Concessioners operating under these agreements generated about $2.2 billion in revenues, and paid the government about $65 million in fees and about $23 million in other forms of compensation. Within the six land management agencies, concession agreements in the National Park Service accounted for about 30 percent of the gross revenues and the return to the government. Factors Affecting the Rate of Return

Our analysis of rates of return throughout the federal government indicated that there are three key factors that affect the rate of return to the government. These are (1) whether the return from a concession agreement was established through a competitive bidding process, (2) whether the incumbent concessioner had a preferential right of renewal in the award of a follow-on concession agreement, and (3) whether the agency had the authority to retain a majority of the fees generated from the concession agreement. Based on this body of work, it is our view that any efforts at reforming concessions should consider (1) encouraging greater competition in the awarding of concession agreements, including eliminating preferential rights of renewal; and (2) promoting more consistency by including all of the land management agencies as part of concessions reform. In addition, Congress may also wish to consider providing opportunities for the land management agencies to retain at least a portion of their concession fees. The use of concessioner special account funds has increased over the past few years.
Why GAO Did This Study

GAO discussed its work on concessions issues, concession reform, and the National Park Service's (NPS) use of concessioner special accounts.

What GAO Found

GAO noted that: (1) in 1994, there were 11,000 concession agreements throughout the federal government; (2) the agreements generated over $2.2 billion in revenue for concessioners; (3) while concessioners in land management agencies paid the government an average of 3 percent of their gross revenues, concessioners in other agencies paid an average of 9 percent of their gross revenues; (4) key factors affecting the government's rate of return include whether the concession is established competitively, whether the agency can retain concessions fees, and whether incumbent concessioners had a preferential right of renewal; and (5) Congress may wish to consider encouraging competition, eliminating preferential rights of renewal for incumbents, promoting consistency among land management agencies, and providing greater opportunities for land management agencies to retain concession fees.