Federal Lands

Concession activity on federal lands is a large industry, with civilian agencies managing more than 11,000 concession agreements throughout the federal government during 1994. Concessioners operating under these agreements generated about $2.2 billion in gross revenue. More than 90 percent of concession agreements and the concession gross revenues were from concessioners in the six land management agencies. For agreements that were either initiated or extended during fiscal year 1994, concessioners in the land management agencies paid the government an average of about three percent of their gross revenue. In contrast, concessioners in other agencies paid fees of about nine percent of their gross revenues. The key factors affecting the rate of return to the government were whether: (1) the fees were established through competition; (2) the agency was allowed to keep most of the concession fees it generated; and (3) whether an incumbent concessioner had a preferential right in renewing its agreement with the government. Throughout the government, rates of return from concessioners were higher when established through competition. Agencies which had authority to retain fees and which did not grant preferential rights of renewal generally obtained higher rates of return from concessioners.