The US Forest Service recently clarified its policy for issuing competitive bids for existing term permit operations in response to a letter from the National Forest Recreation Association (NFRA). In its response, the agency stated that “[a]gency policy and regulations governing competitive issuance of permits for federally owned improvements do not apply to existing concessions involving privately owned improvements such as ski areas, resorts, and marinas that are authorized by a term permit.” While federal regulations require the agency to issue a prospectus when (1) it receives one or more unsolicited proposals and (2) it determines that competitive interest exists, the Forest Service clarified that it will not find competitive interest exists even if it receives a proposal to operate an existing term permit operation “because the authorized improvements are owned by third parties, not the Federal government.”
The issue arose due to the Forest Service’s prior decision to issue a prospectus for an existing shuttle service which was authorized under a term permit. The Forest Service stated that the shuttle service should not have been issued a term permit under the Term Permit Act of 1915 because, even though it owned improvements on the site area including maintenance structures, in the agency’s view the shuttle operations did not depend “exclusively or primarily” on the improvements because the shuttles relied “primarily on roads that are federally owned.” The new permit for the shuttle operations, which was issued pursuant to a competitive process, was not a term permit. Term permit holders who are concerned the agency may assert they were issued a term permit in error should confirm with the agency that their operations rely exclusively or primarily on their improvements rather than federally owned improvements.