The National Park Service recently issued a notice that it was continuing ten (10) concession contracts for one year through the end of 2020. The oldest concession contract to be continued was apparently awarded in 1969 for operations at Wahweap Marina in Glen Canyon National Recreation Area. The older contracts contain a clause which authorizes them to be continued if needed. The older contracts were awarded under a 1965 statute which was replaced in 1998 with a revised authority. The 1998 statute authorized NPS to extend contracts for no longer than three years.
NPS apparently invoked this 1998 authority to extend the contracts at issue upon the completion of their original terms for an additional three years. However, when that authority was exhausted and no new long term contracts had been entered into, NPS invoked the authority under the clause in the older contracts to continue those contracts. With regard to the Wahweap concession contract, NPS was in the process of preparing a new prospectus in 2017, but no new prospectus has been issued to date. Documents published by NPS indicate that the incumbent’s concessioner’s possessory interest in the facilities at the site is $63,500,000, which generally represents the costs incurred in constructing the facility. Typically, the value of the possessory interest must be paid by a new concessioner to the incumbent if the contract changes hands unless NPS buys down that value.