TABLE OF CONTENTS

• Executive Summary
• Foreward
• I. Introduction
• II. Washington’s Current Political Climate
• III. Washington State’s Park System
• IV. The Privatization Option
• V. Parks Privatization Efforts in Other Jurisdictions
• VI. Conclusion

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Privatization Opportunities for Washington State Parks

by Jeff Hanson, Research Analyst
January 2000

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Executive Summary

Washington state’s current political climate is conducive to fundamental reform. With the passage of Initiative 695, elected officials will find it difficult to ignore the many state residents who insist that government can spend its existing resources more efficiently.

The Washington State Parks and Recreation Commission is an agency that would especially benefit from efficiency improvements, given its well-publicized budget strains. In August 1998 the Commission declared that it may have to close up to forty state parks, citing the park system’s $35 million maintenance backlog and the prospect of budget cuts. The budget cuts never materialized, the parks were not closed, but the maintenance backlog remains.

Privatization is a well-established technique for improving the delivery of government services. By substituting the creativity of the marketplace for government monopoly, privatization can often lower costs, improve service levels and allow government to focus on its core functions.

Privatization has been applied with success to the operation of government-owned parks. Several park systems in North America contract out a significant share of their operations. Among them are the provincial park systems of Alberta, British Columbia and Ontario. Their approaches vary, but their privatization efforts have helped them confront their own budget challenges. Washington state’s park planners should learn from the experiences of these park systems and apply those lessons to reform the operation of Washington state’s parks.

By granting Washington State Parks the flexibility to contract out operations where appropriate, lawmakers would respond to voter demand for greater efficiency, while helping to secure the future of the state’s parks.

Foreword by State Senator Dino Rossi

Washington state voters have once again stated that they believe they are overtaxed and that their government needs downsizing. The passage of Initiative 695 is the most recent in a string of voter-approved measures sending that message. The challenge for state policy makers is to determine the best response to the call to reduce our tax burden.

In 1998, the State Parks and Recreation Commission considered closing as many as forty state parks because of financial constraints. While the Legislature was able to continue the funding for operations of all parks in 1999, the passage of I-695 adds new challenges. Faced with the choice of closing parks or raising taxes after I-695, some may argue that closing parks is the choice that must be made.

However, as the research of the Washington Institution Foundation demonstrates, that is a false dilemma. More than a challenge to maintain state services, the passage of I-695 presents an opportunity to make government more efficient and effective. It forces the Legislature and state agencies to look for smarter ways of doing business, and to look at proven success stories around the nation and beyond.

As this study documents, one proven approach to improving park operations and lowering costs is privatization. The experiences of the North American park systems cited in this study offer important lessons for Washington state’s park planners. Whether through the use of service contracts for individual park functions (prevalent in Ontario) or through the contracting out of a park’s entire operations (customary in British Columbia and Alberta), privatization can lower costs and improve levels of service. BC Parks, for example, estimates that contracting out has resulted in 20 percent-per-year savings.

The recommendations offered in this study would grant Washington State Parks the ability to contract with private-sector providers. Such flexibility would signal a seri-ous commitment to improving park operations. Park dollars are scarce, and Washington state taxpayers and park visitors deserve no less than our best effort to lower costs, improve service, and maintain current levels of access to our wonderful park system.

A change in culture is needed in Washington government—a change that refocuses government on its core functions and withdraws from the unnecessary ones. Most importantly, government must reform public services that can be performed to equal or better quality standards by private contractors at lower costs. Introducing privatization will bring about competition. Competition drives quality and value.

As this study demonstrates, Washington’s parks and recreation system is an ideal place to start applying this principle.

I. Introduction

Like most state park systems across the country, the Washington State Parks and Recreation Commission (State Parks) faces a substantial maintenance backlog. Not surprisingly, the agency has requested a substantial budget increase. Such an increase, though, seems as remote today as ever, given Washington voters’ resounding demand for greater efficiency in government. Under these circumstances, even advocates of big government must admit that the most feasible solution for State Parks is to identify savings opportunities within its existing budge.

Privatization is one well-established technique for improving the delivery of government services. Several North American park systems have improved their operations by contracting out services, which is the most common privatization approach. Washington state lawmakers should learn from these experiences and grant State Parks the flexibility to contract out operations, as appropriate. By doing so, lawmakers will lend support to the state’s parks, while also responding to voters’ demand for improving government operations.

II. Washington’s Current Political Climate

Lawmakers are often at their most innovative when facing severe budget challenges. If, on the other hand, government revenues are strong, then typically more attention is devoted to new spending proposals than to ideas for making current programs more efficient. In Washington state, the economy remains very strong. Real personal income growth has exceeded 3 percent for five straight years; the unemployment rate held at 4.8 percent from 1997 through 1999, lower than at any period in the last three decades.[1] Thanks to the strong economy and the constraints imposed by the Initiative 601 spending limit, Washington state’s current General Fund budget reserve exceeds $1 billion, or about 10 percent of the state’s annual General Fund expenditures.

Yet even with the state’s strong economy, Washington’s current political climate is conducive to fundamental and positive reform of the state’s park system. Our optimism is based on recent political activity in Washington state.

A. The Park Closure Threat

Though its budget is comparatively small at less than one-half of one percent of the state’s overall General Fund expenditures, the Washington State Parks and Recreation Commission has generated substantial media attention in recent years. In August 1998 the commission announced that it might have to close as many as 40 state parks due to budget strains. Earlier in the year Governor Gary Locke had instructed State Parks and most other state agencies to identify options for incorporating a 7 percent reduction in their budget requests. By September, commission staff and a special blue-ribbon panel had recommended which parks ought to close under three different budget-cutting scenarios (see Appendix 1).

Understandably, the prospect of park closures caught the attention of Washington residents, who highly value their state’s parks. Many Republican legislators characterized the closure threat as an election-year scare tactic designed to encourage opposition to Republican-sponsored Referendum 49. The referendum, which passed in November 1998, increased transportation funding and included a modest cut in the Motor Vehicle Excise Tax (MVET).

Ultimately Governor Locke proposed a 1999-2001 budget that spared State Parks from any cuts. Yet the park closure threat resurfaced in the 1999 legislative session. During budget negotiations, some Democratic lawmakers claimed that the House Republican proposal might result in park closures.[2] The Parks and Recreation Commission even held a special hearing to compare publicly the Republican proposal with the two proposals from the Governor and House Democrats. When a commissioner asked if the Republican budget would require employee layoffs or park closures, a State Parks Assistant Director answered, “Yes.”[3]

The extent to which the park closure discussion is politically motivated is of secondary importance to this study. Of direct importance is the fact that the fate of state parks—a topic forever overshadowed by issues such as education, transportation, crime and health care—has now attracted the attention of lawmakers, newspaper editors and voters. Budget pressures might force fresh considerations of park closures. Before reaching that decision, however, lawmakers should consider how to spend current park appropriations more effectively and efficiently. As this paper will conclude, opportunities for privatization and contracting out can help stretch scarce park dollars.

B. Anti-Tax Sentiment in Washington State

Another reason to anticipate meaningful reform of the park system is the anti-tax sentiment prevalent among Washington state voters. On November 2, 1999, 56 percent of voters approved Initiative 695. The “$30 License Tab” initiative cuts Motor Vehicle Excise Tax revenue by more than $1 billion for 1999-2001 and by about $1.7 billion in 2001-03.[4] Initiative 695 also requires voter approval for any new or increased taxes or fees proposed by state or local governments.[5] With the passage of the initiative, Washington lawmakers at all levels of government are faced with a greater urgency to identify and implement cost-saving opportunities. As State Senator Mary Margaret Haugen recently observed, “Sometimes when you’re in a crisis situation, you can do some really creative things. Make do with what we’ve got and do as much as we can with it.”[6]

The passage of Initiative 695 continues the trend of Washington voters supporting anti-tax measures. In November 1998, voters approved Referendum 49, a transportation-funding measure that included a modest cut in the car tax. Voters had demanded significant property tax relief in November 1997 by overwhelmingly approving Referendum 47. Four years earlier, voters passed Initiative 601, which has had a dramatic impact on the state’s budget process. Initiative 601 restrains the growth of state government by limiting the increase in General Fund expenditures to population growth and inflation; the initiative also requires a two-thirds supermajority in the Legislature for tax increases.[7]

Washington state residents’ anti-tax sentiment is well-established. Elected officials will find it difficult to ignore the many state residents who clearly believe that the state can spend its existing resources more efficiently. Washington State Parks cannot escape receiving its share of that attention.

C. Recent Interest in Privatization

The benefits of privatization are increasingly gaining attention in Washington state. For example, two recent high-profile performance audits included privatization recommendations. In its much-anticipated 1998 performance audit of the Washington State Department of Transportation’s highways and rails programs, the consulting firm Cambridge Systematics recommended that WSDOT be granted the flexibility to contract out highway maintenance where appropriate.[8] A legislative bill based on this recommendation was introduced in the 1998 legislative session (HB 2892). Though it passed out of the Legislative Transportation Committee by a vote of 17 to 10, the bill never reached the full House.[9] The second high-profile privatization recommendation was included in the 1998 performance audit of Washington State Ferries (WSF). That audit recommended that WSF consider privatizing the operation of its heavily subsidized passenger-only ferry service.[10]

Privatization also received attention in Washington’s 1999 legislative session. SSB 5363, an unsuccessful bill sponsored by Governor Locke, would have created a collective bargaining system for state employees and also would have permitted state agencies more freedom for contracting out through managed competition.[11] Finally, specific to State Parks, a January 1999 hearing of the Senate Natural Resources, Parks and Recreation Committee included discussion of the possible benefits of privatizing park maintenance and operations.[12]

III. Washington State’s Park System

Washington state’s park system is among the most popular in the country. Its 125 developed parks attracted nearly 51 million visitors in 1998; only the California and New York park systems were more popular.[13] (A map of the state park system is included as Appendix 2.) The vast majority of visitors utilize the parks as day-use destinations. State parks attract visitors looking to “picnic, fish, bicycle, boat, rock climb, hike, swim, ski, [or] participate in an innumerable amount of activities.”[14]

Washington’s parks are also popular among campers. In 1998 there were 2.1 million overnight stays at the 7,000-plus campsites and other overnight facilities in the system.[15] Washington state’s parks offer a variety of overnight options: sites for tents, utility sites for recreation vehicles, yurts (circular, domed tents) with hardwood floors, cabins, vacation houses, lodges and even a lighthouse keeper’s house at Fort Canby.

A. Budget History

State Parks’ 1999-2001 operating budget of $89.2 million represents a 15 percent increase over its previous biennial budget. Since 1989-91, State Parks’ operating budget has increased nearly 50 percent; for comparison, inflation has increased over that same period by about 31 percent.[16]

The growth in the department’s budget, however, is misleading if one does not account for the operating impacts of new programs or facilities. The $29.6 million increase in State Parks’ budget from 1989-91 to 1999-2001 includes $13.5 million for new programs or facilities.[17] Leaving these additions aside, State Parks’ budget has increased 27 percent over that period, lagging slightly behind inflation.

B. State Parks and the Private Sector

The private sector currently plays a modest, though not insignificant, role in Washington state’s parks. In fiscal year (FY) 1998, leases and concessions generated about $585,000 in revenue for State Parks.[18] The three most profitable agreements are for Tillicum Village (Blake Island), Sun Lakes golf course and the Mount Spokane ski area.[19] Another example is Fort Worden, in Port Townsend, where food service and janitorial work are contracted out.[20] The Parks Commission also recently approved a proposal to solicit bids from soft-drink companies for vending machines in the state’s parks; the department expects the program will generate annual profits in “the six-figures.”[21]

State Parks also contracts with private companies for capital projects and for some maintenance in its operating budget. Capital projects, those with costs exceeding $25,000 or an expected life of 13-or-more years, are competitively bid. State Parks’ 1997-99 capital budget was nearly $29 million (which was separate from its $77 million operating budget).[22] Maintenance projects within the agency’s operating budget fall in one of three categories: preventative, planned or emergency maintenance.[23] Preventative maintenance is performed by agency staff or volunteers, while planned and emergency maintenance work may be done in-house or by contract.[24] Of the $2.8 million spent on these three categories in 1997-99, about $700,000 of the work was competitively bid.[25]

C. State Parks’ Maintenance and Repair Requests

Assuring adequate preventative maintenance is a perennial problem for public agencies, from which Washington’s parks have not been exempt. State Parks has recently detailed a $32.7 million maintenance backlog. That figure includes $23.1 million in “minor facility preservation projects,” which are competitively bid, and $9.6 million in “immediate maintenance and repairs,” which are typically done by park staff. The figure for immediate maintenance and repairs represents only the costs of materials. If one includes the labor costs for these associated projects, the total maintenance backlog is substantially higher; according to State Parks, labor costs for these projects would amount to about double the material costs. Table 1 displays the maintenance requests by project type.[26]

State Parks has also identified $8 million in equipment needs, ranging from mowers and chain saws to heavy equipment such as trucks and tractors. The figure reflects replacement costs for equipment that is at least 10 years old and has exceeded its life expectancy.[27] Equipment replacement costs, though, should not be considered “needs” in the same sense as are maintenance needs. After all, one advantage of contracting out activities such as maintenance is to shift these equipment costs to private providers, where different incentives can result in lower overall costs.

D. State Parks’ Operational Requests

In addition to its maintenance and equipment requests, State Parks has asked for substantial increases in its operational budget. Two documents reflect the agency’s perception of its budget needs: its 1999-2001 budget request and its February 1999 report to the Legislature on its operational funding needs.[28] One might characterize its budget request as its politically constrained appeal and its report to the Legislature as its “wish list.”

State Parks’ 1999-2001 operating budget of $89.2 million includes funding for 605 full-time equivalent (FTE) positions, an increase of $11.8 million and 37 FTEs from 1997-99.[29] These increases, however, fell well short of State Parks’ request for $101.9 million and 649 FTEs. Included in its final budget was $3.1 million and 2 FTEs for visitor and ranger safety, substantially lower than State Parks’ request for $8.7 million and 39 FTEs.[30] For its maintenance backlog, the department requested $4 million, but its final budget did not include funding for deferred maintenance. A $2 million appropriation, however, may be used for maintenance or ranger safety, provided State Parks is able to enhance park revenues.[31]

In its 1999 report to the Legislature—its “wish list”—State Parks identified far more substantial operational “needs.” The department used the following operational standards: each park would have at least one ranger and one additional park ranger or aide working during operational hours; split shifts would be eliminated; each management area would have an eight-month office assistant; and maintenance staffing would increase by an amount sufficient to complete immediate maintenance and repair projects over two biennia. Table 2 summarizes the perceived needs using these operational standards.[32]

As is evident from Table 2, the State Parks and Recreation Commission favors substantial departmental growth. The additional 288 FTE positions identified in Table 2 would represent a staggering 48 percent staffing increase over existing levels.[33] The additional $24.6 million in ongoing associated costs is similarly substantial, especially in light of the additional equipment and maintenance requests identified earlier.

Couple the substantial maintenance needs of Washington’s parks with the anti-tax sentiment of the state’s residents and one would expect that park planners would have little choice but to consider all options to improve the efficiency of park operations.

E. Absence of Day-Use Fees

When considering the Washington state park system it is important to recognize the extent to which the agency is dependent on General Fund support. In FY 1998, overall park revenues accounted for a mere 32 percent of operating expenses, with the balance covered by general tax dollars.[34]

Certainly, one reason why State Parks is so dependent on General Fund support is the fact that Washington is one of only ten states that does not charge day-use fees (entrance fees) at any of its parks.[35] As a result, camping revenues account for about 70 percent of total park revenues, despite the fact that only 4.2 percent of total park visits are overnight visits.[36] The Parks and Recreation Commission has proposed day-use fees in the past, only to have the proposals rejected by either the Legislature or the governor. Discussion of day-use fees remains common. The Republican-sponsored 1999-2001 House budget proposal included a pilot day-use parking fee program; the pilot proposal, however, was not included in the final operating budget.

The extent to which the absence of day-use fees explains State Parks’ heavy reliance on general tax support is debatable. In a previous study, this author contends that with properly designed entrance fees State Parks can approach, if not achieve, self-sufficiency, with annual day-use revenue potential exceeding $20 million.[37] On the other hand, State Parks estimates that a seasonal $3 parking fee at 72 parks would only generate about $3.6 million per year in new revenues, with $1.7 million in annual collection costs (plus $1.4 million in one-time start-up costs).[38] Two Seattle-based outdoor recreation authors have even gone so far as to question whether revenues would exceed collection costs: “Just because some other states have instituted day-use fees does not mean that such fees are, in fact, net revenue producers.”[39] (If it were true that State Parks—managing a system that attracts 50 million day-use visitors—is unable to recover enough day-use revenue to pay for its collection costs, then one must conclude that the department is astonishingly inefficient.)

IV. The Privatization Option

It is clear that Washington State Parks has legitimate budget concerns. It would seem all the more urgent, therefore, for State Parks to identify and take steps to improve efficiency. Lawmakers and park planners ought to consider privatization options as a way to improve efficiency, improve services and attract private capital investment in the state’s parks.

A. Types of Privatization

“Privatization” is a broad term. It can refer to techniques ranging from the use of volunteers to the complete shedding of a government service. The most common privatization technique involves the contracting out of a service that a government previously supplied in-house.[40]

The contracting out of park operations is the focus of this study. One approach is to contract out individual functions such as park maintenance, custodial work, fee collection or security service. Another technique is to contract out the entire operation of an individual park; an operator is then responsible for all or nearly all park functions. In Canada, Ontario Parks makes extensive use of individual service contracts; Alberta’s park system typically contracts out the operation of entire parks; British Columbia Parks relies on 100 percent contracting of park operations. These and other examples of park privatization efforts are examined further in a later section.

B. Goals of Privatization

Privatization is increasingly seen by public policy analysts and lawmakers as an approach to improve the delivery of government services. As a result of privatization efforts in the 1990s by leaders such as Indianapolis Mayor Stephen Goldsmith and former Massachusetts Governor William Weld, policymakers can have even greater confidence that the theoretical benefits of privatization will translate into real-world successes. Privatization is not appropriate in all cases, but often by substituting the creativity of the marketplace for government monopoly, the harnessing of competitive forces can achieve one or more of the following goals:

C. Legal Barriers to Contracting Out

To take full advantage of the benefits that privatization opportunities offer, lawmakers ought to relax the legal restrictions that make privatization difficult in Washington state. Among the barriers are the state’s limits on contracting out.

As a general rule, a state agency cannot contract out services that state employees have traditionally performed, unless specific legislative authority is granted.[41] Two appellate court decisions are discussed below. The first is the landmark 1978 decision that established the restrictive interpretation noted above. Next we discuss a 1994 decision that relies on an exception to the general rule.

1. Spokane Community College Case

In Washington Federation of State Employees v. Spokane Community College, the State Supreme Court ruled that the state’s civil service law prohibited Spokane Community College from contracting out maintenance and custodial services at its new administration building.[42] The college had projected annual cost savings of $210,000 by contracting out these services at this and other new buildings. Though no existing public employees would have lost their jobs if the work was contracted out, the Spokane court nevertheless ruled against the college. According to the court’s reasoning, contracting out is not permitted in those cases “where a new need for services which have been customarily and historically provided by civil servants arises, and where there is no showing that civil servants could not provide those services.”[43] In response, the Legislature enacted RCW 41.06.380, which codified the Spokane decision, but also exempted those services that had been contracted out prior to the decision.[44] Thus, contracting out traditional duties such as park landscape maintenance would be prohibited by Spokane and RCW 41.06.380.

2. “Jiffy Lube” Case

A 1994 Court of Appeals decision clarified the Spokane rule by stating that contracting out is permitted if it is no longer practicable for civil servants to provide a service. Police vehicle maintenance was at issue in Joint Crafts Council and Teamsters Local 117 v. King County, also know as the “Jiffy Lube” case.[45] In 1987 King County instituted a “Car Per Officer” (CPO) program, which assigns a vehicle to each officer. Under the program, each officer uses that vehicle while on duty and keeps it at his or her home when off duty. For vehicle maintenance, officers take their vehicles to conveniently located private repair shops, rather than to the county’s centralized maintenance facility.

Citing the county’s rationale for implementing the program (among the stated goals were to improve scheduling efficiency, heighten officer morale, and enhance police visibility), the court ruled in favor of the county and against a coalition of labor unions:

In light of the purposes and goals of the CPO program, we hold that, upon implementation of the CPO program, it was no longer practicable, from other than a strictly cost savings perspective, for civil servants to continue to perform maintenance and repair services on police vehicles.[46]

In other words, because the CPO program—which was instituted for reasons other than simply saving money—requires multiple service locations, it was no longer practicable for civil servants to provide vehicle maintenance.

The “Jiffy Lube” exception may well apply to a range of contracting out activities, such as the complete operation of a park or the furnishing of a new service, where the decision to contract out is program-driven rather than cost-driven.

3. Granting a Legislative Exemption for State Parks

The legal obstacles to contracting out are based on judicial interpretation of statutes, not on constitutional interpretations. Thus, the Legislature and governor are free to relax or eliminate these prohibitions by enacting appropriate legislation exempting an agency from RCW 41.06.380. Simply granting an agency the discretion to contract out services is not sufficient, however, because that authority could be limited through the collective bargaining process.[47] An appropriate solution requires legislation with language similar to a provision in an unsuccessful 1998 bill to privatize highway maintenance: “The department of transportation may purchase maintenance services by contract with individuals or business entities. . . . As prescribed in RCW 41.06.150 (13), a discretionary decision by the department to purchase maintenance services by contract is not a bargainable issue.”[48]

V. Parks Privatization Efforts in Other Jurisdictions

In this section we examine the experiences of five park systems in North America. The list is not exhaustive, but serves to illustrate a range of examples relevant to Washington State Parks. Interestingly, four of the five examples are privatization efforts of Canadian provincial park systems. Yet their inclusion is unsurprising given that Canada’s park systems have faced budget pressures even more severe than those plaguing park systems in the United States.

A. Alaska: Response to a Mini-Crisis

Beginning in the 1990s Alaska State Parks began contracting out the operation of a small number of campgrounds.[49] Currently the department contracts out seven parks. The parks are small and isolated, attracting few visitors and low revenues. Because of their isolation, the parks were costly (relative to revenues) for the department to maintain. Rather than close the parks outright, Alaska Parks decided to contract them to private operators. Contract lengths are short, running from one to five years. In return for meeting maintenance standards, operators keep the camping fees and have their commercial use permit fee waived. With one exception, where an operator’s aggressive sales of firewood led to many customer complaints, the contracting-out experience has succeeded. Doing so has enabled the department to keep parks open that would have otherwise closed.

Indicative of the department’s satisfaction with contracting out, Alaska Parks is currently proceeding with a plan to contract out the operation of a “top-flight” park, Eagle River. Alaska State Parks is now soliciting letters of interest for the park.

B. Newfoundland: Response to a Larger Crisis

The experience of Newfoundland is significant because of the magnitude of its privatization efforts. Unlike the Washington state parks system, Newfoundland’s provincial park system is small with overwhelmingly primitive sites. In 1997, faced with a $1.8 million[50] cut in its small budget of $3.2 million, Newfoundland’s Parks and Natural Areas Division privatized 21 of its 34 provincial parks.[51] The 21 privatized parks were rural, primitive parks, with low usage.[52] All parks remain public land (Crown Land); some agreements are leases of duration of up to fifty years, while others are short-term “licenses to occupy.” Essentially wilderness parks without utility hookups, lease payments are on the order of hundreds of dollars per year. Significantly, during their first season, 13 operators at the privatized parks made capital improvements, thus using profit incentives instead of tax dollars to mobilize resources to upgrade park facilities.[53] No longer draining the provincial budget, these parks are now modest revenue producers that, with the capital upgrades, better serve the public.

C. Ontario: Service Contracts for Individual Park Functions

In 1996 Ontario’s provincial park system[54] was reorganized along a “business model.”[55] To improve its degree of self-reliance, Ontario Parks was granted the ability to retain and manage its park revenues through a special account. Previously, revenues went to the general government and thus their “return” was subject to the unpredictability of the budget process with no necessary correlation to consumer satisfaction or park utilization. The current system gives park managers a “bottom-line” test comparable to the private sector for determining how well they are servicing their customers. Also to improve its self-reliance, Ontario Parks committed to increasing the role of the private sector in the delivery of its services.[56]

Ontario Parks makes extensive use of service contracts to maintain and operate its parks. Its 116 service contracts, totaling $3.7 million, cover activities such as janitorial services, grounds maintenance and enforcement services. The decision to contract out services varies from park to park. Quite simply, if savings are projected, the department will use a service contract. In the northern region of the province, contractors are not as readily available, which makes the service contract option more costly.

Of particular interest is Ontario’s experience contracting out security services. Recall that Washington State Parks has requested a substantial increase in the number of park rangers on its payroll, in large part to address its ranger safety concerns. Ontario Parks currently contracts out security services at two large recreational parks. The department is pleased with the results and has taken steps to extend the practice to other parks in the system.

With five of its small recreational parks, Ontario contracts out the entire operation of the parks. Since park revenues now stay within the system, Ontario Parks has decided to use “full park contracting” less often. Of three parks with full contracts recently up for renewal, only one had the contract extended. Again, though, the department decides on a case-by-case basis, based on fiscal projections.

Ontario Parks contracts out its central reservation system to Bluewater Parklands Management. Campsite reservations are taken 24 hours a day, 365 days a year. The system will soon accommodate Internet reservations.[57] Washington State Parks will consider contracting out the operation of its central reservation system when its current software contract expires this year.[58] The Bluewater experience demonstrates how the mental habits ingrained by competition frequently result in private-sector providers being more customer-oriented than are government agencies: currently, phone reservations for Washington state’s parks (Reservations Northwest) are taken Monday through Friday, 8 a.m. to 5 p.m. only, and the system does not yet accommodate Internet reservations. Reservations Northwest also advises interested campers to avoid calling on Mondays or Tuesdays, its busiest days, thus admitting that it is not adequately prepared to handle peak calling periods.[59] Private-sector operators like Bluewater almost instinctively staff to serve peak demands and are not restricted by the traditional government work week.

Ontario’s parks have charged day-use fees since the 1960s. In 1997, Ontario Parks introduced differential fees. In place of the previous uniform fee of $7 per vehicle, the department began charging a fee ranging from $5 to $10 depending on market demand (e.g., based on time of year, day of week, popularity of park), thus using the price mechanism to respond to different customer demands.[60]

Since its reorganization in 1996, Ontario Parks has increased revenues and decreased its dependence on general tax support. Since the reforms, Ontario Parks’ cost recovery on operating and capital expenditures has increased from 45 percent to 70 percent.[61]

D. British Columbia: 100 Percent Contracting of Operations

British Columbia’s park system is extensive. In FY 1998, BC Parks attracted 23.8 million visits, 2.7 million of which were overnight camping visits at more than 300 camping areas.[62] FY 1998 expenditures totaled nearly $34 million.[63] In 1988, BC Parks began using private-sector contractors to operate its parks; by 1992 the department contracted out 100 percent of park maintenance and operations.[64]

The contract length for park operations is short: two years, though the contract can twice be renewed for three additional years per renewal. In return for operating the parks, the contractors retain all camping and firewood fees, plus receive an “efficiency payment” to cover additional operating costs. Unlike Ontario, BC Parks does not charge for day use. Thus, department expenditures are required to compensate private operators for maintaining and operating day-use facilities. BC Parks also bundles some day-use only parks with overnight parks in single contracts. Operators are responsible for minor repairs, while the department is responsible for larger, “operational repairs.” In FY 1998, park-facility operators retained $8.3 million in campground revenues.[65]

BC Parks’ practice of contracting out park operations has proven successful. In FY 1998 visitor satisfaction was high: 81 percent of visitors rated park facilities and services as excellent or above average.[66] The department has also realized substantial savings, estimated at 20 percent on average.[67]

E. Alberta: A Comprehensive Restructuring of the Park System

Like British Columbia Parks, Alberta’s park system makes extensive use of private-sector operators. Alberta Environmental Protection, which oversees the provincial park system, announced a new management strategy in May 1997. At that time, 92 percent of all campsites in the system were already maintained or operated by private-sector providers.[68] The 1997 restructuring provides an excellent example of how a government agency can identify its core mission and utilize the private sector where appropriate.

Alberta’s “Completing the Puzzle” management strategy identifies four program goals: preservation, heritage appreciation, outdoor recreation and tourism. Based upon that site’s contribution to these four goals, Alberta Environment classified each park or protected area in the system as one of two management categories: Natural Heritage Sites (NH) or Recreation Facility Sites (RF). RF sites contribute primarily to outdoor recreation; NH sites contribute primarily to preserving significant natural landscapes, often contribute significantly to heritage appreciation, and may also serve the recreation and tourism goals.[69] Department resources are focused on NH sites, especially on “flagships parks” that contribute to all four goals. Of the department’s 536 recreation and protected areas, 258 are designated NH sites and 278 are RF sites.[70] As a percentage of total landbase, however, NH sites account for 97 percent of the network.[71]

With its new park management plan, Alberta Environment has “shift[ed] its emphasis towards the preservation, conservation, and heritage appreciation aspects of its legislated mandate while redefining its role with respect to outdoor recreation and tourism, which remain significant components of the mandate.”[72] The department enlists private operators in those program areas where the private sector is firmly established. Doing so helps free department resources from routine operational and maintenance duties, allowing them to focus more on planning and managing protected landscapes and resources inventory, delivering heritage appreciation and environmental education, managing contracts and partnerships, and coordinating volunteer efforts.[73]

Alberta Environment attempts to contract out the operation of recreation facilities in both NH and RF sites. Given their different roles within the system, however, the procedures and terms for NH sites differ from those for RF sites. With RF sites, the department seeks to eliminate provincial expenditures. In return, private operators are given greater operating flexibility to improve the site’s economic viability.

NH sites are operated and maintained according to established provincial standards and fees. Alberta’s parks do not charge day-use fees. Departmental supplemental payments are paid to operators, and the department may also dedicate resources for capital development or facility repair.[74] Security and public safety services may or may not be provided by department staff; they are negotiated on a site-by-site basis.[75] In those instances where bid proposals require supplemental payments that exceed what the department’s net costs were to operate the site with its own staff (i.e., when it costs more to contract out), the department will continue to operate the site and uses service contracts for day-to-day operational tasks.[76]

At both NH and RF sites, operators are encouraged to upgrade existing facilities or develop new facilities, but the types of permissible developments are more restricted at NH sites (because of the sites’ significant natural landscapes). Alberta Environment will normally approve development proposals at NH sites (and RF sites) for playgrounds, non-motorized trails, interpretive facilities and other “low-impact” upgrades. Other facility proposals will be considered for approval only after public consultation. Table 3 lists the types of NH and RF facility proposals that will be considered after public consultation, and those that are precluded from consideration at NH sites.[77] As evident from the table, the department and the public retain control to ensure that the environmental integrity of NH sites is protected.

All capital enhancements become the property of Alberta Environment (at no cost) at the expiration of an operating agreement.[78] To encourage capital investment proposals, the department will extend the standard five-year term of an operating agreement according to the following: investments between $50,000 and $149,999 will extend the term to 7 years; $150,000-299,999 qualifies for a 10-year term; $300,000-$749,999 equals 15 years; and more than $750,000 in investment will result in negotiated terms up to 25 years.[79] Terms are extended only if development plans are identified in the operator’s initial proposal. If an operator later submits a capital investment proposal, the term of the agreement is not extended due to government restrictions on public tendering.[80] Private operators would prefer greater flexibility in this area, since a longer contract is often essential to acquiring a sufficient loan and since capital upgrade possibilities may not become apparent until after taking over operation of a park.[81] Even with this limitation, the incentive approach tying length of lease to level of capital investments has proven successful; typical improvements include electrification of sites and concession buildings.[82]

Private operators are given greater flexibility in RF sites in order to enhance their economic viability. With RF sites, Alberta Environment does not provide supplemental payments to operators, no department resources are committed to capital improvements and the department will provide enforcement services at higher-use RF sites only on a fee-for service basis.[83] Because revenues at RF sites must be sufficient to cover all operating, maintenance, security and enhancement costs, prospective operators are able to submit one of two types of proposals.[84] Under an RF Strategy 1 (RFS1) proposal, an operator must comply with the standards and operating criteria set by Alberta Environment. If prospective operators do not consider a site economically viable under such standards, they have the option of submitting an RF Strategy 2 (RFS2) proposal. At an RFS2 site, the operator outlines its standards and fees in its annual plan, yet forfeits the opportunity to be visually identified and promoted as a provincial facility and does not have the option of using rangers on a fee-for-service basis. When evaluating proposals, Alberta Environment gives preference to RFS1 submissions.[85] Currently there are 38 RFS2 sites in the network.[86]

It is important to recognize that the absence of day-use fees can limit the effectiveness of contracting efforts. Neither British Columbia nor Alberta charges day-use fees. BC Parks’ operating agreements include supplemental payments to operators. In Alberta, NH sites include supplemental payments, but RF sites do not. Private operators, of course, are required to accommodate day visitors and maintain those areas. Even if an operating agreement includes a lump-sum payment to cover day-use associated costs, an operator is tempted to cut corners on maintenance in day-use areas. After all, profits are increased by attracting more overnight visitors; operators are neither penalized nor rewarded directly based on the number of day visits. With day-use fees, a private operator has another revenue source and has incentive to attract more day visitors.

Even if lawmakers choose to continue subsidizing day-use visits out of general tax dollars, the problem can be minimized if operators were supplemented with a variable payment based on the number of day visitors rather than a lump-sum payment as in Alberta in British Columbia. Under such an arrangement, operators would have incentive to attract day-use visitors. The department would either need to estimate day-use attendance itself or monitor operators’ attendance figures.[87]

Alberta Environment’s heavy reliance on private-sector operators has helped the department withstand budget reductions, while at the same time increase the size of its recreation and protected areas network. Between FY 1993 and FY 1997 the department saw its budget reduced $11 million; another $6 million was eliminated in FY 1999.[88] Despite the reductions, Alberta Environment added 34 undeveloped sites to the network over a 25-month period beginning in March 1995.[89] Visitor satisfaction is high, according to 1998 visitor surveys. On a scale of 1 (low) to 5 (high), overall visitor satisfaction averaged 4.2 across all parks, ranging from 3.66 at the lowest-rated park to 4.68 at the highest-rated.[90]

VI. Conclusion

The experiences summarized above offer lessons for Washington state’s park planners, who must confront a maintenance backlog and budget strains. Most fundamental, Washington State Parks ought to be given the flexibility to tap private-sector providers where appropriate as a way to reduce costs, improve service levels and focus on its core mission. Also as evident above, more than one privatization approach can lead to these benefits. A properly designed reform of State Parks would include enough flexibility to identify and implement the approach most suitable for each individual park. Naturally, the details of implementation should ensure that current agency employees are treated fairly.[91] A reform plan should include the following steps:

Reduce State Parks to its Core Mission. Washington state park planners ought to emulate Alberta’s comprehensive evaluation and restructuring of its park system. Like Alberta, Washington State Parks should redefine its role with respect to outdoor recreation and focus department resources on its core mission: preservation and heritage appreciation. Like the City of Rancho Palos Verdes, California, State Parks likely will find that a number of recreational activities it offers are currently provided at a reasonable price by private organizations.[92]

Grant State Parks the Authority to Contract Out Services. Washington state lawmakers should exempt State Parks, if not all state agencies, from state law restricting agencies’ ability to contract out services (RCW 41.06.380).

Contract Out the Campsite Reservation System. Campsite reservations at Oregon or Washington parks are currently handled by Reservations Northwest, which is staffed by Oregon Parks personnel. To improve efficiency and increase service levels (e.g., around-the-clock phone and internet reservations), State Parks should solicit bids from private call centers. Several states and Ontario have contracted out their campsite reservation systems with successful results.[93]

Contract Out Operation of Parks on Closure List. In September 1998, State Parks and a blue-ribbon panel identified up to forty parks for closure (See Appendix 1). To preserve these parks, which the state has concluded are low priority, State Parks should immediately evaluate their suitability for privatization through long-term lease, as was done in Alaska and Newfoundland.

Transfer Title to Selected Parks on Closure List. Some parks designated for closure should be considered for transfer to nonprofit or community-based organizations dedicated to conservation and recreation. New York City’s famed and widely used Central Park, for example, is managed by the Central Park Conservancy.[94] Another option is for State Parks to transfer some parks to local governments. In December 1999 the Parks and Recreation Commission transferred Moses Lake State Park to the City of Moses Lake.[95]

Contract Out Building and Grounds Maintenance on a Pilot Program Basis. Lawmakers should introduce a pilot program to contract out routine maintenance of buildings and grounds at a variety of state parks, as is common in Ontario Parks.

Contract Out Security Service and Other Individual Functions on a Pilot Program Basis. State Parks should address its ranger- and public-safety needs, in part, by implementing a pilot program to contract out security services at various parks. Ontario Parks has successfully used service contracts for security services. State Parks should also evaluate other individual functions, some of which may also lend themselves to contracting out.

Contract Out the Operation of Entire Parks on a Pilot Program Basis. In addition to parks on the closure list, State Parks should contract out the entire operation of other individual parks. The experiences of Alberta and British Columbia reveal the success that can accompany full park contracting. Again, the department should use the approach at a variety of parks on a pilot program basis. Design of the pilot program should recognize the extent to which contract length can serve as a tool to encourage needed capital investment.

Pilot programs can determine which contracting-out techniques are most appropriate for specific types of parks, while allowing State Parks to learn the techniques of successful contract management. To facilitate these goals, park planners should select a diverse set of parks: urban/rural, large/small, day-/camping-oriented, revenue winners/losers, and so on. Certain parks may prove best-suited for full contracting and others for individual service contracts. In other cases the most efficient solution may be to continue to have park staff provide the services.[96]

Washington State Parks faced serious budget pressures well before Initiative 695 surfaced. Since the initiative’s passage, lawmakers have an even-greater urgency to identify and implement cost-saving opportunities. By granting Washington State Parks the flexibility to contract out operations where appropriate, state legislators would respond to voter demand for greater efficiency, while helping to secure the future of the state’s parks.

Appendix 1: Parks Identified for Possible Closure by Parks and Recreation Commission

About the Authors

Jeff Hanson is a Research Analyst at the Washington Institute Foundation, where he works on state and local tax and budget issues, as well as privatization topics. He previously worked for the Evergreen Freedom Foundation and for the California Legislature. A native of Stanwood, Washington, Jeff received a master’s degree in International Studies from the Claremont Graduate University in Claremont, California. He earned a bachelor’s degree in political science and mathematics from Linfield College in Oregon.

Dino Rossi, the author of the foreword, is a State Senator representing the 5th Legislative District, which includes parts of South and East King County. Senator Rossi currently serves as Ranking Republican Member of the Senate Ways and Means Committee. He also serves on the Senate Natural Resources, Parks and Recreation Committee.

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[1] Office of the Forecast Council, Washington State. Washington Economic and Revenue Forecast, November 1999 (Olympia, Washington), Table A1.3, p. 84.

[2] Thomas Shapley, “GOP Budget Could Close State Parks, Democrats Say,” Seattle Post-Intelligencer, 1 April 1999.

[3] Quoted in Thomas Shapley, “Political Move by Parks Commission May Net it Millions,” Seattle Post-Intelligencer, 9 April 1999.

[4] Office of Financial Management, Washington State. “Potential Impacts of I-695” (Olympia, Washington, April 1999).

[5] The findings of a KOMO News poll suggest that support for Initiative 695 is more reflective of anti-tax sentiment generally than of particular distaste for the car tax. Released on September 14, 1999, the KOMO poll found higher support for the provision requiring a public vote for tax or fee increases (74 percent favoring) than for the car tax reduction (69 percent support). (Quoted in O. Casey Corr, “I-695’s Hardly the Monster Depicted by its Opponents,” Seattle Times, 22 September 1999, B4.)

[6] Quoted in Diane Brooks, “County and State Officials Ponder Life After I-695,” Seattle Times, 1 December 1999.

[7] The provisions of Initiative 601 replaced the largely ineffective limitation mechanism of Initiative 62, which passed in 1979 and limited the growth in state revenues to increases in state personal income.

[8] Cambridge Systematics, Department of Transportation Highways and Rail Programs Performance Audit (Report 98-2 for State of Washington Joint Legislative Audit and Review Committee, Olympia, Washington, 13 March 1998), chapter 4.

[9] For a discussion of HB 2892 and, more generally, privatized highway maintenance as it would apply in Washington state, see Dennis Lisk, “Competing for Highway Maintenance: Lessons for Washington State—Part II” (Washington Institute Foundation, Seattle, Washington, January 1999), available at http://www.wips.org/studies/pbhwyii.htm.

[10] Booz-Allen and Hamilton, Department of Transportation Ferry System Performance Audit (Report 98-6 for State of Washington Joint Legislative Audit and Review Committee, Olympia, Washington, 6 October 1998), chapter 9.

[11] See Paul Guppy, “Governor’s Collective Bargaining Bill Challenges Separation of Powers” (Washington Institute Foundation, Seattle, Washington, March 1999), available at http://www.wips.org/Studies/Barg.htm.

[12] Peter Eichstaedt, “Lawmakers Consider Parks Privatization,” The Olympian, 15 January 1999, B1.

[13] The National Association of State Park Directors, “The 1999 Annual Information Exchange” (Tucson, Arizona, February 1999), Table 3A, p. 23.

[14] Washington State Parks and Recreation Commission, “1997-99 Operating Budget Proviso [Part I]: Report to the Legislature” (Olympia, Washington, December 1997), p. 1.

[15] Ibid., Table 3B, p. 24, and Table 2, p. 15.

[16] Budget figures are taken from two sources: Washington State Parks and Recreation Commission. “1997-99 Operating Budget Proviso, Part II: Washington State Parks, Operational Funding Needs” (Olympia, Washington, 19 February 1999); and Cleve Pinnix, Director of Washington State Parks and Recreation Commission, memorandum to Commission, “Review and Discussion of 1999-01 Operating Budget,” 30 April 1999 (http://www.parks.wa.gov/rev99-01.htm). Inflation (implicit price deflator) data are taken from Forecast Council, September 1999 Forecast.

[17] New responsibilities include costs associated with assessing historical structures, complying with the Native American Graves and Repatriation Act and ensuring Y2K compliance. The bulk of new responsibilities, though, is the operating impact of new or upgraded facilities. The figure for new responsibilities is calculated by the author based on information in two sources: for 1999-2001, Pinnix memorandum, attachment A; for 1989-91 through 1997-99, Washington State Parks and Recreation Commission, “History of State Parks Budget,” http://www.parks.wa.gov/budghist.htm. Unlike in the State Parks documents, the estimate above does not classify enhanced revenue authority as a “new responsibility.”

[18] Washington State Parks and Recreation Commission, http://www.parks.wa.gov/revenuhx.htm.

[19] Tom Oliva, Enterprise Coordinator, Washington State Parks and Recreation Commission, phone conversation with author, 24 September 1999.

[20] Ibid.

[21] “State OKs Pop Machines for 125 Parks,” Seattle Times, 25 July 1999.

[22] Office of Financial Management, Washington State. “Capital Project Tracking, State Parks and Recreation Commission” (Olympia, Washington, 29 June 1999).

[23] Preventative maintenance includes mowing of lawns, cleaning, touchup painting, sewage lagoon management, water/sewer testing, fence repair and small roof repairs. Planned maintenance includes the painting of buildings and the replacement of fixtures, pumps, utility hook-ups, service panels, plumbing, broken windows and fences. Emergency maintenance includes repair related to electrical or plumbing failures, road washouts and storm damage. (Rita Cooper, Assistant Director, Administrative Services, Washington State Parks and Recreation Commission, letter to author, 6 December 1999.)

[24] State Parks is able to contract out a portion of its maintenance work because of a provision in the collective bargaining agreement (see the discussion of the Spokane Community College case in the section below entitled “Legal Barriers to Contracting Out”). The bargaining agreement permits State Parks to contract out some work, provided that no state employees are displaced or laid off. In practice, the agency uses contracts for work that would not otherwise be completed (because staff work plans are already full or available staff do not have the expertise for a particular project). (Rita Cooper, Assistant Director, Administrative Services, Washington State Parks and Recreation Commission, phone conversation with author, 10 January 2000.)

[25] Cooper, letter to author, 6 December 1999.

[26] A summary of maintenance needs is reported in State Parks, “Budget Proviso, Part II,” pp. 13-14. That document also lists each maintenance project individually.

[27] Ibid., p. 15.

[28] Ibid. and State Parks, “Budget Proviso, Part II.”

[29] Pinnix memorandum, attachment B.

[30] In December 1998 the Parks and Recreation Commission voted unanimously to arm park rangers. In many parks, rangers work alone at night; in remote areas, timely backup from local law enforcement is not possible. On March 5, 1999, the State Department of Labor and Industries issued State Parks a safety citation for “fail[ing] to furnish and use safety devices and safeguards, and to use practices, means, methods, and operations, which were reasonably adequate to render . . . employment and place of employment safe. . . .” (Inspection number 115311474, Washington Industrial Safety and Health Act [WISHA] Services Division, Olympia, Washington.)

[31] Pinnix memorandum, attachment A.

[32] State Parks, “Budget Proviso, Part II,” pp. 11-12.

[33] As compared to the 598 FTEs needed to maintain existing levels of performance, which State Parks estimated in its 1999-2001 budget request (Pinnix memorandum, Attachment B).

[34] NASPD, “1999 Information Exchange,” Table 5A, p. 29.

[35] Ibid., Table 5D, pp. 34-37.

[36] The remaining 30 percent of revenues come from sources such as environmental learning center fees, concessions and boat launch fees. Attendance data are for FY 1998 from NASPD, “1999 Information Exchange,” Table 3A, p. 23; revenue data are for FY 1998 as reported by State Parks at http://www.parks.wa.gov/revenuhx.htm.

[37] Jeff Hanson, “Toward a Self-Sufficient State Park System: Ensuring Stable and Equitable Parks Financing” (Evergreen Freedom Foundation, Olympia, Washington, 9 December 1998), available at http://effwa.org/publications/inbriefs/8-1.htm.

[38] State Parks, “Budget Proviso, Part II,” Appendix VII, p. 85. The assumptions behind these estimates are contained in a spreadsheet e-mailed to the author on 15 June 1999 (the estimate was calculated by Bethany Lael, Chief of Budget and Policy, Washington State Parks). The assumptions are very conservative: 50 percent of visits are walk-ins or free admission; 40 percent of the remaining visits are lost because of a fee backlash (inconsistent with the experiences of other park systems); 4 persons per vehicle; and so on. Also critical, the hypothetical $3 parking fee does not charge per individual, nor does it vary according to market demand (compare with Hanson, “Self-Sufficient Park System”).

[39] Marge and Ted Mueller, letter to the editor, Seattle Times, 17 November 1998.

[40] William D. Eggers, “Designing a Comprehensive State-Level Privatization Program” (Reason Public Policy Institute, Los Angeles, California, January 1993).

[41] William L. Williams, Senior Assistant Attorney General, Office of the Attorney General of Washington, memorandum to Timothy C. Easton, Pacific Consulting Group, 10 December 1997, included in Cambridge Systematics, Department of Transportation Audit, Appendix 5.

[42] 90 Wn.2d 698, 585 P.2d 474 (1978).

[43] Ibid. at 702-703.

[44] Williams memorandum to Easton.

[45] 76 Wn. App. 18, 881 P.2d 1059 (1994).

[46] Ibid.

[47] Williams memorandum to Easton.

[48] Substitute House Bill 2892, 55th Washington State Legislature, 1998 regular session.

[49] The information that follows is from Pete Panarese, Chief of Operations, Alaska State Parks, phone conversation with author, 7 September 1999.

[50] This and all subsequent dollar figures reported in the context of provincial park systems are in Canadian Dollars.

[51] Government of Newfoundland and Labrador, Department of Tourism, Culture and Recreation, “Doing Things Differently,” departmental submission for 1998 Institute of Public Administration of Canada (IPAC) Award for Innovative Management.

[52] Unless otherwise noted, the information on Newfoundland’s experience is from Barry Butt, Director of Land Management Division, Lands Branch, Newfoundland Department of Government Services and Lands, phone conversation with author, 15 September 1999.

[53] Sandra Kelly, Minister of Tourism, Culture and Recreation, Government of Newfoundland and Labrador, “Update on Parks Privatization Initiative,” news release, 18 December 1997. Available at http://www.gov.nf.ca/releases/1997/tcr/1218n05.htm.

[54] Ontario Parks includes 105 operational parks and draws about 8.5 million visits per year. (Ontario Parks, “Ontario Parks: A New Business Model for Ontario’s Provincial Parks,” news release, May 1996. Available at http://www.ontarioparks.com/fsmay96.html.)

[55] Unless otherwise noted, the information on Ontario Parks that follows is from George Scott, Provincial Park Management Coordinator, Ontario Parks, phone conversation with author, 21 September 1999. Comments on the strengths and weaknesses of Ontario’s approach, however, represent this author’s analysis.

[56] Ontario Parks, “New Business Model.”

[57] Greg Maude, Manager, Marketing and Communications Section, Ontario Parks, phone conversation with author, 1 September 1999.

[58] Don Powell, Central Reservation System Manager, Washington State Parks and Recreation Commission, phone conversation with author, 18 August 1999.

[59] Under “Tips for Reservations,” at http://www.parks.wa.gov/rnw.htm.

[60] George Scott, Provincial Park Management Coordinator, Ontario Parks, e-mail correspondence with author, 3 December 1999.

[61] Ontario Parks, “New Business Model” and Scott, phone conversation, 21 September 1999.

[62] British Columbia Ministry of Environment, Lands and Parks, “Annual Report 1998: Parks Division.” Available at http://www.elp.gov.bc.ca/main/annrep/ar98/parks.htm.

[63] Ibid.

[64] Unless otherwise noted, information on BC Parks is from Dave Fauville, Administrative Officer, Recreation Services, Parks Division, British Columbia Ministry of Environment, Lands and Parks, phone conversation with author, 17 September 1999.

[65] BC Ministry of ELP, “Annual Report 1998.”

[66] Ibid.

[67] A staff evaluation from around 1990 estimated 20 percent savings, according to John Block, Manager, Recreation Services, Parks Division, British Columbia Ministry of Environment, Lands and Parks, phone conversation with author, 12 October 1999. Estimate also cited in Ronald D. Utt, “Transferring Functions to the Private Sector,” in Mandate for Leadership IV: Turning Ideas into Action, ed. Stuart M. Butler and Kim R. Holmes (Washington, D.C.: Heritage Foundation, 1997), 151.

[68] Alberta Environmental Protection, Natural Resources Service, “Completing the Puzzle: Building a Recreation and Protected Areas Network for the Next Century,” executive summary, May 1997. Available at http://www.gov.ab.ca/env/parks/strategy/summary.html.

[69] Alberta Environmental Protection, Natural Resources Service, “Completing the Puzzle Implementation Guide,” 22 May 1997.

[70] Gordon Holt, Operations Technologist, Alberta Environmental Protection, e-mail correspondence with the author, 24 August 1999.

[71] Alberta Environment, “Completing the Puzzle” summary.

[72] Alberta Environment, “Completing the Puzzle Implementation Guide,” 14.

[73] Ibid., 14-15.

[74] Ibid., 17, 34.

[75] Alberta Environmental Protection, Natural Resources Service, “Natural Heritage Site: Proposal for Facility Operation,” standard proposal form, 7 September 1999.

[76] Holt, e-mail correspondence, 24 August 1999.

[77] Alberta Environment, “Natural Heritage Site: Proposal” and Alberta Environmental Protection, Natural Resources Services, “Recreation Facility Site: Proposal for Facility Operation,” standard proposal form, 7 September 1999.

[78] “Completing the Puzzle Implementation Guide,” 21.

[79] Ibid.

[80] Holt, e-mail correspondence, 16 September 1999. An operator does have the option, though, of terminating an existing contract, in which case the project would be re-advertised and placed up for bid. The current operator would then have the opportunity to include the newly identified development proposal in a new bid submission. (Holt, e-mail correspondence, 15 December 1999.)

[81] Wayne Webb, President, Provincial Campground Operators Association (Alberta), phone conversation with author, 12 October 1999.

[82] Holt, e-mail correspondence, 14 September 1999.

[83] Alberta Environment, “Recreational Facility Site: Proposal.”

[84] Recall that Alberta does not charge day-use fees. Thus, the operator of an RF site must earn enough in camping and other revenues to cover costs associated with day-use visitors.

[85] Alberta Environment, “Recreational Facility Site: Proposal.”

[86] Holt, e-mail correspondence, 22 September 1999.

[87] Washington State Parks currently estimates day-use attendance by using vehicle counters. If relying on vehicle counts, State Parks would need to take some care to ensure that operators are not attempting to inflate those counts.

[88] Ashley Geddes, “More Privatization of Parks Eyed,” Calgary Herald, 17 September 1996, A1; and Don Martin, “Provincial Campgrounds Have Become Profitable,” Calgary Herald, 17 May 1998, A13.

[89] Alberta Environment, “Completing the Puzzle” summary.

[90] Techneos Information Strategies, “1998 Visitor Profile and Satisfaction Survey, Summary Report” (for Alberta Environmental Protection), p. 11.

[91] For a discussion of this issue, see John O’Leary and William D. Eggers, “Privatization and Public Employees: Guidelines for Fair Treatment” (Reason Public Policy Institute, Los Angeles, California, August 1993).

[92] See Elaine R. Davis, “Private Solutions for Public Service: Opportunities for Privatization in King County” (Washington Institute Foundation, Seattle, Washington, August 1997), p. 12, which is available at http://www.wips.org/Studies/kcpriv.htm.

[93] Among the states that contract out their campsite reservation systems are California, New York, Wisconsin, Texas and Massachusetts.

[94] See Ibid.

[95] The transfer was required as a result of SHB 1718, which passed in the 1999 State Legislative session.

[96] For proper evaluations, it is necessary to calculate accurately the total costs for State Parks to provide a service. Overhead and other indirect costs are frequently overlooked. For a thorough analysis of this issue, see Lawrence L. Martin, “How to Compare Costs Between In-House and Contracted Services” (Reason Public Policy Institute, Los Angeles, California, March 1993).

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