National Park Service: Concessions Program Has Made Changes in Several Areas, but Challenges Remain
Released: 2017-03-20T00:00:00


Highlights: section_title: Why GAO Did This Study
paragraphs: The 1998 Concessions Management Improvement Act governs concessions services at national parks. In 2016, the Park Service managed 488 concessions contracts, and such contracts generated about $1.4 billion in gross revenues in the prior year. Under these contracts, companies and individuals operate businesses in parks, including lodges, restaurants, and recreational services. GAO was asked to review the concessions program.

This report examines (1) how the concessions program has changed since GAO's 2000 report and (2) any ongoing challenges in the concessions program. To conduct this work, GAO examined Park Service policy, guidance, and relevant laws and regulations; analyzed Park Service data on concessions contracts; interviewed Park Service staff at headquarters, all seven regions, and 20 park units, selected for size of concessions program and park type, among other things; and interviewed concessioners and stakeholders, such as consultants familiar with the concessions program.

section_title: What GAO Found
paragraphs: The Department of the Interior's National Park Service (Park Service) has made several changes to its concessions program since GAO issued a report on the program in 2000. In that report, GAO highlighted three management challenges: (1) inadequate qualifications and training of concessions staff; (2) backlog of expired contracts that were extended; and (3) lack of accountability in the concessions program. In this review, GAO found that the Park Service has taken steps to address these challenges:

Staff qualifications: Park Service has hired many concessions staff with relevant skills or educational backgrounds, such as in hospitality services or business. In addition, the Park Service developed several training classes for concessions staff to help improve their skills.

Contracts under extension: Park Service has reduced the percentage of extended contracts, from about 45 percent in 2000 to 28 percent in 2016.

Accountability: Park Service headquarters has increased its involvement in the concessions program and has centralized more information on the program. However, in some instances, GAO found that some financial reports that were to be submitted by concessioners to the Park Service were not submitted in a timely manner or data in the submitted reports were inaccurate. Park Service staff did not identify these discrepancies when reviewing the reports. Without timely and accurate financial data from concessioners, the agency could be limited in its ability to oversee certain aspects of the program such as determining whether concessioners paid required fees.

GAO identified some ongoing challenges in each of the three steps of the concessions process. First, developing a prospectus, which provides information on a concessions operation to potential bidders, can be a lengthy and expensive process, and it can be hard to generate competition. Second, the agency's evaluation panels can sometimes have difficulty assessing some proposals, and the award process can be lengthy. Third, contract management can be affected by limited staffing and confusion among concessioners about how to fund maintenance and capital improvements on buildings or land assigned to them by the Park Service. This situation is, in part, because the Park Service has not yet finalized related guidance and made it publicly available to concessioners. The Park Service's commercial services strategic plan recognizes many of the challenges GAO identified and lists goals to potentially address them. For example, the plan has a goal to improve the prospectus and contract award processes by reducing costs and improving efficiency to the government and bidders. In addition, the plan aims to attract more bids for concessions contracts, increase the accuracy of financial reporting, and increase the percentage of concessions staff that receive training. However, these goals do not have targets or timeframes for their completion. Leading practices indicate it is critical for an agency to set meaningful performance goals and to measure progress towards these goals. Without clearly defined performance goals that contain targets or timeframes, it will be difficult for the Park Service to track its progress in these areas and determine where additional effort may be needed to address identified challenges in the concessions program.

section_title: What GAO Recommends
paragraphs: GAO recommends that the Park Service review and adjust its process to help ensure timely and accurate reporting of financial data from concessioners, finalize its guidance and make it public, and develop performance goals with targets and timeframes in its commercial services strategic plan. The Department of the Interior agreed with GAO's recommendations.

section_title: Letter
paragraphs: The Department of the Interior’s National Park Service (Park Service) has  long managed concessions contracts, which provide services to visitors at  national park units. The National Park Service Organic Act that created  the Park Service authorized the Secretary of the Interior to grant  privileges to private businesses for the accommodation of visitors within  the national park system. The first director of the Park Service, Stephen  Mather, highlighted the importance of concessions operations when he  said, “Scenery is a hollow enjoyment to the tourist who sets out in the  morning after an indigestible breakfast and a fitful night’s sleep on an  impossible bed.” As of April 2016, the Park Service managed 488  concessions contracts, and such contracts generated about $1.4 billion in  gross revenues in 2015. Under these contracts, companies and  individuals operate businesses in parks, including lodges, restaurants,  and recreational services such as horseback riding. The Park Service’s  concessions process consists of three main steps: (1) developing a  prospectus, which provides information on the concessions operation and  the business opportunity it presents to potential bidders; (2) evaluating  proposals and selecting the winning bid; and (3) managing the awarded  contract.

The National Park Service Concessions Management Improvement Act of  1998 (1998 Concessions Act) serves as the current basis for the  concessions program. Prior to the development of regulations to implement this law, we issued a report in 2000 on the concessions  program that highlighted three longstanding management challenges for  the Park Service: (1) inadequate qualifications and training of  concessions staff; (2) inability to manage its contract workload and the  resulting backlog of expired contracts that were under extension; and (3)  lack of accountability in the concessions program, such as oversight of  concessioners’ performance. In that report, we recommended that the  Park Service improve the qualifications of concessions staff, contract for  needed contracting expertise, or do some combination of both. We also  recommended that the Park Service establish a formal process of  performing independent inspections of lodging operations. The Park  Service agreed with these recommendations.

You asked us to review the Park Service concessions program since the  passage of the 1998 Concessions Act. This report examines (1) how the  concessions program has changed since our 2000 report and (2) any  ongoing challenges in the concessions program.

To address these objectives, we examined Park Service policy and  guidance documents and relevant laws and regulations. We reviewed  some of our prior reports on the concessions program. In particular, we  reviewed our 2000 report on the concessions program, which identified  management challenges facing the concessions program prior to the  implementation of the 1998 Concessions Act. In addition, we analyzed  Park Service data on concessions contracts. Specifically, we examined  administrative data that the Park Service provided us as of April 2016 on  the concessions contracts in place, the services they provided, and their  contract terms. We also examined financial data on concessions  contracts, including gross revenues, for 2015, the most recent year for  which data were available. To determine the reliability of these data, we  interviewed agency officials who were familiar with these data and  conducted electronic testing of these data. We found these data to be  sufficiently reliable for our purposes.

In addition, we interviewed agency staff at Park Service headquarters,  regional offices, and selected park units. Specifically, at headquarters, we  interviewed the chief of the commercial services office, who oversees the  concessions program, along with officials in all four branches of the  commercial services office—Asset Management, Planning and  Development, Financial Analysis, and Contract Management. We  interviewed concessions staff in all seven regional offices. We also  interviewed concessions staff involved in managing concessions at 20  park units, including staff at 2 park units in person and the remaining 18  via phone, and asked about their experiences with implementing the  concessions program. We interviewed staff from at least two park units in  each of Park Service’s seven regions. In selecting parks, we included  units that varied by characteristics such as the number of visitors and  type of park (i.e., scenic versus historical). We used a standard set of  questions to obtain information from staff on qualifications, training, the  concessions program, and any challenges in the program. We also  interviewed 21 concessioners, including at least one concessioner that  operated in each of the 20 parks units we contacted. In selecting  concessioners, we included a range of concessioners that varied by the  gross revenues they generated and the types of services they provided.  We used a standard set of questions to obtain concessioners’ views on  the concessions process and any challenges they face. We analyzed the  responses from our interviews with the Park Service and concessioners  to identify the most common challenges that were identified. We also  interviewed stakeholders who were familiar with the concessions  program, including consultants who help the Park Service implement the  program and academics in the hospitality field. The views from our  interviews are not generalizable to all parks or concessioners, but they  were used to provide a range of perspectives on the concessions  program. Appendix I contains a more detailed description of our  objectives, scope, and methodology.

We conducted this performance audit from January 2016 to February  2017 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: The Park Service is composed of headquarters, seven regional offices,  and 417 park units that cover 84 million acres across all 50 states. Park  units include national parks, national battlefields, national recreation  areas, and national lakeshores. The Park Service has long worked with  concessioners who provide visitor services, such as lodging and  recreational opportunities in national park units, and some concessions  operations are nearly as old as the parks in which they operate. For  example, the Many Glacier Hotel in Glacier National Park opened for  business in 1915, 5 years after the park was established in Montana, and  is currently operated by a concessioner.
subsections: section_title: Revenues Generated and Services Provided
paragraphs: As of April 2016, the Park Service had 488 concessions contracts in over  100 park units, and in 2015, such operations collectively generated about  $1.4 billion in gross revenues and paid about $104 million in franchise  fees to the Park Service. Concessioners provide a vast array of services  throughout the national park system. Table 1 shows the most commonly  offered services under concessions contracts.

Concessions contracts also vary in size and scope. The largest  concessions contracts in terms of revenues generated generally offer  lodging, food, and retail services. According to a Park Service  presentation, these three services accounted for over half of the revenue  generated under concessions contracts in 2014. In 2015, the five largest  concessions contracts generated more than $50 million each in gross  revenues for services in Yosemite, Yellowstone, and Grand Canyon  national parks along with Statue of Liberty National Monument and Glen  Canyon National Recreation Area. These contracts generally offer  lodging, food, and retail services. In addition, in 2015, 20 concessions  contracts with the largest gross revenues accounted for about two thirds  of the total revenues generated under all concessions contracts. In  contrast, 177 concessions contracts each generated less than $100,000  in annual revenues in 2015. Many of these contracts were for guide  services and outfitters. Some concessioners, such as those that operate  lodges, are assigned buildings or land that are owned by the federal  government, and they are responsible for maintaining them during the life  of the contract.

section_title: Concessions Process
paragraphs: As shown in figure 1, the concessions contracting process consists of  three main steps: prospectus development, contract award, and contract  management.

Park Service staff at the headquarters, regional, and park unit levels  serve different roles in the concessions program. Park Service  headquarters provides guidance on the concessions program and  oversees the process for developing prospectuses for contracts with  anticipated annual gross revenues of more than $5 million a year or a  contract term of more than 10 years, which are known as “headquarters- level” contracts. As of April 2016, there were 52 headquarters-level  contracts, and these contracts accounted for almost 80 percent of the  total gross revenues generated by concessions contracts in 2015. Within  headquarters, four branches have different roles in the concessions  program, as shown in table 2.

According to Park Service officials, regional staff are also involved in  developing prospectuses for headquarters-level contracts. In addition,  regional staff take the lead in developing prospectuses for concessions  operations that are under $5 million a year in revenue or 10 years in  length and answer questions that park unit staff may have on the  concessions program. The primary role of park unit staff is to oversee  concessions contracts once they have been awarded. Park unit staff will  also provide input into prospectus development, such as what services  should be allowed. According to Park Service officials, park unit staff  include full-time, dedicated staff who are generally known as concessions  management specialists and collateral duty staff. Collateral duty staff  have other responsibilities at the park in addition to overseeing  concessions, such as being a law enforcement ranger.

section_title: Legislative Authorities
paragraphs: The 1998 Concessions Act authorizes the concessions program at the  Park Service to provide necessary and appropriate services to visitors  that are consistent with the preservation and conservation of a park unit’s  resources. The 1998 Concessions Act repealed the National Park  Service Concessions Policy Act, which was enacted in 1965 (1965  Concessions Act), and made changes to the concessions program. For  example, the 1998 Concessions Act reduced the ability of the Park  Service to offer a preferential right of renewal to incumbent  concessioners, which allows an incumbent concessioner to match a  better bid offered by a competitor. The 1998 Concessions Act allows a  preferential right of renewal for concessioners offering guide or outfitting  services or those with anticipated gross revenues under $500,000. In  contrast, the 1965 Concessions Act allowed a preferential right of renewal  for all concessioners.

The 1998 Concessions Act also changed how concessioners are to be  compensated for capital improvements made to buildings or land  assigned to them. Under the 1998 Concessions Act, concessioners that  make approved capital improvements receive a leasehold surrender  interest (LSI) for this improvement. LSI generally represents the initial value of capital improvements adjusted for inflation and depreciation  made by a concessioner to a property, such as building a new structure,  completing a major rehabilitation, or installing a non-removable piece of  equipment, known as a fixture. LSI took the place of a system of  compensation for capital improvements called “possessory interest” that  existed under the 1965 Concessions Act. According to Park Service  officials, one of the key differences between these systems is the method  used to calculate their values, with LSI being easier to calculate than  possessory interest because there is a defined formula to calculate LSI in  the act. The Park Service tracks LSI balances during the contract term,  and if a contract is awarded to a different concessioner when the contract  ends, the 1998 Concessions Act requires the previous concessioner to be  paid for any LSI. Table 3 compares selected provisions in the 1965  Concessions Act and 1998 Concessions Act.

section_title: Challenges Highlighted in 2000 GAO Report
paragraphs: Our 2000 report on the concessions program, which we issued prior to  the implementation of the 1998 Concessions Act, highlighted three  management challenges:  Inadequate staff qualifications and training: We generally found that  Park Service staff at the headquarters, regional, and park unit levels  did not have the necessary skills or training to implement the program.  We found that concessions staff were often transferred from other  career fields at the Park Service, such as interpretive or law  enforcement rangers and the agency’s view was that “anyone could  do concessions.”

Inability to manage contract workload and expired contracts: We  found that the Park Service was unable to manage its concessions  contract workload, and this had resulted in approximately 45 percent  of concessions contracts and permits (283 of 630) being expired as of  December 31, 1999, meaning that these contracts had exceeded their  original term and were under an extension. We found that this  backlog of expired contacts resulted in concessioners not having an  incentive to invest in facilities that were under short-term extensions  because the extensions gave concessioners little time to earn a return  on their investment.

Lack of accountability: We found that the organizational structure of  the Park Service impeded accountability because Park Service  headquarters did not have direct authority over how park units were  implementing the program. We also found that confusion existed  about the roles and responsibilities in the program among  headquarters, region, and park unit staff, and that the review process  for concessioners was not adequate.

To address some of these challenges, we recommended that the Park  Service improve the qualifications of concessions staff, use contractors in  the program, or do some combination of both. We also recommended  that the Park Service establish a formal process to conduct periodic independent inspections of concessioners’ lodging facilities. The Park  Service agreed with these recommendations and has taken steps to  implement them, as discussed below.

section_title: Since 2000, Park Service Has Made Changes to the Concessions Program, but Some Oversight Issues Remain
paragraphs: The Park Service has made several changes to the concessions program  since our 2000 report. Specifically, the Park Service has hired  concessions staff with relevant skills or educational backgrounds, is using  consultants, and has increased training opportunities. In addition, the  Park Service has reduced the number of concessions contracts under  extension because it is issuing contracts on a regular basis. The Park  Service’s headquarters office has also increased involvement in the  program and is collecting more data from concessioners. However, we  found that some of these data are incomplete because concessioners did  not submit required financial reports or data were reported incorrectly and  were not identified in the agency’s review of the reports.
subsections: section_title: Park Service Has Hired Staff with Relevant Skills and Backgrounds, and the Agency Has Started Using Consultants and Added Training
paragraphs: In our 2000 report, we found that Park Service concessions staff  generally did not have the business, financial, or contracting backgrounds  needed to successfully carry out the concessions program. Since then,  the agency has taken steps to hire concessions staff with relevant  qualifications, particularly at the headquarters or regional level. Two park  superintendents who have been in the Park Service for more than 30  years said the agency was hiring staff with business backgrounds and  specialized skills for the program instead of moving people from other  park unit positions, such as rangers, into the concessions program. This  is a change from the time of our 2000 report, when we found that the Park  Service typically filled concessions positions by transferring staff from  other career fields.

According to our interviews with Park Service concessions staff at  headquarters, regional offices, and park units, many current program staff  have relevant experiences or educational backgrounds as follows.

Headquarters: The chief of commercial services and the four branch  chiefs have educational degrees in relevant fields, such as hospitality  or business, prior work experience in relevant fields, or had worked in  the concessions program for some time. For example, the commercial  services chief, who was hired in November 2014, has more than 25  years of experience working in the hospitality industry along with  degrees in hospitality and business.

Regional offices: Most of the seven commercial services chiefs who  oversee the concessions program in their regions have relevant  educational degrees or work experience. Specifically, three of the  chiefs had prior relevant experience, such as working on contracts in  the private sector, while three others had worked in the concessions  program for more than 8 years. In addition, several regional office  concessions staff have similar backgrounds and experiences. For  example, concessions staff at three of the regional offices have  business degrees.

Park units: Concessions staff at the 20 park units we interviewed have  a variety of backgrounds. Some of these park staff have degrees in  business or hospitality or several years of experience in the  concessions program, while other staff did not. Those staff with fewer  relevant qualifications were generally at parks that did not have large  concessions programs, in terms of the number of the contracts at the  park or the revenues generated under these contracts. For example,  at one park unit that had one small concessions operation for a  campground, the one collateral duty staff overseeing this operation  did not have a relevant background or much experience in the  program.

In our 2000 report, we recommended that the Park Service consider  using contractors in the concessions program for activities such as writing  prospectuses and performing financial analysis. The 1998 Concessions  Act directs the Park Service to use contractors to conduct or assist in  various aspects of the concessions program, including health and safety  inspections, analysis of rates charged to the public, and the preparation of  the financial aspects of prospectuses. According to Park Service  officials and consultants we interviewed, we found that the agency uses  consultants in certain aspects of the concessions program. In addition,  the draft guidance directs concessions staff to use consultants to help  develop prospectuses for headquarters-level contracts. Some of the  ways in which consultants are used, according to our interviews, are as  follows:

Condition assessment: Consultants develop inventory of park assets,  such as buildings and land that are part of concessions operations,  and then conduct assessments of their condition. The results of these  assessments are used to develop maintenance plans for  concessioners to follow under their contracts.

Financial analysis: During prospectus development, consultants  develop models that estimate future costs and revenues for  concessions operations. These models are used to develop the  minimum franchise fee that is published in a prospectus.

Rate administration: Consultants develop tools to support and conduct  rate comparability studies to respond to requests from concessioners  to change the rates they charge for visitor services.

Environmental audits: Consultants examine environmental  management programs that are part of concessions operations, such  as their use of hazardous chemicals that are part of certain  operations.

In our 2000 report, we also found that once staff were transferred from  other fields into the concessions program, there was limited training  available to them and this further limited their ability to carry out their  duties. The Park Service now offers additional training courses on the  concessions program to staff to help improve their skills, as shown in  table 4. Specifically, the agency offers four classroom-based courses that  are several days in length. According to a senior Park Service official, the  Evaluation and Pricing course predated the implementation of the 1998  Concessions Act, but the other three classes were developed since the  law’s implementation to provide additional training to concessions staff.  Of these training courses, concessions staff are only directed to complete  the Evaluation and Pricing training as of November 2016, while the other  courses are optional. Many of the park unit staff we interviewed said they  had taken one or more of the four classroom training courses. At one park  unit, a collateral duty staff said that he did not have a background in the  concessions area and that the courses had helped him understand how  to administer the program. The Park Service supplements these  classroom trainings with online training and monthly conference calls  during which different concessions topics are covered.

section_title: Park Service is Extending Fewer Concessions Contracts and for a Shorter Period
paragraphs: Based on our analysis of Park Service data, the Park Service has  extended fewer concessions contracts past their contract term.  Specifically, as we reported in 2000, approximately 45 percent of  concessions contracts and permits (283 of 630) had expired as of  December 31, 1999, and many of these had been under extension for 5  to 10 years. In contrast, as of April 2016, 28 percent (136 of 488) of  concessions contracts were under extension, and 85 percent (116 of 136)  had been under extension for 3 years or less. Table 5 shows the  number of contracts that were under extension by region, as of April  2016. The Alaska region has the highest percentage of contracts under  extension. According to Park Service officials from this region, limited  staff were available to help prepare the prospectuses needed to award  new contracts so the region extended some existing contracts.

According to Park Service officials, the decrease in the proportion of  contracts under extension is due, in part, to a provision in the 1998  Concessions Act, which limits contract extensions to a maximum of 3  years. Officials said that this led the agency to award contracts on a  regular basis instead of extending them indefinitely, as had been allowed  under the 1965 Concessions Act.

section_title: Headquarters Office Has Increased Involvement in Concessions Program, but Some Data from Concessioners Were Missing or Inaccurate
paragraphs: In our 2000 report, we found that under the agency’s organizational  structure, Park Service headquarters did not have direct authority over  how park units implemented the program and that headquarters did not  have information on certain aspects of the program, such as centralized  information on the condition of lodging facilities. Since then, headquarters  has increased its involvement in the concessions program. For example,  headquarters is actively involved in preparing prospectuses for the 52  headquarters-level contracts, which are the largest concessions  contracts. Specifically, a headquarters Planning and Development  branch staff member serves as one of the project managers during  prospectus development for these contracts. In carrying out this role,  headquarters helps to determine how to structure the concessions  contract, including what services to allow under the contract and whether  to permit large-scale capital improvements during the term of the contract,  such as constructing new buildings. According to the Park Service’s draft  guidance on the concessions program, the Director of the Park Service  must also approve any capital projects estimated to cost over $1 million.  According to Park Service officials, the increased oversight of LSI eligible  projects is intended to prevent LSI balances from growing too high under  certain contracts. High LSI balances can discourage competition because  few companies have the resources to purchase the LSI from the previous  concessioner, according to Park Service officials.

The Park Service also has some initiatives under way to help oversee the  performance of concessioners. For example, Park Service headquarters  developed a data system to track the ratings that park unit staff give to  concessioners as part of the annual overall review process, according to  a senior Park Service official. In addition, this official said that 10 percent  of annual overall reviews on concessioners will be subject to further  review by Park Service headquarters staff, beginning in 2017. Park  Service headquarters currently reviews these annual ratings for  completeness, but it is aiming to determine if the rating given to a  concessioner is justified by the supporting narrative.

In our 2000 report, we also found that the Park Service lacked centralized  information on the condition of concessioner lodging facilities, which  limited the agency’s ability to oversee the program. Since then, the Park  Service has directed that condition assessments of structures maintained  by concessioners be conducted during the prospectus development  process, according to Park Service officials. Information from these  assessments is entered into the Park Service’s Facility Management  Software System, which contains data on Department of the Interior  facilities. Park Service staff use this information to develop a maintenance  plan for the concessions contract, which they review and update as  needed, according to the agency’s draft guidance and agency officials.

While the Park Service has taken steps to obtain more centralized  information on the concessions program, we found that some  concessioners’ financial reports were missing or data contained in the  reports we reviewed were sometimes reported incorrectly. Standard  concession contracts require concessioners to submit annual financial  reports to the Park Service for each concessions contract they hold.  These reports provide data such as gross revenues, operational costs,  and franchise fees paid. The Park Service uses these reports and the  data they contain for several purposes, including to reconcile franchise  fee payments received from concessioners annually and to generate  financial projections that are used to develop prospectuses for contracts,  according to agency officials. We found instances where these reports  had not been submitted or data on the financial reports that were  submitted were incorrectly reported by concessioners.

Some financial reports were missing: Financial reports for 2015 had  not yet been submitted for 23 of 485 concessions contracts as of  November 2016. Under these contracts, a total of about $20 million  in gross revenues and about $98,000 in franchise fees were reported  on their most recently available financial report, which in most  instances was from 2014. According to the standard contract  language the Park Service uses for concessions contracts, these  reports are due within 120 days of the end of a concessioner’s fiscal  year, and Park Service officials said that most concessioners use a  calendar year for financial reporting. This means that these  concessioners should have submitted their 2015 financial reports by  April 30, 2016. When we asked Park Service officials about this issue,  they said that this was a recurring issue for some concessioners and  that it can be hard to obtain financial reports from smaller  concessioners because these concessioners sometimes have only  one or two employees and these limited resources can make it difficult  to submit reports on time.

Financial reports sometimes contained incorrect data: For 39 of 485  contracts, concessioners reported gross revenues, but did not report  paying a franchise fee in their 2015 financial report. Under these 39  contracts, a total of about $21 million in gross revenues was reported  in 2015. According to Park Service data, a franchise fee should have  been paid under these contracts. Park Service officials said that they  believed these were instances where the concessioner had paid  franchise fees, but had not filled out the annual financial reports  properly. They added that these inconsistencies should have been  identified by the relevant park unit or the regional office during their  review of these financial reports. Some park unit officials said that  they are overwhelmed by the number of reports, including financial  reports, they receive from concessioners and do not have time to  review all of them. In addition, we found that the data from these  financial reports are entered into a spreadsheet that does not contain  edit checks that could identify possible errors. We used supplemental  data from the Park Service to determine that franchise fees had been  paid under some of these contracts, but we were unable to confirm  franchise fees had been paid for all of them because these data were  reported at a park unit level and not at a contract level.

According to Standards for Internal Control in the Federal Government,  agencies should obtain information from external parties in a timely  manner and should have control activities to ensure that data are reliable.  However, not all financial reports were submitted in the time frames  required by standard contract language, and some that were submitted  contained errors that were not identified by Park Service staff during the  review process. Without timely or accurate financial data from  concessioners, the agency could be limited in its ability to oversee certain  aspects of the concessions program such as determining whether  concessioners have paid their franchise fees.

section_title: Concessions Program Continues to Face Challenges, Which the Park Service’s Strategic Plan May Address, but the Plan Is Missing Key Elements to Track Progress
paragraphs: In interviewing Park Service officials and concessioners, we identified  some challenges in the three steps of the concessions process:  prospectus development can be a lengthy and expensive process, and it  can be hard to generate competition for some contracts; the agency’s  evaluation panels can sometimes have difficulty assessing proposals, and  the award process can be lengthy; and contract management can be  affected by limited staffing and confusion about how to fund capital  improvements and maintenance. The Park Service’s commercial services  strategic plan highlights many of the challenges we identified and  identifies initiatives to potentially address them, but is missing certain  information, such as performance measures that are quantifiable to track  progress and determine where additional effort may be needed.
subsections: section_title: Prospectus Development Can Be a Lengthy or Expensive Process
paragraphs: Several Park Service officials said that developing prospectuses can be a  lengthy or expensive process, taking as long as 4 years to complete.  Some of these officials noted that the process is lengthy, in part, due to  the multiple levels of Park Service review or the time it takes for  consultants to conduct condition assessments of concessioner-assigned  buildings or land. In addition, according to one consultant we interviewed,  it can cost between $70,000 and $400,000 for a consultant to do a  condition assessment of the buildings that are part of a concessions  operation, depending on the size and scale of the operation. A Park  Service headquarters official acknowledged that it can be costly to  develop a prospectus but a future contract can generate revenues that  greatly exceed these costs. For example, this official told us that the  agency spent about $2 million for a condition assessment of 800 buildings  for a concessions contract that was anticipated to generate over $100  million in annual gross revenues and had a contract term of 20 years. In  addition, several concessioners noted that responding to a prospectus  can be time consuming or expensive. For example, some of these  concessioners said that developing a proposal cost several tens of  thousands to hundreds of thousands dollars.

A few Park Service officials and a trade association representing guides  and outfitters suggested that a simplified prospectus development  process for small contracts may help to reduce the time and costs of  developing the agency’s prospectuses and concessioners’ proposals. The  Park Service was directed by the 1998 Concessions Act to use a  simplified process for small, individually owned entities seeking  concessions contracts. The Park Service has developed guidance for  one part of the prospectus development process—determining franchise  fees for small concessions contracts with projected annual gross  revenues less than $250,000. In 2014, the agency began a pilot project  designed to help it develop a simplified prospectus process, but it has not  yet issued a prospectus using this process. According to Park Service  officials, the agency plans to issue a prospectus under the pilot project by  the end of 2016 and use the results of this effort to simplify the  prospectus development process for small contracts.

section_title: Generating Competition for Some Concessions Contracts Can Be Challenging
paragraphs: According to Park Service officials, one of the goals of the 1998  Concessions Act was to increase competition in the concessions  program, but several Park Service officials and concessioners we  interviewed said that increasing competition on concessions contracts  continues to be a challenge. Competition for larger contracts is limited to  a few companies, in part, because some contracts have high LSI  balances, according to Park Service officials. High LSI balances can  discourage competition because few companies have the resources to  purchase these balances from the previous concessioner, as we found in  2015.

The Park Service has taken steps to manage LSI balances by either  reducing high balances on existing contracts or limiting the LSI that a  concessioner can incur on a new contract, as we found in 2015.

Specifically, the Park Service has reduced high LSI balances by using  franchise fees to buy down these balances on contracts that would  otherwise have attracted few bidders. Most notably, the agency spent  almost $100 million to reduce the LSI balance for capital improvements at  Grand Canyon National Park to encourage competition. On another  contract, concessioners informed the Park Service that they would not  submit proposals since the LSI balance on a concessions contract was  too high, according to a Park Service official. As a result of this input, the  park unit plans to buy down the LSI to zero, which staff said may help  generate competition. In addition, the Park Service has limited the  amount of LSI that concessioners can incur on new contracts, as we  found in 2015. However, according to some concessioners, not allowing  concessioners to incur LSI could limit their interest in investing in  concessioner-assigned buildings or land because they would not be paid  for eligible capital improvements they make.

Competition is also limited because over half of the Park Service’s  concessions contracts continue to have a preferential right of renewal,  according to Park Service officials. While the 1998 Concessions Act  generally prohibits the Park Service from granting a preferential right of  renewal for larger contracts, the Park Service estimates that about 70  percent of its concessions contracts continue to have a preferential right  of renewal. These contracts generally have less than $500,000 in gross  annual revenues or are for guide services or outfitters. Competition for  contracts may be limited in such situations because the incumbent can  match a better bid offered by a competitor. Some guiding concessioners  we spoke with said that it was important to maintain a preferential right for  guides and outfitters because these types of concessioners often have  specialized equipment and skills unique to the park and service provided,  such as mountain climbing.

section_title: Assessing Some Proposals Can Be Difficult and the Process for Awarding Concessions Contracts Can Be Lengthy
paragraphs: Several Park Service officials and concessioners said that it can  sometimes be challenging for evaluation panel members to determine if a  bidder can perform all of the services listed in its proposal. According to  the agency’s draft guidance on the concessions program, panel members  are to typically review information that is submitted as part of the bidder’s  proposal, and according to Park Service officials, panel members  generally do not ask for additional information during the evaluation  process to help assess a bidder’s proposal. Some of these Park Service  officials and concessioners said that this can sometimes result in the  agency awarding the contract to a bidder who has a well-written proposal,  but might have “overpromised” in its ability to implement its proposal. For  example, a park unit official said that a concessioner submitted a  proposal in response to a prospectus for a tour boat operation and  included additional services not specifically required by the prospectus,  such as offering a healthy food menu on board the boat. This  concessioner was awarded the contract, in part, because of these  additional services; however, it took years for the concessioner to follow  through on providing this service, according to this park unit official.

A concessioner we spoke with said that it would be helpful for park unit  staff knowledgeable about the concessions operations at the park unit to  be included as an advisor to the evaluation panel to help determine if  proposed services are feasible. According to the Park Service’s draft  guidance, park unit staff typically serve as technical advisors to the panel.  Park unit staff are not always included because of limited travel funds,  according to a Park Service official. However, the evaluation panel may  informally contact park unit staff when it has technical or park-specific  questions, according to agency officials.

Another challenge with the contract award phase of the process is the  length of time it takes to award a concessions contract, according to  some Park Service officials and concessioners. For example, one park  unit official we interviewed in July 2016 said that a contract had not been  awarded by an evaluation panel that took place in the prior winter and for  which only one proposal was submitted. According to Park Service  officials, this contract is to be awarded in December 2016. The length of  time to award a contract can be affected by the need for agency review.  According to the agency’s draft guidance, agency officials are to review  the evaluation panel’s recommendation on which concessioner submitted  the better proposal before announcing the winner of a contract. There is  also a need for review by the Office of the Solicitor during several stages  of the concessions process, according to agency officials.  In addition, the  1998 Concessions Act requires that the Park Service submit  headquarters-level contracts to specified congressional committees for a  period of 60 days before they can be awarded.

section_title: Contract Management Can Be Affected by Limited Staffing
paragraphs: Several Park Service officials as well as concessioners we interviewed  said that the agency does not always have enough staff to adequately  manage concessions contracts. These management activities include  reviewing a concessioner’s performance and compliance with its contract  and approving concessioner rates. For example, concessions staff at two  park units said they found it difficult to review required reports submitted  by concessioners because of the large number of concessions contracts  they managed. According to the Park Service’s draft guidance on the  concessions program, staff are to review and update required reports to  ensure that concessioners are meeting their established operational and  maintenance responsibilities and providing visitors with satisfactory  services, among other things. Furthermore, two concessioners said that  not having enough concessions staff at parks slows the review and  approval of their requests, such as changes to their rates. For example,  one concessioner said that it took several months for concessions staff at  a park unit with limited staff to respond to a request to adjust the prices  for food the concessioner sold.

Staff at some park units we contacted manage the concessions program  as a collateral duty, meaning they have other primary responsibilities,  such as law enforcement. A few of these park unit concessions staff said  that managing the concessions program as a collateral duty works well  because the concessions program is not large at their park. However,  staff at other park units said that managing the concessions program as a  collateral duty is challenging since their primary duties take up the  majority of their time. As a result, they do not always have time to  proactively manage concessions contracts, such as approving new prices  for services. Park Service officials said headquarters offers a technical  assistance program to parks that need support. In a typical year, the  program funds a total of 10 onsite trips, during which headquarters staff  travel to park units to assist park unit staff in areas such as conducting  inspections of concessioner operations.

For the 20 park units we contacted, we generally found that parks that  had more contracts or headquarters-level contracts also had more staff  managing the program (see table 6). One exception was at Glacier Bay  National Park and Preserve, where two full-time concessions staff are  responsible for overseeing 39 concessions contracts. In addition, parks in  our review that had concessions contracts generating higher revenues  generally had more staff. For more information on gross revenues  generated at these different park units, see appendix II.

Limited staffing levels can also affect a regional office’s ability to support  parks in the concessions program, according to Park Service officials.  According to regional officials, parks that do not have full-time  concessions staff can rely on the regional offices for assistance in  managing the concessions program. In 2015, the agency tried to address  staff shortages in regional offices by allowing each of them to use funding  from franchise fees to hire an additional full-time concessions  management specialist to help with the workload, according to Park  Service officials. As of November 2016, six of the seven regional offices  have requested funding to hire additional staff and three of these offices  have hired staff using this funding.

section_title: Some Concessioners Find It Challenging to Determine How to Fund Maintenance and Capital Improvements
paragraphs: Some concessioners we interviewed said that it was challenging to  determine how to fund maintenance or capital improvements.  Concessioners that have been assigned buildings or land, such as hotels  or restaurants, are required to maintain these assets, and they may also  be required to undertake capital improvement projects. In the area of  maintenance and capital improvements, projects may be funded in  several ways, depending on the type of work required:

Routine maintenance: Activities, such as painting or replacing carpet,  are paid for by the concessioner.

Personal property: Includes certain items, such as removable  equipment and furniture, which are paid for by concessioners.

Replacement of building components: Concessions contracts may  require concessioners to set aside a percentage of their revenues into  a repair and maintenance reserve fund that they establish and  manage. These funds can be used to replace a building component,  such as a roof or windows, at the end of its useful life. These funds  cannot be used for large-scale capital improvements that would  qualify for LSI, and cannot be used for routine maintenance needs.

Large capital projects or fixtures: Concessioners can also be required  under their contracts to undertake capital improvements, which are  eligible for LSI, such as constructing a new building, completing a  major rehabilitation, or replacing fixtures. The Park Service tracks  LSI balances during the contract term, and if a contract is awarded to  a different concessioner when the contract ends, the 1998  Concessions Act requires the previous concessioner to be paid for  any LSI.

Figure 2 shows different types of maintenance or improvements that  could be made by a concessioner in a lodging room and the applicable  funding category. As this figure shows, a single project to update a lodge  room could involve a concessioner determining whether a specific activity  qualifies for one of the four categories mentioned above.

A few concessioners said it was challenging to determine which category  of funding a repair or improvement qualifies for within a single project. For  example, one concessioner had to replace some carpet, furniture, and dry  wall at a historic lodge due to mold, a project that cost about $50,000.  The concessioner said it was surprised to learn that the repair and  maintenance reserve fund they manage would cover only the dry wall  replacement, which cost about $4,000, and the rest of the expense would  be the concessioner’s responsibility.  Another concessioner said it was  confusing to determine which “bucket” of money to use for improvements  made as part of one project. As a result, the concessioner was still trying  to determine how to account for different parts of this project completed  years ago.

Confusion exists, in part, because the Park Service has not finalized  certain guidance or made it publicly available. Park Service officials said  that the agency provides information on the use of LSI and repair and  maintenance reserve funds to concessioners upon request and that some  information on these topics is in the contracts that concessioners sign.  However, we found that detailed guidance on how to fund particular  repairs and capital improvements was not always readily available and  that some of the guidance for these funding sources is still in draft.  Specifically, the Park Service issued draft guidance on LSI in 2012 and  updated it in another draft dated October 2015, but this guidance has not  yet been finalized and is not available on the Park Service’s website as of  December 2016. Two concessioners said that the agency’s list of fixtures  that qualify for LSI, which are listed in the guidance, periodically changes,  adding to the challenge of determining what qualifies for LSI. Similarly,  the Park Service has developed internal guidance on the use of repair  and maintenance reserve funds, but this guidance is also not available on  its website for concessioners to consult, as of December 2016.

Under Standards for Internal Control in the Federal Government,  agencies should communicate with external parties to achieve their  objectives. According to Park Service officials, one of their goals in  implementing the 1998 Concessions Act was for the Park Service to  improve the maintenance of concessioner-assigned buildings. However,  confusion about how to fund maintenance and capital improvements will  likely continue without finalized guidance that is publicly available to  concessioners. This could lead to delays in undertaking needed  maintenance projects and capital improvements, which could further  contribute to the agency’s deferred maintenance in concessioner- assigned buildings, which was over $400 million in fiscal year 2015,  according to Park Service officials.

section_title: Commercial Services’ Strategic Plan May Address Many of the Challenges We Identified, but Lacks Certain Elements Needed for Successful Implementation
paragraphs: The Park Service developed a 5-year commercial services program  strategic plan in 2015, to help improve the commercial services program,  including concessions management. This plan was an update to the  commercial services improvement plan that had been place for the prior  10 years.  According to agency officials, the 2015 strategic plan provided  the agency with an opportunity to review progress made on past goals  and establish new plans going forward. The Park Service developed this  plan based on interviews with concessioners, consultants, and park unit  staff, according to a senior Park Service official. As a result, the strategic  plan recognizes many of the challenges that we also identified in our  interviews with Park Service officials and concessioners. For example,  the plan has a goal to improve the prospectus and contract award  process which aims to reduce costs and improve efficiency to the  government and bidders. Similarly, the plan aims to attract more bids for  concessions contracts, increase the accuracy of financial reporting, and  increase the percentage of concessions staff who receive training.

While the Park Service’s strategic plan recognizes many challenges that  the concessions program faces, we found that the plan is missing  quantifiable and measurable performance goals, which would help ensure  that these challenges are addressed. Specifically, the plan identifies  various performance measures, but it has no related targets or time  frames, which would clearly identify the level of performance the agency  is trying to achieve and by when. For example, within the goal to improve  the prospectus and contract award process, the agency has identified  four performance measures, one of which is “change in percent of  responses to prospectuses (increase).” While the plan notes that Park  Service is aiming to increase the percent of responses, which provides a  sense of what the agency is trying to achieve, it does not state by how  much (target) or by when (timeframe)—two key aspects of a performance  goal. According to agency officials, the strategic plan is still a work in progress, and the agency plans to develop a process to track  performance in 2017. Until this effort is complete, it is unclear whether  this process will include targets and timeframes.

As we previously found, a critical element in an organization’s efforts to  manage for results is its ability to set meaningful goals for performance  and to measure progress towards these goals. The performance  planning and reporting framework put into place by the Government  Performance and Results Act of 1993 (GPRA), as updated by the GPRA  Modernization Act of 2010, provides important tools to decisionmakers.  For example, agencies are to develop performance goals that define the  level of performance to be achieved in each fiscal year, and express  those goals in an objective, quantifiable, and measureable form. Without  clearly defined performance goals that would provide a basis against  which results can be compared, it will be difficult for the Park Service to  track its progress in these areas and determine where additional effort  may be needed to address identified challenges to the concessions  program.

section_title: Conclusions
paragraphs: Concessioners help to provide a range of services to visitors to national  park units. The Park Service has made positive changes in many of the  areas that we identified as challenges in our 2000 report, such as  obtaining more centralized information to oversee the concessions  program. However, in some instances required reports from  concessioners were not provided on time or those submitted contained  incorrect financial data that was not identified in the review process.  Without more timely and accurate financial data from concessioners, the  agency could be limited in its ability to oversee certain aspects of the  concessions program, such as whether concessioners have paid  franchise fees.

In addition, Park Service officials and concessioners identified ongoing  challenges with the concessions program. Specifically, some  concessioners said they find it challenging to determine how to fund  maintenance or capital improvements on buildings or land they can be assigned under their contracts. This is, in part, because some guidance in  this area is not finalized or publicly available to concessioners.

The Park Service’s strategic plan for the commercial services program  recognizes many challenges facing the concessions program and has  identified goals that may address some of them. However, this plan lacks  performance goals with targets that specify desired outcomes and  timeframes. Without clearly defined performance goals, it will be difficult  for the Park Service to track its progress in addressing these challenges  and determine where additional effort may be needed.

section_title: Recommendations for Executive Action
paragraphs: To help improve oversight of the concessions program, we recommend  that the Secretary of the Interior direct the Director of the National Park  Service to take the following three actions:  review the financial reporting process and make any necessary  adjustments to help ensure timely and accurate reporting of data on  annual financial reports;  finalize guidance on maintenance and capital improvements and  make it publicly available to concessioners; and develop performance goals with targets and timeframes in its  commercial services strategic plan.

section_title: Agency Comments
paragraphs: We provided a draft of this report to the Department of the Interior for  review and comment. The GAO Audit Liaison from the Department of the  Interior responded via e-mail, stating that the department agreed with our  recommendations and providing technical comments, which we  incorporated as appropriate.

As agreed with your offices, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies of this report to the  appropriate congressional committees, the Secretary of the Interior, and  other interested parties. In addition, the report will be available at no  charge on the GAO website at www.gao.gov.

If you or your staff members have any questions about this report, please  contact me at (202) 512-3841 or fennella@gao.gov. Contact points for  our Offices of Congressional Relations and Public Affairs may be found  on the last page of this report. GAO staff who made major contributions to  this report are listed in appendix III.

section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: Our objectives were to examine (1) how the concessions program has  changed since our 2000 report and (2) any ongoing challenges in the  concessions program.

To address these objectives, we examined relevant laws, regulations, and  Park Service documents. Specifically, we examined the National Park  Service Concessions Management Improvement Act of 1998 (1998  Concessions Act), its associated regulations, and the National Park  Service Concessions Policy Act. We examined the Park Service’s draft  guidance on commercial services, known as Reference Manual 48A,  along with guidance on repair and maintenance reserve accounts, and  draft guidance from 2012 and 2015 on leasehold surrender interest. We  reviewed some of our prior reports on the concessions program. In  particular, we reviewed our 2000 report on the concessions program,  which identified management challenges facing the concessions program  prior to the implementation of the 1998 Concessions Act. We also  examined the Park Service’s commercial services program strategic plan,  which includes initiatives to help address challenges in the concessions  program, and compared this plan with our past work on leading practices  in strategic planning, as applicable.

In addition, we obtained and analyzed data on concessions contracts  from the Park Service. Specifically, we analyzed administrative data that  were provided to us in April 2016 on the concessions contracts in place,  the services they provided, and their contract terms. We used these data  to conduct various analyses, including identifying the number  concessions contracts, the services offered under these contracts, and  whether these contracts were under an extension. We analyzed financial  data on concessions contracts, including their gross revenues and  franchise fees paid, for 2015, the most recent year for which data were  available. We used these data to determine the gross revenues that were  generated under concessions contracts and the franchise fees that were  paid. To determine the reliability of these data, we interviewed agency  officials who were familiar with these data and conducted electronic  testing of these data. We found these data to be sufficiently reliable for  our purposes, which included providing information on the number of  contracts, the services provided under contracts, the number of contracts  under extension, and the total gross revenues and franchise fees in the  concessions program. In our report, we noted some limitations in the  financial data. Specifically, we found that some annual financial reports  for the year 2015 were missing and that some of the financial reports  contained incorrect data. However, we concluded that we could still use  the financial data in our report because of the small number of contracts  that had data issues, and we concluded that the data we report on total  gross revenues and franchise fees would not be substantially affected by  the data issues we identified.

We interviewed Park Service officials at the headquarters, regional, and  park unit levels to better understand staff qualifications and training, the  concessions program, as well as their perspectives on ongoing  challenges in the program. We used a standard set of questions to obtain  information on these topics. At the headquarters level, we interviewed the  chief of the commercial services office, who oversees the concessions  program, along with the branch chiefs of all four branches of the  commercial services office—Asset Management, Planning and  Development, Financial Analysis, and Contract Management. At the  regional level, we interviewed regional commercial services chiefs in all  seven regions—Alaska, Intermountain, Midwest, National Capital,  Northeast, Pacific West, and Southeast—as well as concessions staff in  these offices who help to manage the concessions program. At the park  unit level, we interviewed concessions staff involved in managing  concessions at 20 park units that had one or more concessions contracts.  Specifically, we interviewed staff from 2 park units in person (Mount  Rainier and Olympic national parks) and staff from the remaining 18 park  units via phone to ask about their experiences in managing concessions  contracts. We selected a range of parks that varied by region; the number  of visitors to the park; type of park (i.e. scenic versus historical); and the  size of the concessions program at these parks. We interviewed officials  from at least two park units in all seven of the Park Service’s regions.  Appendix II lists the park units that we contacted and information on the  concessions contracts in these parks.

We also interviewed 21 concessioners, including at least one  concessioner that operated in each of the 20 parks we contacted, to  understand their perspectives on the concessions program. We selected  a range of concessioners that varied by the gross revenues their  operations generated and the types of services they provided under their  contracts. We used a standard set of questions to obtain their views on  the concessions process and any challenges they face. To identify the  most common challenges mentioned in our interviews, we performed a  content analysis of the answers to our interview questions for the 48  interviews we conducted with Park Service officials and concessioners.  For reporting purposes, we categorized their responses as follows:  “several” represents an answer mentioned in more than 10 of these  interviews; “some” represents an answer mentioned in 7 to 10 of these  interviews.

We also interviewed two trade groups, the National Park Hospitality  Association and America Outdoors Association because they represented  a variety of concessioners in the program. In addition, we conducted  interviews with stakeholders who were familiar with the concessions  program, including consultants that help the Park Service implement the  program, academics in the hospitality field, and lawyers who represent  concessioners. The views from the interviews we conducted are not  generalizable to all parks, concessioners, or stakeholders, but they were  used to provide a range of perspectives on the concessions program.

We conducted this performance audit from January 2016 to February  2017 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.

section_title: Appendix II: Information on Concessions Contracts at Selected Park Units
paragraphs: Table 7 provides information on the number of, gross revenues, and  services offered under concessions contracts at park units we contacted.

section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact

section_title: Staff Acknowledgments
paragraphs: In addition to the individual named above Elizabeth Erdmann (Assistant  Director), Scott Heacock, and Carmen Yeung made key contributions to  this report. Additional contributions were made by Penny Berrier, Anna  Brunner, Greg Campbell, Antoinette Capaccio, Cindy Gilbert, Benjamin T.  Licht, Ying Long, Guisseli Reyes-Turnell, and Dan Royer.

Fast facts: Have you ever purchased a postcard or eaten a meal at a national park? Chances are you bought it from a concessioner. The National Park Service managed nearly 500 concessions contracts in 2016 that provided visitor services like lodging, food, and retail sales.

The Park Service has taken steps to address issues we've previously identified in its concessions program, including a lack of qualified staff and inadequate oversight, but ongoing challenges remain.

We recommended ways to improve the Park Service's concessions program, including better defining their performance goals so that they can measure progress towards achieving them.

Question-summary annotations: questions: question: What changes has the Park Service made to its concessions program since a 2000 GAO report was issued?
answer: The Department of the Interior's National Park Service (Park Service) has made several changes to its concessions program since GAO issued a report on the program in 2000.
child_questions: question: What issues did GAO highlight in its 2000 report?
answer: In that report, GAO highlighted three management challenges: (1) inadequate qualifications and training of concessions staff; (2) backlog of expired contracts that were extended; and (3) lack of accountability in the concessions program.

question: How do those discoveries contrast with what GAO found in this review?
answer: In this review, GAO found that the Park Service has taken steps to address these challenges:

questions: question: What has Park Service headquarters increased its involvement in?
answer: Accountability: Park Service headquarters has increased its involvement in the concessions program and has centralized more information on the program.

question: What issue did GAO discover with the Park Service's data collection?
answer: However, in some instances, GAO found that some financial reports that were to be submitted by concessioners to the Park Service were not submitted in a timely manner or data in the submitted reports were inaccurate. Park Service staff did not identify these discrepancies when reviewing the reports.
child_questions: question: How might this issue negatively affect the Park Service's data processing?
answer: Without timely and accurate financial data from concessioners, the agency could be limited in its ability to oversee certain aspects of the program such as determining whether concessioners paid required fees.

questions: question: What challenges did GAO identify in the concessions process?
answer: GAO identified some ongoing challenges in each of the three steps of the concessions process. First, developing a prospectus, which provides information on a concessions operation to potential bidders, can be a lengthy and expensive process, and it can be hard to generate competition. Second, the agency's evaluation panels can sometimes have difficulty assessing some proposals, and the award process can be lengthy. Third, contract management can be affected by limited staffing and confusion among concessioners about how to fund maintenance and capital improvements on buildings or land assigned to them by the Park Service.
child_questions: question: Why is there confusion among concessioners?
answer: This situation is, in part, because the Park Service has not yet finalized related guidance and made it publicly available to concessioners.

question: How will the Park Service's commercial services strategic plan address these challenges?
answer: The Park Service's commercial services strategic plan recognizes many of the challenges GAO identified and lists goals to potentially address them. For example, the plan has a goal to improve the prospectus and contract award processes by reducing costs and improving efficiency to the government and bidders. In addition, the plan aims to attract more bids for concessions contracts, increase the accuracy of financial reporting, and increase the percentage of concessions staff that receive training.
child_questions: question: What issues does this plan have?
answer: However, these goals do not have targets or timeframes for their completion.
child_questions: question: How might cause difficulties for the Park Service?
answer: Without clearly defined performance goals that contain targets or timeframes, it will be difficult for the Park Service to track its progress in these areas and determine where additional effort may be needed to address identified challenges in the concessions program.

questions: question: What does the 1988 Concessions Management Improvement Act govern?
answer: The 1998 Concessions Management Improvement Act governs concessions services at national parks.
child_questions: question: How are concessions services managed under the Park Service?
answer: In 2016, the Park Service managed 488 concessions contracts, and such contracts generated about $1.4 billion in gross revenues in the prior year. Under these contracts, companies and individuals operate businesses in parks, including lodges, restaurants, and recreational services.

question: What was GAO asked to review?
answer: GAO was asked to review the concessions program.