Study: Cash-strapped Park System Need Not Close Facilities

Study: Cash-strapped Park System Need Not Close Facilities
March 1, 1999



While acknowledging that the state of Washington's park system faces serious budget problems, an Olympia-based research group says Governor Gary Locke's threat to close 40 parks is nothing more than political maneuvering.

In "Toward a Self-Sufficient State Park System," a policy brief prepared for the Evergreen Freedom Foundation, fiscal policy analyst Jeff Hanson contends that self-sufficiency, rather than government financing, is needed to rejuvenate the state's parks. Hanson is a doctoral candidate in political science at Claremont (California) Graduate University.

According to Hanson, Washington state's park system--which has a $35 million maintenance backlog--would be assured of stable and equitable financing if park managers were given greater responsibility for the operation of their parks, and if the burden of park financing were shifted to user fees, rather than general tax support.

"With the changes proposed in this study, Washington's park system can generate sufficient revenues to support an expanded park operating budget," writes Hanson. "State Parks' reliance on General Fund support ($43 million for the 1997-1999 biennium) can be reduced substantially, if not eliminated."

In fiscal 1997, according to Hanson, State Parks collected only 22 cents per visitor--the third least of all state park systems--compared with the national average of 71 cents a visitor, which "is itself inadequate."

Revenue reforms, Hanson recommends, should take into account the varying demands of users by charging fees based on such factors as location, time of year, day of week, and facilities and accommodations. The park system's current flat fee structure ignores such factors, writes Hanson, noting that in the private sector, differential pricing is commonplace. "Cinemas offer matinee discounts; weekday golfers typically enjoy lower green fees."

According to Hanson, the proposed user-fee formula would increase camping revenues by 20 percent, to $9 million, while day-use entrance fees could generate revenues between $20 million and $37 million.

"It (the park system) cannot rely solely on its overnight visitors, who account for less than 5 percent of the parks' overall attendance," Hanson writes. Washington is one of only 10 states that do not charge entrance fees.

Hanson estimates that increasing park revenues and reducing, and eventually eliminating, tax funding for parks would result in annual operating revenues between $32 million and $49.5 million. Even at the low end, he notes, the system could nearly match its current annual operating budget of $34 million.

Individual parks should be allowed to retain most of the revenues they generate, Hanson urges, making the system more efficient. Under the present system of "spend it or lose it" tax financing, park managers lack incentives to spend wisely. Moreover, Hanson contends, park users would be less opposed to fee increases if the money were spent to maintain the specific location at which it is raised. Operational flexibility also would be enhanced if managers were allowed to raise or lower fees as demand dictates.

"[Park managers] have the incentive to make prudent decisions, because they assume the risks and reap the benefits of their decisions," he concludes.

Hanson warns that such an entrepreneurial approach should be used with caution in order to avoid unfair competition with the private sector in such areas as lodging and restaurants.

"In fact," he says, "parks should explore ways that private companies could help improve the efficiency of park operations. For example, private competitive bids should be solicited for park support functions, including security, cleanup and fee collection."