Private CG owners complain that FS undercuts their prices.

Fred · **Posted:** Mon Jan 17, 2011 8:05 pm

Owners submit FS is unfairly competing with them; includes concessionaire-operated CGs. In some cases, there may be some merit to this allegation. However, the issue is contentious to people on all sides of the fence because:

1. amenities provided are more likely not comparable;
2. access challenges to FS CGs; and
3. Forest Service may arbitrarily permit increasing fees to avoid local, private CG owner discontent.

kbenzar · **Joined:** Mon Jan 17, 2011 2:31 pm **Posts:** 18

There is absolutely no question that concessionaires are intentionally driving prices up in the campgrounds the FS still manages. Below is the text of a letter from a major National Forest concessionaire, Hoodoo, urging the Forest not to charge only $8 at a FS campground that was previously free, specifically because he doesn't want his prices to seem too high and make him look "greedy."

You can view a scan of the letter at
http://www.westernslopenofee.org/pdfuploads/Willamette_Hoodoo_Letter.pdf

Concessionaires typically argue that they can manage campgrounds more efficiently than the government can. If that's so, then why aren't their prices lower than the government's instead of higher?

Quote:

Hoodoo Recreation to Detroit Ranger District, Willamette National Forest
October 5, 2007

Dear Dan,
As I read an article about the proposed fee increases in the Willamette Forest, I felt somewhat annoyed for reasons probably different from others. A good example of the problem has to do with the Lost Lake Campground. [Note: Lost Lake Campground was being proposed to go from free to an $8 fee.] I am very familiar with the fees in the local area since most of them were set by me in coordination with the MacKenzie River District, but I am also very familiar with the fees througout northern California to the Canadian Border. If this campground were being managed by Hoodoo the fees would be about $14 plus $7 for the EV. If it were in most other areas they would be $16 to $18 with the EV fee ranging from $5 to $9.
I realize that you don't have to pay room tax, nor income taxes, but quite honestly Hoodoo doesn't have to pay much in income tax either because we don't make much. Our cost for the sites at Lost Lake would be about $15 per site. I am guessing that your costs are probably higher than that even without the room tax. The problem that I see is that campers don't understand the difference between tax subsidized fees and full concessionaire fees. They just assume that Hoodoo’s fees are higher because we are greedy. This makes the campers unhappy with us and with you. My experience with fees that are held artificially low in camping fees or rents or other things as well is that usually they cause more contention overall than the higher fees would have.
I don’t know why the USFS feels the need to hold the fees lower than the market would say is reasonable. I don’t believe that you would have any more complaints at $14 than you would at $8. In fact you will probably have more this way because campers will complain about how high the Hoodoo fees are assuming that they should be at your level. Please do not hold your fees artificially low, this actually hurts the concessionaire model which I know that the national USFS is anxious to have work.

Sincerely,
Chuck Shepard
CEO of Hoodoo Recreation

Fred · **Posted:** Tue Jan 18, 2011 5:15 am

Absolutely frightening! At least in this instance, the concessionaire is manipulating the FS. It is soooo blatant. Notwithstanding, as I have said before, why is there often such a disparity between the concessionaire and FS operated campgrounds? Why aren't the fees more alike? The FS fees are too low or the FS approved concessionaire fees are inflated or a combination of both? On the other hand, if there is little disparity between the two entities does that make the fees correct. Maybe, maybe not.

Whether the public likes it or not, the FS has to start operating more like a business. Making decisions about fees (whether recommended to the RAC or not) involves some business expertise. Who else is going to make fee recommendations/decisions? This is the dilemma.

llempart · **Joined:** Mon May 24, 2010 5:14 pm **Posts:** 8

Hopefully not the concessionaires! There is some cost associated with running a campground. Paying an attendant, maintaining benches, fire pits, toilets, purchasing toilet paper, etc. I'm sure whoever is in charge can easily keep track of, and total these expenses. Some amount of tax-money goes to offset these costs. Divide the difference by the number of visitors in a given year and you have your fee. Some nominal additional fee may be charged for things like campground improvement or area conservation, but not a penny should go into any individual's or corporation's pocket as profit from the campground.

kbenzar · **Joined:** Mon Jan 17, 2011 2:31 pm **Posts:** 18

Make no mistake: the FS is totally committed to making sure private concessionaires are profitable. In 1997, when Fee Demo was brand new, some silly District Rangers thought that they could use its fee-retention authority to return campgrounds to agency control, which they naively assumed was a desirable outcome. They got slapped down hard in the following memo from then-Chief Dombeck:

Quote:

Department of Agriculture Forest Service
P.O. Box 96090, Washington, DC 20090-6090

File Code: 2330/6230/6500
Date: February 25, 1997
To: Regional Foresters

Subject: Prohibition Against Displacement of Concessions Based On Recreation Fee Demonstration Project

I commend you for your Region's active participation in the Recreation Fee Demonstration. This unique authority is a good example of one strategy we need to carry out our mission in a quality manner with declining resources.

Another strategy is to encourage an expanding role for the private sector in delivering services in national forest settings. Use of concessions is a key tool for providing quality services with declining work forces and capital resources. In addition to providing benefits and services to our customers, concessions also directly contribute to ecosystem protection and enhancements while promoting economic strength and stability in the communities we serve.

To ensure these approaches do not conflict, direction was established guiding selection of each demonstration project. Specifically, our direction is not to displace concessionaires associated with the execution of the fee demonstration test. Several of our trade association partners have contacted my office and members of Congress expressing their concerns that some areas are contemplating modifications of current concession permits, or even not renewing permits, to incorporate a site in the demonstration program.

We must continue to work with our service partners. From the beginning, we indicated we would not displace their operations during this test. Our partners trusted our word. They supported this authority in our local communities and with their congressional representatives. This is a 4-year test during which we will learn more about the potential of a fee system, and we should not disrupt our continuing support for providing services by private concession.

At the same time, both Congress and the Administration have identified the need to reduce the size and scope of Government. How we manage the national forests has shifted. We must effectively utilize our employees as program administrators and adjust to leaner Government.

Ensure this direction reaches each line officer. I encourage your continued support of both of these programs. Each warrant your leadership. We must take advantage of locally retained fees and continue to promote an expanding private sector industry to serve national forest visitors. I ask that each line officer work directly with affected partners, such as our permitees, to develop successful implementation strategies for each demonstration project.

/s/ Mark A. Reimers (for)

MIKE DOMBECK
Chief

Concessionaires have become the tail that wags the FS dog.

Fred · **Posted:** Tue Jan 18, 2011 8:09 pm

Wow, this gets heavier and heavier . . . See forum - "Does the Forest Service care about recreation in national forests?" and topic about the FS mission statement.

bukhrn · **Posted:** Wed Jan 19, 2011 4:35 pm

"Private CG owners complain that FS undercuts their prices."
Too bad, Private CG's are over inflated anyways, lower their prices,& quit nickel & diming people to death, & maybe more people would go there.
So whats their solution, raise FS prices so theirs will look more in line?
:evil:

Ed · **Posted:** Wed Jan 19, 2011 8:37 pm

Sure, tax susidies have traditionally allowed for lower fees at FS operated CGs...but why not? As taxpayers we are the ones providing the subsidy.
But given the state of the Federal finances, those subsidies are likely to disappear rapidly. CG fees rise accordlingly. Given that trend, it seems to me that the FS should only be contracting with private operators who will provide as good or better services, at as good or better price as the FS unsubsidized price. And the FS must be prepared to give enough oversight to ensure compliance. If the private sector can make a profit under those rules, fine. If not they will fail like other businesses who cannot compete.

blumie · **Joined:** Sat Jan 22, 2011 12:13 am **Posts:** 1

If the private concessioners who currently operate USFS campgrounds want to talk about for-profit prices being undercut, then they need to compare apples to apples in their business analyses, not apples to oranges. Do private concessioners put up the capital investments for campground land and improvements? Of course not! So their turn-key operating expenses are much lower than a private campground owner who has to pay a mortgage on the property and pay for the buildings, utility systems, etc.

If the USFS is going to be pressured into raising prices to equal private campgrounds - something I hope they resist - they may as well go all the way and require the concessioner to BUY the campgrounds and all their improvements... that would better level the economic playing field for the campground operators.

wayne · **Joined:** Thu Jan 27, 2011 3:54 am **Posts:** 3

we worked part of a season for Hoodoo. Personally , i liked their management staff and know they are in better favor with several national forests in pacific northwest. however since i have also hosted for the USFS run campgrounds for 5 different summers, I must say they are pushing up the cost of camping in national forest ranger districts. I dont know how much coersion exists relative to a district keeping a couple campgrounds out of private control and or keeping the price down. My feeling is that regular repeat campers in each ranger district know where to camp and do not want high camping prices to hit them in these less used places. secondly, i believe there should always be some campgrounds that are all first come first served places with low camping fees. I have found that some concessionaire host members have a bizarre since of how to assist campers. I believe that i am there to help them anyway i can within the rules that apply. removing firewood from a site after the camper leaves, so the next camper has to buy a bundle of balsa wood at terrible prices from a host is not my idea of hosting. I am aware that budget cuts and staffing cuts at ranger districts does play a large part in the decission to privatize. I am told they get 30% of the campgrounds receipts from the concessionaire and that that is reapplied to the campground in areas of new restrooms, firepits or whatever. for this they do not have to spend as much overseeing etc to the c.g.

bounder cowboy · **Joined:** Sun Feb 13, 2011 5:52 am **Posts:** 1

When the CG owners bought there camp grounds they were aware then that the FS charged less which also makes it affordable for families to have vacations in the FS operated CG’s. Private owners has already raised there prices to the level that we have found it cost effective to stay in a motel which is in the same price range. This means that the parents can not afford to spend time in the forest with there children and teach them about nature and the beauty that the good Lord provided us. I worked in one campground in Arkansas that was extremely upset that the FS CG’s was hurting there business. And I can say from my experience working for them that there problem stemmed from greed. We need to keep the FS CG’s affordable for all, not just families with children but also for singles and couples to visit. With the down turn in the economy many folks can not afford vacations and need the time to relax and lower there stress levels from there daily lives. Please keep all of this in consideration. Thank you so very much for giving me the opportunity to express my thoughts here.

Korbe · **Joined:** Fri Nov 13, 2009 9:42 pm **Posts:** 94

I see many situations where RV parks set right next to FS campgrounds and State parks. Most of the time the public campgrounds have limited amenities and the RV parks have full hookups, cable tv, wi-fi and all the fancy stuff. There are a lot of people that want the hookups, and from my vantage point, the competition is good for business. Just like McDonalds and Burger King want to be right next to each other.

Fred · **Posted:** Mon Feb 14, 2011 5:27 pm

Good point, Korbe

Private CG owners complain that FS undercuts their prices.

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