Park Service: Agency Needs to Better Manage the Increasing Role of Nonprofit Partners
Published: 2003-07-18T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Two types of nonprofit organizations, cooperating associations and friends groups, provide substantial support to the national parks. GAO was asked to report on (1) the number of park units supported by nonprofits and the amount of their contributions, (2) the revenue-generating activities of nonprofits and how they compete with park concessioners, (3) factors that contribute to competition between nonprofits and for-profit concessioners, and (4) how park managers are held accountable for meeting goals for nonprofit financial support.
section_title: What GAO Found
paragraphs: Cooperating associations and friends groups help support 347 (90 percent) of our national parks. Their contributions totaled over $200 million from 1997-2001 and were an important supplement to federal appropriations. These organizations also have additional assets totaling about $200 million, which could become available for future donation to the parks. The primary revenue-generating activities of cooperating associations are selling educational materials in park bookstores and providing educational services to park visitors. In contrast, friends groups generally rely on donations and membership dues to generate revenue. Accordingly, only cooperating associations directly compete with concessioners or other local for-profit businesses. In some parks, the sales and services provided by cooperating associations have caused conflicts between park management, the associations, and concessioners. There are three major factors that contribute to conflicts between associations and concessioners: (1) Park Service policies encourage an expanding reliance on nonprofit organizations; (2) the broad discretion local park managers have in deciding the role and scope of association activities has permitted expanded sales and service activities by cooperating associations; and (3) the agency has a financial incentive to use cooperating associations because they provide a higher return on sales revenue. To minimize conflicts and better ensure that park managers consistently apply agency policies in making decisions about whether and how to use cooperating associations and concessioners, Park Service guidelines call for individual park managers to develop "Commercial Services Plans." However, these plans are rarely developed or used. In addition, even though one of the agency's key goals is to increase its reliance on partnerships with nonprofit organizations, the Park Service does not have a process for holding local park managers accountable for meeting contribution goals.

section_title: Letter
paragraphs: The needs of America’s parks are not met with federal dollars alone.  Although the national parks are primarily a public responsibility, parks  have benefited for many years from other sources of support. In particular,  individuals, corporations, and nonprofit organizations have donated time  and money to enhance the U.S. National Park Service’s mission of  promoting and protecting the parks.
Because federal funding for the Park Service has not kept pace with such  needs as visitor services and maintenance requirements, the Congress and  the Park Service are seeking expanded funding from other sources. One  such source, the Recreational Fee Demonstration Program, allows parks  to charge and retain visitor recreation fees. Similarly, the Park Service is  attempting to increase the support it receives from nonprofit organizations  and for-profit businesses—concessioners—that provide merchandise and  services to park visitors under Park Service contracts. To help accomplish  this objective, the Park Service has established agencywide and park- specific plans and goals that encourage local park managers to work with  these organizations to increase the donations and services provided by  nonprofits as well as the fees paid to the Park Service by concessioners.  Some concessioners are concerned that these park initiatives are resulting  in nonprofit organizations expanding into sales and services that have  traditionally been provided by concessioners.
In this context, you asked us several questions about the scope and roles of  the two most common types of nonprofit organizations that work with the  parks: cooperating associations and friends groups. Cooperating  associations support parks by providing educational services to park  visitors largely through sales and information assistance at bookstores.  Friends groups support park operations by raising funds for specific park  projects such as construction and maintenance projects. In addition, both  cooperating associations and friends groups provide volunteer services  such as maintaining trails and painting historic structures. As agreed with  your office, we are reporting on (1) the number of national park units  supported by cooperating associations and friends groups and the amount  of contributions these groups made to the parks, (2) the revenue- generating activities of cooperating associations and friends groups and the  extent to which these activities compete with park concessioners, (3)  factors that contribute to competition and potential conflicts between  nonprofits and concessioners, and (4) how local park managers are held  accountable for meeting agency goals for nonprofit financial contributions.  In addition, you asked that we cite the specific statutory authorities for  nonprofit operations in national parks.
Our work involved the development of an original database that is based in  part on a GAO survey of friends group organizations working with parks  throughout the system. We obtained financial information on about two- thirds of the friends groups queried, including all of those with annual  revenue over $25,000 that were required to file tax reports. Among other  things, the database we compiled includes the name, location, park  affiliation, and contribution amounts of every cooperating association and  each friends group that responded. To help determine if, and how,  nonprofit organizations compete with for-profit businesses serving park  visitors, we visited six parks that have partnerships with such  organizations. These parks were selected based on the scale of their  nonprofit and concession operations and, in two cases, because of known  concessioner concerns about the activities of nonprofit organizations in  those parks. Details of the scope and methodology of our review are  presented in appendix I.
subsections: section_title: Background
paragraphs: The National Park System is a network of natural, historic, and cultural  treasures. The system’s 385 park units include 56 areas that are formally  titled “national parks,” as well as many other designations. As the  network’s federal manager, the National Park Service is charged with  conserving “the scenery and the natural and historic objects and the wild  life therein and to provide for the enjoyment of the same in such manner  and by such means as will leave them unimpaired for the enjoyment of  future generations.” In short, the agency has the difficult task of balancing  resource protection with providing for appropriate public use, including  meeting the needs of nearly 300 million park visitors each year— responsibilities that entail considerable management and financial  challenges.
To manage this diverse system, the 385 park units are arranged within  seven regional offices. These offices offer administrative or specialized  support not always available at the local parks. However, the true hub of  the system’s management is the park superintendent. Superintendents  oversee each park unit, and the agency relies heavily on their judgment for  most decisions affecting local park operations. For financial support, the  Park Service depends primarily upon federal funding. The agency’s fiscal  2003 annual appropriation totaled over $2 billion, supplemented by  financial support from admission and user fees collected at park sites,  franchise fees paid by over 600 park concessioners, and private donations.  Nonetheless, federal funding has not kept pace with increasing  responsibilities. Accordingly, the Park Service has launched several  initiatives seeking expanded supplemental support, including one  promoting increased partnering with nonprofit and other private  organizations.
Nonprofit organizations have a long history of partnering with the Park  Service. Since the agency was created in 1916, the Park Service has  developed partnerships with nonprofit organizations, as well as for-profit  concessioners, to help serve its mission. These partners supply important  financial and nonfinancial assistance, in effect, supplementing  congressionally appropriated funds available for park use. The Park  Service is authorized by statute to accept donations and to enter into  agreements with nonprofit organizations and other fundraising partners.
The two types of nonprofit partners discussed in this report are  cooperating associations and friends groups. Cooperating associations are  corporate entities with boards of directors and an executive director  responsible for day-to-day management. The Park Service requires that  cooperating associations operate as tax-exempt organizations and  employs a standardized cooperating association agreement identifying the  specific federal statutes (see app. II) and agency policies that govern  agency and association responsibilities. There is no specific legal definition  or federal statute for friends groups; most are local volunteers organized  for a specific purpose or interest in a particular park. The Park Service  does not require friends groups to operate as tax-exempt entities or to have  formal partnership agreements with the agency, unless these groups raise  funds for the parks. Moreover, the Park Service does not have a standard  agreement governing friends group operations or specific policy guidance  for friends groups. Guidelines for park fund-raising activities are the  primary source of park policy covering friends group activities. Although  other nonprofit organizations also provide services and conduct  commercial activities, such as guided hiking and rafting trips at park sites,  these organizations are not included in this review.
Park concessioners are a third type of Park Service partner discussed in  this report. Concessioners provide such services as lodging, food, and  guided services, and sell merchandise at park stores. Generally,  concessioners are private, for-profit entities. Concessioners operate under  Park Service contracts or permits that require them to pay a franchise fee  to the park where they operate and that specify agency oversight functions  and concessioner responsibilities.
section_title: Parks’ Reliance on Nonprofits Is Substantial and Increasing
paragraphs: Cooperating associations and friends groups support 90 percent of the  nation’s 385 national parks. Parks are increasingly reliant on support from  these organizations; contributions from these organizations went from  about $27 million in fiscal year 1997 to over $47 million in fiscal year 2001,  totaling over $200 million during this period. In addition, cooperating  associations and friends groups have accumulated funds and other  assets—such as land, buildings, and equipment—worth more than  $200 million that could become available for future park donations.  Nonprofits also provide considerable nonfinancial assistance such as  volunteer services.
section_title: Nonprofit Organizations Operate in Most Parks
paragraphs: A cooperating association or a friends group supports park programs and  operations in 347 (90 percent) of the nation’s 385 national parks. Of the 347  parks, 136 have both types of nonprofit organizations, 187 have only a  cooperating association, and 24 have only a friends group (see table 1).
Thus, cooperating associations support about 84 percent of the nation’s  parks and friends groups support about 41 percent.
The Park Service does not maintain an accurate database of friends groups  or complete financial information on cooperating associations working  with the parks. As a result, we constructed a database using existing Park  Service data, tax records that are available on nonprofit organizations, and  friends group responses to a GAO survey. Appendix III lists each national  park that is affiliated with a cooperating association and/or friends group.
Since 2001, an estimated 215 nonprofit groups—66 cooperating  associations and 149 friends groups—have worked with 347 parks across  the country. Cooperating associations often serve multiple parks while  friends groups are typically associated with a single park. Table 2 shows  the number of each type of organization and the number of parks served.
Moreover, much of the support provided by nonprofit organizations is  concentrated in a few large cooperating associations that serve many  different parks. As table 3 shows, 5 cooperating associations serve about  58 percent of all 385 national parks, or 70 percent—225 of 323—of all parks  served by cooperating associations.
One of the key characteristics of these large cooperating associations that  serve multiple parks is that they have the ability to serve smaller, less  visited park units that might not be able to otherwise provide bookstores or  educational services. For example, Eastern National operates some  bookstores as an educational service to visitors even though the stores are  not profitable. Eastern National can do so because it operates at 127 parks  and shares money from its more profitable locations with its less profitable  locations. This shared donation approach allows the association to operate  bookstores at small locations like the Charles Pinckney National Historic  Site (29,272 visitors in 2001) that are not as commercially viable as other  parks. On average, as table 4 shows, the five large cooperating associations  operate in parks with lower visitation and operating budgets than other  associations.
subsections: section_title: Nonprofit Financial Contributions Have Dramatically Increased
paragraphs: Nonprofit contributions to the park system doubled from fiscal years 1997  through 2000, before dropping in 2001. Specifically, as table 5 shows, the  total contributions by cooperating associations and those friends groups  for which we were able to obtain data rose from about $27 million in 1997  to about $53 million in 2000, before dropping to about $47 million in 2001.  Cumulatively, these contributions are substantial. Cooperating associations  and friends groups contributed over $200 million to support park programs  and projects from 1997 through 2001. Table 5 also shows that revenues  from both types of nonprofit organizations followed a pattern similar to  that of contributions, increasing from about $110 million in 1997 to about  $178 million in 2000, but dropping to $148 million in 2001. The decrease in  contributions and revenues in 2001 may be related to decreased park  visitation or other negative commercial effects following the terrorist  attacks of September 11, 2001, as agency officials speculate, or to the  general economic downturn and corresponding reduction in charitable  giving that has occurred across the United States.  In addition, during the  1997-2001 fiscal year period, the Golden Gate National Parks Association  made large contributions.  These varied considerably from year to year  and help explain the fluctuation in cooperating association contributions  (see app. IV).
Although contributions and revenues from both cooperating associations  and friends groups increased considerably over the 5-year period, the  increase in friends group contributions and revenues is most dramatic. This  increase may be explained by recent increases in the number of friends  groups as well as by the relative newness of friends groups compared to  cooperating associations. According to Park Service data, the number of  cooperating associations changed little from 1996 to 2001, rising from 64 to  66 and then dropping to 65 as 2 associations merged. In contrast, friends  groups are recent additions to the park scene and are expanding more  rapidly throughout the park system. While the Park Service does not have  historical data on friends groups, in the six parks we visited the years of  incorporation for friends groups operating in these parks generally ranged  from 1988 to 2001, with only one dating to 1959. By comparison, the years  of incorporation for cooperating associations ranged from 1923 to 1961  (see table 6). Moreover, while the median date of incorporation for  associations also is 1941, the median incorporation date for the friends  groups is 1995. Contributing to the establishment of new friends groups is  recent legislation that directed the National Park Foundation to design a  program fostering fund-raising at individual park units and specified that  program implementation include assisting in the creation of local nonprofit  groups.
The importance of nonprofit support varied considerably across parks. For  example, Golden Gate NP received over $10 million in aid in fiscal year  2001, the highest contribution by a cooperating association that year, while  Voyageurs NP received $3,233 from its cooperating association, the lowest  financial contribution to a park that year. Similarly, one friends groups  affiliated with the Statue of Liberty NM contributed over $8 million to the  park, while 34 friends groups reported zero financial contributions to their  affiliated parks in fiscal year 2001. Appendixes IV and V provide detailed  revenue and contribution information for cooperating associations and  friends groups, respectively.
section_title: Nonprofits Have Additional Assets That Are Available for Future Donation
paragraphs: In addition to the financial contributions they make to parks each year,  cooperating associations and friends groups also hold over $200 million in  accumulated net assets that are potentially available for future  contributions to parks. According to tax data for 2001, friends groups  retained over 60 percent of these accumulated assets. More precisely, the  net assets of friends groups totaled $125 million in 2001, according to data  collected for over two-thirds of the groups, including the largest friends  groups (see app. V). In comparison, net assets held by cooperating  associations, according to 2001 tax data, were $78 million (see app. IV).  These assets represent the accumulated monetary assets (such as cash,  stocks, or bond investments) and nonmonetary assets (such as land,  buildings, and equipment) of the organizations. The monetary component  of these assets often consists of restricted and unrestricted accounts.  Restricted accounts typically represent funds that have been earmarked for  specific future projects, such as a park construction project or an  endowment to fund future maintenance costs of a capital project.  Unrestricted accounts usually represent funds that are currently available  for any expenses related to a park project. For example, the friends group  associated with Acadia NP has net assets of about $14 million, including  $13 million in restricted accounts for 2001. The funds in the restricted  accounts are for such things as an endowment to fund future maintenance  of the carriage road in Acadia NP and an endowment to support future  Acadia Youth Conservation Corps activities in the park. Further,  information we obtained based on available tax records from 1998 through  2000 indicates that friends groups are adding substantial amounts to their  accumulated assets each year. Specifically, they retain about 40 percent of  their revenue or about $20 million annually.
section_title: Nonprofit Organizations Provide Nonfinancial Support to Parks
paragraphs: In addition to contributions of funds, buildings, equipment, and other  assets, cooperating associations and friends groups also provide volunteer  services that are of considerable value. Nonprofit members of both  cooperating associations and friends groups recruit and organize  volunteers for park projects and promote support for parks in local  communities. Some friends groups, such as the Appalachian Trail  Conference, make little if any direct financial contributions but have a  substantial volunteer base engaged in volunteer stewardship programs at  the parks. The Appalachian Trail Conference reported that its  4,500 volunteers contributed 187,475 hours to trail work in fiscal year 2000.  The exact number of volunteers for all park-affiliated nonprofit  organizations is not known. However, many groups have thousands of  members and volunteers. Of these, the Statue of Liberty-Ellis Island  Foundation, Inc., is the largest friends group donor within the national park  system and has close to 160,000 members; other groups responding to our  friends group survey averaged 3,700 members and volunteers. Table 7  provides examples of nonfinancial contributions made by selected  nonprofit organizations.
In addition to volunteer service, at least two nonprofit organizations are  legislatively authorized to provide operational and management services in  parks. Specifically, the Theodore Roosevelt Inaugural Site Foundation was  authorized in 1980 to assist the Secretary of the Interior in “the operation,  maintenance, management, development and interpretation of the  Theodore Roosevelt Inaugural National Historic Site.” More recently, The  Island Alliance, a private nonprofit organization, was designated by the  Congress as a financial support partner for the Boston Harbor Islands  Recreation Area, a unit of the national park system established in 1996.
section_title: Revenue-Generating Activities of Cooperating Associations Sometimes Compete with Those of Park Concessioners
paragraphs: The primary revenue-generating activities of cooperating associations are  selling educational materials in park bookstores and providing educational  services to park visitors. These activities, together with growing  association sales of visitor convenience items such as film and disposable  cameras, are responsible for 90 percent of association revenue. At many of  the parks with cooperating associations, concessioners also provide  park-related merchandise for visitor consumption, as well as visitor  services and convenience items. Generally, the educational attributes  associated with association sales and services distinguish them from  concessioner sales and services. However, this is not always the case. In  fact, in three of the six parks we visited, competition between cooperating  associations and concessioners or local businesses led to conflicts. In  contrast, friends groups generally do not compete with concessioners  because they rely primarily on donations and membership dues to generate  revenue.
subsections: section_title: Selling Educational Materials and Providing Services Are the Main Revenue-Generating Activities of Cooperating Associations
paragraphs: Cooperating associations exist to support the educational, scientific,  historical, and interpretive activities of the National Park Service.  Accordingly, association activities are intended to provide the public with  educational materials related to the parks and to generate revenue for  other association programs and activities that support the agency.  Associations support park programs by making direct purchases on behalf  of the parks and by providing funds for use by park staff. Typically, each  park has a standard agreement with an affiliated cooperating association.  This agreement documents and clarifies the association’s scope of  responsibility and permitted activities and is often supplemented to  address association services specific to a park. Local park managers are  responsible for overseeing association activities including ensuring that  sales and services are consistent with the terms of the agreement and  assuring that association support is appropriately targeted.
Cooperating association activities focus on supporting parks by providing  visitors with educational materials and services. The main revenue- generating activity of associations is operating bookstores that sell  educational and other merchandise, often at park visitor centers.  Cooperating associations reported generating revenue of $109 million in  fiscal year 2001. As figure 1 shows, of this amount, 90 percent came from  sales and services to park visitors. Over $84 million (78 percent) was raised  through the sale of educational materials—primarily books. About  $10 million (9 percent) was from educational program services such as  audio tours and organized backcountry hiking and camping activities.  Association operated “field institutes” frequently provide these educational  program services. Field institutes are a part of cooperating associations  that focus on providing visitors with active learning experiences within a  park. Another $3 million (3 percent) came from sales of visitor  convenience items—items that are not educational and that the Park  Service describes as necessary for the comfort and convenience of visitors.  These items include beverages, aspirin/antacids, insect repellent, sun  screen, film, disposable cameras, and stamps. The remaining 10 percent of  association revenues came from fund-raising, membership fees, and park  donation boxes.
In addition, some associations support the needs of the parks they serve in  other, nontraditional ways. For example, associations may act as  concessioners, generating income by operating park concession contracts.
This is the case at Mt. Rushmore NM, where the cooperating association  has a 20-year concession contract for constructing and operating a parking  facility at the site. Under these circumstances, associations are required to  report this revenue to the park service as concession contract revenue. As  such, these revenues are not included in figure 1. However, these  circumstances are exceptional and do not occur frequently.
A description of the sales and services offered by cooperating associations  at the six parks we visited will help clarify the revenue-generating activities  that occur throughout the system. Associations at each of the six parks  operated a bookstore, and five of the six associations also sold  merchandise via a park-affiliated Web site. At three parks, a field institute  was a significant part of the association’s educational service program. At  Grand Canyon NP, for example, the Grand Canyon Field Institute offered  exploratory tours where visitors could learn about the canyon’s geology,  ecology, and Native American and pioneer history. This institute also  provided park-related educational materials to elementary classrooms  across the United States. Two of the six associations provided other  services—one provided a guided park tour and one operated the park’s  wilderness reservation system.
Except for visitor convenience items, we found that the merchandise sold  and the services provided at each of the six parks visited were generally  related to the educational mission of the cooperating associations and to  park themes. Cooperating association bookstores carried a wide variety of  park-related publications, maps, videos, and theme-related merchandise  intended to enhance visitor understanding, appreciation, and knowledge of  parks. For example, at areas managed by Fort Sumter NM staff, the  cooperating association operated four bookstores with educational books  and items related to Civil War occurrences in the Charleston, South  Carolina area. At Yosemite NP, the association sold books, Native American  artifacts and jewelry, and CD-ROMs that were generally consistent with its  educational mission and park themes. Cooperating association Web sites  generally offered the same merchandise as the bookstores. Although our  examination of the items being sold at association bookstores and Web  sites at the six parks we visited revealed a few items that were not clearly  related to the association’s educational mandate, these were low volume  and low cost items that were not financially significant. For example, the  association sold magnets at Ft. Sumter, and slinkys and hula hoops at the  Eisenhower National Historic Site.  In commenting on our report, the  association’s executive director noted that magnet sales were discontinued  at this store.  The director stated that hula hoops and slinkys are sold with  interpretive text and help connect visitors to the lifestyle of the 1950s,  which is a park interpretive goal.
Like merchandise sales, we found that the services provided by  cooperating associations at the six parks we visited were educational and  consistent with park themes. Some of these services generated substantial  revenue for individual parks. For example, at Gettysburg NMP, the local  association operates the “Electric Map” and “Cyclorama” mural painting.  The Electric Map orients visitors to the park by depicting the progress of  the 3-day Gettysburg battle, while the historic mural depicts the cavalry  battle known as “Pickett’s Charge” in a 360-degree panorama. In fiscal 2000,  these operations generated revenue of $758,183 and $320,475, respectively,  of which the association donated about 40 percent to the park.  Associations, however, also provide services that generate little or no  revenue or profit. At Yosemite NP, for example, the cooperating association  operated the park’s backcountry reservation program and worked with  concessioners to rent bear-resistant food canisters to visitors having  backcountry reservations. All association receipts from this program were  used to purchase more canisters. The park received no revenue from this  activity.
section_title: Revenue-Generating Activities of Cooperating Associations and Concessioners Are Not Always Distinct and Sometimes Lead to Conflicts
paragraphs: Generally, the educational and thematic attributes of association sales  items and services distinguish them from concessions sales items and  services. However, this is not always the case. Sometimes the sales and  services of associations and concessioners as well as other for-profit  businesses are in direct competition with one another. At three of the six  parks we visited, sales and services by associations and for-profit  concessioners and other businesses were not clearly distinguished and this  led to conflicts among these organizations. At the other three parks we  reviewed, there were no apparent conflicts between associations and  concessioners or other for-profit businesses.
subsections: section_title: At Some Parks Competition between Cooperating Associations and Concessioners Leads to Conflict
paragraphs: The three parks with conflicts were Grand Canyon NP, Fort Sumter NM,  and Gettysburg NMP. In each instance, the conflicts resulted from local  park managers’ decisions to permit associations to sell goods or services  that had been traditionally provided by concessioners or other for-profit  businesses. At Grand Canyon and at Fort Sumter, the conflicts involved  association and concessioner sales. At Gettysburg, the conflict involved  services provided by the association and a local business that, like  concessioners, depended on park visitors for its survival.
At Grand Canyon NP, three concessioners operated stores throughout the  park that sold, among other things, film, disposable cameras, and a variety  of other visitor convenience items to the millions of people that annually  visit the park. These items were traditionally sold by the concessioners and  were an important part of their business. However, in 2001, park managers  began allowing the Grand Canyon Cooperating Association to sell visitor  convenience items, including film and disposable cameras, at the  association’s new bookstore. As a result, the association’s sales of these  items went from zero in 2000 to over $50,000 during a 7-month period in  2001. This change caused considerable concern among park concessioners,  whose collective film sales total over $1.5 million. Representatives of each  of the three park concessioners believe that park management’s decision  allowing association sales of visitor convenience items resulted in unfair  competition that would adversely affect their profitability. At the time of  our review, each concessioner estimated that film sales had decreased  considerably. One concessioner told us that film sales decreased by  $140,000 and another stated that, while overall sales declined by  9.5 percent, film sales deceased by 10.5 percent.
The concessioners’ concerns were based on three factors. First, the  association’s point of sale is located at the initial gathering place for most  park visitors, which provides a marketing advantage that concessioners  believe reduces their business. Second, because visitor convenience items  are neither educational nor characteristic of a Grand Canyon theme,  concessioners view these items as inconsistent with an association’s  traditional scope of sales and educational mission. And third, because  concessioners could not compete for operating the new bookstore at this  location, they believe the association received favorable treatment that  placed them at a competitive advantage. On the other hand, park managers  and the cooperating association Executive Director pointed out that  locating the association bookstore at the visitor center area was consistent  with the park’s General Management Plan. Further, park officials told us  that bids were not solicited on the bookstore operation because the  bookstore was intended to serve an educational purpose—an activity  consistent with the association’s mission and its agreement with the Park  Service.  They also noted that the cooperating association was willing to  fund the building’s construction.  In commenting on a draft of this report,  the new association executive director stated that the conflict with  concessioners was overstated and that the association has a strong  working relationship with park concessioners.
The situation at Fort Sumter NM is similar to that at Grand Canyon NP. At  Fort Sumter there are two locations where merchandise is sold. The  largest of these is a bookstore operated by the cooperating association in  the recently opened visitor center in Charleston, South Carolina. Because  this center is the main departure point for visiting Fort Sumter, it has  generated considerable increases in association sales revenue. Moreover,  according to park plans, in the future it may be the only commercial  location serving Ft. Sumter visitors. The other sales location is a small store  at the fort (see fig. 2).
When the bookstore in the Charleston visitor center opened in 2001, the  park manager permitted sales of educational and theme-oriented  merchandise traditionally sold by associations as well as visitor  convenience items. Prior to the opening of the new bookstore, visitor  convenience items were sold by the store at the fort. This store was  operated by a concessioner during the peak season—March 15th through  Labor Day—when the park gets about 65 percent of its visitors, and by the  cooperating association during the remaining months. Park plans  envisioned this store closing when the new visitor center opened in  Charleston and, in August 2000, several months before the new bookstore  opened, the park discontinued all concessioner sales operations at the fort.  However, the park manager subsequently decided that there was a need for  educational and theme-related merchandise at the fort and determined  that the association would operate the store at the fort on a year-round  basis, including selling visitor convenience items. The concessioner  questioned the decision to close the concession store at the fort because  the association store remains open there and sells items similar to what the  concessioner sold. The concessioner also believed that park officials  should have afforded for-profit businesses an opportunity to compete for  the bookstore operation in the new visitor center. This situation has  contributed to conflict between the concessioner and park management.  From park management’s perspective, the decision to have the association  provide all of the sales at both the fort and the Charleston visitor center  was consistent with the long-term plans for the park and the association’s  educational agreement. According to park plans, these decisions were  made to de-emphasize commercial activities at the park, to reduce the time  spent by staff in supervising concession sales operations, and to focus  merchandise sales on the park’s educational and interpretive goals.
Because the conflicts at both the Grand Canyon and Fort Sumter involved  increased association sales of visitor convenience items, we examined  convenience item sales data for the 323 parks with cooperating  associations to determine if the increases at these parks were part of a  trend throughout the national park system. As table 8 shows, revenue from  the sales of visitor convenience merchandise is expanding more rapidly  than other sources of association revenue. These sales increased by  55 percent (from $2.06 to $3.19 million) between 1997 and 2001, while  revenue from other sources increased only about half as much—about  21 percent.
These data indicate that this sales trend is occurring nationwide. In  addition, five of the seven regional directors in the Park Service told us that  cooperating associations were expanding sales of visitor convenience  merchandise in their regions.
Table 9 provides some contextual information on the potential scope of  conflicts that could occur between cooperating associations and  concessioners at the parks. Specifically, the table provides national data on  parks where both associations and concessioners sell merchandise  to visitors.
Table 9 shows that 84 of 91 parks having at least one concessioner that sells  merchandise to visitors also have cooperating associations that sell  merchandise and provide services to visitors. The table also shows that  merchandise concessioners typically operate in parks with high visitation.  Accordingly, competition is more likely in the largest parks. Appendix III  provides a complete list of parks that have cooperating associations and  merchandise concessioners.
The third park we visited where a conflict was evident was Gettysburg  NMP. This conflict involved the cooperating association and a local  for-profit business that, like concessioners, derived its revenue from  visitors to the park. In contrast to the conflicts at Grand Canyon and  Fort Sumter, the conflict involved competition over providing tour bus  service, not the sale of merchandise. Specifically, with the approval of park  management, the cooperating association initiated a bus tour in 2001 that  directly competes with locally operated bus tours. Further, because the  association is affiliated with the park, this tour is permitted to pick up and  drop off its customers at the park’s main visitor center—unlike the  privately run for-profit tours. Neither of the local businesses that provided  battlefield tours is permitted to pick up or discharge at the visitor’s center.  Instead, their tours operate primarily from their offices in the commercial  district of the town of Gettysburg—a few blocks from the visitor center.
One of the local businesses contends that the association-administered bus  tour service was unnecessary because similar tour services were already  available to visitors. This business owner also was concerned because the  association tour originates at the park visitor center and, as a result, has an  important competitive advantage. Further, although park officials  informally discussed the tour service with this business owner, the owner  is concerned because the Park Service did not advertise and solicit bids for  this new service and, thus, denied the business the opportunity to bid and  compete for providing the service. Finally, this owner asserts that his  business has already experienced adverse financial consequences as a  result of the association tour, but because of difficulty in isolating the  effects of this new service, cannot provide documentation supporting his  assertion. In contrast, two other parks we visited, Yellowstone and Fort  Sumter, also offered guided tours for visitors. In both instances, the tours  were operated by for-profit businesses—concessioners—under contract  with the respective parks.
According to the park manager at Gettysburg, the association began  operating the tour service at his request in order to enhance the  educational and interpretive services offered to park visitors. Park  managers told us that they require the cooperating association to use  licensed park guides to provide narration and interpretation for customers  on these tours and that this arrangement improves the quality of service  provided to park visitors. Because park officials believed the tour service  was consistent with the association’s agreement with the park, they  decided that a concession contract and bid solicitation process was not  necessary.
section_title: Not All Concessioners Were Concerned about Competition from Cooperating Associations
paragraphs: While conflicts between cooperating associations and concessioners and  similar for-profit businesses existed at some of the parks we visited, they  did not exist at others. In fact, at two of the six parks we visited—Yosemite  NP and Yellowstone NP—these organizations worked collaboratively to  enhance visitor service. At a third park, Badlands NP, the association  operated a small bookstore. Both association and park officials stated that  the concessioner at Badlands had minor concerns about this association’s  sales.
Yosemite is a good example of where competing entities work together to  serve overall park interests. Although the association and concessioner  sometimes sold competing merchandise, officials of these entities agreed  that there was a good understanding of their respective roles at the park  and there were no noteworthy problems among the entities. In fact, there  were a number of coordinated efforts between the association and  concessioner. The following activities demonstrate collaborative activities  at the park:  The concessioner’s chief operating officer is also a member of the  cooperating association board of trustees.
The association arranges for artists to provide classes for visitors at an  art activity center operated by a concessioner.
At park wilderness centers the association issues permits and sells  several visitor convenience items that are useful in the park’s  backcountry—backpacking stoves, fuel canisters for the stoves, water  filters, and spades. The association buys these items from the  concessioner.
The association and the concessioner are involved in providing  backcountry visitors with bear-resistant food canisters. Previously, bear- resistant canisters were available only by purchase from a concessioner.  The association and concessioner reached an agreement that provides  for canister rentals from either the association or the concessioner and  allows visitors to return canisters rented at a concession store to  locations operated by the association.
According to the association’s Executive Director, the concessioner is  the biggest wholesale purchaser of the association’s publications.
section_title: Friends Groups Generate Revenue Chiefly by Soliciting Donations
paragraphs: Because soliciting donations from individuals, corporations, and  foundations is their chief revenue-generating activity, friends groups  typically do not sell goods or services within the national park system.  Accordingly, these groups generally do not compete for business with  concessioners or other for-profit businesses that serve the parks. However,  there are some exceptions where the boundaries distinguishing these two  kinds of organizations are indistinct.
Typically, friends groups raise revenue through fund-raising campaigns to  support a local park project. To raise funds on behalf of the Park Service,  agency policy requires that friends groups have an agreement signed by a  local park manager, usually the park superintendent, and the president or  chief executive officer of the friends group. Under this policy, national  fund-raising campaigns or fund-raising campaigns with a goal of $1 million  or more require the approval of the Park Service Director. Fund-raising  campaigns also require an approved fund-raising plan detailing techniques,  timing, staff needs, strategy, and costs. Park Service policy states that fund- raising plans will not be approved if overhead costs—which include fund- raising and administrative expenses—are projected to exceed 20 percent of  revenues over the life of the campaign. The primary sources of friends  group revenue are  Federal & State Grants The precise proportion of revenue that friends groups derive from these  various sources is not known. The Park Service does not collect such data,  and available federal tax data do not provide detailed information related  to these revenue sources. However, the tax data that are available suggest  that fundraising is by far the most important source of friends group  revenue. A prominent ongoing fund-raising effort is the National Park  Foundation’s Proud Partner of America’s National Parks campaign. The  foundation recognizes in numerous publications that five corporations— American Airlines, Discovery Communications, Inc., Ford Motor Company,  Kodak, and TIME magazine—are “Proud Partners of the National Parks”. In  return, these corporations have committed $85 million in cash and  resources over a 3-year period.
Friends group tax reports show that several have received federal or state  grants. The Theodore Roosevelt Inaugural Site Foundation, for example,  reported a federal grant in connection with its legal mandate to support  management functions at the Theodore Roosevelt Inaugural National  Historic Site. Similarly, the Friends of the National Parks at Gettysburg  received a $1 million grant from the Commonwealth of Pennsylvania to  restore a state memorial in Gettysburg. One friends group’s tax report  recorded revenue from the sale of personalized state license plates as a  government grant.
Park Service policy allows friends groups to sell items within a park with the approval of  the cooperating association and park superintendent. Cooperating associations also may  sell items on behalf of friend groups. However, such arrangements are infrequent. provide a service in return. More typical of friends group sales are those by  the group at the Virgin Islands NP, which offers T-shirts, license plates, and  park-related merchandise at its office outside the park, on its Web site, and  through local stores in St. John, Virgin Islands. Similarly, the friends group  at Great Smoky Mountains NP reported selling items such as hats, T-shirts,  specialty license plates, and other merchandise with its logo outside park  boundaries, at its offices in Tennessee and North Carolina, through its Web  site, and at festivals.
Friends groups also generate revenue membership fees, through special  events, and park donation boxes. Many friends groups offer fee-based  memberships that provide member benefits. For example, at Yellowstone  NP, a friends group offers memberships beginning at $25; it reported having  over 8,000 members or volunteers. Paying members receive a free  subscription to the group’s biannual newsletter, a copy of the annual report,  and have their names displayed in the Yellowstone NP Honor Book at the  Old Faithful Visitor Center for 1 year. Special fund-raising events hosted by  friends groups usually consist of a one-time entertainment for which  attendees are charged a fee. For example, in 2000, a friends group at Great  Smoky Mountains NP raised over $133,000 through special events that  included dinners, concerts, and hikes. Similarly, at Acadia NP the friends  group netted about $250,000 through a special auction held in 2001.
The development of data on friends group revenues is complicated by a  blurring of the functional and organizational boundaries between some  friends groups and associations. Although both types of organizations work  to help the Park Service meet its mission, distinctions between cooperating  associations and a friends groups are not always clear as evidenced by  several “hybrid” groups that serve the parks. For example, the association  at Golden Gate NP combines cooperating association and friends group  functions under the same organization. The nonprofit organization at Mt.  Rushmore NM created a subsidiary group to allow distinct bookstore and  fund-raising and concession contract operations. And at Rocky Mountain  NP, one nonprofit organization conducts fund-raising activities and a  second operates a bookstore. These distinct nonprofit organizations are  administratively linked, however, sharing the same Board of Directors.
section_title: Several Factors Contribute to Competition and Potential Conflicts between Associations and Concessioners
paragraphs: Three primary factors contribute to competition and conflicts between  cooperating associations and concessioners and other for-profit businesses  that serve the parks. First, Park Service policies intended to increase  association support for parks lead to expanded association sales and  services that compete with for-profit businesses for sales and services.  Second, park managers have broad discretion in deciding the scope of park  sales and services as well as whether cooperating associations and/or for- profit businesses operate in a park. In some cases, the rationale for  expanding cooperating associations’ operations was not clear and  contributed to conflicts among park management, cooperating  associations, and concessioners. Third, cooperating associations return a  higher percentage of their sales and service revenue to the parks compared  to for-profit businesses, giving park managers a financial incentive to  expand association operations. The Park Service recognizes the balancing  act that is needed to manage the roles of cooperating associations and  businesses that serve parks visitors, and agency policy encourages park  managers to develop and implement plans addressing these roles. Among  other things, these plans—called Commercial Services Plans—are intended  to reduce conflicts in parks by clarifying the roles and competitive  relationships of associations and concessioners and providing a more  predictable business environment for them. However, these plans are  rarely developed or used.
subsections: section_title: Policies Encouraging Increased Financial Support from Cooperating Associations Also Promote Increased Competition
paragraphs: Park Service policies and plans encourage park managers to generate  increased financial support from cooperating associations and  concessioners. The Park Service’s strategic and annual performance plans  set programmatic and financial goals designed to substantially increase  donations from cooperating associations as well as the amount of franchise  fees from concessioners. For cooperating associations to provide  increased financial support to parks, they must expand profit-making  activities including the sale of merchandise. This promotes increased  competition between cooperating associations and concessioners for park  visitor dollars.
The Park Service has set a goal of increasing cooperating association  support by 35 percent between 1997 and 2005. As table 10 illustrates,  between fiscal years 1997 and 2001 revenues increased about 22 percent— from about $89.36 million in fiscal year 1997 to about $108.78 in fiscal year  2001.
Table 10 also shows that $18.37 million (about 95 percent) of this  revenue increase has come from activities that are most like those of  concessioners—merchandise sales of educational materials and visitor  convenience items. Accordingly, this trend contributes to increased  competition with concessioners. This trend is likely to continue as the Park  Service and cooperating associations try to meet their increased revenue  goals for 2005.
Park Service policies and plans also have established goals for increasing  revenue from concessioners. Specifically, the agency’s goal is to increase  franchise fees paid by concessioners from about 4 percent of gross revenue  in fiscal year 2000 to about 10 percent by 2005. While the mechanisms for  concessioners achieving this goal are varied and complex, getting this done  could involve increased concessioner offerings of their most profitable  merchandise to park visitors.  To the extent that concessioners and the  associations are each vying for visitor dollars or offering similar  merchandise, this would lead to increased competition.
Further, the Park Service encourages concessioners to sell merchandise  that is educational and consistent with park-related themes. Although there  is no agencywide list of preferred merchandise, the Park Service’s  Management Policies 2001 encourages concessioners to offer items for  sale that foster awareness and understanding of a park. In this regard, the  2001 policy directs each park with a concessioner to have a gift shop  mission statement that ensures concessioners sell merchandise reflecting  information about the park. For example, at the Grand Canyon, one  concessioner’s gift shop mission statement states that “to the greatest  extent possible, merchandise will have an identifiable relationship to  Grand Canyon National Park” and identifies several park themes, such as  the park’s geology and history, that serve as a guide for implementing this  objective. While this increased emphasis on concessioners selling more  educational and theme-related merchandise may help provide visitors with  a better park experience, it also promotes greater competition among  associations and concessioners. According to some concession officials at  the parks we visited, this emphasis by the Park Service makes  concessioner sales venues more like those of cooperating associations. On  the other hand, concession officials at other parks we visited stated that  this change did not pose serious competitive issues.
In a broader context, the issue of competition between for-profit and  nonprofit organizations is a long-standing one that is not limited to the Park  Service. As we have previously reported, representatives of for-profit  businesses believe that the revenue-generating activities of nonprofit  organizations exceed the traditional role of these organizations, and that  the nonprofits receive a competitive advantage by virtue of their nonprofit  tax status and other benefits. On the other hand, representatives of  nonprofits believe certain nontraditional activities further their nonprofit  purposes by generating additional revenue to fund these purposes.  Although the Congress has attempted to address this issue in the past, it  remains contentious.
Park Service policy recognizes that a “delicate balance” exists between  associations that have traditionally served an educational mission and  concessioners that provide “necessary and appropriate” visitor services.  Concessioners at two of the parks we visited, a local business at a park  without a merchandising concessioner, and officials from the national  organization representing park concessioners, contended that this  delicate balance has become unsteady, and expressed concern that  cooperating association operations are expanding into areas traditionally  served by concessioners or for-profit businesses. They were unsure of the  bounds on association sales activity and believed some association  merchandise and services duplicated or replaced merchandise and services  available in or near parks, were inconsistent with nonprofit educational  mandates, and placed for-profits in increased financial jeopardy. Park  Service regional directors generally agreed that the roles of both  associations and concessioners are changing and that the distinction  between what associations and concessioners sell has become less clear.
section_title: Park Managers Have Broad Discretion in Deciding to Expand Cooperating Association Sales and Services and Do Not Always Provide Transparent Rationale
paragraphs: In practice, park managers determine whether a cooperating association or  concessioner will operate in a park. They also determine the scope, mix,  and appropriateness of the sales and services that are provided. In this  regard, local managers are also responsible for monitoring nonprofit  operations, ensuring that association sales and services do not conflict  with the contractual rights of concessioners, and minimizing potential  conflicts with concessioners. However, the rationale for decisions on these  matters was not always transparent, which contributed to conflicts among  park management, cooperating associations, and concessioners.
At each of the three parks we visited where there were conflicts—Grand  Canyon, Fort Sumter, and Gettysburg—cooperating associations  merchandise sales or services were expanded without concessioners or  other local for-profit businesses having an opportunity to compete to  provide these operations. Further, in each instance, the sales and services  at the center of these conflicts were to be provided at prime locations  within each park and the decision was made without providing a  transparent rationale. In two cases, park officials decided to allow  associations to provide new sales or services without addressing the  decision in park plans. The following paragraphs provide a snapshot of the  circumstances at each of these three parks.
At the Grand Canyon, park officials requested that the association  construct a bookstore adjacent to a new visitors center on the South Rim of  the Canyon—by far, the most popular and heavily visited area of the park.  The association raised $1.8 million for the project, gave the store property  to the Park Service, and assumed responsibility for operating the store. As  previously discussed, park managers permitted the association to sell  traditional, park-related educational merchandise as well as visitor  convenience items. Concessioner officials at the Grand Canyon told us  that, in their opinion, providing them an opportunity to compete to operate  the bookstore would have been a more balanced approach. Further, the  officials told us that a double standard is applied by park managers that is  advantageous to the cooperating association. As evidence of this concern,  the concessioners cited how signage restrictions are applied differently for  concessioners than for the cooperating association. On the south rim of the  canyon, a store operated by the concessioner was not permitted to post any  outside signage or displays, while an adjacent store operated by the  cooperating association was permitted to do so (see figs. 3 and 4).  In  commenting on these pictures, the current cooperating association  executive director stated that the signage outside the association’s  bookstore was justified because, unlike the concession store, the  bookstore was not visible from the major visitor contact area. However, in  our view, this does not justify different signage standards for concessioners  and associations. Moreover, these displays do not make the store visible  from where it was previously invisible. Finally, the sandwich board  displayed outside this store, advertised an association bookstore that is  located elsewhere in the park.
At Fort Sumter, the long-term plan for the development of the park  specified that the concessioner-operated sales facility at the Fort would be  relocated to a new visitor’s center. In a commercial services plan designed  to implement the long-term plan, park officials decided that the  cooperating association would operate the new sales facility at the visitor’s  center, that the cooperating association could sell visitor convenience  items as well as educational merchandise, and that no other merchandise  facilities would be permitted. In accordance with the park’s commercial  services plan, park managers did not provide the existing park  concessioner an opportunity to operate the new sales facility. However,  although both the long-term and implementation plans envisioned closing  the sales facility at the Fort, this has not happened and the association  operates two stores—one at the new visitors center and a second at the  Fort. The park concessioner believes there should have been a bid  solicitation process for operating the new facility—particularly since the  cooperating association is selling noneducational visitor convenience items  that had been sold by the concessioner.
At Gettysburg, the local park manager permitted the association to manage  a new, narrated bus tour for park visitors without giving for-profit  businesses an opportunity to compete to provide this service. According to  the owner of a competing local for-profit business near the park’s visitor  center, the association-managed tour presents unfair competition because  there was no public advertisement or discussion of the park’s proposal to  initiate the association tours, nor was there a bid solicitation process that  afforded for-profit businesses an opportunity to contract to provide this  service.  According to park officials, their decision to allow the cooperating  association to manage a new tour from the visitor’s center instead of a  concessioner or other for-profit business was made for several reasons,  including their belief that the association would provide the best  educational service to visitors; and that associations require less park  resources to administer and allow changes that are responsive to the needs  of park management.
section_title: Financial Incentives Encourage Increased Use of Cooperating Associations by Parks
paragraphs: Cooperating associations can provide a much higher return to parks  than concessioners. This ability is not surprising since, as nonprofit  organizations, they enjoy a number of important financial advantages  over for-profits. Most park officials that we spoke with said that financial  advantage was not a factor in deciding whether an association or a  concessioner provides sales and services. Rather, they described service to  park visitors as the most important criterion. However, park officials at  Gettysburg did tell us that associations’ higher financial return to parks was  a factor in their decision to allow a cooperating association to operate a  new bus tour.  In commenting on a draft of this report, nonprofit  organizations stated that although associations provide a higher return to  the parks, this provides only a minimal incentive for park superintendents  to select a cooperating association over a concessioner.
Park Service data show that cooperating associations contribute a  considerably higher percentage of total revenue to the parks than  concessioners. Over 5 fiscal years, 1997 through 2001, association  contributions averaged 26 percent of revenue. In contrast, the  concessioners that sold merchandise paid the Park Service an average of  about 4 percent of revenue over the same period (see table 11).
For example, the cooperating association at the Grand Canyon NP gave  about 36 percent of its gross revenue to the park. The concessioners paid  about 4 percent of sales revenue to the park during this period. Also, local  parks retain 100 percent of association contributions, but keep only  80 percent of concession payments, consistent with legislation that was  enacted in 1998.
Cooperating associations generally provide a higher return to parks than  concessioners owing, in large part, to associations’ nonprofit status and  charitable mission as well as to park policies that support association  operations. The following factors provide associations with a considerable  financial advantage when providing sales or services compared with  concessioners:  All cooperating associations are tax-exempt organizations under the  Internal Revenue Code. Thus, they do not pay federal income taxes on  funds collected to meet their nonprofit purpose.
In most states, associations that are exempt from federal taxes do not  have to pay state income tax on funds collected to meet their nonprofit  purpose.
Associations that are exempt from federal taxes may obtain exemptions  from state and local sales taxes. Such exemptions apply to the  purchases of the association. In a few states, associations also may be  exempted from collecting state and local sales taxes on the sale of  merchandise.
Association sales and service revenues are substantially enhanced  through donations and memberships fees from individuals and  organizations wishing to support park activities.
Volunteers often provide association services and may staff bookstore  operations, thereby reducing association salary expenses.
Association profits must be used to support the parks and are not  shared with stockholders or company owners.
Association Boards of Directors generally are not salaried.
Parks routinely provide free sales areas and other facilities to the  associations. For example, the parks provide bookstore space within  visitor centers and support association field institutes by providing free  facility space for classrooms and for instructor and participant housing.
Parks provide free services that reduce overall association operating  costs and overhead expenses. These services may include routine  maintenance, garbage collection, interior work, repair services, and  such utilities as water, heat, and air conditioning (to the extent these are  required for the operation of the building for government purposes).
Park staff sometimes assist in operating association bookstores. This  assistance occurs after regular association operating hours, during off- season periods when the association may not have full-time staff, and at  locations with low visitation where the association cannot afford to  employ full-time staff.
We did not attempt to quantify the value of tax-exempt status and park  assistance to associations. However, Park Service, association, and  concessioner officials agree that the nonprofit tax-exempt status is an  association’s paramount financial advantage.
Although cooperating associations usually enjoy financial advantages in  competing with concessions, not all associations are profitable. For  example, according to Park Service officials, the cooperating association  that serves the 14 Park Service sites in Washington, D.C., has had serious  financial problems. This association provides educational materials to  visitors at facilities like the Washington Monument and Lincoln Memorial  and has estimated debts exceeding $800,000. Further, according to its new  executive director, the association lost money in 8 of the past 10 years.  While other factors contributed to these losses, the director told us that  one reason the association has not made money is that it could not sell  many profitable items in its bookstores because Park Service officials  viewed the items as competing with the sales of park concessioners.
section_title: Park Service Does Not Use Planning Tools Available to Better Define and Manage the Roles of Nonprofits and Concessioners
paragraphs: The Park Service is aware of the competitive tensions and potential  conflicts that can exist between cooperating associations and  concessioners within a park. To minimize conflicts, help ensure that agency  policies are consistently followed, and provide a more systematic basis for  making decisions about commercial sales and services in parks, Park  Service guidance suggests that individual park managers develop  Commercial Services Plans.
Essentially, Commercial Services Plans are publicly available documents  that, among other things, are intended to establish a predictable business  environment in parks by better defining the roles of cooperating  associations, concessioners, and other for-profit businesses in providing  sales and services to park visitors. These plans also are intended to clarify  what kind of sales and services are to be provided by the various  commercial interests in a park. In brief, the plans rationalize a park’s  approach to providing visitor sales and services and provide a  decision-making framework that is transparent to the public, visitors, and  commercial stakeholders at the park. To facilitate the development of this  planning tool, the Park Service provides local park managers with  guidelines, standards, and assistance.
However, despite agency guidance and the benefits associated with  Commercial Services Plans, they are rarely used. Data gathered from Park  Service regional offices show that these plans were developed at only 3 of  84 parks (4 percent) where both cooperating associations and  concessioners provide sales and services (app. VI has a complete list of  these parks and the status of their plans). Moreover, we visited two of the  six parks that had developed plans—Fort Sumter and Yosemite—and found  that the plans did not meet the agency’s standards. At Yosemite, the plan  was more than 10 years old and was based on an outdated management  plan for the development of the park. Moreover, the plan did not describe  the commercial activities of the cooperating association. The Fort Sumter  plan, developed in 2000 and containing considerable detail, did not address  the current scope of cooperating association operations because these had  expanded beyond what the plan envisioned.
Park Service officials told us that the primary reason Commercial Services  Plans were not developed or up to date was because park resources are  limited and preparing the plans is not among the agency’s highest priorities.  At Yosemite NP, for example, park officials believed an updated plan would  be helpful but that the plan also would require an Environmental Impact  Statement (EIS). They expected that preparing the EIS would cost  extensive park resources and viewed this cost as a major obstacle. Further,  Commercial Services Plans must be consistent with the long-term  management plans for the parks. These long-term plans—known as  General Management Plans—are frequently out of date. In fact, over  25 percent of parks either do not have a General Management Plan or have  a plan that is more than 20 years old. As a result, developing or updating  Commercial Services Plans could also require that General Management  Plans be updated. For example, at two of the six parks we visited the  General Management Plans were more than 20 years old and needed  updating. Updating and developing these plans would require a major  resource commitment by the agency. Appendix VI provides a complete list  of the status of General Management Plans.
section_title: Park Service Cannot Hold Local Park Managers Accountable for Meeting Contribution Goals
paragraphs: The Park Service does not have an effective process for holding local park  managers accountable for meeting nonprofit contribution goals, even  though one of the agency’s strategic goals is to increase the amount of  contributions it receives from nonprofit organizations. The Park Service’s  Strategic Plan FY 2000–FY 2005 establishes contribution goals for  cooperating associations and friends groups. The agency has identified  these goals as critical to accomplishing the mission of the Park Service. For  cooperating associations, the agency’s goal is to increase the amount of  donations and services by 35 percent from $19.0 million in the fiscal 1997- baseline year to $25.6 million by 2005. For friends groups and other  sources, the goal is to increase cash and in-kind donations from  $14.5 million in fiscal 1998 to $50.0 million by 2005. These long-term  strategic goals are broken into annual agencywide performance targets and  used to establish contribution goals for each park unit.
However, the Park Service does not collect the information needed to  determine whether these goals are being met and to accurately measure  nonprofit support. For cooperating associations, the Park Service collects  only aggregate information on the amount of association contributions.  Consequently, agency managers cannot always track contributions on a  park-by-park basis because, as discussed previously, cooperating  associations usually serve multiple parks. Specifically, about 40 percent of  all cooperating associations operate in more than one park and six of the 10  largest revenue-generating cooperating associations operate in more than  one park. Table 12 lists the 10 largest associations and the number of parks  served.
As table 12 shows, the Eastern National cooperating association serves 127  parks. However, the Park Service collects information only on the total  contributions made by Eastern National and not on the amount of  contributions made to each of the 127 park units it serves. Accordingly,  collecting and reporting only aggregate contribution information for  Eastern National and other associations that serve multiple park units  precludes the agency from establishing meaningful performance goals,  evaluating the performance of local managers against the goals, and  holding managers accountable for meeting established contribution goals.
Although the Park Service collects some information on the contributions  made by cooperating associations, it does not routinely collect any  information on the amount of contributions made to parks by friends  groups—either in the aggregate or on a park-by-park basis. In fact, the Park  Service does not maintain an accurate, up-to-date list of friends groups  currently working with the agency or of the specific parks they serve.  Lacking this basic management information, the agency is unable to  establish meaningful goals for local park managers or to monitor friends  group contributions on an agencywide or park-by-park basis.
According to Park Service and nonprofit officials, more complete  information on cooperating associations and friends groups is not collected  and reported for two key reasons. First, because nonprofits are voluntary  partners in assisting the agency in performing its mission and already must  meet a wide range of administrative requirements, both agency and  nonprofit officials are reluctant to initiate additional requirements for  collecting and reporting information. Second, both agency and nonprofit  officials are concerned that collecting and reporting detailed information  on the amount of contributions could lead to offsetting reductions in the  amount of congressional appropriations made available to the agency.
section_title: Conclusions
paragraphs: Between 1997 and 2001 cooperating associations substantially increased  their financial support to parks. A major reason for this increased support  is the additional revenue that cooperating associations generated from  expanded sales of educational materials, services, and visitor convenience  items. Friends group contributions also have dramatically increased, in  large part because the number of these groups rose as did the scope of their  fund-raising activities. These increased nonprofit donations are good news  for the Park Service and the national park system because they supplement  the appropriated funds provided by the Congress. However, the expanding  presence and scope of cooperating association sales and service activities  is causing some conflicts at parks where concessioners or other local, for- profit businesses are competing for similar sales and services. Given the  conflicts we found at three of six parks we reviewed and the agency’s  continuing emphasis on increasing the amount of nonprofit support for the  national park system, we believe these conflicts will become more  common.
Several other factors add to the likelihood of increased conflict, especially  at parks having both association and concessioner sales and services.  Specifically, agency policies that encourage concessioner sales and  services that are related to park themes, and agency decisions permitting  increased visitor convenience item sales by cooperating associations, blur  the distinction between concessioner and association activities. Local park  managers’ broad discretion in determining whether concessioners or  cooperating associations provide needed sales and services and the  substantial financial incentive for using cooperating associations also  heighten the likelihood of conflict. In light of these circumstances, it is not  surprising that park managers are expanding cooperating association roles.  In the final analysis, these decisions may be in the best interest of the  parks; however, the process for making these decisions does not serve to  minimize conflicts because it does not provide a transparent rationale or  give concessioners or other local for-profit businesses an opportunity to  compete for new sales and services.
The Park Service understands the competitive tensions that exist between  concessioners and cooperating associations. To help minimize conflicts,  park managers are advised to develop Commercial Services Plans. These  plans are intended to provide a logical and consistent basis for decisions,  reflect public comments, and provide a more predictable commercial  environment in the parks, which would give businesses greater confidence  in their long-term decisions. However, these plans are only rarely  developed or used. As a result, the basis for park decisions is not always  clear, and public accountability is diminished.
Moreover, because the Park Service does not collect accurate or complete  information on the contributions it receives from its nonprofit partners— either agencywide and on a park-by-park basis—it cannot hold park  managers accountable for meeting strategic contribution goals. Further,  without better and more complete information the agency cannot establish  meaningful performance goals or monitor progress against these goals.
section_title: Recommendations for Executive Action
paragraphs: In order to (1) minimize conflicts among the Park Service, cooperating  associations, and concessioners, (2) better ensure that decisions about  providing commercial sales and services are made more consistently and  that logical criteria are followed, (3) provide a predictable commercial  environment in the parks, and (4) enhance public accountability for its  decisions, we recommend that the Secretary of the Interior require the  Director of the National Park Service to  revise its policy regarding Commercial Services Plans so that all parks  offering visitor sales and services are required to develop these plans  and  ensure that Commercial Services Plans include (1) an explanation of the  roles and responsibilities of both concessioners and cooperating  associations in providing visitor sales and services in a park unit and (2)  rationale for decisions that specify associations or other nonprofits will  provide new visitor sales or services and that do not afford  concessioners and other local, for-profit businesses an opportunity to  compete.
To establish meaningful contribution goals and to improve the  accountability of park managers in meeting agency goals, we recommend  that the Secretary of the Interior require the Director of the National Park  Service to  develop and maintain an accurate and up-to-date list of friends groups  on a park-by-park basis and  require cooperating associations and friends groups to report key  financial information on a park-by-park basis.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided the Department of the Interior, the Association of Partners  For Public Lands (representing park cooperating associations and friends  groups), and the National Park Hospitality Association (representing park  concessioners), with copies of a draft of this report. The Association of  Partners For Public Lands and the National Park Hospitality Association  generally agreed with the recommendations and contents of this report.  The Association of Partners For Public Lands’ comments are included in  appendix VII. In addition, the Association provided technical and clarifying  comments that we incorporated into the report as appropriate. The  National Park Hospitality Association’s comments are in appendix VIII. The  association suggested additional recommendations. However, we believe  these are not warrented based on the information and analysis in the  report. The Department of the Interior did not provide comments on the  report.
As agreed with your office, unless you publicly announce its contents  earlier, we plan no further distribution of this report until 30 days from the  date of this letter. At that time, we will send copies of this report to  appropriate congressional committees and other interested parties.  We  will also make copies available to those who request them.  In addition, this  report will be available at no charge on the GAO Web site at  http://www.gao.gov.
If you or your staff have any questions about this report, please call me or  Cliff Fowler at (202) 512-3841. Key contributors to this report were Michael  Krafve, Paul Lacey, Peter Oswald, and Mona Sehgal.
section_title: Scope and Methodology
paragraphs: We examined activities of two types of nonprofit organizations commonly  found at parks: (1) cooperating associations and (2) friends groups.  Although other nonprofit organizations also provide services and conduct  commercial activities such as guided hiking and rafting trips at park sites,  based on the subcommittee’s letter and discussions with subcommittee  staff, these organizations were not included in the scope of this review.
To identify the number of parks supported by nonprofit organizations and  these organization’s contributions, we obtained annual reports of  cooperating association’s aid and revenue from the National Park Service’s  Division of Interpretation and Education. We obtained the National Par  Service’s most recent directory of friends groups (1998-1999) from the Park  Service’s Partnership Office and contacted groups listed in the directory. To  determine which groups were active, we telephoned all groups listed in the  directory. For groups that could not be reached, we confirmed with the  associated parks whether the group was still active. We also obtained  organizational information from representatives of nonprofit groups, including the  National Park Foundation, and National Park Service officials. We identified 149  friends groups, although it is possible that there are other groups that we  were not able to identify. Contribution amounts and other nonprofit financial  information used in this report are based on several sources. We received  data on cooperating associations for 1997-2001 from the Park Service;  these data are based on annual reports that all cooperating associations are  required to submit to the Park Service. Tax data for 1998-2000 were  purchased from the Urban Institute, which contracts with the Internal  Revenue Service to digitize data on tax-exempt organizations; these data  were based on tax returns submitted by nonprofit organizations with  revenues over $25,000. Tax data were also obtained from the GuideStar  Web site operated by Philanthropic Research Inc.; these data consisted of  electronically scanned tax reports for friends groups and cooperating  associations with revenues over $25,000. We also surveyed identified  friends groups, as described below.
We did not verify that information in the annual reports and tax returns was  correct. We relied heavily on self-reported donation and tax data from tax- exempt organizations; however, we previously reported that because  potential donors look at what percentage of expenses go to the charitable  purpose rather than management and fund-raising, nonprofit organizations  have an incentive to report management and fund-raising costs as  charitable expenses. Thus, there may be some over reporting of charitable  contributions and underreporting of management and fund-raising costs. In  this regard, we noted significant differences in reported tax information by  two of the largest cooperating associations, Eastern National and Parks  and History. Eastern National reports that about 20 percent of its  expenditures are for charitable purposes and about 80 percent is used to  cover the costs of materials, selling, and administrative expenses; Parks  and History reports that about 90 percent of its expenditures are charitable  expenses.
Data from the Park Service on cooperating associations were not  comparable with tax data from the Urban Institute and GuideStar because  of differences in reporting periods and accounting practices. We assessed  the reliability of the electronic data we received from the Park Service and  the Urban Institute through tests to determine obvious problems with  completeness or accuracy. We determined that the data were reliable  enough for the purposes of this report.
In addition, we conducted a survey of active friends groups regarding their  financial information. We mailed the survey to all 149 identified groups in  June 2002 and conducted several follow-ups by telephone and e-mail to  encourage responses; we completed data collection in November 2002. Of  the 149 groups surveyed, 79 returned responses (53 percent). Survey data  were supplemented with tax data for an additional 23 groups, resulting in  102 of 149 groups (68 percent) with available financial data. Where  possible, survey data were compared to tax data and any discrepancies  were resolved through discussion with the groups. Figures presented in  this report represent the two-thirds (68 percent) of identified friends  groups for which we had either tax data or survey data, and dollar amounts  should be considered a minimum estimate of the totals for all friends  groups.
To identify the revenue-generating activities of nonprofits in the parks, and  factors that contribute to cooperating association and concessioner  competition and conflicts, and to assess how park managers are held  accountable for meeting park service goals for nonprofit contributions, we  (1) reviewed Park Service documents, plans, and policies; (2) obtained  information from each of the Park Service’s seven regional offices; and (3)  met with National Park Service officials, the Association of Partners For  Public Lands the National Park Foundation, the National Park Hospitality  Association, and the Friends Alliance. We also met with park, nonprofit,  and concessioner officials at Gettysburg NMP, Fort Sumter NM, Grand  Canyon NP, Badlands NP, Yosemite NP, and Yellowstone NP and discussed  a nonprofit-managed concession contract with park and association  officials at Mt. Rushmore NM. We chose to visit Grand Canyon, Yosemite,  and Yellowstone national parks because their cooperating association and  concession operations were among the largest in the park system;  Gettysburg NMP and Fort Sumter NM to explore concessioner and local  business concerns about nonprofit activities in these parks; and Badlands  NP for perspective on a smaller nonprofit operation. Because these parks  were not a random sample, they may not be representative of the system as  a whole. We obtained data identifying merchandising concessioners, along  with fees paid to the parks, from the Park Service’s Concession  Management Division., We conducted our work from October 2001 to April 2003 in accordance  with generally accepted government auditing standards.
section_title: Statutory Provisions Relating to Cooperating Associations and Friends Group Activities at National Parks
subsections: section_title: 16 U.S.C. § 1
paragraphs: Establishes the National Park Service and the basic mission of the agency:  “to conserve the scenery and the natural and historic objects and the wild  life therein and to provide for the enjoyment of same in such manner and  by such means as will leave them unimpaired for the enjoyment of future  generations.”
section_title: 16 U.S.C. § 1a-2 (g)
paragraphs: Authorizes the Secretary of the Interior to enter into contracts, including  cooperative arrangements, with respect to conducting living exhibits,  interpretive demonstrations, and park programs.
section_title: 16 U.S.C. § 1b(5)
paragraphs: Authorizes the Secretary of the Interior to provide, on a reimbursable basis,  supplies and equipment to persons that render services or perform  functions that facilitate or supplement the activities of the Park Service.
section_title: 16 U.S.C. § 1g
paragraphs: Authorizes the Park Service to enter into cooperative agreements that  involve the transfer of Park Service appropriated funds to state, local and  tribal governments, other public entities, educational institutions, and  private nonprofit organizations for the public purpose of carrying out  National Park Service programs pursuant to 31 U.S.C. § 6305.
section_title: 16 U.S.C. § 3
paragraphs: Authorizes the Secretary of the Interior to issue rules and regulations for  use and management of park areas.
section_title: 16 U.S.C. § 6
paragraphs: Authorizes the Secretary of the Interior to accept donations of lands, other  property, and money for the purposes of the National Park System.
section_title: 16 U.S.C. § 17j-2(e)
paragraphs: Authorizes the use of Park Service appropriations for the services of field  employees in cooperation with nonprofit scientific and historical societies  engaged in educational work in the parks.
section_title: 16 U.S.C. § 18f
paragraphs: Authorizes the Secretary of the Interior to accept donations and bequests  of money or other personal property, and use and administer these for the  purposes of increasing the public benefits from museums within the  National Park System.
section_title: 16 U.S.C. § 19e
paragraphs: Establishes the National Park Foundation, a charitable and nonprofit  corporation, to accept and administer gifts of real and personal property  for the benefit of, or in connection with, the National Park Service, its  activities, or its services.
section_title: 16 U.S.C. § 19jj-4
paragraphs: Authorizes the Secretary of the Interior to accept donations of money or  services to meet expected, immediate, or ongoing response costs  concerning destruction, loss, or injury to park system resources.
section_title: 16 U.S.C. § 462(e)
paragraphs: Authorizes the Park Service to enter into contracts and cooperative  agreements with associations and others to protect, preserve, maintain, or  operate any historic or archaeologic building, site, object, or property in  the National Park System.
section_title: 16 U.S.C. § 464
paragraphs: Authorizes the Secretary of the Interior, in administering historic sites,  buildings, and objects of national significance, to cooperate with and seek  and accept the assistance of any federal, state, or municipal department or  agency; any educational or scientific institution; or any patriotic  association or individual.
section_title: 31 U.S.C. § 6305
paragraphs: Authorizes federal agencies to use cooperative agreements when (1) the  principal purpose is to transfer a thing of value to the recipient to carry out  a public purpose and (2) substantial involvement is expected between the  agency and the recipient when carrying out the activity contemplated in the  agreement.
section_title: National Parks Affiliated with Cooperating Associations, Friends Groups, and/or Merchandise Concessioners
subsections: section_title: Black Canyon of the Gunnison National Monument
section_title: Cooperating Association Revenue, Donations, and Net Assets (1997-2001)
subsections: section_title: Cooperating association revenue (1997-2001)
paragraphs: Cooperating association Cooperating association donations (1997-2001) and net assets83,785 (166,087)
section_title: Friends Group Revenue, Donations, and Net Assets (1997-2001)
paragraphs: Chesapeake and Ohio Canal Association,  Inc.
Fire Island Lighthouse Preservation Society,  Inc.
Friends of the Chickamauga & Chattanooga  NMP (14,511)
Friends of Fort Vancouver National Historic  Site Friends of Harpers Ferry National Historical  Park Friends of Independence National Historical  Park Friends of Perry’s Victory and International  Peace Memorial, Inc.
Friends of Stones River National Battlefield Friends of the Claude Moore Colonial Farm  at Turkey Run, Inc.
Friends of the Cape Cod National Seashore,  Inc.
Friends of the Gateway Parks Foundation,  Inc.
Indiana Dunes Environmental Educational  Consortium Rocky Mountain National Park Association Statue of Liberty—Ellis Island Foundation,  Inc.
Friends group donations (1997-2001) and net assetsChesapeake and Ohio Canal Association,  Inc.
Fire Island Lighthouse Preservation Society,  Inc. (32,935)
Friends of Fort Vancouver National Historic  Site Friends of Great Smokey Mountains National  Park Friends of Harpers Ferry National Historical  Park Friends of Independence National Historical  Park Friends of Perry’s Victory and International  Peace Memorial, Inc.
Friends of Stones River National Battlefield Friends of the Claude Moore Colonial Farm  at Turkey Run, Inc.
Friends of the Cape Cod National Seashore,  Inc.
Friends of the Gateway Parks Foundation,  Inc.
Friends of the William Howard Taft Birthplace Indiana Dunes Environmental Educational  Consortium Rocky Mountain National Park Association Statue of Liberty—Ellis Island Foundation,  Inc.
Voyageurs Region National Park Association (33,809)
section_title: Parks with General Management and Commercial Services Plans
paragraphs: General Management Plans (GMP)
Plans (CSP) (complete/due)
Abraham Lincoln Birthplace National Historic Site Alibates Flint Quarries National Monument Allegheny Portage Railroad National Historic Site Appomattox Court House National Historical Park Arlington House – The Robert E. Lee Memorial Big South Fork National River & Recreation Area Black Canyon of the Gunnison National Monument 1997 General Management Plans (GMP)
Plans (CSP) (complete/due)
Boston African American National Historic Site Boston Harbor Islands National Recreation Area Brices Cross Roads National Battlefield Site Brown v. Board of Education National Historic Site Cane River Creole National Historical Park Carl Sandburg Home National Historic Site Castillo de San Marcos National Monument Chattahoochee River National Recreation Area Chesapeake & Ohio Canal National Historical Park 1976 General Management Plans (GMP)
Plans (CSP) (complete/due)
Chickamauga & Chattanooga National Military Park Cuyahoga Valley National Recreation Area Dayton Aviation Heritage National Historical Park Delaware Water Gap National Recreation Area Ebey's Landing National Historical Reserve 1990 General Management Plans (GMP)
Plans (CSP) (complete/due)
Florissant Fossil Beds National Monument Fort McHenry National Monument & Historic Shrine Fort Union Trading Post National Historic Site Frederick Law Olmsted National Historic Site 1983 General Management Plans (GMP)
Plans (CSP) (complete/due)
Fredericksburg & Spotsylvania County Battlefields  Memorial National Military Park George Rogers Clark National Historical Park George Washington Birthplace National Monument George Washington Carver National Monument Great Egg Harbor Scenic and Recreational River Hagerman Fossil Beds National Monument 1996 General Management Plans (GMP)
Plans (CSP) (complete/due)
Home of Franklin D. Roosevelt National Historic Site Homestead National Monument of America Hubbell Trading Post National Historic Site Jean Lafitte National Historical Park & Preserve John D. Rockefeller, Jr., Memorial Parkway John Fitzgerald Kennedy National Historic Site 1984 General Management Plans (GMP)
Plans (CSP) (complete/due)
General Management Plans (GMP)
Plans (CSP) (complete/due)
General Management Plans (GMP)
Plans (CSP) (complete/due)
General Management Plans (GMP)
Plans (CSP) (complete/due)
Saint Croix Island International Historic Site Salinas Pueblo Missions National Monument Salt River Bay National Historical Park and Ecological  Preserve San Antonio Missions National Historical Park San Francisco Maritime National Historical Park Santa Monica Mountains National Recreation Area Sunset Crater Volcano National Monument Theodore Roosevelt Birthplace National Historic Site Theodore Roosevelt Inaugural National Historic Site 1993 General Management Plans (GMP)
Plans (CSP) (complete/due)
Upper Delaware Scenic and Recreational River Virgin Islands Coral Reef National Monument War In The Pacific National Historical Park Wolf Trap Farm Park for the Performing Arts 1982 General Management Plans (GMP)
Plans (CSP) (complete/due)
section_title: Comments from the Association of Partners for Public Lands
paragraphs: The following are GAO’s comments on the Association of Partners for  Public Lands’ letter dated June 13, 2003.
subsections: section_title: GAO Comments
paragraphs: 1. We agree that NPS must better manage information on nonprofits, and  this is one of our recommendations. We do not agree that the report  title should be changed as proposed because the change would not  capture another issue that our report and recommendations address --  the need to better manage the increasing role of nonprofits in providing  visitor convenience items and services. Problems in these areas led to  conflicts at three of the parks we visited. Moreover, our  recommendation that parks develop commercial services plans is  directed at managing the roles of nonprofits in the parks. 2. The association correctly points out, as we likewise observed in the  report, that our observations at six parks cannot be generalized to the  system as a whole.  However, because association sales of convenience  items are growing more rapidly than other association revenue items  (table 8), we are concerned that the likelihood of conflicts between  associations and concessioners may also increase. Positive  relationships between associations and concessioners are discussed in  the section “Not All Concessioners Were Concerned about Competition  from Cooperating Associations,” on pp. 25 - 26. 3. We agree that cooperating associations provide benefits to visitors that  are not measured by the amount of donations to the Park Service. We  identified nonfinancial benefits that associations provide in a distinct  report section on p. 14 and noted that association activities are focused  on providing visitors with educational materials and services on p. 16.  In addition, examples of nonfinancial assistance are in table 7.   4. This effort focused on the National Park Service’s role in partnering  with nonprofits. We do cite prior GAO efforts that examined IRS  oversight of nonprofits. For example, we cite TAX-EXEMPT  ORGANIZATIONS: Additional Information on Activities and IRS  Oversight, (GAO/T-GGD-95-198), which found compliance and  administrative difficulties with Unrelated Business Income Tax  reporting (see p. 32). 5. We added the association’s view to the discussion on p. 36. As stated in  this section, we believe cooperating associations offer a considerable  financial advantage, owing to the associations’ nonprofit status and  other park support. However, we did not attempt to quantify the value  of these advantages or to measure their effect on park decision makers. 6. We agree that net assets are intended to cover operating reserves and  are not held exclusively for future contribution. We added the  clarification that these assets are “potentially” available (pp. 3 and 13)  and “could become” available (p. 7) for contribution. To the extent that  nonprofit assets exceed operating expenses and other liabilities, net  assets can only be used for their tax-exempt purpose, which for most of  the nonprofits discussed in this report, is solely to benefit national  parks. 7. Detailed technical and clarifying comments were incorporated into the  report as appropriate.
section_title: Comments from the National Park Hospitality Association
paragraphs: The following are GAO’s comments on the National Park Hospitality  Association’s letter dated June 18, 2003.
subsections: section_title: GAO Comments
paragraphs: 1. We agree that Commercial Services Plans will require time to develop  and implement and that development and implementation may be  difficult because of resource constraints or because General  Management Plans must first be prepared or updated. In this regard, we  note on p. 1 that federal funding for the Park Service has not kept pace  with such needs as visitor services and maintenance requirements.  On  p. 40, we note that Park Service officials told us that Commercial  Service Plans were not developed because park resources are limited  and there are higher priorities. We also note that Commercial Services  Plans must be consistent with long-term plans – General Management  Plans – and while the National Parks and Recreation Act of 1978  requires that each park unit maintain an up-to-date General  Management Plan, these are frequently out of date. Although progress  in developing and implementing Commercial Services Plans is  necessarily dependent upon the availability of agency resources and its  consideration of other agency priorities, we believe the likelihood that  concessioner and nonprofit conflicts will become more common (see p.  42) supports placing greater emphasis on Commercial Services Plans.  2. As is clear from the heading on p. 33, the section “Park Managers Have  Broad Discretion in Deciding to Expand Cooperating Association Sales  and Services and Do Not Always Provide Transparent Rationale”  already discusses the considerable autonomy park managers have at  the local level. This was an important factor in our recommending that  these managers provide rationale for decisions involving the scope,  mix, and appropriateness of association and concessioner sales and  services (see p. 44). Because we did not examine the advantages and  disadvantages of the Park Service’s decentralized structure, we cannot  address the need for increased headquarters’ or regional oversight of  park managers.  3. We did not identify instances where the contractual rights of  concessioners were not respected.  In addition, D.O. # 32 makes  reference to the preferential rights of concessioners.  The National  Parks Omnibus Management Act of 1998 (P. Law 105-391) prohibits the  Secretary of the Interior from granting a preferential right to a  concessioner for most new contracts or services.  Although D.O. # 32  could be updated for consistency with current law, we are not making  this recommendation because we did not identify problems related to  the outdated wording.
Moreover, the contracts that we examined as part of our work usually  did not give concessioners “exclusive” rights to sell or provide services.   In fact, contract language in some cases specifies that concessioners  are not granted “an exclusive or monopolistic right, to provide public  accommodations, facilities, and services.”
The Association correctly points out that the Reference Manual for  D.O. # 32 specifies that associations may be authorized to sell visitor  convenience items when “concessioners are not presently providing  such services”.  This same instruction later specifies that a  concessioner and an association generally will not carry on duplicative,  competitive operations “in the same building.” Although the Park  Service may wish to reexamine these provisions, we did not make this  recommendation because, in some cases, concessioners and  associations may need to provide similar services at a park.  For  example, prior to the new visitor center facility opening at Fort Sumter  NM, the merchandise concessioner chose not to operate its store  during the off-season.  During this period, the association operated that  facility, providing visitor convenience items in addition to interpretive  materials.  4. Table 5 notes that association financial contributions include a dollar  value assigned to information assistance provided by association staff  to visitors and that the Park Service allows associations to claim up to  50 percent of association sales staff salaries.  However, we agree that  additional detail would provide a clearer picture of the composition of  association contributions.  We added language to tables 5 and 11 that 25  percent of association contributions were for information assistance.   We also added that information assistance is a primary type of park  support to the discussion on p. 2.  5. The issues addressed in this report do not provide a basis for making  these recommendations.  6. Associations have appointed concessioner officials to their Boards of  Directors.  This was the case, for example, at Grand Canyon NP and  Yellowstone NP.  We believe that deciding who should serve on its  Board of Directors is a decision best left to the private cooperating  association.
section_title: GAO’s Mission
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section_title: Public Affairs