Paying for Parks

It may appear that the federal government, which for years has been criticized for ignoring the fundamentals of economics, has thwarted the law of demand. In 1997, the National Park Service increased fees at 100 parks, recreation areas, and historic sites yet experienced no drop in visits. Overall, more than 277 million people visited NPS-managed sites in 1997, a jump of roughly 3.6 percent over 1996. Attendance at the 100 parks that instituted new fees rose by 3.5 percent.

The Park Service hasn't really violated any fundamental economic principles; instead it's allowing its managers to take advantage of their localized knowledge while giving them incentives to improve their facilities. The new fees are a product of the Recreational Fee Demonstration Program, a three-year experiment Congress authorized in 1995. It allows the National Park Service either to increase old fees or implement new ones at selected sites. The new program allows each park to keep 80 percent of the additional revenue it collects, alleviating the need to petition Congress or Park Service headquarters for a piece of a shared pie. Prior to this, all park fees went directly to the federal treasury, where they were spent on everything from cruise missiles to food stamps.

In its first year, the program raised $53 million more than the roughly $80 million that pre-existing fees brought in. While this is still less than 5 percent of the NPS's $1.6 billion budget, it is big bucks for particular parks. Acadia National Park in Maine, for instance, plans to use the $2 million it will collect in fees in 1997 and 1998 to restore a popular hiking trail and historic vistas. Denali National Park in Alaska will make major improvements to its campgrounds with its extra $2 million in fees.

So well received was the program that Congress will allow all fees, not just those increased under the program, to remain at the facilities where they are collected in 1998 and 1999. This pleases park managers and patrons alike. Park managers like it, says NPS spokesperson Dave Barna, because it removes some managerial decisions from "the political context" of annual appropriations. As for patrons, a Park Service survey found widespread support for the program, with eight in 10 parkgoers finding the new fees acceptable. Says Gary Machlis, chief social scientist at the NPS, "If the fees are fair, easy to understand, and the money goes back to the parks, a large majority of the American people accept and support them."