be kept to support requests for LSI and to assist future 
maintenance and/or appraisal efforts. Photographic documentation is 
also usually required for modifications to ``listed'' historic 
structures. To be most useful, photos should be filed with the 
documents they support.
(7) Submit Resource Compliance Documents for Review and Approval
    During development of the project statement, responsibility for 
compliance work will be established. The Concessioner must request the 
participation of NPS staff early in project planning to assure 
uninterrupted project implementation. Development of compliance 
documentation must occur as soon as possible. Every effort shall be 
made to perform compliance document preparation tasks concurrently with 
project planning and design.
    (a) Historic/cultural compliance. Historic and cultural compliance 
document approval is required for property listed in or eligible for 
inclusion in the National Register of Historic Places. Any undertaking 
affecting property listed shall be performed in accordance with The 
Secretary of the Interior's Standards for Rehabilitation & Illustrated 
Guidelines for Rehabilitating Historic Buildings. The Concessioner must 
document proposed actions using the ``XXX Form'' (available from the 
National Park Service) before any work occurs for any project that may 
affect a historic structure, historic district, cultural landscape, 
archeological site or historic object or furnishing. Compliance will 
usually require the preparation of at least ``assessment of effect'' 
drawings and specifications to the level of final documents if 
required. Compliance shall carry through to submission of the 
``Construction or R&M Completion Report'' for many projects where 
significant changes are made to the historic structure and/or 
landscape. Therefore, compliance document approval usually will not 
occur until after submission of project documents. In-park historic 
compliance review and approval will require at least several weeks from 
date of submittal. Where submittal is made to the State Historic 
Preservation Officer or the Advisory Council on Historic Preservation, 
additional time will be required before approval may be given. This may 
be performed concurrently with approval of project documents.
    (b) Ground disturbance. Where ground disturbance will take place 
submittal of drawings that show area and depth of proposed ground 
disturbance will be required. Submittal of this document early in 
project planning is recommended. All project documents that include 
soil disturbance shall have the following specification included within 
them:
    ``Petroglyphs, artifacts, burial grounds or remains, structural 
features, ceremonial, domestic, and archeological objects of any 
nature, historic or prehistoric, found within the project area are the 
property of and will be removed only by the Government. Should 
Contractor's operations uncover or his/her employees find any 
archeological remains, Contractor shall suspend operations at the site 
of discovery; notify the Government immediately of the findings; and 
continue operations in other areas. Included with the notification 
shall be a brief statement of the location and details of the findings. 
Should the temporary suspension of work at the site result in delays, 
or the discovery site require archeological studies resulting in delays 
of additional work for Contractor, he/she will be compensated by an 
equitable adjustment under the General Provisions of the contract.''
    (c) Archeological Monitoring. Monitoring project activity is a 
requirement of cultural compliance when significant ground disturbance 
occurs during project work. Any cultural resource monitoring required 
shall be performed under the direction

[[Page 26082]]

of the NPS. The NPS shall be notified sufficiently in advance of the 
need for a monitor and will assist the Concessioner in making 
arrangements for the services of an archeological monitor at the 
expense of the Concessioner, if the NPS is unable to provide the 
expertise.
    (d) National Environmental Policy Act (NEPA) compliance. NEPA 
compliance document approval is required before any construction or R&M 
project occurs for any project that has an impact on the environment. 
Projects requiring compliance will be identified by the NPS early 
during project planning. The actual review period length may vary 
widely depending on the nature, scope, and complexity of the project 
elements that relate to resource compliance. Projects that have an 
insignificant effect on park resources usually require a ``categorical 
exclusion'' determination--a process that may require sufficient 
extended lead-time from submittal of review documents. Projects having 
a significant effect on park resources or that are not part of other 
NEPA compliance documentation may also require a longer period of 
implementation.
(8) Submit Project Documents (PDs) for Review and Approval
    The Concessioner shall submit PDs for review and approval to 
establish project activity for approval by the Superintendent. Approved 
PDs establish the full scope of the project and the quality of work to 
be performed by the Concessioner. The scope of the documents required 
will be identified in the PS. The scope and detail of the documents 
will vary depending on the nature and complexity of the project. 
``Manufacturer's cut-sheets'' may be all that is required for some R&M 
projects, and for others, complete detailed drawings and specifications 
may be required. The Concessioner is responsible for the technical 
accuracy and completeness of PDs and shall provide the technical review 
as needed to assure compliance with all applicable federal, state and 
local statutes, codes, regulations and appropriate industry standards. 
Any exception to this will be by written authorization from the 
Superintendent.
(9) Submit a Project Estimate and Schedule
    An estimate of the Total Project Price and completion schedule 
shall be submitted to the Superintendent before work begins. This is a 
revision of the Total Project Price and completion schedule estimated 
in the Project Statement. It is based on the best information available 
identified during project planning and design.

D. Project Management Procedures

(1) Identify a Project Supervisor
    A Project Supervisor shall be identified and vested with the 
authority to direct the contractor on behalf of the Concessioner. The 
NPS will direct its communication concerning the nature and progress of 
day-to-day project activity to this person. This person should have 
full responsibility for assuring that all construction complies with 
the approved Project Documents and specified code compliance. The NPS 
should not take any responsibility for projects until Project Close-out 
and Acceptance when the NPS receives certification of completed work 
performed in compliance with Project Documents and all specified codes.
(2) Submit a Total Project Price for Review
    (a) All projects completed under the terms of this Contract where 
LSI is requested shall include submittal of a Total Project Price in 
writing to the Superintendent for review.
    (b) Where no LSI is requested, the Total Project Price is provided 
as an informational item. Formal approval by the Superintendent is not 
required.
(3) Notice-to-Proceed with a Project
    A ``Notice-to-Proceed'' with a project will be issued when all 
submittals requested by the Park Superintendent have been reviewed and 
approved. The Notice-to-Proceed must be received by the Concessioner in 
writing before any project work occurs.
(4) Hold a Pre-Project Conference with the Contractor
    The Concessioner shall arrange and facilitate a pre-project 
conference as needed or as requested by the NPS with the Contractor. 
The purpose of the conference is to provide the NPS the opportunity to 
meet the Contractor and confirm that the Contractor has full 
understanding and knowledge of all work to be performed. In addition, 
the conference provides the opportunity to confirm established 
communication linkages between the Concessioner, the Contractor and the 
NPS. Any questions the Contractor may have regarding any matter of the 
project or anything about Area access, rules and regulations may also 
be discussed.
(5) Submit Project Activity Reports (As Required)
    A record of project activity shall be provided by the Concessioner 
on all approved projects. The scope and frequency of performing this 
documentation shall be identified upon submittal of PDs for Park 
approval. The Concessioner is responsible for the accuracy and 
completeness of all design and completed projects.
    (a) Content. Project activity reports shall summarize daily project 
activity recording important observations and decisions. It shall also 
identify project expenditures to date if required for leasehold 
surrender interest purposes. The reports shall identify any changes to 
the approved PDs either by change order or any other variance from 
approved PDs. The NPS shall be notified immediately, if a change is 
likely to occur in the Total Project Price where the project involves 
LSI. (See discussion below for review and approval of change orders and 
contract modifications.)
    (b) Regulatory code compliance and project inspection (as 
required). Inspection reports specifically addressing regulatory code 
compliance and adherence to PDs will be required, at the request of the 
Superintendent, during certain stages of the work. Independent industry 
certified inspectors or registered professional subject area experts 
shall perform all inspections and project component certification. 
Inspection reports shall be prepared that include all findings and 
results of code compliance inspection. Section and paragraph of 
applicable codes shall be referenced when deficiencies are noted. 
Recommendations presenting remediation shall accompany line item 
deficiencies in the report. All inspection reports shall be included in 
the final project completion report submitted before project acceptance 
by the Superintendent.
(6) Submit Requests for Changes in Approved Project Documents
    The Superintendent's approval will be required before any 
significant changes are made to the project scope during the completion 
of projects, as identified in the approved PDs. The Concessioner shall 
provide the NPS with written notification immediately upon identifying 
the need for a change in project scope that effects any of the items 
listed below. The written notification shall include a request for 
change in the approved PDs complete with justification and explanation 
of effect of change on all other aspects of project design and work. 
Requests for any significant changes in the approved PDs shall be 
reported in project activity reports with attachment of any 
documentation requested. Changes in approved project scope during the 
work

[[Page 26083]]

that will require review and approval of the Superintendent include the 
following:
    (a) Changes affecting natural, cultural and/or historic resources;
    (b) Changes in designated visual appearance;
    (c) Changes in the interface with NPS utility and/or road facility 
maintenance operations;
    (d) Changes in project scope and/or the estimated leasehold 
surrender interest, as required for facility improvement projects.
    (e) Proposed changes where natural or cultural/historic resources 
are involved may require a significant period of review depending on 
the complexity of the concern.
(7) Submittal of Change Orders for Review and Approval (For Leasehold 
Surrender Interest Only)
    When one of the five factors listed above exists, the Concessioner 
shall submit, for the review and approval of the Park Superintendent, 
documentation justifying the proposed changes. The Concessioner shall 
also submit a revised Total Project Price for each proposed change, as 
needed, indicating the proposed change in estimated LSI. All change 
orders or any other means of directing the Contractor that may have the 
effect of increasing the Total Project Price will require the Park 
Superintendent's review and approval, if the project has LSI 
implications.
(8) NPS Project Inspection
    The project will be inspected periodically by a representative of 
the Park Superintendent. The purpose of these inspections is not in 
lieu of or in any way a substitute for project inspection provided by 
the Concessioner. The responsibility to assure safe, accountable 
project activity and for providing the contractor with direction to 
fulfill the full scope of approved work is the responsibility of the 
Concessioner.
(9) Project Supervision Documents
    Project drawings and specifications must be kept on the project 
site complete with any design or project modifications, in a well-
organized form. The Construction Supervisor shall keep a current ``red-
line'' copy of approved PDs updated daily showing any changes. In 
addition, a well-organized file of submittals required in the approved 
PDs and approved where required by professional Architects and/or 
Engineers must also be kept on the project site with the PDs for 
periodic inspection by NPS staff.
(10) Substantial Completion Inspection and Occupancy
    Joint inspection by the NPS and the concessioner will occur upon 
notification that the project is substantially complete. A ``punch 
list'' of work items will be formulated and performed to ``close-out'' 
the project. The Superintendent, in writing will accept the project, 
when the ``punch-list'' items are completed.
    The Concessioner is not to occupy the facility until authorized in 
writing by the Park Superintendent.
(11) Requesting Approval of Leasehold Surrender Interest
    Upon substantial completion of a project, as determined by the Park 
Superintendent, the Concessioner must provide the Superintendent a 
written schedule of requested LSI eligible costs incurred, which 
becomes the Concessioner's request for LSI approval. The project file, 
containing actual invoices and the administrative record of project 
implementation, must support these expenditures and shall be submitted 
to the Park Superintendent for review with the request. If requested by 
the Park Superintendent, the Concessioner shall also provide written 
certification from a certified public accountant regarding the LSI 
costs. The certification must comply with the requirements of Exhibit A 
of this Contract.
(12) Project Completion Report
    Upon completion of any project, the Concessioner shall submit a 
Project Completion Report to the NPS. The completion report shall 
include the Total Project Cost; before-and-after photo documentation; 
warranties; operation and maintenance manuals, if required; all 
inspection and certification reports; and ``as-constructed'' drawings 
(see item section C(13) below). Projects where LSI is requested may 
require the submittal of any other similar documents deemed by the NPS 
necessary to establish complete project documentation. The level of 
documentation requested may also include adequate photo-documentation 
provided during construction to record significant unforeseen site and 
construction conditions resulting in changes to approved PDs and the 
approved Total Construction Price.
(13) ``As-Constructed Drawings''
    The ``as constructed'' drawings included with the Project 
Completion Report for all projects shall be full-size archival quality 
prepared in accordance with NPS management policies and must be 
submitted before project acceptance by the National Park Service. At 
least two half-size sets of drawings shall also be provided. The 
drawings establishing LSI shall provide a full and complete record of 
all ``as-constructed'' facilities including reproduction of approved 
submittals and manufacturer's literature documenting quality of 
materials, equipment and fixtures in addition to a record set of 
project specifications approved for construction.
(14) Request Project Acceptance and Close-out by the Superintendent
    The Concessioner shall request project acceptance by the Park 
Superintendent either at the time of submittal of the Project 
Completion Report or at any time thereafter. Project acceptance will be 
contingent upon fulfillment of all requested project completion work 
tasks and submittal of all project documentation in accordance with 
these guidelines and as requested by the NPS. Until receiving formal 
written project acceptance and close-out from the Park Superintendent, 
the Concessioner retains full responsibility for all project 
construction activity and liability for both completed and uncompleted 
work. For LSI projects, the project close-out letter issued by the 
Superintendent will specify the granted amount of LSI value resulting 
from the project.

Exhibit G

Leasehold Surrender Interest as of the Effective Date of this 
Contract

    Pursuant to Section 9(c)(2), the Concessioner's leasehold surrender 
interest in real property improvements as of the effective date of this 
CONTRACT, if any, is as follows:
Building Number
Description
Value
    [If there are none, this exhibit should say ``NONE''.]
Exhibit G Approved Effective ________
Concessioner
United States of America
By: ________
Director, National Park Service
By: ________
Title: ________

Exhibit H

(Sample) Maintenance Plan

I. Introduction

    This Maintenance Plan between ____ (hereinafter referred to as the 
``Concessioner'') and [Park Unit Name], National Park Service 
(hereinafter referred to as the ``Service'') shall serve

[[Page 26084]]

as a supplement to Concession Contract CC-xxxxnnnn-yy (hereinafter 
referred to as the ``CONTRACT''). It sets forth the maintenance 
responsibilities of the Concessioner and the Service with regard to 
those lands and facilities within [Park Unit Name] which are assigned 
to the Concessioner for the purposes authorized by the CONTRACT.
    In the event of any apparent conflict between the terms of the 
CONTRACT and this Maintenance Plan, the terms of the CONTRACT, 
including its designations and amendments, shall prevail.
    This plan shall remain in effect until superseded or amended. It 
will be reviewed annually by the Superintendent in consultation with 
the Concessioner and revised as determined necessary by the 
Superintendent of [Park Unit Name]. Revisions may not be inconsistent 
with the terms and conditions of the main body of this CONTRACT. 
Revisions must be reasonable and in furtherance of the purposes of this 
CONTRACT.
    [From this point on, this document is tailored to the requirements 
of each individual park.]

Exhibit I

Insurance Requirements

I. Insurance Requirements

    The Concessioner shall obtain and maintain during the entire term 
of this CONTRACT, at its sole cost and expense, the types and amounts 
of insurance coverage necessary to fulfill the obligations of the 
CONTRACT:

II. Liability Insurance

    The following Liability Coverages are to be maintained at a 
minimum, all of which are to be written on an occurrence basis only. 
The Concessioner may attain the limits specified below by means of 
supplementing the respective coverage(s) with Excess or Excess 
``Umbrella'' Liability.
A. Commercial General Liability
    1. Coverage will be provided for bodily injury, property damage, 
personal or advertising injury liability (and must include Contractual 
Liability and Products/Completed Operations Liability).
Bodily Injury and Property Damage Limit
Products/Completed Operations Limit
Personal Injury & Advertising Injury Limit
General Aggregate
Fire Damage Legal Liability ``per fire''
    2. The liability coverages may not contain the following 
exclusions/limitations:
a. Athletic or Sports Participants
b. Products/Completed Operations
c. Personal Injury or Advertising Injury exclusion or limitation
d. Contractual Liability limitation
e. Explosion, Collapse and Underground Property Damage exclusion
f. Total Pollution exclusion
g. Watercraft limitations affecting the use of watercraft in the course 
of the concessioner's operations (unless separate Watercraft coverage 
is maintained)
    3. For all lodging facilities and other indoor facilities where 
there may be a large concentration of people, the pollution exclusion 
may be amended so that it does not apply to the smoke, fumes, vapor or 
soot from equipment used to heat the building.
    4. If the policy insures more than one location, the General 
Aggregate limit must be amended to apply separately to each location, 
or, at least, separately to the appropriate NPS location(s).
B. Automobile Liability
    Coverage will be provided for bodily injury or property damage 
arising out of the ownership, maintenance or use of ``any auto,'' 
Symbol 1. (Where there are no owned autos, coverage applicable to 
``hired'' and ``non-owned'' autos, ``Symbols 8 & 9,'' shall be 
maintained.)

Each Accident Limit
C. Liquor Liability (if applicable)
    Coverage will be provided for bodily injury or property damage 
including damages for care, loss of services, or loss of support 
arising out of the selling, serving or furnishing of any alcoholic 
beverage.

Each Common Cause Limit
Aggregate Limit
D. Watercraft Liability (or Protection & Indemnity) (if applicable)
    Coverage will be provided for bodily injury or property damage 
arising out of the use of any watercraft.

Each Occurrence Limit
E. Aircraft Liability (if applicable)
    Coverage will be provided for bodily injury or property damage 
arising out of the use of any aircraft.

Each Person Limit
Property Damage Limit
Each Accident Limit
F. Garage Liability (if applicable)
    This coverage is not required, but may be used in place of 
Commercial General Liability and Auto Liability coverages for some 
operations. Coverage will be provided for bodily injury, property 
damage, personal or advertising injury liability arising out of garage 
operations (including products/completed operations and contractual 
liability) as well as bodily injury and property damage arising out of 
the use of automobiles.

Each Accident Limits--Garage Operations
Auto Only
Other Than Auto Only
Personal Injury & Advertising
Injury Limit
Fire Damage Legal Liability ``per fire''
Aggregate Limit--Garage Operations
Other Than Auto Only
    If owned vehicles are involved, Liability coverage should be 
applicable to ``any auto'' (``Symbol 21'') otherwise, coverage 
applicable to ``hired'' and ``non-owned'' autos (``Symbols 28 & 29'') 
should be maintained.
G. Excess Liability or Excess ``Umbrella'' Liability
    This coverage is not required, but may be used to supplement any of 
the above Liability coverage policies in order to arrive at the 
required minimum limit of liability. If maintained, coverage will be 
provided for bodily injury, property damage, personal or advertising 
injury liability in excess of scheduled underlying insurance. In 
addition, coverage shall be at least as broad as that provided by 
underlying insurance policies and the limits of underlying insurance 
shall be sufficient to prevent any gap between such minimum limits and 
the attachment point of the coverage afforded under the Excess 
Liability or Excess ``Umbrella'' Liability policy.
H. Care, Custody and Control--Legal Liability (Describe Specific 
Coverage)
    Coverage will be provided for damage to property in the care, 
custody or control of the concessioner.

Any One Loss
I. Environmental Impairment Liability
    Coverage will be provided for bodily injury, personal injury or 
property damage arising out of pollutants or contaminants (on site and/
or offsite).

Each Occurrence or Each Claim Limit
Aggregate Limit
J. Special Provisions for Use of Aggregate Policies
    At such time as the aggregate limit of any required policy is (or 
if it appears that it will be) reduced or exhausted, the concessioner 
may be required to reinstate such limit or purchase additional coverage 
limits.

[[Page 26085]]

K. Self-Insured Retentions
    Self-insured retentions on any of the above described Liability 
insurance policies (other than Excess ``Umbrella'' Liability, if 
maintained) may not exceed $5,000.
L. Workers Compensation & Employers' Liability
    Coverage will comply with the statutory requirements of the 
state(s) in which the concessioner operates.

III. Property Insurance

A. Building(s) and/or Contents Coverage
    1. Insurance shall cover buildings, structures, improvements & 
betterments and/or contents for all Concession Facilities, as more 
specifically described in Exhibit D of this CONTRACT.
    2. Coverage shall apply on an ``All Risks'' or ``Special Coverage'' 
basis.
    3. The policy shall provide for loss recovery on a Replacement Cost 
basis.
    4. The amount of insurance should represent no less than 90% of the 
Replacement Cost value of the insured property.
    5. The coinsurance provision, if any, shall be waived or suspended 
by an Agreed Amount or Agreed Value clause.
    6. Coverage is to be provided on a blanket basis.
    7. The Vacancy restriction, if any, must be eliminated for property 
that will be vacant beyond any vacancy time period specified in the 
policy.
    8. Flood Coverage shall be maintained with a limit of not less than 
$.
    9. Earthquake Coverage shall be maintained with a limit of not less 
than $.
    10. Ordinance or Law Coverage shall be maintained with a limit of 
not less than $.
B. Boiler & Machinery Coverage
    1. Insurance shall apply to all pressure objects within Concession 
Facilities.
    2. The policy shall provide for loss recovery on a Replacement Cost 
basis.
    3. The amount of insurance should represent no less than 75% of the 
Replacement Cost value of the insured property.
    4. The coinsurance provision, if any, shall be waived or suspended 
by an Agreed Amount or Agreed Value clause.
    5. Coverage is to be provided on a blanket basis.
    6. If insurance is written with a different insurer than the 
Building(s) and Contents insurance, both the Property and Boiler 
insurance policies must be endorsed with a joint loss agreement.
    7. Ordinance or Law Coverage shall be maintained with a limit of 
not less than $.
C. Builders Risk Coverage
    1. Insurance shall cover new buildings or structures under 
construction at the Concession Facilities, and include coverage for 
property that has or will become a part of the project while such 
property is at the project site, at temporary off-site storage and 
while in transit. Coverage should also apply to temporary structures 
such as scaffolding and construction forms.
    2. Coverage shall apply on an ``All Risks'' or ``Special Coverage'' 
basis.
    3. The policy shall provide for loss recovery on a Replacement Cost 
basis.
    4. The amount of insurance should represent no less than 90% of the 
Replacement Cost value of the insured property.
    5. The coinsurance provision, if any, shall be waived or suspended 
by an Agreed Amount or Agreed Value clause.
    6. Any occupancy restriction must be eliminated.
    7. Any collapse exclusion must be eliminated.
    8. Any exclusion for loss caused by faulty workmanship must be 
eliminated.
    9. Flood Coverage shall be maintained with a limit of not less than 
$.
    10. Earthquake Coverage shall be maintained with a limit of not 
less than $.
D. Business Interruption and/or Expense
    1. Business Interruption insurance, if maintained by the 
Concessioner, should cover the loss of income and continuation of fixed 
expenses in the event of damage to or loss of Concession Facilities. 
Extra Expense insurance shall cover the extra expenses above normal 
operating expenses to continue operations in the event of damage or 
loss to covered property.
E. Deductibles
    Property Insurance coverages described above may be subject to 
deductibles as follows:
    1. Direct Damage deductibles shall not exceed the lesser of 10% of 
the amount of insurance or $25,000 (except Flood & Earthquake coverage 
may be subject to deductibles not exceeding $50,000).
    2. Extra Expense deductibles (when coverage is not combined with 
Business Interruption) shall not exceed $25,000.
F. Required Clauses
    1. Loss Payable Clause:
    A loss payable clause similar to the following must be added to 
Buildings and/or Contents, Boiler and Machinery, and Builders Risk 
policies:
    ``In accordance with Concession Contract No. ___ dated ___, between 
the United States of America and [the Concessioner] payment of 
insurance proceeds resulting from damage or loss of structures insured 
under this policy is to be disbursed directly to the Concessioner 
without requiring endorsement by the United States of America.''

IV. Construction Project Insurance

    Concessioners entering into contracts with outside contractors for 
various construction projects, including major renovation projects, 
rehabilitation projects, additions or new buildings/facilities will be 
responsible to ensure that all contractors retained for such work 
maintain an insurance program that adequately covers the construction 
project.
    The insurance maintained by the construction and construction-
related contractors shall comply with the insurance requirements stated 
herein (for Commercial General Liability, Automobile Liability, 
Workers' Compensation and, if professional services are involved, 
Professional Liability). Where appropriate, the interests of the 
Concessioner and the United States shall be covered in the same fashion 
as required in the Commercial Operator Insurance Requirements. The 
amounts/limits of the required coverages shall be determined in 
consultation with the Director taking into consideration the scope and 
size of the project.

V. Insurance Company Minimum Standards

    All insurance companies providing the above described insurance 
coverages must meet the minimum standards set forth below:
    1. All insurers for all coverages must be rated no lower than A- by 
the most recent edition of Best's Key Rating Guide (Property-Casualty 
edition).
    2. All insurers for all coverages must have a Best's Financial Size 
Category of at least VIII according to the most recent edition of 
Best's Key Rating Guide (Property-Casualty edition).
    3. All insurers must be admitted (licensed) in the state in which 
the concessioner is domiciled.

VI. Certificates of Insurance

    All certificates of Insurance required by this CONTRACT shall be 
completed in sufficient detail to allow easy identification of the 
coverages, limits, and coverage amendments that are described above. In 
addition, the insurance companies must be accurately listed along with 
their A.M. Best

[[Page 26086]]

Identification Number (``AMB#''). The name, address and telephone 
number of the issuing insurance agent or broker must be clearly shown 
on the certificate of insurance as well.
    Due to the space limitations of most standard certificates of 
insurance, it is expected that an addendum will be attached to the 
appropriate certificate(s) in order to provide the space needed to show 
the required information.
    In addition to providing certificates of insurance, the 
concessioner, upon written request of the Director, shall provide the 
Director with a complete copy of any of the insurance policies (or 
endorsements thereto) required herein to be maintained by the 
concessioner.

VII. Statutory Limits

    In the event that a statutorily required limit exceeds a limit 
required herein, the higher statutorily required limit shall be 
considered the minimum to be maintained.

    Dated: April 27, 2000.
Linda Canzanelli,
Acting Associate Director, Park Operations and Education, National Park 
Service.
[FR Doc. 00-10984 Filed 5-3-00; 8:45 am]
BILLING CODE 4310-70-P