53 



STATEMENT OF PAUL NIELSEN, ATTORNEY, FRED HARVEY 



COMPANY 



Mr. Nielsen. Mr. Chairman, my name is Paul Nielsen. I appre- 

 ciate the opportunity to appear before you today. I am here on be- 

 half of Amfac Resorts, Inc., which is also known as The Fred Har- 

 vey Company, and the National Park Hospitality Association, an 

 organization of concessioners who provide services such as food, 

 lodging, and recreational activities to millions of visitors to our na- 

 tional parks every year. 



My experience is primarily in commercial real estate where I 

 have engaged in the acquisition, financing, leasing and sale of 

 major real estate assets for certain affiliates of Fred Harvey. I have 

 also analyzed and commented upon various legislative initiatives 

 relating to national parks concessions and have participated in re- 

 viewing prospectuses and preparing bids for concession opportuni- 

 ties. With me today is Allan Howe, Washington Representative of 

 the National Park Hospitality Association. I am sure that you know 

 Mr. Howe. 



We come here today, Mr. Chairman, to support the initiative you 

 have made to reexamine concessions contracting on Federal lands. 

 We think the approach taken in your bill, H.R. 2028, is much pref- 

 erable to the other bills which are before your committee relating 

 to the national parks concessions. 



In fact, we agree with every word of the introductory statement 

 you issued in connection with the bill. However, we think that H.R. 

 2028 can be improved in a number of areas. I have commented on 

 various provisions of the bill in my written testimony and cannot 

 touch upon all of them now. 



The basic point that I would like to make is that the basic rules 

 of business, real estate, and finance do not somehow magically 

 change once you drive through the gates of a national park or other 

 Federal land area. Return on investment and cash flow are still the 

 measures of a business's success. 



It should be realized that companies considering bidding on con- 

 cession contracts will be comparing those opportunities with other 

 alternative businesses. To the extent this committee makes one as- 

 pect of a concession business less attractive than a similar business 

 conducted on private land, it must make up for it somewhere else 

 to generate interest. 



It is to be realized that fees, revenues, expenses, capital invest- 

 ment, and property values are all interrelated components of the 

 mathematics of business. We believe that the development of a 

 more integrated bidding system can be good both for our industry 

 and the American public if consistent with these business fun- 

 damentals. 



Such a system should accomplish three things. First, it should 

 stimulate investment by the private sector in facilities which serve 

 the public. Second, it should result in the best operator under each 

 contract. And, third, it should encourage continuity by rewarding 

 good performance. 



The system should also be easily understood and administra- 

 tively efficient. If those goals are satisfied, we believe that there 

 will be no shortage of bidders for most operations, and that fees to 

 the government will rise somewhat over current levels. 



