SPEAKERS       CONTENTS       INSERTS    
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45–042 CC

1997

OVERSIGHT HEARING ON FEDERAL VS. STATE MANAGEMENT OF PARKS

OVERSIGHT HEARING

before the

SUBCOMMITTEE ON NATIONAL PARKS AND PUBLIC LANDS

of the

COMMITTEE ON RESOURCES
HOUSE OF REPRESENTATIVES

ONE HUNDRED FIFTH CONGRESS

FIRST SESSION

JULY 10, 1997, WASHINGTON, DC

Serial No. 105–43

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Printed for the use of the Committee on Resources

COMMITTEE ON RESOURCES

DON YOUNG, Alaska, Chairman

W.J. (BILLY) TAUZIN, Louisiana
JAMES V. HANSEN, Utah
JIM SAXTON, New Jersey
ELTON GALLEGLY, California
JOHN J. DUNCAN, Jr., Tennessee
JOEL HEFLEY, Colorado
JOHN T. DOOLITTLE, California
WAYNE T. GILCHREST, Maryland
KEN CALVERT, California
RICHARD W. POMBO, California
BARBARA CUBIN, Wyoming
HELEN CHENOWETH, Idaho
LINDA SMITH, Washington
GEORGE P. RADANOVICH, California
WALTER B. JONES, Jr., North Carolina
WILLIAM M. (MAC) THORNBERRY, Texas
JOHN SHADEGG, Arizona
JOHN E. ENSIGN, Nevada
ROBERT F. SMITH, Oregon
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CHRIS CANNON, Utah
KEVIN BRADY, Texas
JOHN PETERSON, Pennsylvania
RICK HILL, Montana
BOB SCHAFFER, Colorado
JIM GIBBONS, Nevada
MICHAEL D. CRAPO, Idaho

GEORGE MILLER, California
EDWARD J. MARKEY, Massachusetts
NICK J. RAHALL II, West Virginia
BRUCE F. VENTO, Minnesota
DALE E. KILDEE, Michigan
PETER A. DeFAZIO, Oregon
ENI F.H. FALEOMAVAEGA, American Samoa
NEIL ABERCROMBIE, Hawaii
SOLOMON P. ORTIZ, Texas
OWEN B. PICKETT, Virginia
FRANK PALLONE, Jr., New Jersey
CALVIN M. DOOLEY, California
CARLOS A. ROMERO-BARCELÓ, Puerto Rico
MAURICE D. HINCHEY, New York
ROBERT A. UNDERWOOD, Guam
SAM FARR, California
PATRICK J. KENNEDY, Rhode Island
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ADAM SMITH, Washington
WILLIAM D. DELAHUNT, Massachusetts
CHRIS JOHN, Louisiana
DONNA CHRISTIAN-GREEN, Virgin Islands
RON KIND, Wisconsin
LLOYD DOGGETT, Texas

LLOYD A. JONES, Chief of Staff
ELIZABETH MEGGINSON, Chief Counsel
CHRISTINE KENNEDY, Chief Clerk/Administrator
JOHN LAWRENCE, Democratic Staff Director

Subcommittee on National Parks and Public Lands
JAMES V. HANSEN, Utah, Chairman

ELTON, GALLEGLY, California
JOHN J. DUNCAN, Jr., Tennessee
JOEL HEFLEY, Colorado
WAYNE T. GILCHREST, Maryland
RICHARD W. POMBO, California
HELEN CHENOWETH, Idaho
LINDA SMITH, Washington
GEORGE P. RADANOVICH, California
WALTER B. JONES, Jr., North Carolina
JOHN B. SHADEGG, Arizona
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JOHN E. ENSIGN, Nevada
ROBERT F. SMITH, Oregon
RICK HILL, Montana
JIM GIBBONS, Nevada

ENI F.H. FALEOMAVAEGA, American Samoa
EDWARD J. MARKEY, Massachusetts
NICK J. RAHALL II, West Virginia
BRUCE F. VENTO, Minnesota
DALE E. KILDEE, Michigan
FRANK PALLONE, Jr., New Jersey
CARLOS A. ROMERO-BARCELÓ, Puerto Rico
MAURICE D. HINCHEY, New York
ROBERT A. UNDERWOOD, Guam
PATRICK J. KENNEDY, Rhode Island
WILLIAM D. DELAHUNT, Massachusetts
DONNA CHRISTIAN-GREEN, Virgin Islands
RON KIND, Wisconsin
LLOYD DOGGETT, Texas
ALLEN FREEMYER, Counsel
P. DANIEL SMITH, Professional Staff
LIZ BIRNBAUM, Democratic Counsel

C O N T E N T S

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    Hearing held July 10, 1997

Statements of Members:
Faleomavaega, Hon. Eni, a Delegate in Congress from the Territory of American Samoa
Hansen, Hon. James V., a Representative in Congress from the State of Utah
Prepared statement of
Hill, Hon. Rick, a Representative in Congress from the State of Montana, prepared statement of

Statements of witnesses:
Jones, Kenneth B., Deputy Director for Park Stewardship, California Department of Parks and Recreation
Prepared statement of
Leal, Donald R., Senior Associate, Political Economy Research Center
Prepared statement of

Additional material supplied:
PERC, Bozeman, Montana, ''Parks in Transition; A Look at State Parks''
PERC Policy Series, ''Back to the Future to Save Our Parks''

OVERSIGHT HEARING ON FEDERAL VS. STATE MANAGEMENT OF PARKS

THURSDAY, JULY 10, 1997
House of Representatives, Subcommittee on National Parks and Public Lands, Committee on Resources, Washington, DC.

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    The Subcommittee met, pursuant to call, at 10 a.m., Room 1324, Longworth House Office Building, Hon. James V. Hansen, Chairman, presiding.

STATEMENT OF HON. JAMES V. HANSEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF UTAH
    Mr. HANSEN. Good morning. The Subcommittee on National Parks and Public Lands will come to order. I have scheduled this hearing as a continuation of this Subcommittee's longstanding interest in the issue of recreational fees on Federal lands, especially in the National Park System.

    This issue has been a major concern for the Congress for the past 10 years. And this subcommittee, as well as the Committee on Resources, have worked closely with the Budget Committee and the Appropriations Committee to ensure that the American public has the opportunity to enjoy the federally managed lands by paying fair and reasonable recreation fees.

    During 1996, Congress authorized a Recreational Fee Demonstration Program providing the Federal land management agencies far-reaching discretion in creating recreation fee programs during the next 3 years. This Fee Demonstration Program allows the agencies to retain 80 percent of the revenue collected in excess of the amount collected in 1995, with 20 percent returning to the General Treasury.

    Currently, language contained in the fiscal year 1998 Interior Appropriations bill would allow the agencies to retain 80 percent of the revenue in the unit collecting the fee, and the remaining 20 percent to the Federal land management agency. This subcommittee will continue to oversight the progress of this Recreation Fee Demonstration Program. And today's hearing will add valuable insight into the future success of National Park Service recreation fee program.
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    As in many instances, the States are in the forefront of implementing new and creative solutions to old problems. Today, we will hear detailed and interesting testimony concerning how States are addressing the issue of tight fiscal constraints in park budgets by moving from general tax support to user fees to operate and maintain their State parks.

    Although I do not believe that the National Park System should ever reach total self-sufficiency in its operation budget, I do believe that there are many comparisons that can be made from the success of the States in operating and maintaining their parks.

    I welcome Mr. Don Leal, Senior Associate of the Political Economy Research Center, Bozeman, Montana, who will present findings from his recently published policy paper entitled, ''Back to the Future to Save Our Parks.'' I believe that many of us will be surprised to learn that 16 State park systems currently obtain more than one-half of their operating costs from recreation fees, and that many others are heading in that direction.

    Furthermore, I believe that this paper demonstrates that if fees are reasonable and the public is informed that their fees are utilized in the park where collected, there is broad-based support for recreation user fees.

    I also welcome Kenneth B. Jones, Deputy Director for Park Stewardship, California Department of Parks and Recreation, who will provide testimony on the tremendously successful transition the State of California park system is undertaking to address budgetary and management issues.

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    The California park system is unique, consisting of 264 parks covering 1.3 million acres, including 11,000 picnic sites, 17,500 campsites, 280 miles of coastline, and 3,000 miles of trails. With over 70 million visitors enjoying this State system each year, it provides a true benchmark by which to measure our efforts on the Federal level.

    I will let both of our distinguished panelists make their presentations so that we have their ideas and concepts on the table, and then I will recognize members for their questions. But prior to that, I recognize my good friend and colleague from American Samoa, the Ranking Member of the subcommittee, Mr. Faleomavaega. The gentleman from American Samoa.

    [Statement of Mr. Hansen follows:]
STATEMENT OF HON. JAMES V. HANSEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF UTAH
    Good Morning. The Subcommittee on National Parks and Public Lands will come to order.
    I have scheduled this hearing as a continuation of this Subcommittee's longstanding interest in the issue of recreational fees on Federal lands, especially in the National Park System. This issue has been a major concern for the Congress for the past 10 years, and this Subcommittee, as well as the Committee on Resources, have worked closely with the Appropriations Committee to insure that the American public has the opportunity to enjoy federally managed lands by paying fair and reasonable recreation fees.
    During 1996, Congress authorized a Recreational Fee Demonstration Program providing the Federal land management agencies far-reaching discretion in creating recreation fee programs during the next three years. This Fee Demonstration Program allows the agencies to retain 80 percent of the revenue collected in excess of the amount collected in 1995, with 20 percent returning to the General Treasury. Currently, language contained in the fical year 1998 Interior Appropriations bill will allow the agencies to retain 80 percent of the revenue in the unit collecting the fee, and the remaining 20 percent to the Federal land management agency. This Subcommittee will continue it's oversight role to monitor the progress of this Recreation Fee Demonstration Program, and today's hearing will add valuable insight into the future success of National Park Service recreation fee programs.
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    As in many instances, the States are in the forefront of implementing new and creative solutions to old problems. Today, we will hear detailed and interesting testimony concerning how States are addressing the issue of tight fiscal constraints in park budgets by moving from general tax support to user fees to operate and maintain their State parks. Although, I do not believe that the National Park System should ever reach total self-sufficiency in its operations budget, I do believe that there are comparisons that can be made from the success of the States in operating and maintaining their parks.
    I welcome Mr. Don Leal, Senior Associate of the Political Economy Research Center (PERC), Bozeman, Montana, who will present findings from his recently published policy paper entitled, ''Back to the Future to Save our Parks.'' I believe that many of us will be surprised to learn that sixteen State park systems currently obtain more than one-half of their operating costs from recreation fees, and that many others are heading in that direction.
    Furthermore, I believe that this paper demonstrates that if user fees are reasonable, and that the public is informed that their fees are utilized in the park where collected, there is broad based support for recreation user fees.
    I also welcome, Kenneth B. Jones, Deputy Director for Park Stewardship, California Department of Parks and Recreation, who will provide testimony on the tremendously successful transition the State of California park system is undertaking to address budgetary and management issues. The California park system is unique, consisting of 264 parks covering 1.3 million acres, including 11,000 picnic sites, 17,500 campsites, 280 miles of coastline, and 3,000 miles of trails. With over 70 million visitors enjoying this State system each year, it provides a true benchmark by which to measure our efforts at the Federal level.
    I will let both of our distinguished panelists make their presentations so that we have their ideas and concepts on the table, and then I will recognize Members for their questions, but prior to that, I recognize my good friend and colleague from American Samoa, the Ranking Member of the Subcommittee, Mr. Faleomavaega.
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STATEMENT OF HON. ENI FALEOMAVAEGA, A DELEGATE IN CONGRESS FROM THE TERRITORY OF AMERICAN SAMOA
    Mr. FALEOMAVAEGA. Thank you, Mr. Chairman. And, Mr. Chairman, I understand one of the focuses of today's hearing will be on a report issued by a private organization known as the Political Economy Research Center, otherwise known as PERC.

    The report entitled, ''Back to the Future to Save Our Parks,'' is based on the premise that, to use PERC's own words, popular parks can and should pay their own way. I believe this is a seriously flawed premise. We do not operate our national parks like Walt Disney charging what the market will bear.

    Our national parks have value to the Nation whether they are visited by one or 1 million persons. Many members support reasonable fees for visiting national parks with the understanding that the money collected will remain in the parks. As you know, Mr. Chairman, this was the subject of considerable debate in the subcommittee last Congress. The key to fee collection is that is it fair, reasonable, and equitable?

    If we were to follow PERC's recommendation, there would have to be a sevenfold increase in what is currently collected. This is not to say there is not room for improvement, and I will certainly approach today's hearing in that light. If there are ways we can ease the financial problems of our parks in a manner that is fair, reasonable, and equitable, then I am certain that we are willing to consider those options.

    And, Mr. Chairman, at this time, I would like to welcome our witnesses this morning, and I am looking forward to hearing their testimonies. Thank you, Mr. Chairman.
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    Mr. HANSEN. Thank you. We are grateful to our panelists for being here. Thanks so much for coming. We will start with you, Mr. Leal, and then Mr. Jones. Is that all right? And, Mr. Leal, as we say in our business, the floor is yours.

STATEMENT OF DONALD R. LEAL, SENIOR ASSOCIATE, POLITICAL ECONOMY RESEARCH CENTER
    Mr. LEAL. Thank you, Mr. Chairman. I am here today to present the case for returning our popular national parks to the self-supporting parks they originally were intended to be. It is not widely known, but the intent of our early national parks was that they would be self-supporting parks. Congressional appropriations were to be limited to the Initial investments in roads and visitor facilities.

    In 1916, when Congress authorized the creation of the National Park Service, Interior Secretary Franklin Lane appointed Stephen Mather, a successful businessman and millionaire, to run the 14 existing national parks on a self-supporting basis.

    In Mather's first report on parks to the Secretary, he states, ''It has been your desire that ultimately the revenues of several parks might be sufficient to cover the cost of administration and protection, and that Congress should only be requested to appropriate funds for their improvement. It appears at least five parks have a proven earning capacity sufficiently large to make their operation both feasible and practible.'' The five parks were Yellowstone, Yosemite, Mount Rainier, Sequoia, and what is now called Kings Canyon-Sequoia National Parks.

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    Importantly, at this time, park revenues were held in a special account accessible to the Park Service without congressional appropriation. Mather, the Director of the Park Service, considered this important for responsible management because, from the Park Service's perspective, there was a clear link between serving park visitors and having the funds necessary to manage the parks.

    Unfortunately, Congress took control of all financing for parks in 1918 by requiring that all park fees be returned to the Federal Treasury, and this critical link between serving visitors and generating funds for managing the parks was broken. With revenues going to the Treasury and the lion's share of the funding coming from tax dollars, the Park Service has had little economic incentive to serve park visitors.

    Moreover, park budgets have become political footballs. Raising money via allocations from the Treasury has been a matter of first denying customer service or letting park facilities run down in order to provide the necessary political impetus to free up more money for parks.

    I can give you a great illustration of the political problems in our financing. The Superintendent of Yellowstone Park last year announced the closing of two museums in a popular campground called Norris Campground in order to save $70,000, the cost in operating these facilities. And he was right. He would save $70,000 in operating costs.

    But the problem was those three facilities or, excuse me, just the campground alone generated $114,000. In other words, revenue from that operation alone actually surpassed the costs of operating the three facilities. From the Superintendent's perspective, he didn't see the revenue. It all went to the Federal Treasury. So it was rational for him to try to save money by closing the popular campground and the two museums.
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    Contrary to the view that tax-supported parks guarantees long-term protection, our national parks have suffered from poor incentives to maintain themselves. The Park Service says it has a $4.5 billion backlog of construction improvements and a $800 million backlog of major maintenance.

    Are we to assume that our parks have fallen victim to a budget-conscious Congress? The evidence says no. From 1980 to 1995, the total budget of the Park Service nearly doubled from almost $700 million to $1.3 billion. Spending on operation, which includes staffing and wage increases, grew at a healthy inflation-adjusted annual rate of 3.1 percent, and full-time staff increased from 15,836 to 17,216 employees, more than enough to handle visitation which grew by less than 1.5 percent per year. While spending on the agency itself increased, spending for major park repairs and renovations fell at an inflation-adjusted annual rate of 1.5 percent.

    The healthy increase in annual operating expenses has not led to better service in Yellowstone, Yosemite, and other popular parks. According to a recent Consumer's Report survey, the two most frequent complaints were crowded conditions and the lack of adequate visitor servcies. This sad state of affairs is brought about because most of the money to support parks is not earned from park visitors.

    States, however, are showing us that as tax support for their parks declined, State park agencies generated more revenue from users. Spurred by nearly a 41 percent decline in real terms in general tax support for all State parks in the country, user fees collected at all State parks went from $182 million in 1980 or about 17 percent of the total State park spending, to $513 million in 1994 or one-third of total park spending.
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    In contrast, the Park Service collected $94 million representing about 7 percent of total spending by the agency. Like national parks, State parks have increased fees, but they have also raised revenue by being innovative in creating more services for park visitors.

    Moreover, a number of State park systems are showing us that the idea of self-supporting parks, at least operationally, is a feasible goal when heavy reliance on tax support for park operations is no longer a viable option. Faced with dramatic declines in general tax support, 16 State park systems now regularly obtain more than half of their operating costs from user fees.

    New Hampshire State Park System funds its entire $5 million operating budget out of entrance and camping fees, not out of condos or golf courses, but from just entrance and camping fees. In 1991, in the midst of a growing general fund crisis, the legislature required the park system to rely solely on park-generated revenue.

    Park revenue has actually exceeded operating expenditure for three consecutive years prior to passage of the Act, but park receipts have been handed over to the State treasury. The 1991 Act let receipts flow into a park fund that carries over unspent park moneys from year to year. This encourages self-sufficiency because park officials know that they have a reliable source of money dedicated to parks over the long-term.

    Texas is another great example of a State that is weaning itself from public funding. In the early 1980's, the Texas State Park System got almost 60 percent of its operating funding from general State taxes. It now gets 67 percent of its operating funding from user fees.
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    It has also devised institutional reforms to raise revenue and save money. The Texas park management developed the entrepreneurial budget system. This innovative, market based financing system rewards individual parks with larger operating budgets if they surpass their revenue or cost savings targets for the year.

    With financial self-sufficiency as a goal, we can expect better service and greater efficiencies in running our parks. Comparing adjacent State and national parks in Texas, California, and South Dakota where the attractions and the natural amenities are about the same and the market areas are about the same, State parks, relying heavily on user support earn more revenues per acre, spend less per acre, and offer more services than the nearby national parks. And I include those examples in my Exhibits A, B, C, and D in this.

    And now, thanks to Congress, the National Park Service is testing the waters of greater user support. Congress recently authorized a 3-year demonstration program that raises fees and allows greater fee retention. However, I think we need to even go further.

    I think Congress should establish a fixed schedule that gradually reduces annual appropriations for park operations over a 10-year period until it reaches zero like they did in Texas and New Hampshire. Removing the heavy dependency on general funds spurred Texas, New Hampshire, and other State park systems to respond with greater revenue. The Park Service has to face the same reality.

    Congress should allow park managers to institute their own fee-based services as long as these services are compatible with the protection of natural amenities. Most of the fees collected in these parks—95 percent at least—should remain in the park system. A small amount, perhaps 5 percent, could be used to fund the systemwise administration.
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    I also recommend that parks managers should be allowed to keep all cost savings and apply them to the budget for subsequent years. And, finally, each park should have a special park endowment fund for capital improvements. Capital allocations from the Treasury have a way of going to the creation of new parks instead of maintaining the existing ones.

    Giving park managers a capital fund dedicated to the individual park and the wherewithal to finance it with road tolls, surpluses from the operating revenues, as well as other avenues will help them generate the needed capital to support the park.

    Of course, some parks will not attract enough visitors or have enough commercially valued assets to be self-supporting. If these parks are to remain in the public domain, they should be funded separately out of general funds and not be subsidized by the high-use parks because this would weaken the incentives for revenue generation. These parks could also be turned over to private nonprofit groups with a one-time endowment to fund maintenance.

    Requiring popular parks to be self-supporting, at least operationally, is the surest way of spurring responsible management and financial accountability. The idea of self-supporting parks is what early park supporters had in mind near the turn of the century when we were a much poorer Nation. Surely, with our higher incomes today, we as users of parks can afford to pay these amenities and help make our parks the treasures they should be. Thank you very much, Mr. Chairman.

    [Statement of Mr. Leal may be found at end of hearing.]
    [PERC Policy Series may be found at end of hearing.]
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    [Park report may be found at end of hearing.]
    Mr. HANSEN. Thank you, Mr. Leal; appreciate your excellent testimony. Mr. Jones, we will turn the time to you, sir, and thank you for being here.

STATEMENT OF KENNETH B. JONES, DEPUTY DIRECTOR FOR PARK STEWARDSHIP, CALIFORNIA DEPARTMENT OF PARKS AND RECREATION
    Mr. JONES. You are welcome. Thank you. Good morning, Mr. Chair, members. On behalf of Governor Pete Wilson and the California State Parks Director, Donald Murphy, who has testified before this committee before, it is a privilege to be here today to talk about the many changes California State Parks has gone through over the past several years and the bright prospect for our future.

    Earlier this year, our system's creative efforts in raising revenue and decreasing dependence on taxpayers was praised as pioneering by the Wall Street Journal. We are proud of our work in this field, but we are especially proud that our work in this area has not detracted from our mission and values, but it has been wholly consistent with them. In fact, we have become better stewards of California's most cherished natural and cultural resources.

    Let me begin by giving you an overview of the system we manage today. California State Parks manages 264 parks and other properties covering 1.3 million acres. Each year, 70 million visitors enjoy our 11,000 picnic sites, 17,500 campsites, 280 miles of coastline, and 3,000 miles of trail.

    We are a system as diverse as the National Parks, with historic sites such as Hearst Castle and Old Town San Diego; magnificent deserts such as Anza-Borrego; mighty redwood parks such as Big Basin, Humboldt, and Prairie Creek; special reserves such as Point Lobos and Torrey Pines; and expansive recreation-oriented beaches such as Huntington and Doheny.
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    To pay for all this, our operating budget for the 1996–97 fiscal year was about $181 million, 36 percent of which came from the State's general fund, and another 35 percent from revenues, which include user fees and concession rentals. The remainder comes from a number of other places such as grants, special fuel taxes, and an off-highway vehicle trust fund that supports our off-highway vehicle program.

    As a percentage of our budget, tax-based support for State Parks has diminished over the years, from nearly 80 percent in the early 1980's to 36 percent this past year. As that has happened, we at California State Parks have become more creative in raising revenues.

    The recession of the early 1990's led to a wholesale restructuring of the Department to put the focus back in the field, not behind the desk. We reduced the number of park districts from 55 to 23, abolished five regional offices, and we gave superintendents more authority to make important decisions such as adjusting user fees.

    This reorganization removed about 180 positions by attrition and saved the State taxpayers more than $10 million. Our reorganization also allowed us to become more efficient, and this efficiency is also demonstrated in terms of our excellent working relationship with the National Park Service.

    In three parts of the State—the North Coast Redwoods, the San Francisco Bay Area, and the Santa Monica Mountains—California parks and National Park Service have signed an agreement to work together for greater cost savings, improved resource management, and enhanced public service. Now, we are working with the National Park Service to expand the same partnership for our parks in the Mojave Desert and Marin County.
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    Our recession-created reforms were one step. Another step toward more self-sufficiency and greater accountability took place 2 years ago when, with the active support of Governor Wilson, we took on a 5-year initiative to further decrease our dependence on the general fund by more than $19 million. We are doing this in a number of ways and have already reduced this figure by $3.5 million.

    For example, we are exploring other alternatives such as the privatization of selected parks and operations. And we are revising our fee structure to make fees simpler and more reflective of the use visitors get from their parks. After analyzing how our annual pass holders are using their passes, we are considering annual passes that are park-specific, for example. We expect to have a modified fee structure in place by the end of this year.

    One of our most successful endeavors in encouraging greater self-sufficiency has been our Revenue Allocation Program, which we instituted last year. This program is designed to encourage our park districts to increase revenue by providing incentives that allow them to retain much of the new revenue.

    Each fiscal year a district is given a guaranteed minimum allocation, referred to as its Tier One [base] allocation. While this is not tied to revenue, each district is expected to raise an agreed-to base revenue.

    As the district's revenue rises above the base, it is authorized to spend up to a level defined as its Tier-Two allocation, and that is a specified maximum. When a district exceeds this maximum and enters a third tier, these revenues are then applied against the general fund reduction. Following the first year of revenue allocation, revenue at State parks has increased about $3 million representing a 6 percent increase. And our conclusion is simple, that the incentives to the districts work.
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    Our new Division of Marketing and Revenue Generation has provided the field with entrepreneurial expertise, and many of our superintendents and other field staff have found unique ways to raise revenues, something they would not have been able to do if everything was controlled through headquarters in Sacramento.

    For example, our superintendent in the Salton Sea Sector used targeted advertising and discount coupons to increase visitation at a unit named Picacho State Recreation Area off the Colorado River near the Mexican border. In 1 month, we saw a 65 percent increase in visitation and a 40 percent overall increase for the fiscal year.

    Several other parks and districts are offering value-added services such as special tour programs. Our Department's outdoor programs are aimed at introducing people to the skills they need to camp and enjoy California's great outdoors. Our districts have used their flexibility in altering fees to attract more visitors.

    In the area of concessions, we have had the opportunity to renegotiate contracts and receive higher payments in a number of key park units. Concession rental revenue has increased each year and for the 1997–98 fiscal year is projected to be $2 million above the previous year.

    But just as we are finding ways to be creative and entrepreneurial, we are getting more and more Californians involved in their parks. For example, we have an active volunteer program. In 1995, nearly 12,000 volunteers logged in 886,000 hours for the Department, saving the taxpayers $11.5 million. We have more than 80 cooperating associations raising millions to support our park programs.
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    The support of our volunteers and our stakeholders is mirrored in the high level of regard Californians have for their State parks. Last summer, we commissioned a statewide survey that yielded results that shocked the pollsters. They were not used to such a positive reaction.

    Ninety-four percent of those polled said that despite the current shortfall of available revenues, parks must be properly maintained for present and future generations to enjoy. Seventy-five percent supported government funding for parks. Interestingly, when we asked our respondents what they felt were the most appropriate ways for State parks to raise money, corporate sponsorship, fee increases, and merchandising were at the top of the list.

    Besides this survey, we regularly track how our guests feel about the parks they visited. And satisfaction is ranked high in a number of areas such as facilities, public safety, interpretation, even fees. We have discovered that our visitors and all Californians support the direction in which we are headed.

    California State Parks is proof that we can make entrepreneurial changes and improve public service and resource management at the same time. We are a long way from self-sufficiency, nor do we ever want to or expect to achieve this. But we know that we are taking the right steps to be responsible without jeopardy to the stewardship of the natural and cultural resources placed under our care. Thank you.
    [Statement of Mr. Jones may be found at end of hearing.]
    Mr. HANSEN. Thank you very much. It was an interesting and informative testimony from both of our witnesses, and we appreciate that. The gentleman from American Samoa, Mr. Faleomavaega.
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    Mr. FALEOMAVAEGA. Thank you, Mr. Chairman. Staff informs me that the annual budget of our whole National Park System—our operating budget at least runs for about $700 million. Can you hear me on this?

    Mr. JONES. Yes.

    Mr. FALEOMAVAEGA. And that annually we collect fees or at least the generation of that of approximately $100 million. There is no question that there is a problem here in meeting the care and the maintenance and of this sort. And I want to ask, Mr. Leal, if it is your organization's position that eventually all our national parks should be given to the States to operate and that the Federal Government perhaps should get away from the business of running parks?

    Mr. LEAL. No, it is not my or my organization's position that the National Park System should be Federalized or turned over to the States. It is our position, again, that the national parks only learn from what the States are doing. Because there are 50 State parks systems and they approach the problem of financing somewhat differently, they do provide laboratories from which we can examine different policy approaches and see what the results are.

    That is the reason I examined the State Parks System was to get an idea of how well parks could be operated with revenues—i.e., more revenues and less taxes—and what the outcomes would be.

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    Mr. FALEOMAVAEGA. Well, if I may make an observation here of what your statement is, why is it that it costs less for a State to build a road through a park system, and when the Feds do it it costs 10 times more? I mean, this doesn't make sense. Can you share any observations on that, why the difference? Because the Federal Government has a higher standard of building a road than it is for a State or———

    Mr. LEAL. That is one possibility, but I think it is more likely that the Federal Government has deeper pockets and it is not as frugal, if you will, about spending tax money. When you have to generate the money or earn the money on your own, there is a tendency to be more frugal in the building of roads or any of the infrastructure for the parks.

    Mr. FALEOMAVAEGA. You indicated in your testimony earlier about the five national parks that are very popular I guess in the sense that they are able to pretty much generate revenues to the extent that they become self-sufficient in that sense. What is your suggestion, that these parks should be turned over to the States to operate?

    Mr. LEAL. No. I mean that the Park Service should price services more realistically and be more diligient in fee collection. In actuality, Yellowstone Park is very close to self-sufficiency. In 1997 Yellowstone Park will generate on the order of $8.5 million in revenues, representing 44 percent of the budget.

    All Yellowstone Park would have to do to be 80 percent self-sufficient would be to charge people with Grand Teton passes a $20 entrance fee. They would generate another $7 million or $15 million total in revenue if they took that loophole away.

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    Mr. FALEOMAVAEGA. You don't feel that grandmother and grandfather should deserve some kind of a special treatment like a senior pass to go through Yellowstone, and they should not be given a discount of some sort for our senior citizens?

    Mr. LEAL. I don't have a problem with a discount. I have a problem with the size of the current discount. A $10 lifetime pass to a national park is a pretty big discount compared to the $20 regular entrance fee for Yellowstone Park.

    I think we need to reconsider the size of all discounts. Let's face it, in studies of national park visitors, the average income for an entrant in the national park is almost twice as high as the median income of the United States. There are not a lot of poor people entering the park.

    If you want to subsidize the poor so more can visit, we better think seriously about subsidizing their transportation and lodging expense because that is the lion's share of total expenses of visiting parks.

    Mr. FALEOMAVAEGA. So you believe that perhaps the way that we are doing this for our senior citizens is that there should be a better way of—arrangement. If you are a rich senior citizen———

    Mr. LEAL. Yes.

    Mr. FALEOMAVAEGA. [continuing] you should pay the 40 bucks?

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    Mr. LEAL. I really do because when I see the elderly driving in an RV that cost $90,000 to enter the park, I am not sure that we are being realistic with our charges.

    Mr. FALEOMAVAEGA. Of course, at the same time, the elderly that drives an RV of $90,000, they feel that they are paying taxes, and they should be given a break once in a while, don't you think?

    Mr. LEAL. I guess. But making parks tax dependent does not generate the necessary incentives for quality park services and also park upkeep.

    We have given a lot of tax money to the parks—the National Park System—since 1980. We have stayed ahead of inflation and that, but most of the money was spent on the agency itself and not on the parks.

    Look at the operating budget of the National Park Service—the operating budget alone is $1.1 billion now.

    If you add up all the operating budgets of the national park units, it totals out to $668 million. In other words, $432 million goes to the DC and regional offices. You know, that is a pretty top-heavy organization.

    Mr. FALEOMAVAEGA. Do you think the National Park Service bureaucracy—they are just sitting on their butts doing nothing?

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    Mr. LEAL. I think that there is a lot of room to reduce operating expenses of the Park Service and devoting the savings to park infrastucture.

    Mr. FALEOMAVAEGA. How about our friend from California, who seems to have the most parks than any other State? Do you agree with Mr. Leal's assessment?

    Mr. JONES. That is a pretty broad question. A couple of things that I would say I would not agree with is that there is no absolutes in these kind of policy decisions as to, for example, the level of funding. Self-sufficiency—working toward self-sufficiency or a target toward self-sufficiency is a worthwhile and noble objective. One hundred percent self-sufficiency for an organization like National Parks is just not in anyone's best interests, and it is likely not doable, in my opinion.

    I feel very strongly that where you have these lands that are high public trust lands, such as considerable and significant natural resource values and cultural values, that it is not a sin to provide public funding to support those programs. The core values that are necessary to maintain the stewardship year after year after year takes precedent over everything. But by the same token, it is not wrong to have these reasonable objectives toward more and improved self-sufficiency. I would say that is probably where California State Parks would disagree with one of the premises.

    The other aspect that I made a notation of is that I think there is a caution in comparing or picking a State and looking at that as being a potential direct application to Federal lands. The scale—for example, a 40 acre set-aside piece of land in the State of Oregon for campsites is not comparable to a Yellowstone and $9 million.
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    And we have lots of examples in California that we could use that same comparison. So everyone's program I think needs to be tailored to the needs of that particular organization. California State Parks I think does happen to come as close as any to a National Park Service, and even our scale is out of whack when you compare it to a Federal level.

    And as far as the—I found with great interest, and I wasn't aware of this until I heard the testimony from PERC, that our movers and leaders of the Park System, Stephen Mather and Horace Albright and others, who thought self-sufficiency was very doable, I don't think possibly could have understood and forecasted what we might be in for in the 1990's and moving into the year 2000 with our national parks and millions and millions of visitors. It just wasn't possible to foresee. Those are some random thoughts I had.

    Mr. FALEOMAVAEGA. Just one more question, Mr. Chairman. We have talked a lot about Yellowstone, Yosemite, Mount Rainier, and these are the biggies. What about the little parks I feel that are just as important, but maybe they don't generate as many visitors? What would be Mr. Leal's recommendations to that kind of a situation?

    Mr. LEAL. Again, I think that the motivation is for the popular parks not to suffer the rewards of generating revenue on their own. Therefore, I think it is important that those little parks that aren't tourist-attractors should be financed different. If you want to keep them in the public domain, then, by all means, use the general funds to support them, but don't penalize Yellowstone Park by taking money away from it and giving it to the little park.

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    Take money out of the General Treasury and give it to the little park. It stands to reason they are not going to be that expensive to run so fund them out of tax funds.

    If you are really serious about paring down the size of the National Park System, which I think people ought to consider especially when you look at some units that really don't fit into the mission of the National Park Service and that—like Steamtown—we ought to give serious attention to turning those over to the private sector, to private land trusts, whatever. They probably would be taken care of better.

    Mr. FALEOMAVAEGA. Well, I appreciate your comments, Mr. Leal, but the problem that I have observed here while being here in the Congress is that we are always robbing Paul to give to—to say don't do it to us, but this is constantly how we seem to be juggling our Federal budget every year, you know—take it from Paul to give it to someone else. But, at any rate, thank you, gentlemen. Thank you, Mr. Chairman.

    Mr. HANSEN. Thank you. You know, it is always interesting—the gentleman from American Samoa brought up some interesting things about seniors. We always go through that little flap. I was wondering about why we let seniors, especially through our big drive-in parks—they come in.

    I have spent a lot of time in my many years back here stumbling through the parks and walking into the camp areas. And it always bothers me when I see a guy in one of these $80,000 Winnebago and pulling a $30,000 Suburban—retired CEO—comes in with his Golden Eagle free—hooks into the sewer or the water, electricity, and camps. He is given a limit of seven or 8 days. He just sits there, and he gets a freebie.
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    And you see the kid in law school coming along, and he is in an old beatup car with two little kids, and he has got a little dome tent, and he pays the limit, and they kick him out in a short time. He has got to be back. So the equity of this thing always bothers me.

    And I have often tried—I remember when Ronald Reagan was in, in 1981 I tried to change that around. I was creamed on the floor. But people didn't make the distinction between our big drive-in parks, whether they be State or Federal, and our walk-in parks.

    Now, it is very difficult to take a walk in a park. Like right here, how do you do it? You can't do it. Mr. Jones, is the State experiencing anything like that? I know you have got some beautiful, beautiful State parks. We have got 41 State parks in the State of Utah, and I have talked ad nauseam to the guys here, and everyone wrings their hands on how do you do it.

    And this trend toward a park fee, how is that acceptable? Is that acceptable at all to your park superintendents? How is that selling? I mean, your State is kind of a pilot State. You probably have got more than anybody else. You have got some gorgeous areas out there. What seems to be the trend with the guy on the ground who has to administer this program?

    Mr. JONES. I think generally the acceptance when the public understands the value they are receiving is close to 100 percent, a reasonable price for a campsite in a beautiful park is absolutely accepted. And we have found that in our last 3 years of surveys of our users where we have asked directly related questions to that satisfaction level.

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    Where it becomes highly criticized and publicized, two points come to mind. It is where that value is not understood and the public is scrambling in their own minds to rationalize, ''Why do I have to pay $5 to enter a beach which should be a God-given right to enter a beach?''

    Mr. HANSEN. Well, don't they think that they are getting the best deal in America? I mean, I think the public should be made aware where is a better deal than a park? I mean, you take your wife and your children to dinner and to a movie on the weekend, like many American families do. You drop 100 bucks.

    And they walk into a park—you take Yellowstone, for example, in 1915 it cost $10. In 1996, it costs $10 or is it $15? I can't recall. It is $20 now, but up to this point, before we gave Mike Findley a little more latitude, it was—you could walk in there for almost 80 years and drive into that park and see the granddaddy of all parks for almost zilch.

    And people write me letters and say, ''Oh, gee. I hate the idea of doing it.'' A guy drives in. He has got $100,000 he is taking in there. Then he belly aches about a $15, now $20, fee to go in a park. My answer to him is, ''Tough. You are getting the best deal in America.'' And most people respond and say—most of them say, ''Yes, it is a good deal.'' In fact, we get money sent to us all the time saying, ''I ripped you off.''

    They go down to what we call the Golden Circle in Utah where they can go to Zion, Bryce, Canyonlands, Arches, and Glen Canyon National Recreation Area, and now they can go to a place called the Grand Escalante-Staircase National Monument, which is nothing but rolling hills of sagebrush, and half the people that go there keep looking for the monument but don't know that they are in it because there is nothing there.
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    But they love it, they think, because the President preserved something, where he really didn't. He opened it up for all kinds of development but didn't understand that he shot himself in the foot, but the environmentalists are soon finding that out. And they get the best deal in America. It kind of bothers me, the attitude of the public, not knowing that this is the best gift they have got since we started buying F–16's to defend them.

    Mr. JONES. Mr. Chairman, we wrestle with those same kinds of, ''How could they not be buying into this?'' And there is a certain segment of the population—I am speaking for California and not for the United States—that clearly believes because it is public lands that they should be used. They already paid for it once, they don't want to continue to pay for it, and they aren't willing to recognize that it costs money to maintain facilities, maintain roads, maintain rest rooms, all the behind-the-scenes stuff that it takes to keep a park going.

    Mr. HANSEN. Mr. Jones, where did they pay for it once? You mean in their income tax?

    Mr. JONES. Well, they rationalize I think in the acquisition and———

    Mr. HANSEN. The taxes they paid through other means. They feel, ''Yes, I have already paid for this, and the legislature should be smart enough to take care of it''?

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    Mr. JONES. But I do believe that that is actually a small percentage of our users. I think, by and large, again, the users in California that can make a simple connection to the value that they are getting by using their parks really don't have any problem with them, and our survey demonstrates that.

    I think there is another segment of the population, the naysayers, that don't want any fees, that tend to promote scare tactics of commercialization and sponsorships and all those kinds of things as tools to not increase fees or not have any fees. And we are always sometimes frustrated by that because the banner argument sometimes stand in the way of doing something reasonable like a reasonable increase to an annual pass or something of that nature.

    But there is a balancing act, and I think one of the greatest challenges for both the Feds and States like California is finding the framework that the decisionmakers have to make as public policy decisions and delegations to the respective departments that carry these out. And in a way, that does take care of the little, tiny battlefield in Kentucky versus the Yellowstone.

    It is very difficult to set policy from the top, and that applies to the California legislature or anywhere else. And that is a real challenge for public agencies that manage these important lands.

    Mr. HANSEN. You probably heard those bells, and back there are two lights on which means we have a vote on. I have questions for both Mr. Leal and some more for you, Mr. Jones. I am going to ask you—here are a series of questions. Could I ask you to write to Dan here and me and give us a copy of your answers? We would be very curious as to how you would respond to these. If you would give us that courtesy, we would really appreciate it.
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    I want to recognize Mr. Hill from Montana, and then we are going to adjourn this because we have got a vote on, and I don't want to keep you here if we come back for two questions. The gentleman from Montana.

    Mr. HILL. Thank you, Mr. Chairman, and I apologize for being late. And I do have a statement. If I could have that entered into the record?

    Mr. HANSEN. Without objection, so ordered.

    [Statement of Mr. Hill follows:]
STATEMENT OF HON. RICK HILL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MONTANA
    Thank you, Mr. Chairman, for holding this important oversight hearing.
    I am pleased to join my colleagues in welcoming our distinguished witnesses. I want to particularly thank Don Leal of Bozeman, Montana for traveling at great lengths to present his research on 27 State park systems.
    Mr. Chairman, the subject we will be discussing today is an important one for the long-term health of our National Park System and the people who want to enjoy it. For too long, our national parks have faced enormous and unhealthy financial backlogs in operations and maintenance, construction and land acquisition. In Yellowstone National Park, for example, visitor facilities are in a state of serious disrepair, compromising our environment and visitor enjoyment of one of our national treasures.
    Congress passed a Fee Demonstration program last year which is helping certain parks fill their financial needs. However, this is not the only answer, nor are unlimited amounts of taxpayer's dollars appropriated by Congress.
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    Washington doesn't have all the answers to help funding disparities in our parks and that's why we are here to listen to experts who have devoted themselves to finding ways to address these problems on a State level. I look forward to hearing from them on this important discussion.
    Mr. Chairman, I again commend you on your leadership on protecting our national park system.

    Mr. HILL. I am just going to ask one question at this point. First I want to thank Mr. Leal for being here from Montana. You have a very outstanding organization that you are part of that is constantly thinking about natural resource issues and public land management and how we can be more efficient and more effective in how we do that. I want to welcome you here, and I want to thank you for being here.

    We have two outstanding, wonderful parks—Glacier Park and Yellowstone Park that border Montana. But one of the things that it seems to me and it concerns me is the gateway communities. One of the important things I think in helping enhance the experience of parks and attracting people to experience the parks is how gateway communities broaden the scope of services that can be offered to the people.

    And we have had a lot of controversy, and I guess I would ask both of you to respond to this. Where there is greater cooperation with the park managers and the businesses in those gateway communities, do we have more successful parks?

    Mr. LEAL. I think from my observation I can use State parks as an example. I think in Montana one of the most successful State park units is the Lewis and Clark Caverns, which, by the way, it cost $260,000 to operate, and it generates $350,000. People pay $7 each, children free, to enter that system. And it is not far away from Three Forks, Montana. Some of the local restaurants and that, they do benefit from the operation of that well-run operation of the Lewis and Clark Cavern.
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    At the national level we have not had a lot of cooperation. It was an interesting thing when Superintendent Mike Findley from Yellowstone Park urged the local businesses around the gateway communities, ''Don't promote Yellowstone Park because we don't have the money to operate it.'' That didn't go over too well, naturally, with the local businesses.

    When Superintendent Findley said he was going to close down Norris Campground and the two museums in an effort to save $70,000, despite the fact that the campgrounds have generated $114,000 is another example of conflict between local businesses in the gateway communities and what goes on in the park itself.

    I think if we do have more self-sufficient park units and that, you will see more cooperation with the gateway businesses and that. In fact, you will probably see a lot more cooperation.

    Mr. HILL. How about in California? Do the managers of the park work in a real cooperative fashion with the gateway communities?

    Mr. JONES. Yes. And we have several examples of that. I would like to give you two real briefly. First of all, to answer your basic question, yes, where there is greater cooperation, and that translates many ways, but improved communication, for one, we have much greater success, and the public gets a better shot, a better experience for that two or 3 day, or whatever it is, venture.

    The whole Yosemite and an organization that is a pilot program in California acronymed YADI deals with gateway community and its relationship to national parks. And the only reason I happen to know about that is we have a forum in California that is an ad hoc group—that is the California Round Table on Recreation, Parks, and Tourism. And it wrestles with these very kind of issues that you are talking about.
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    We have only been in existence for 1 year, but we have already made great strides in moving, branching much further out than just what we have as an expectation of one of our superintendents, for example. We are able to use that forum to combine all kinds of regional planning. The Tahoe Basin is a phenomenal example of the kind of thing I think you are talking about.

    The biggest potential tension points I feel are where you have those high resource-value parks, and there are carrying capacities and limitations during peak periods. And everybody wants to make hay when the sun shines, and there has got to be a balance there. But if you don't have communication and the forum in place to deal and wrestle and explain and rationalize and compromise, it doesn't work very effectively, and everybody stays angry with everyone.

    Mr. HILL. Thank you, Mr. Jones. Thank you, Mr. Leal.

    Mr. HANSEN. We thank our witnesses for excellent testimony; appreciate you taking the time to be here. And we will look forward to the response to some of our additional questions. I see in the audience Dr. Randy Simmons from Utah State University, a great resource to this committee, and I was tempted to pull you up, Randy, and ask you a few questions, but we are running out of time.
    Thank you so very much for your time. We will look forward to using you as a resource if you don't mind because we surely realize that most of the questions come or good answers don't necessarily come from Washington, contrary to popular belief. And this committee now will adjourn. Thank you.
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    [Whereupon, at 10:55 a.m., the Subcommittee was adjourned.]

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