00-16783. National Park Service Concession Contract Franchise Fees

AGENCY:

National Park Service, Interior.

ACTION:

Notice Regarding Franchise Fee Determination

SUMMARY:

On February 6, 1998, the National Park Service (NPS) published in the Federal Register a notice regarding the continuation of guidelines for determining franchise fees for NPS concession contracts. On November 13, 1998, Title IV of Public Law 105-391 amended NPS statutory authorities regarding concession contracts, including provisions concerning franchise fees. This notice provides the public with information as to NPS concession contract franchise fee determinations under the terms of Title IV of Public Law 105-391.

EFFECTIVE DATE:

On or before August 2, 2000.

FOR FURTHER INFORMATION CONTACT:

Cindy Orlando, Concession Program Manager, National Park Service, 1849 C Street, NW, Washington, DC 20240.

SUPPLEMENTARY INFORMATION:

the February 6, 1998, Federal Register notice concerning NPS franchise fee determinations re-adopted those portions of the NPS concession contracting guidelines (NPS-48) that concern determinations of concession contract franchise fees, including determinations of franchise fees for new (or reviewed) concession contracts and possible adjustments to the franchise fees of existing concession contracts during their term. On April 17, 2000, NPS published in the Federal Register final new regulations for the NPS concession contracting program (36 CFR Part 51).

Title IV of Public Law 105-391 repealed the statutory authorities under which the franchise fee guidelines were developed. In addition, Section 407 of Public Law 105-391 established new statutory authorities and policies regarding NPS concession contract franchise fees. Title IV of Public Law 105-391 also included other provisions that have implications for concession contract franchise fees, including, without limitation, the establishment of leasehold surrender interest in certain capital improvements constructed pursuant to a concession contract.

Section 407(a) of Public Law 105-391 reads as follows:

SEC. 407(a). A concession contract shall provide for payment to the government of a franchise fee or such other monetary consideration as determined by the Secretary, upon consideration of the probable value to the concessioner of the privileges granted by the particular contract involved. Such probable value shall be based upon a reasonable opportunity for net profit in relation to capital invested and the obligations of the contract. Consideration of revenue to the United States shall be subordinate to the objectives of protecting and preserving park areas and of providing necessary and appropriate services for visitors at reasonable rates.

In light of the enactment of Title IV of Public Law 105-391, NPS hereby withdraws Chapter 24, Section D (“Franchise Fee”) of NPS-48 as outdated. The terms and conditions of current concession contracts and permits remain in effect except as may otherwise be provided by Section 415(a) of Public Law 105-391.

Until such time as NPS may adopt more specific new franchise fee determination guidelines reflecting the terms and conditions of Title IV of Public Law 105-391, NPS will establish minimum franchise fees for new (or renewed) concession contracts on a case by case basis in accordance with the terms of Section 407(a) of Public Law 105-391 and will include the proposed minimum franchise fee in concession contract prospectuses issued pursuant to 36 CFR part 51. The establishment of minimum franchise fees will consider the probable value to the concessioner of the privileges to be granted by the new contract. This probable value will be based upon a reasonable opportunity for net profit in relation to capital invested and the obligations of the contract. Consideration of revenue to the United states shall be subordinate to the objectives of protecting and preserving park areas and of providing necessary and appropriate services for visitors at reasonable rates.

Dated: June 27, 2000.

Maureen Finnerty,

Associate Director, Park Operations and Education.