National Parks Get Green Light for More Commercial Operations
Published Date: 1/17/2025
Rule
Summary
Starting February 18, 2025, the National Park Service can award and manage contracts to improve visitor services and facilities in national parks. This means better shops, tours, and programs for visitors, thanks to new authority from Congress. Businesses and visitors will see changes as the NPS expands and upgrades commercial services, aiming for a smoother, more fun park experience.
Analyzed Economic Effects
9 provisions identified: 3 benefits, 3 costs, 3 mixed.
NPS Can Award VEIA Contracts
Starting February 18, 2025, the National Park Service may solicit, award, and manage "commercial services contracts" under the Visitor Experience Improvements Authority (VEIA) to operate and expand visitor facilities and services in National Park System units. This creates new business opportunities for companies that want to run shops, tours, lodging, marinas, campgrounds, and similar services in parks.
Industry-Style Contract Models Allowed
The VEIA allows NPS to use industry-standard models like management agreements (NPS owns assets; operator paid base + incentive fee) and percentage lease agreements (operator keeps revenue and pays a base fee plus a percentage). These models may require less up-front capital from operators and may attract more hospitality companies to bid.
10-Year Term Limit; No Leasehold Interest
Commercial services contracts awarded under the VEIA may not have a term greater than 10 years, and operators will not receive leasehold surrender interest in capital improvements completed during the contract. The VEIA also may not be used for outfitter and guide services or for services that have a current preferential right of renewal under the 1998 Act.
Revolving Fund Can Support Operators
Funds collected under VEIA contracts will be credited to an NPS revolving fund that the NPS can use for management, operations, construction, maintenance, and to transfer funds to operators when needed. The NPS may transfer funds to operators to cover start-up expenses or large capital work, and transfers could come from taxpayer or non-taxpayer revenue sources.
Procurement Rules Largely Waived; Labor Protections Kept
VEIA commercial services contracts may be awarded without regard to most Federal procurement laws and regulations, but laws and regulations governing working conditions, wage rates, and applicable civil rights provisions still apply. The NPS must award VEIA contracts through a competitive, publicly solicited process.
Reporting, Recordkeeping, and OMB Review
Operators under VEIA contracts must provide reports such as an Annual Plan and Monthly Performance Reports, keep records for the term plus five calendar years after contract end, and submit financial data in accordance with GAAP. The rule includes new information collections that require OMB approval (OMB Control Number: 1024-New).
NPS May Approve or Set Visitor Rates
The NPS will generally approve rates for services based on market demand, but the Director may specify rates or rate methods for particular services to ensure affordability for a broad segment of visitors. This oversight aims to keep charges reasonable while allowing market-based pricing in many cases.
Funds in Operator Accounts Must Be Safeguarded
Under management agreements the NPS may transfer revolving fund money to operator-owned bank accounts for operations and capital improvements, but the rule requires safeguards: accounts must be FDIC-insured, the NPS holds a first lien on balances, funds must not be commingled, budgets need NPS approval, and NPS may require monthly reporting and annual audits.
VEIA Expires December 16, 2025
The VEIA statute expires on December 16, 2025 (extension provided by Pub. L. 117-328), so the NPS generally must solicit contracts before that date; however, contracts awarded under VEIA may continue beyond the statute's expiration if the contract terms allow. The NPS will consider whether it can solicit a contract before the VEIA expires when evaluating projects.
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