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Friday, February 26, 2010
3:30 PM EST
Robert Clemmer

Give a Hoot, Don’t Pollute . . .the Economy with Taxes or Unnecessary Spending

Arizona’s budget battle has squeezed the Arizona State Parks Board, closing two-thirds of state parks. Politicians will sometimes use the “Washington Monument Syndrome” tactic, closing something popular in order to justify raising taxes. At one point, Arizona considered a $15 license plate tax, allowing anyone with an Arizona license plate to enter for “free.” However, the Goldwater Institute has recognized that raising taxes will not only burden taxpayers, but will not offer any long-term solution to the state’s $ 4 billion deficit or its suffering state park system.

 The Goldwater Institute has suggested that Arizona allow private companies to manage the parks. Recreation Resource Management is a private company based in Phoenix, dedicated to running state parks more efficiently. Currently RRM manages 175 properties in 11 states. The state leases the land out to RRM on a short term or long term contract and RRM then pays the state part of its revenue as “rent,” which on average ranges from 10-12% of revenue. However, a state can receive up to 22% of revenue depending on the contract.
 
The costs of running state parks is all placed on the company, alleviating taxpayers and making these former state run operations subject to market pressures. Critics of leasing land to private companies complain that companies will hike up rates in order to turn a profit. However, RRM usually needs state approval to raise prices and even then the company is against price hikes, believing it turns away customers. So if RRM is not hiking up prices, what does it do to make a profit?
 
ATR has previously noted the insane perks that public sector employees receive. Much of the costs associated with running parks are from paying off wages and benefits. RRM has noted that “just as one would not hire a Fortune 500 CEO to do one’s web design, park employees with masters in environmental science are not ideal for manning gate houses and cleaning bathrooms.” Instead RRM hires a more flexible and less expensive workforce. While state parks hire workers all year, paying them even when parks are closed, RRM hires seasonal folk. Being a private business there is also inherently a lot less bureaucracy and it is easier to get rid of bad employees.
 
But RRM does not just manage the parks and make them profitable, but they also renovate the property providing a better outdoor experience to consumers. When RRM took over operations of Honeycomb Parks in Alabama, the park was run down. RRM built new docks, a new store, and new camp grounds. RRM also invested a half million dollars in private funds to build cabins and a trail loop for McArthur-Burney Falls Memorial State Park. Many of their camps have been voted in the top 100 family campgrounds in the US.
 
RRM is not the only private company that turns budget-busters into money-makers. American Land & Leisure which is based in Utah manages federal lands with contracts ranging from California to West Virginia. California Land Management has been around since 1981 and is managing campgrounds and parks along the West coast.
 
Warren Meyer, CEO of Recreation Resource Management has sent a proposal to the Arizona Legislature, asking to manage 7 of the state’s closed parks. Rather than propose new taxes and fees, Arizona should contract state parks to private entities which would bring in revenue without burdening taxpayers. Last year Arizona entered into concessions to deliver transportation projects, why not state parks? Alleviate ailing state governments, removing burdens on taxpayers, and giving the private sector to take care of our parks: sounds like a win-win to me.
 
 
 
Posted by Robert Clemmer on Friday, February 26, 2010 3:30 PM EST
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