National Park Service: Information on Special Account Funds at Selected Park Units
Released: 1996-06-17T00:00:00

Letter

Background

Over the years, the Park Service’s basic mission of protecting the national park system for the enjoyment of current and future generations has not changed. Since the first park unit was created at Yellowstone over 100 years ago, the system has grown to encompass 369 units covering about 80 million acres and includes parks, monuments, and historic sites. The value of the infrastructure of buildings, roads, bridges, utility systems, and other facilities constructed to provide access to or to make use of natural resources on Park Service lands has grown to an estimated $35 billion. In addition, the Park Service’s duties and responsibilities have expanded to include protecting endangered and threatened species, maintaining or restoring environmental quality, identifying and assessing the effects of its own activities on the environment and natural resources, and developing long-range plans.

Recognizing the continuing growth and popularity of the national park system and the Park Service’s increasing responsibilities, the Congress has increased appropriations to operate and maintain the Park Service by more than 30 percent (in constant dollars) over the past 10 fiscal years to about $1.1 billion in fiscal year 1994. However, despite these funding increases, we and others have shown that the health of the national park system is deteriorating. As recently as August 1995, we reported that the scope and quality of services for visitors within the park system have been declining and that many park units lack sufficient data to determine the overall condition or trend of their cultural and natural resources.

The Congress and the Department of the Interior have taken measures to help deal with the parks’ deteriorating conditions. Among other things, additional funding sources have been made available to park units. Specifically, park units have been permitted to keep some of the funds that are generated from in-park activities without going through the annual congressional appropriations process. We are referring to these funds as special account funds.

Sources and Amounts of Special Account Funds Throughout the Park Service

Park Service headquarters officials identified eight special accounts and provided us financial data for these accounts. The total value of these accounts was about $45 million in fiscal year 1994. Of the eight accounts, five are authorized to recover the costs of particular in-park activities. The other three accounts are not designed to recover costs, but provide park units with cash and noncash benefits to be used for a variety of purposes within the parks. In fiscal year 1994, according to data provided by the Park Service, the cost-recovery accounts totaled $6.5 million; the noncost-recovery accounts were valued at $38.5 million. Following are descriptions of each of these eight special accounts.

Living History

The living history account is used by park units that offer special interpretive programs or sell merchandise that interprets the history of the park unit. For example, at Lowell National Historical Park, tours of a restored 19th century cotton mill are provided so that visitors can experience the actual workings of this historic industrial facility. Park units charge for these kinds of activities and use the funds collected to sustain the interpretive program and the production of merchandise. In fiscal year 1994, 30 park units used the living history account; the total amount collected was $2.2 million.

Special-Use Permits

Special-use permits are issued by park unit managers for activities within a park unit when a service or privilege is provided to a visitor beyond that received by the general public. When fees are charged, the parks are to recover and retain the costs of providing the necessary services associated with the permitted activity. At the park units we visited, the associated costs were usually personnel costs of the park unit employees needed to oversee the permitted activity. Weddings, receptions, television commercials, and filmmaking are types of activities that required permits and supervision by park unit personnel, and fees were charged accordingly. In fiscal year 1994, 98 park units had special-use fees. In total, $3.8 million in fees was collected in fiscal year 1994.

Mess Operations

A park unit uses the mess operations account for collections made for food provided by the Park Service to Park Service and state employees in the field. These employees include firefighters and trail maintenance crews. In fiscal year 1994, three park units used this special account, and $68,000 was collected.

Leasing Historic Properties

The Park Service also leases historic properties within park units to tenants who pay rent. The rental revenue is then used to maintain the property. In fiscal year 1994, seven park units used this special account, and $285,000 was collected.

Damaged Park Resources

The damaged park resources account is used by park units to recover from the public the cost of restoring damaged resources. When a resource is accidentally damaged, the park unit recovers whatever costs it can from those who damaged the resource and applies those funds to restoring the resource. In fiscal year 1994, seven park units used this special account, and the total amount collected was $128,000.

Donations

Donations to an individual park unit include cash from the general public that is put in the donation boxes at visitors’ centers as well as checks that are mailed by individuals, corporations, or other groups. If a donation is not marked for a specific purpose, the park unit manager has discretion in how to spend it. In fiscal year 1994, the donations at 273 park units totaled $8.2 million.

Cooperating Associations

Cooperating associations generally support a park unit by providing staff at bookstores, volunteers who assist in interpretive programs, and/or cash. Park unit managers work with cooperating association staff to determine the types of support to be provided. Nationwide, there are 65 cooperating associations serving almost every park unit. In fiscal year 1994, the services and cash these associations provided were worth $16.4 million.

Concessioners’ Special Accounts

Over the past few years, the Park Service has been requiring that the concessioners in park units establish commercial bank accounts into which the concessioners deposit funds for improving, rehabilitating, and constructing the facilities that directly support their services. The use of these accounts has increased over the past few years as park unit managers look for ways to improve the facilities that serve visitors beyond what is normally provided through the annual appropriations. Expenditures from concessioners’ special accounts are to be made only for improvements authorized by park unit managers. For example, replacing a roof on a lodge could be paid for from a concessioner’s special account.

According to data from the Park Service’s headquarters, in fiscal year 1994, 21 park units had this type of account; headquarters officials estimated that the deposits totaled $13.9 million. However, Park Service officials acknowledged that the data were not complete because the Park Service did not have a system in place for fiscal year 1994 to routinely or systematically collect information on concessioners’ special accounts. In March 1995, the Park Service introduced a computerized tracking system for concessioners’ special accounts to address this situation. Although the system is still being implemented, Park Service officials stated that it should provide more complete data on the number of concessioners’ special accounts and the amounts in them for fiscal year 1995.

Table 1 provides information about the eight special accounts for which the Park Service provided us information. It shows the number of park units that used each account, the total amount in each account, and the legislative authority for each account.

Information on Funds in Special Accounts at 27 Park Units

To provide a perspective on the amount of special account funds available at individual park units, we gathered information on a judgmental sample of 27 park units that included 20 of the largest parks in the national park system. The details on the amount of funds in special accounts at these park units are included in appendix I.

In collecting this information, we found that, except for concessioners’ special accounts, there were no significant differences between the amount of special account funds reported by Park Service headquarters and the amounts reported to us by the parks. While the Park Service’s headquarters reported $13.9 million in concessioners’ special accounts nationwide, the 27 park units in the sample reported to us a total of $19.4 million—a difference of $5.5 million. Park Service officials explained most of the discrepancies as primarily due to park unit managers’ differing interpretations of what is to be included in concessioners’ special accounts. Table 2 compares the funds available in concessioners’ special accounts as reported by Park Service headquarters with the amounts reported by the 14 park units in our sample that had such accounts.

We discussed the $5.5 million difference between the Park Service headquarters’ total for concessioners’ special accounts and the individual figures we obtained at the 14 park units with concession officials at Park Service headquarters. On the basis of these discussions, we found that the discrepancies were due to differing interpretations among Park Service concessions officials—both at headquarters and at the individual park units—as to what should be counted as concessioners’ special accounts.

For example, the $7.909 million in concessioners’ special accounts reported to us by a Yellowstone National Park concession official includes funds for a cyclic maintenance program which had $3.6 million in deposits for fiscal year 1994. According to Park Service headquarters officials, these deposits should not be considered as a concessioners’ special account because the $3.6 million is money that is used to fulfill normal contractual maintenance requirements. However, a Yellowstone National Park concession official told us that this fund was established so that the concessioner could repair and maintain the historic structures which had fallen into disrepair due to neglect by the previous concessioner. According to the Yellowstone National Park concession official, maintenance provided by these funds is not routine; it is more extensive than that required of other concessioners, such as the preservation of historic log structures, because of the poor condition of the structures. We have included the $3.6 million in our totals because, as indicated by a Yellowstone National Park concession official, the expenditures from this account are over and above normal maintenance and similar to expenditures made from concessioners’ special accounts at the parks we visited.

According to Park Service headquarters officials, other differences between what the park units and headquarters reported could be due to different reporting cutoff dates between the concessioners and the Park Service so that some deposits appeared in a preceding or succeeding year. For example, Statue of Liberty National Monument officials reported to us $1.425 million in concessioners’ special accounts for fiscal year 1994, while Park Service headquarters included this amount as a fiscal year 1993 deposit.

Park Service management has been aware of the problem with tracking concessioners’ special accounts since at least May 1992. At that time, we reported on the Park Service’s inability to track accounts set aside by concessioners to improve government-owned facilities that they used (a forerunner to concessioners’ special accounts). In response to our recommendation that the Park Service develop procedures to track these accounts, the Park Service introduced its “Special Account Tracking System” in March 1995. Although still in the process of implementing this system, concession officials at headquarters thought it would improve the accuracy and consistency of the data maintained by Park Service headquarters on concessioners’ special accounts for fiscal year 1995. Once this system is fully implemented, we plan to review whether it is providing more accurate information.

Special Account Use Was Consistent With Authorized Purposes

To determine whether special accounts were being used for authorized purposes, we conducted detailed, on-site reviews of expenditures at six park units. The six park units used six of the eight types of special accounts. These park units did not receive any income from leasing historic properties or have any damaged resources that were subject to reimbursement. Our review showed that the special account expenditures at the six park units were consistent with the purposes for which the accounts were established. However, we noted that a concessioners’ special account with deposits of $299,500 had been improperly established at one park unit. No expenditures had been made from the account, however, and park unit officials are in the process of taking action to correct the situation.

Cost-Recovery Accounts—Living History, Special-Use Permits, and Mess Operations

The six park units we visited had three special accounts that were essentially for recouping the costs of specific in-park activities. These cost-recovery accounts were for living history demonstrations, special-use permits, and mess operations.

Two of the six park units we visited had living history accounts, and they used most of the fee revenues to defray the salary expenses of the park unit employees who provided special tours or educational experiences. The remaining funds were used to purchase supplies to support these activities.

At Lowell National Historical Park, staff provided tours of the locks and floodgates of the canal surrounding the town and provided interpretation for the Boott Cotton Mills Museum, including the weaving room and interactive exhibits about the industrial revolution. In addition, under a cooperative agreement with the University of Massachusetts, teachers provided educational experiences to students, including such hands-on activities as working on an assembly line, weaving, and role-playing as immigrants and inventors. In fiscal year 1994, the park unit collected $164,000 from the Boott Cotton Mills exhibits and the educational program with the University of Massachusetts. As authorized, the fees from these activities were used to pay the salaries of the teachers and the park unit employees that provided the services and to purchase supplies to support the activities.

Carlsbad Caverns National Park also used the living history account. At Carlsbad, visitors are charged a fee to tour portions of the caverns with fragile or sensitive resources that need protection or when the number of tour participants must be limited due to physical conditions or some other reason. For example, because touring the Hall of the White Giant cavern requires crawling through tight passageways and some free climbing, knee pads and gloves are recommended, and the number of participants in each tour group is limited to eight. In fiscal year 1994, $170,000 was collected by the park unit in fees from these tours that were deposited into its living history account. The fees were used to pay the salaries of the park rangers that provided the tours.

Five of the park units we visited had issued special-use permits during fiscal year 1994 and were collecting fees for the expenses incurred by the park unit as a result of the activity for which the special-use permit was issued. In fiscal year 1994, the Jefferson National Expansion Memorial collected $76,000; Mesa Verde National Park collected $1,000; Grand Canyon National Park collected $71,000; Lowell National Historical Park collected $7,000; and Sequoia and Kings Canyon National Parks collected $11,000.

The specific types of special-use activities at these park units varied considerably. For example, the activities at Sequoia and Kings Canyon National Parks included weddings and cabin rental management, the activities at Grand Canyon National Park included commercial filming and whitewater rafting, and the activities at Mesa Verde National Park included photography workshops.

The five park units that charged for special-use permits generated about $166,000 for fiscal year 1994 from these activities. In most instances, the expenses incurred were the salary costs of park unit staff who provided the special services. Other costs were for support expenses, such as supplies. The documentation we reviewed indicated that the expenditures supported only special-use activities.

Sequoia and Kings Canyon National Parks used the mess operations account for collections made for meals furnished by the Park Service to Park Service and state employees—firefighters and trail maintenance crews—in the field. In fiscal year 1994, Sequoia and Kings Canyon National Parks collected $39,000 that was used to provide meals and purchase food preparation equipment.

Noncost-Recovery Accounts—Donations, Cooperating Associations, and Concessioners

In fiscal year 1994, the National Park Service valued the amount of funds in noncost-recovery accounts at $38.5 million. Funds from these accounts, which are used to provide benefits for a variety of purposes, come from three sources—donations, cooperating associations’ donations, and concessioners’ special accounts. Table 3 shows the amount of funds available during fiscal year 1994 for the three noncost-recovery accounts at the six park units we visited.

The Secretary of the Interior can accept donations and use them for the purposes of the national park system. In fiscal year 1994, donations at the six park units we visited totaled $205,000 and included cash from donation boxes in visitors’ centers or other locations as well as donations sent directly to a park unit.

The expenditures of donated funds varied at the six park units we visited, but all were used to further the purposes of the park system. For example, at Carlsbad Caverns National Park, donations were used to pay overtime salaries and purchase photography supplies. At Grand Canyon National Park, donations were used to purchase a computer and for search and rescue operations. The Jefferson National Expansion Memorial used its donated funds to purchase supplies, pay for training and travel for interpretive staff, and provide educational displays. At Mesa Verde National Park, a computer and printer for the park’s Interpretative Division was purchased with donated funds. Sequoia and Kings Canyon National Parks used donated funds for a trail reconstruction project. Lowell National Historical Park received donations in fiscal year 1994 but reported no expenditures, choosing to spend the donations at a later date when a particular need surfaces. Park units are authorized to do this.

The park cooperating associations were created to aid the Park Service in its mission of education and service. They provide noncash benefits to park units in the form of salaries for the nonpark personnel working in bookstores in visitors’ centers, compensation for the volunteers who help with interpretive and other educational programs, and the publication of park unit newspapers. The cooperating associations may also provide cash donations to the park units.

In fiscal year 1994, the benefits from the cooperating associations at the six park units we visited were valued at $2.8 million. With one exception, the benefits the cooperating associations provided supported education and service to the park units and their visitors as authorized. For example, at the Jefferson National Expansion Memorial, the cooperating association provided the park with 44 full-time and part-time paid cooperative staff to assist visitors in the Museum of Westward Expansion, the Old Courthouse, the park library, and at various other exhibits. In addition, the association paid for travel and training for Park Service employees in the interpretive branch for a total donation of $985,000 in fiscal year 1994.

At Grand Canyon National Park, donations valued at $1.2 million from the cooperating association provided a stipend and paid other expenses, such as uniforms and supplies, to students who worked part-time in all areas of the park and paid for about seven full-time association employees who spent about half of their time providing information to visitors in stores run by the cooperating association. In addition, the association provided a new trailside exhibit and renovated the historic Kolb Studio’s bookstore and art gallery.

At Sequoia and Kings Canyon National Parks, cooperating association donations totaled $87,000 in fiscal year 1994. These donations included salaries of 11 part-time guides and 3 part-time ticket collectors for the cave tours, several interpretive exhibits, and free publications, such as the park unit’s newspaper. The cooperating association also provided $3,600 toward the salary of a seasonal park ranger. When the Park Service headquarters official responsible for the cooperating association program visited the park, he told association representatives that this was not an authorized expenditure. At that time, the cooperating association discontinued the practice.

At the other park units we visited—Lowell National Historical Park ($8,000), Carlsbad Caverns National Park ($392,000), and Mesa Verde National Park ($134,000)—the cooperating associations also provided salaries for bookstore staff and published the park unit’s newspaper. Included in the cooperating association’s donation to Mesa Verde National Park were funds toward the construction of a new interpretive center near the park entrance.

Concessioners’ special accounts are contractual arrangements between the Park Service and the concessioners. These arrangements occur when the concessioners and park unit managers agree that the concessioners will establish commercial bank accounts that are to be used to rehabilitate and construct the facilities that directly support the concessioners’ services. These commercial bank accounts are established in addition to, or sometimes in lieu of, franchise fees, which, in contrast, are deposited in the U. S. Treasury. Any expenditures from these special accounts must be authorized by park unit managers.

Concessioners’ special accounts were established at three of the six park units we visited—Mesa Verde National Park, Grand Canyon National Park, and Sequoia and Kings Canyon National Parks. At these park units, deposits to the concessioners’ special accounts totaled $1.4 million in fiscal year 1994. We found that the expenditures from the concessioners’ special accounts at these park units were made for authorized purposes.

Mesa Verde National Park had one concessioner’s special account. The deposits for fiscal year 1994 totaled about $44,000. Expenditures were made from this account to purchase and install bear-proof trash cans at a government-owned, concessioner-operated campground.

Grand Canyon National Park had seven separate concessioners’ special accounts. The deposits to these accounts totaled about $895,000 for fiscal year 1994. Expenditures were made from these accounts for several projects, such as painting and repairing an historic railway depot and leasing a van to transport employees’ dependents to and from the concessioner-operated day-care facility. In several instances, funds had not yet been expended from the concessioners’ special account but were being accumulated to fund more costly projects. For example, a concessioner’s special account with a fiscal year 1994 balance of about $9,900 was earmarked for the construction of a backcountry toilet facility estimated to cost about $40,000.

When we visited Grand Canyon National Park, we identified one concessioner’s special account where the concessioner had made deposits of about $299,500 for 1994. The funds deposited into this concessioner’s special account had, in previous years, been deposited into the U.S. Treasury as franchise fees. We noted, however, that the deposits to the concessioner’s special account had occurred before the effective date of the agreement between the concessioner and park unit officials to establish the account. Since then, action has been initiated by park unit officials to remove the 1994 payments from the concessioner’s special account and deposit them into the U.S. Treasury. In addition, park officials told us that deposits occurring after the effective date of that agreement were going into the concessioner’s special account.

At Sequoia and Kings Canyon National Parks, the concessioner’s special account was used to replace the Grant Grove food market, which was destroyed by fire in 1992. This was a government-owned, concessioner-operated facility and was a major project for the park. Construction on the building began in July of 1994 and was completed in the spring of 1995 at a total cost of about $1.2 million.

Agency Comments

We provided a draft of this report to the Department of the Interior for its review and comment. We met with officials from the Office of the Assistant Secretary for Fish, Wildlife, and Parks, including the Assistant to the Assistant Secretary; the Office of the Solicitor; and the National Park Service to obtain their comments. Generally, these officials agreed that the information provided in the report was accurate. In response to their comments, we incorporated technical corrections and clarifying information into this report where appropriate.

We performed our review between April 1995 and April 1996 in accordance with generally accepted government auditing standards. Our scope and methodology are explained in appendix II.

As requested, unless you publicly announce its contents earlier, we plan no further distribution of this report until 30 days after the date of this letter. At that time, we will make copies available to interested congressional committees and Members of Congress; the Secretary of the Interior; the Director, National Park Service; and other interested parties. We will also provide copies to others upon request.

Please call me at (202) 512-3841 if you or your staff have any questions. Major contributors to the report are listed in appendix III.