[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]
H.R. 1461 and H.R. 1491
=======================================================================
LEGISLATIVE HEARING
before the
SUBCOMMITTEE ON NATIONAL PARKS, RECREATION, AND PUBLIC LANDS
of the
COMMITTEE ON RESOURCES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
June 7, 2001
__________
Serial No. 107-34
__________
Printed for the use of the Committee on Resources
Available via the World Wide Web: http://www.access.gpo.gov/congress/
house
or
Committee address: http://resourcescommittee.house.gov
U.S. GOVERNMENT PRINTING OFFICE
72-929 WASHINGTON : 2002
____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512-1800
Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001
COMMITTEE ON RESOURCES
JAMES V. HANSEN, Utah, Chairman
NICK J. RAHALL II, West Virginia, Ranking Democrat Member
Don Young, Alaska, George Miller, California
Vice Chairman Edward J. Markey, Massachusetts
W.J. ``Billy'' Tauzin, Louisiana Dale E. Kildee, Michigan
Jim Saxton, New Jersey Peter A. DeFazio, Oregon
Elton Gallegly, California Eni F.H. Faleomavaega, American Samoa
John J. Duncan, Jr., Tennessee Neil Abercrombie, Hawaii
Joel Hefley, Colorado Solomon P. Ortiz, Texas
Wayne T. Gilchrest, Maryland Frank Pallone, Jr., New Jersey
Ken Calvert, California Calvin M. Dooley, California
Scott McInnis, Colorado Robert A. Underwood, Guam
Richard W. Pombo, California Adam Smith, Washington
Barbara Cubin, Wyoming Donna M. Christensen, Virgin Islands
George Radanovich, California Ron Kind, Wisconsin
Walter B. Jones, Jr., North Carolina Jay Inslee, Washington
Mac Thornberry, Texas Grace F. Napolitano, California
Chris Cannon, Utah Tom Udall, New Mexico
John E. Peterson, Pennsylvania Mark Udall, Colorado
Bob Schaffer, Colorado Rush D. Holt, New Jersey
Jim Gibbons, Nevada James P. McGovern, Massachusetts
Mark E. Souder, Indiana Anibal Acevedo-Vila, Puerto Rico
Greg Walden, Oregon Hilda L. Solis, California
Michael K. Simpson, Idaho Brad Carson, Oklahoma
Thomas G. Tancredo, Colorado Betty McCollum, Minnesota
J.D. Hayworth, Arizona
C.L. ``Butch'' Otter, Idaho
Tom Osborne, Nebraska
Jeff Flake, Arizona
Dennis R. Rehberg, Montana
Allen D. Freemyer, Chief of Staff
Lisa Pittman, Chief Counsel
Michael S. Twinchek, Chief Clerk
James H. Zoia, Democrat Staff Director
Jeff Petrich, Democrat Chief Counsel
------
SUBCOMMITTEE ON NATIONAL PARKS, RECREATION, AND PUBLIC LANDS
JOEL HEFLEY, Colorado, Chairman
DONNA M. CHRISTENSEN, Virgin Islands Ranking Democrat Member
Elton Gallegly, California Dale E. Kildee, Michigan
John J. Duncan, Jr., Tennessee Eni F.H. Faleomavaega, American Samoa
Wayne T. Gilchrest, Maryland Frank Pallone, Jr., New Jersey
George Radanovich, California Tom Udall, New Mexico
Walter B. Jones, Jr., North Carolina, Mark Udall, Colorado
Vice Chairman Rush D. Holt, New Jersey
Mac Thornberry, Texas James P. McGovern, Massachusetts
Chris Cannon, Utah Anibal Acevedo-Vila, Puerto Rico
Bob Schaffer, Colorado Hilda L. Solis, California
Jim Gibbons, Nevada Betty McCollum, Minnesota
Mark E. Souder, Indiana
Michael K. Simpson, Idaho
Thomas G. Tancredo, Colorado
C O N T E N T S
----------
Page
Hearing held on Thursday, June 7, 2001........................... 1
Statement of Members:
Bennett, Hon. Robert F., a U.S. Senator from the State of
Utah, Prepared statement on H.R. 1491...................... 5
Cannon, Hon. Chris, a Representative in Congress from the
State of Utah, Prepared statement on H.R. 1491............. 6
Christensen, Hon. Donna M., a Delegate in Congress from the
Virgin Islands............................................. 4
Hansen, Hon. James V., a Representative in Congress from the
State of Utah.............................................. 3
Prepared statement on H.R. 1491.......................... 4
Hefley, Hon. Joel, a Representative in Congress from the
State of Colorado.......................................... 1
Prepared statement on H.R. 1461 and H.R. 1491............ 2
Matheson, Hon. Jim, a Representative in Congress from the
State of Utah.............................................. 7
Prepared statement on H.R. 1491.......................... 9
McGovern, Hon. James P., a Representative in Congress from
the State of Massachusetts, Prepared statement on H.R. 1461 6
Statement of Witnesses:
Machen, J. Bernard, President, University of Utah, Salt Lake
City, Utah................................................. 24
Prepared statement on H.R. 1491.......................... 25
Mastromarco, Dan R., Executive Director, Travel Council for
Fair Competition, Alexandria, Virginia..................... 37
Prepared statement on H.R. 1461.......................... 39
Ring, Richard G., Associate Director, Park Operations and
Education, National Park Service, Washington, D.C.......... 11
Prepared statement on H.R. 1461.......................... 12
Prepared statement on H.R. 1491.......................... 13
Simon, Dave, Director of Outdoor Activities, Sierra Club, San
Francisco, California...................................... 33
Prepared statement on H.R. 1461.......................... 34
Additional materials supplied:
Coughlin, Cris, President, Glacier Wilderness Guides, Inc.,
Statement submitted for the record......................... 56
Jackson, Stefan J., Public Policy Manager (Acting), National
Outdoor Leadership School, Lander, Wyoming, Statement
submitted for the record................................... 57
Jenkins, David, Director of Conservation and Public Policy,
American Canoe Association, Statement submitted for the
record..................................................... 59
LEGISLATIVE HEARING ON H.R. 1461, TO AMEND THE NATIONAL PARKS OMNIBUS
MANAGEMENT ACT OF 1998 TO REMOVE THE EXEMPTION FOR NONPROFIT
ORGANIZATIONS FROM THE GENERAL REQUIREMENT TO OBTAIN COMMERCIAL USE
AUTHORIZATIONS; AND H.R. 1491, TO ASSIST IN THE PRESERVATION OF
ARCHAEOLOGICAL, PALEONTOLOGICAL, ZOOLOGICAL, GEOLOGICAL, AND BOTANICAL
ARTIFACTS THROUGH CONSTRUCTION OF A NEW FACILITY FOR THE UNIVERSITY OF
UTAH MUSEUM OF NATURAL HISTORY, SALT LAKE CITY, UTAH.
----------
Thursday, June 7, 2001
U.S. House of Representatives
Subcommittee on National Parks, Recreation, and Public Lands
Committee on Resources
Washington, DC
----------
The Subcommittee met, pursuant to call, at 10:03 a.m., in
Room 1334, Longworth House Office Building, Hon. Joel Hefley
[Chairman of the Subcommittee] presiding.
STATEMENT OF THE HONORABLE JOEL HEFLEY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF UTAH
Mr. Hefley. The Committee will come to order. Welcome to
the hearing today this morning. The Subcommittee on Parks,
Recreation, and Public Lands will hear testimony on two bills,
H.R. 1461 and H.R. 1491.
H.R. 1461, which I introduced, would amend the National
Parks Omnibus Management Act of 1998 to remove the exemption
for certain nonprofit organizations from the general
requirement to obtain commercial use authorizations. Under the
current law, tax-exempt organizations that offer tour and
travel services to the general public are exempt from the
requirement to obtain commercial use authorization from the
Park Service to lead tour groups for rafting, hiking, and other
commercial recreational activities. We are aware that the
minority has expressed some concerns over certain provisions in
the bill, but we are hopeful that we can work together to
resolve any differences. It is not my intent to remove the
exemption from a legitimate nonprofit organization such as the
Boy Scouts or Scouts, and I will make sure that I address their
concerns.
Mr. Hefley. H.R. 1491 was introduced by Congressman Jim
Matheson of Utah. This bill would direct the Secretary of
Interior to make a grant to the University of Utah in Salt Lake
City, Utah to pay the Federal share of the costs of
construction for a new natural history museum, including the
design, planning, furnishing, and equipping of the new
building. The museum holds more than 1 million objects and
specimens recovered from Federal, State, and private lands in
Utah and surrounding states. The museum is known for its
extensively archaeological and paleontological collections.
Mr. Hefley. At this time I would like to ask unanimous
consent that Congressman Matheson be permitted to sit on the
dais following his statement. Without objection, so ordered.
I would like to thank all the witnesses who will testify on
these bills today. And I think first of all what I will do is
turn to Chairman Hansen and let's see if he has an opening
statement.
[The prepared statement of Mr. Hefley follows:]
Statement of The Honorable Joel Hefley, Chairman, Subcommittee on
National Parks, Recreation, and Public Lands
Good morning and welcome to the hearing today. This morning, the
Subcommittee on National Parks, Recreation and Public Lands will hear
testimony on two bills--H.R. 1461 and H.R. 1491.
H.R. 1461, which I introduced, would amend the National Parks
Omnibus Management Act of 1998 to remove the exemption for certain
nonprofit organizations from the general requirement to obtain
commercial use authorizations. Under the current law, tax-exempt
organizations that offer tour and travel services to the general public
are exempt from the requirement to obtain commercial use authorization
from the Park Service to lead tour groups for rafting, hiking and other
commercial recreational activities. We are aware that the minority has
expressed some concerns over certain provisions in the bill but we are
hopeful that we can work together to resolve any differences. It is not
my intent to remove the exemption for legitimate non-profit
organizations such as the Boy Scouts or the Girl Scouts, and I will
make sure that I address their concerns.
H.R. 1491 was introduced by Congressman Jim Matheson of Utah. This
bill would direct the Secretary of Interior to make a grant to the
University of Utah in Salt Lake City, Utah, to pay the Federal share of
the costs of construction for a new natural history museum, including
the design, planning, furnishing, and equipping of the new building.
The museum holds more than one million objects and specimens recovered
from Federal, state and private lands in Utah and surrounding states.
The museum is known for its extensive archaeological and
paleontological collections.
At this time, I would like to ask unanimous consent that
Congressman Matheson be permitted to sit on the dais following his
statement. Without objection, so ordered.
I would also ask the Ranking Member, Ms. Christian, if it would be
alright with her if Chairman Hansen made his opening statement first.
Without objection, so ordered.
I would like to thank all of our witnesses for being here today to
testify on these bills and now turn to Chairman Hansen.
______
STATEMENT OF THE HONORABLE JAMES V. HANSEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF UTAH
Mr. Hansen. Well, thank you, Mr. Chairman. I appreciate the
opportunity for being in the Committee today and I do have an
opening statement that I would like to read. I want to welcome
President Bernie Machen, president of my alma mater, University
of Utah, to this Subcommittee. I am pleased to welcome Mr.
Matheson, my colleague from the Second Congressional District
and commend him for recognizing the need for this legislation.
Many reasons to come to Utah are the parks, forests, public
lands, the abundant outdoor recreational and cultural
opportunities, and our history is well worth the trip for
anyone who has not been to the ``beehive State.'' However,
there is one thing that the State of Utah is sorely lacking in,
a museum which showcases our incredible natural history.
I congratulate Representative Matheson and Senator Bennett
for recognizing the need to assist the community in relocating
the museum from its current and unsatisfactory location to its
new building. With 69 percent of the State managed by Federal
agencies, many of the artifacts recovered from Federal lands
are currently archived and protected in the Museum of Natural
History. In the past, a Federal agency such as the Bureau of
Reclamation or Forest Service recovered artifacts on public
lands. They would be sent to the collections at the University
of Utah which is the Federal repository.
Archeological sites such as those found in Glen Canyon were
the previous homes for many of the items found in this
collection. In fact, the museum is now currently home to more
than 1 million artifacts, almost 75 percent of which were found
on Federal lands. The University of Utah has done a commendable
job preserving these priceless natural treasures, but they can
only do so much with the outdated facilities at their disposal.
The George Thomas Building was a fine library in its day. I
spent hundreds of hours in that place, but it is really an
unsuitable home for the collection we are talking about.
Given the facts of such an extensive collection that comes
from the Federal lands, it only makes sense that the Federal
Government should assume some responsibility for providing for
these artifacts in an appropriate home. Such Federal
involvement is not unheard of. Many museums receive Federal
funds, including the New York Public Library, the Chicago
Museum of Science and Industry, and the list goes on and on.
Although I might point out to my colleagues this
legislation authorizes $15 million, which is only 25 percent of
the cost of the new facility, with the 3-to-1 match the Federal
Government is as much a beneficiary as the State and community.
Mr. Matheson represents the interests of the constituency
well by introducing this legislation to ensure that this unique
collection is protected and well preserved. He has made it a
priority to be sure their final home is a place worthy of their
true value. I feel he is to be commended for that and that is
why I want to join him in this effort. I hope all members of
this Subcommittee will do the same thing. I thank you for
allowing us to have this hearing today and I appreciate the
opportunity for giving this opening statement.
Mr. Hefley. Thank you, Mr. Hansen.
[The prepared statement of Chairman Hansen follows:]
Statement of The Honorable James V. Hansen, Chairman, Committee on
Resources, on H.R. 1491
Thank you, Chairman Hefley, for holding this hearing today. I want
to welcome President Bernie Machen, President of my alma mater, the
University of Utah to the Subcommittee. I am pleased to welcome Mr.
Matheson, my colleague from the Second Congressional District and
commend him for recognizing the need for this legislation.
There are many reasons to come to Utah. Our parks, forests and
public lands, the abundant outdoor recreational and cultural
opportunities and our history is well worth the trip for anyone who is
not from the Beehive state. However, there is one thing that the State
of Utah is sorely lacking--a destination museum which showcases our
incredible natural history. I congratulate Congressman Matheson and
Senator Bennett for recognizing the need to assist the community in
relocating the museum from its current and unsatisfactory location to a
new building.
With 69 percent of the State managed by Federal agencies, many of
the artifacts recovered from Federal lands are currently archived and
protected at the Museum of Natural History. In the past, as Federal
agencies such as the Bureau of Reclamation, BLM, or Forest Service,
recovered artifacts on public lands, they would be sent to the
collections at the University of Utah, which is a Federal repository.
Archaeological sites such as those found in Glen Canyon were the
previous homes for many of the items in this collection. In fact, the
Museum now currently home to more than one million artifacts, almost 75
percent of which were found on Federal lands.
The University of Utah has done a commendable job at preserving
these priceless natural treasures, but they can only do so much with
the outdated facilities which they have at their disposal. The George
Thomas Building was a fine library in its day, but it is really an
unsuitable home for the collection we are talking about.
Given the fact that such an extensive collection has come from the
Federal lands, it only makes sense that the Federal Government should
assume some responsibility for providing these artifacts an appropriate
home. Such Federal involvement is not unheard of; many museums receive
Federal funds, including New York Public Library, the Chicago Museum of
Science and Industry, and so on. Although I might point out to my
colleagues that this legislation authorizes $15 million which is only
25 percent of the cost for the new facility. With a 3-to-1 match, the
Federal Government is as much a beneficiary as the state and the
community.
Mr. Matheson, represents the interest of his constituents well by
introducing legislation to assure that this unique collection is
protected and well preserved. He has made it a priority to assure that
their final home will be a place worthy of their true value. I feel he
is to be commended for that, and it is why I want to join him in that
effort, and hope that all the members of the Subcommittee will do the
same.
Thank you Chairman Hefley for holding this hearing.
______
Mr. Hefley. Mrs. Christensen, I think you were awed by the
honor we have of having Mr. Hansen join our Committee here too,
so I went ahead to him first and now I will turn to you.
STATEMENT OF THE HONORABLE DONNA M. CHRISTENSEN, A DELEGATE IN
CONGRESS FROM THE VIRGIN ISLANDS
Mrs. Christensen. Thank you very much. It is nice to have
our Chairman here with us today. I would like to make a
statement on the two measures before us this morning. The first
measure, H.R. 1461, would repeal the omnibus act of 1998 that
exempts nonprofit groups from the requirement to obtain a
commercial use authorization from the National Park Service
unless taxable income is derived from the park use. This
exemption was added to the legislation by the Resources
Committee in 1998 and was supported at that time by the
Majority and Minority alike.
Since then, no one has contacted the Minority to express a
concern with this exemption and the administration's testimony
today does not recognize the exemption as being a problem for
either the resources of our park or their management. Many not-
for-profit organizations such as the Boy Scouts, church camps,
and outdoor clubs such as the Sierra Club take their members on
outings to national parks, providing their own guide services
and charging fees to cover their costs. This alone does not
make them commercial operations, and there is language in the
exemption to deal with any use that generates taxable income.
Further, these not-for-profit organizations are not
permitted unregulated use of our national parks. While they are
exempt from obtaining a commercial use authorization, they are
still required to obtain any other necessary National Park
Service permits and comply with any regulations that the NPS
may have to protect park resources.
Mr. Chairman, nonprofit organization like the Scouts and
others are different than for-profit entities and should be
treated as such. We have seen no evidence thus far indicating
any need for the change proposed by H.R. 1461.
The second measure, H.R. 1491, directs the Secretary of the
Interior to make a grant to the University of Utah to pay what
the bill refers to as the Federal share of the cost to
construct an expansion of the university's Museum of Natural
History. The bill requires the museum to submit a formal grant
proposal to the Secretary and limits the Federal share to 25
percent of the total cost of the project.
Finally, H.R. 1491 authorizes $15 million for the purposes
of this legislation. Mr. Chairman, pass-through grants like
this have been a matter of ongoing concern within our
Committee. The legislation would require the Secretary to award
these funds to the University outside of any existing grant
programs designed to fund museums, allowing this project to
avoid a competitive grant process.
We look forward to learning more about the need for both of
these pieces of legislation from the witnesses before us today.
And I would also like to welcome my other colleague. Thank you.
[The prepared statement of Senator Bennett follows:]
Statement of The Honorable Robert F. Bennett, a U.S. Senator from the
State of Utah, on H.R. 1491
I thank Representative Hefley and the Subcommittee on National
Parks, Recreation, and Public Lands for holding today's hearing on the
Utah Public Lands Artifact Preservation Act. I appreciate the House of
Representatives moving forward with this important legislation. The
Senate will begin its work on this legislation shortly. Additionally, I
welcome the support of Representatives Cannon, Hansen, and Matheson on
this bill which will help Utah protect and preserve its natural history
and cultural heritage.
S.139 and its House companion, H.R. 1491, are rather simple pieces
of legislation that will go a long way to preserve and protect almost
one million artifacts, which showcase the natural and cultural
significance of Utah's public lands. When this bill becomes law, the
Secretary of the Interior will be directed to make available to the
University of Utah Museum of Natural History a grant in the amount of
$15 million for the construction and other associated costs of a new
facility that will allow for the proper curation of the scientifically
significant Federal collection. It should be noted that the Federal
share of this project will not exceed 25% of the total project costs.
The success of the new museum relies on the support of private
individuals and interested foundations. One of the most fulfilling
aspects of this project has been the impressive and generous financial
support from Utah's citizens and foundations. Since I announced my
intentions to introduce and pass this legislation last fall, the museum
has already received a $10 million gift from the Emma Eccles Jones
foundation. Furthermore, it is my understanding that another $10
million from a different foundation is very close to being given to the
museum, pending progress in the Congress.
As you may know, Utah is almost two-thirds Federally managed.
Almost every agency within the Department of the Interior has a land
interest in Utah. I strongly believe that this museum will not only
benefit the people of the Intermountain region and scientific
researchers, but will also benefit the public land management agencies.
This museum will help its visitors understand the significance of
Utah's public lands. Utah's public lands are not only mountains,
basins, mesas, and canyons, they were once roamed by dinosaurs and home
to thriving ancient cultures. It is my hope that a visit to the new
museum will enhance the public's future visits to our National Parks,
BLM lands, and BuRec dams and lakes.
Again, I appreciate the efforts of Representative Hefley, the
members of Utah's delegation, and the Committee on Resources on this
legislation. I look forward to working with them so that we may pass
this legislation this year.
______
[The prepared statement of Mr. Cannon follows:]
Statement of The Honorable Chris Cannon, a Representative in Congress
from the State of Utah
Thank you Mr. Chairman for holding this hearing today. I also thank
Congressman Matheson for introducing the Utah Public Lands Artifact
Preservation Act of 2001. This legislation will enable the Museum of
Natural History at the University of Utah to construct a new facility.
As any of you have visited Utah know, the variety and abundance of
natural resources is stunning. From Dinosaur National Monument with its
dinosaur quarry to Grand Gulch with its high concentration of
archaeological sites, Utah is a historian's paradise. Aside from
dinosaur relics, we also boast an incredible variety of plant and
animal life.
With such a high proportion of Federal ownership of our land, it is
crucial that we preserve the artifacts that are recovered. This
legislation allows the Federal Government to leverage state and private
money to protect Federally owned artifacts. Preservation efforts will
ensure that future generations of Utahns will enjoy the rich ancient
history Utah has to offer. I look forward to hearing the testimony of
the witnesses.
______
[The prepared statement of Mr. McGovern follows:]
Statement of The Honorable James P. McGovern, a Representative in
Congress from the State of Massachusetts
I would like to thank the distinguished Chairman, Mr. Hefley for
holding today's hearing on amendments to the National Parks Omnibus
Management Act of 1998.
I would also like to thank the distinguished panelists for being
here today. I look forward to hearing your testimony.
There are a number of reasons that I am opposed to H.R. 1461. I
believe an attempt to amend the Act in this manner is unfair for both
nonprofit groups and for profit organizations, alike. If this amendment
passes, small groups will be forced to compete with larger more
profitable institutions for Commercial Use Authorizations permits
(CUAs). If every organization is forced to file for a CUA permit, the
cost of trips, clean-ups, scientific and leisure expeditions will
increase. This amendment sends a signal to nonprofit organizations that
we do not trust them and that we do not appreciate their work in our
national parks. I believe that these nonprofit organizations deserve a
lot of appreciation and respect for their dedication to our
environment. I will oppose any legislation that forces them to cut
their programs.
If this amendment passes, the additional cost of a CUA permit will
hinder activity in the national parks. There are many organizations
that partake in events in the National Parks. If they are required to
obtain a CUA permit, these organizations might not organize as many
events as they usually do because of the increased cost.
We should realize that many of the events sponsored by nonprofits
are not just leisurely strolls through the woods. They provide a great
service for the United States by giving many people the opportunity to
see the beauty and splendor of our National Parks. A majority of the
events that nonprofits organize in the National Parks are for the
purpose of promoting awareness. Nonprofits usually have to supplement
the cost of these trips from other sources. Many organizations also run
service trips in the National Parks. Service trips help build and
repair trails, plant new trees, and maintain the parks. Without the
assistance of these organizations, our National Parks would fall into
disrepair. If organizations are required to spend additional funds to
obtain a permit and hire a guide, they will not be able to provide as
many trips as they currently do. The entire country will suffer if we
make it more difficult for these organizations to provide our National
Parks with the support that they need and deserve.
Lastly, I would like to stress that the Administration is against
this legislation. It will prevent smaller organizations from being able
to compete against other larger organizations. The additional revenue
from the fees that the nonprofit organization will have to pay in order
to file to receive a CUA is overshadowed by the additional
administrative cost that would be required to read the applications and
issue the permits. If this amendment passes, the National Parks will
actually lose money because the Park Service will be forced to pick up
where organizations left off.
Thank you, Mr. Chairman, and I request that my statement be
included in the record of this hearing.
______
Mr. Hefley. Okay. Our first panel will start with
Congressman Matheson. I hope you appreciate, Congressman, the
rapidity with which we are getting to your bill and I hope that
it in no way reflects the fact that the gentleman sitting to my
right is Chairman of the Committee. It is simply that my right
arm has been twisted so hard by him, as it has on so many other
occasions, that we welcome you today with your wonderful piece
of legislation. So would you go ahead and take the time to read
it?
STATEMENT OF THE HONORABLE JIM MATHESON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF UTAH
Mr. Matheson. Thank you very much. I will leave comments
about your right arm so you can discuss that with Mr. Hansen.
But, Chairman Hefley and Ranking Member Mrs. Christensen, I
just want to thank you for having this hearing today. It is
important. It is not only important to the people of Utah, it
is also important to our shared national heritage. And I want
to give special thanks to Chairman Hansen and Congressman
Cannon and to their staffs for their steadfast support on this
project. Today's hearing is really a culmination of our
collective efforts as a delegation from Utah.
In 1824, a philanthropist named James Smithson bequeathed
his fortune to the Government of the United states in order to
found an institution to, and I quote, increase the diffusion of
knowledge among men.
In 1846, the United States established the Smithsonian
Institution and established the wise and remarkable precedent
of the value of public investment into institutions of science,
research, and heritage.
President Machen and I have come here today as part of this
precedent. Mr. Chairman, in Utah we have an institution that
houses 1 billion years of the history of life on our planet. It
is an institution that hold three-quarters of a million
artifacts, detailing tens of thousands of years of Native
American life throughout the Rocky Mountain and Great Basin
areas of our Nation. It contains over 30,000 specimens of
mammals, one of the 30 largest collections in the Western
Hemisphere and its 18,000 specimen reptile collection contains
one of the largest turtle assemblages in the world.
It is an institution that houses one of the world's great
paleontology collections. Its 12,000 specimen vertebrate fossil
collection is dominated by 150-million-year-old dinosaurs from
the Jurassic period, as well as Ice Age mammals such as giant
bears, mammoths and mastodons.
What I have just described is just a fraction of the
resources provided by the University of Utah's Natural History
Museum. It is a source for archaeological, anthropological, and
paleontology treasures unsurpassed in the western United
States.
However, these resources are under threat. First, they are
housed in a converted library built in the 1930's. It is a
building constructed for the close, claustrophobic stacking of
books, not for the storage of national treasures. Most of the
ceilings throughout the building are 7 feet 2 inches high,
which, as you can imagine, makes dinosaur storage somewhat of a
problem. Climate control and water systems are woefully
antiquated. The humidity and temperature in the display and
storage areas has wide swings. This inconsistency puts
tremendous strain on the increasingly fragile collections.
A few weeks ago I took a tour of the museum, and halfway
through the tour we encountered a chunk of ceiling that had
falling during a water leak that had occurred within the last
couple of days. As with many Depression era buildings, there
are numerous structural deficiencies that put the collections
as risk and inhibit access to the public. Fire protection
systems are inadequate, an outdated HVAC system, no possibility
for expansion, and no freight elevator loading dock.
All of these are compounded by the fact that the collection
now sits 400 yards away from the second most active fault in
the Continental United States in a building with beams built to
hold books rather than mastodons.
It is plausible to think that our kids' Pokemon cards might
be at less risk for damage than some of the pieces of this
collection.
The University, along with private donors and the State
government, have embarked on an ambitious project to build a
new museum that would be a centerpiece for cultural and
scientific education in the intermountain West. They have
selected a site for the new building that would be located at
the University's Research Park and will be adjacent to the city
zoo, a living history heritage park, and the State arboretum.
The University has just completed its preprogram study of the
site as well as determining the project costs. This project
will be a partnership in every sense of the word. State and
private donors have promised to match every Federal dollar with
three of their own. The University's donors and alumni network
view this as a priority project for Utah and are actively
engaged in its development.
The University has already contributed the 14 acres for the
development. The State has guaranteed the operating funds for
the facility at $800,000 annually. To date, close to $12
million has been raised from private donors and this includes
$10 million from the Emma Eccles Jones Foundation.
Unlike many museums throughout the country, about 75
percent of the museum's holdings are owned outright by the
Federal Government, with more than 90 percent of some
collections coming from Federal lands. That means that these
artifacts, fossils, and specimens belong to the people of the
United States. These exhibits and collections are part of our
collective national heritage. I hope with your help we can save
these treasures for future generations of Americans. And I
appreciate your time.
Mr. Hefley. Thank you, Congressman.
[The prepared statement of Mr. Matheson follows:]
Statement of The Honorable Jim Matheson, A Representative in Congress
from the State of Utah
Chairman Hefley, Ranking Member Christensen, I want to thank you
for having this hearing today. It is important, not only to the people
of Utah, but also to our shared national heritage.
I want to give special thanks to Chairman Hansen and Congressman
Cannon and their staffs for their steadfast support of this project,
and today's hearing is a culmination of our collective efforts as a
delegation.
In 1824, a philanthropist named James Smithson bequeathed his
fortune to the government of the United States in order to found an
Institution to, and I quote, ``increase the diffusion of knowledge
among men.
In 1846 the United States established the Smithsonian Institution,
and established the wise and remarkable precedent of the value of
public investment into institutions of science, research, and heritage.
President Machen and I have come here today as part of this
precedent.
Mr. Chairman, in Utah we have an institution that houses one
billion years of the history of life on our planet. It is an
institution that holds three-quarters of a million artifacts detailing
tens of thousands of years of Native American life throughout the Rocky
Mountain and Great Basin areas of our nation.
It contains over 30,000 specimens of mammals, one of the thirty
largest collections in the western hemisphere, and its 18,000 specimen
reptile collection contains one of the largest turtle assemblages in
the world.
It is an institution that houses one of the world's great
paleontology collections. It's 12,000 specimen vertebrate fossil
collection is dominated by 150 million year old dinosaurs from the
Jurassic period, as well as Ice Age mammals such as giant bears,
mammoths and mastodons.
What I have just described is just a fraction of the resources
provided by the University of Utah's Natural History museum. It is a
source of archaeological, anthropological, and paleontology treasures
unsurpassed in the Western United States.
However, these resources are under threat. First, they are housed
in a converted library built during the 1930s. It is a building
constructed for the close, claustrophobic stacking of books not for the
storage of national treasures.
Most of the ceilings throughout the building are seven feet two
inches high. Which, as you can imagine, makes dinosaur storage somewhat
of a problem.
Climate control and water systems are woefully antiquated. The
humidity and temperature in the display and storage areas has wide
swings. This inconsistency puts tremendous strain on the increasingly
fragile collections.
A few weeks ago, I took a tour of the museum. Halfway through the
tour a chunk of ceiling fell and crashed at my feet. Never have I been
so serendipitously hit in the head by a chunk of plaster.
As with many Depression Era buildings there are numerous structural
deficiencies that put the collections at risk and inhibit access to the
public. Fire protection systems are inadequate and antiquated, an
outdated HVAC system, no possibility for expansion, and no freight
elevator or loading dock.
All of these are compounded by the fact that the collection now
sits 400 yards away from the second most active fault in the
continental United States in a building with beams built to hold books
rather than mastodons.
It's plausible to think that our kid's Pokemon cards might be at
less risk for damage than some of the pieces in this collection.
The University along with private donors and the state government
have embarked on an ambitious project to build a new museum that would
be a centerpiece for cultural and scientific education in the
Intermountain West.
They have selected a site for the new building that will be located
in the University's Research Park, and will be adjacent to the City's
zoo, a living history heritage park, and the state arboretum. The
University has just completed its pre-program study of the site, as
well as determining the project costs.
This project will be a partnership in every sense of the word.
State and private donors have promised to match every Federal dollar
with three of their own. The University's donors and alumni network
view this as a priority project for Utah, and are actively engaged in
its development.
The University has already contributed the 14 acres for the
development. The State has guaranteed the operating funds for the
facility at $800,000 annually. To date close to $12 million has been
raised from private donors, this includes $10 million from the Emma
Eccles Jones foundation.
Unlike many museums throughout the country, about seventy-five
percent of the museum's holdings are owned outright by the Federal
government. With more than ninety percent of some collections coming
from Federal lands.
That means that these artifacts, fossils, and specimens belong to
the people of the United States. These exhibits and collections are
part of our collective national heritage. I hope with your help, we can
save these treasures for future generations of Americans.
Thank you for your time.
______
Mr. Hefley. Mrs. Christensen.
Mrs. Christensen. I don't have any questions at this time.
Mr. Hefley. Mr. Hansen.
Mr. Hansen. I have no questions. I commend my colleague
from Utah for his standpoint on this matter.
Mr. Simpson. Just one question. Did I hear you correctly
that--what was it--70 percent of the artifacts are actually
owned by the Federal Government?
Mr. Matheson. Seventy-five percent.
Mr. Simpson. Thank you.
Mr. Hefley. You made a good case for the quality of the
collection and for the need for a new facility.
You know, I used to go with the Fish and Wildlife Service
every year fishing out on the eastern plains of Colorado and we
caught lots of fish, and I have accused them of having divers
down there put it on my hook.
How could you have a more opportune thing happen than the
roof fall in just as you are viewing it? I want to talk to the
president of the University about that.
I guess the question I would have is I think the case needs
to be made that this is a Federal responsibility, that the
Federal Government should do this. I know that we have, as
Chairman Hansen has said, we have given money to museums, $80
million for Steamtown--Mr. Hansen, you and I have talked about
that a lot; $6.4 million for the New York botanical garden; 16
million for the Hispanic Cultural Center in New Mexico; 13
million for the American Museum of Natural History; and 10
million for Fort Pack Dam Interpretive Center in Montana; 3.8
million for the Center for Historically Black Heritage at Texas
A&M; 3 million for a museum at Brown University.
So it is not without precedent. But this, as I understand
it, would come out of the Park System's hide. And with all the
other needs we have in the Park System, convince us that this
is an expenditure of money that we need to be make being.
Mr. Matheson. Sure. First of all, there is nothing in the
legislation that specifically says it would come from the
National Park Service alone. This is looking at it as a
Department of Interior appropriations at the discretion of the
Secretary of Interior, so we want to make sure that it is
understood. We have a lot of Federal land in Utah we have BLM
lands, we have national forestland, we have national parkland
in Utah. These artifacts come from all of these locations.
I do want to correct--at least my understanding would be is
this is not necessarily a target of just the National Park
Service funding as a source of funds for this museum
construction. As I said in my testimony, 75 percent of the
artifacts in this museum are Federal artifacts. Many of these
artifacts come from Federal lands, and I think that in and of
itself is a compelling case there ought to be some Federal
involvement.
Mind you, as I said, this is a 3-to-1 match. We are looking
at $3 coming in from elsewhere to match $1 that comes from the
Federal Government.
Mr. Hefley. Okay. I don't think I have any further
questions. Thank you very much for being here and please join
us if you would like.
Mr. Matheson. Thank you.
Mr. Hefley. Our second panel will be Mr. Richard Ring,
Associate Director of Park Operations and Education for the
National Park Service. He will be speaking on both bills.
Mr. Ring, we will give you the time, and we ordinarily do 5
minutes of testimony, and in this case you will be speaking on
both bills, so if you need to take more time than that, feel
free to do that.
STATEMENT OF RICHARD G. RING, ASSOCIATE DIRECTOR, PARK
OPERATIONS AND EDUCATION, NATIONAL PARK SERVICE
Mr. Ring. Thank you, Mr. Chairman, I will try to keep it
down to 5 minutes. And again, thank you for the opportunity to
testify this morning. I am here to present the Department of
Interior's views first on H.R. 1461, a bill to amend the
National Park Omnibus Management Act to remove the exemption
for nonprofit organizations from the general requirement to
obtain commercial use authorizations.
The Department does not support H.R. 1461 because of the
financial burden that it would potentially place on many
nonprofit organizations including educational groups, outdoor
clubs, and other nonprofits. Section 14 of the Omnibus
Management Act of 1998 permits the National Park Service to
authorize commercial use authorizations for these for a variety
of smaller operations, and these operations are intended to be
used only for services that lack minimal impacts on park
resources and values and are consistent with the purposes for
which the park were established.These operations are limited to
those grossing $25,000 or less annually and the law does exempt
nonprofits from the requirement of obtaining commercial use
authorizations unless taxable income is derived from their
operations.
H.R. 1461 would remove the provision in the law, and
organizations such as outdoor clubs, scout groups, educational
groups, and other nonprofits would be required to obtain the
authorization and pay for it. And it is subject to the payment
of the same fees and/or requirements as other commercial
operators. Such a change in the law would result in financial
burdens being placed on some smaller nonprofits, potentially
discouraging or precluding them from being able to conduct
their activities in national parks. The financial benefit from
additional fee receipts that we would like to receive from
these folks would be both minimal and would be offset by the
additional administrative costs that would be necessary to
evaluate the commercial value of nonprofit operations that do
not generate taxable income.
The Department would be glad to work with the Committee to
ensure that this issue is addressed in an appropriate and fair
manner. And I would be happy to answer any questions on this
bill.
[The prepared statement of Mr. Ring follows:]
Statement of Richard G. Ring, Associate Director, Park Operations and
Education, National Park Service, U.S. Department of the Interior, on
H.R. 1461
Mr. Chairman, thank you for the opportunity to present the
Department of the Interior's views on H.R. 1461, a bill to amend the
National Parks Omnibus Management Act of 1998 to remove the exemption
for nonprofit organizations from the general requirement to obtain
commercial use authorizations.
The Department does not support H.R. 1461 because of the financial
burden it would potentially place on many nonprofit organizations,
including educational groups, outdoor clubs, and other nonprofits.
Section 418 of the National Parks Omnibus Management Act of 1998
permits the National Park Service to authorize individuals,
corporations, or other entities to provide visitor services in units of
the National Park System through a commercial use authorization. Such
authorizations are not concessions contracts, and are intended to be
used only for services that will have minimal impact on park resources
and values and are consistent with the purposes for which the park was
established.
Furthermore, the law limits this type of authorization to
commercial operations grossing $25,000 or less annually from services
originating and provided solely within a park, or operations whose use
of the park is incidental and whose services originate and terminate
outside of the park. In addition, the law specifically recognizes
commercial use authorizations for uses such as organized children's
camps, outdoor clubs, and other nonprofit institutions. However, the
law exempts nonprofits from the requirement of obtaining a commercial
use authorization unless taxable income is derived from their
operations in the park.
H.R. 1461 would remove the provision in the law that exempts
nonprofits from having to obtain a commercial use authorization. The
effect of this would be to require all nonprofit organizations, even
those that do not derive taxable income from their operations in a
park, to obtain a commercial use authorization. Potentially,
organizations such as outdoor clubs, scout troops, educational groups,
and other nonprofits could be required to obtain an authorization,
subject to payment of the same fees and other requirements as
commercial operators. While the Department strongly supports the
concept of requiring commercial operators, including nonprofits that
derive taxable income from their park operations, to pay a fee in order
to obtain an authorization, we do not believe that this requirement
should apply to all nonprofits. Such a change in the law would result
in a financial burden being placed on some smaller nonprofits,
potentially discouraging or precluding them from being able to conduct
their activities in national parks.
For the National Park Service, the financial benefit from
additional fee receipts would likely be both minimal and offset by the
added administrative requirements to evaluate the commercial value of
nonprofit operations that do not generate taxable income. However, the
Department would be glad to work with the committee to ensure that this
issue is addressed in an appropriate and fair manner.
This concludes my testimony. I would be glad to answer any
questions that you or members of the subcommittee might have.
______
Mr. Ring. And I am pleased to go to the second bill, Mr.
Chairman.
Mr. Hefley. Go ahead with your testimony on the other one,
and then we will do both.
Mr. Ring. Okay. I would like to also testify on H.R. 1491,
a bill to assist in the preservation of archaeological,
paleontological, zoological, geological, and botanical
artifacts through the construction of a new facility for the
University of Utah Museum.
The Department opposes H.R. 1491. We appreciate the
interest the museum has in providing the highest level of care
to the objects in its collection. We believe the limited use of
National Park Service appropriations to fund the design,
construction, and operation of projects of non-National Park
Service projects of this type is inappropriate.
In the last Congress alone, the legislation was passed and
signed into law that authorized over $80 million in grants to
be passed through the National Park Service budget for nonpark
system projects. Each time this is done it reduces the ability
of a limited amount of discretionary funds to address the needs
of the national parks. We believe that funds are more
appropriately directed at this time to reducing the long list
of necessary but deferred construction projects, as well as
those meeting curatorial needs, that have been identified in
our national parks.
Again, the Department is willing to work with all the
involved agencies and the museum to thoroughly assess all
possible alternatives for providing the highest level of care
to the objects currently housed at the museum, including, if
necessary, the transferring of the collection to Federal
repositories that are managed directly by the Federal agencies.
And again, that summarizes my testimony and I will be happy to
answer any questions on either bill.
Mr. Hefley. Thank you.
[The prepared statement of Mr. Ring follows:]
Statement of Richard G. Ring, Associate Director, Park Operations and
Education, National Park Service, U.S. Department of the Interior, on
H.R. 1491
Mr. Chairman, thank you for the opportunity to present the views of
the Department of the Interior on H.R. 1491, a bill to assist in the
preservation of archaeological, paleontological, zoological,
geological, and botanical artifacts through construction of a new
facility for the University of Utah Museum of Natural History, Salt
Lake City, Utah.
The Department opposes the enactment of H.R. 1491. Our opposition
does not detract from the significance and importance of the museum as
a place of learning and as a keeper of important collections that
showcase many features of America's past. We encourage the University
and the State of Utah to continue to seek funding and other solutions
for the preservation and protection of the collections, including
working with existing programs managed by all of the Federal agencies
with collections stored at the museum.
We appreciate the interest the museum has in providing the highest
level of care to the objects in its collection. However, we believe the
use of limited National Park Service appropriations to fund the design,
construction, and operation of projects of non-National Park Service
projects of this type is inappropriate.
In the last Congress alone, legislation was passed and signed into
law that authorized over $80 million in grants to be passed through the
National Park Service budget for non-Park System projects. Each time
this is done, it reduces the availability of a limited amount of
discretionary funds to address the needs of our national parks and
other important national priorities.
The Department is committed to supporting the President's
Initiative to eliminate the deferred maintenance backlog in our
national parks. We believe funds are more appropriately directed at
this time to reducing the long list of necessary but deferred
construction projects, as well as those meeting curatorial needs, that
have been identified in our national parks.
H.R. 1491 authorizes the Secretary of the Interior, subject to the
availability of appropriations, to award a grant to the museum to pay
for a Federal share of the cost of construction of a new facility. The
bill states that more than 75 percent of the museum's collection have
come from Federal lands and have been collected for a number of years.
Items in the collection have come from land managed not only by the
Bureau of Land Management, the Bureau of Reclamation, the National Park
Service, the United States Fish and Wildlife Service, the U.S. Forest
Service, but also the Department of Defense and the Bureau of Indian
Affairs--agencies not mentioned in the legislation. The Federal share
of the cost for this project is not to exceed 25 percent. A total of
$15 million is authorized to be appropriated as a grant to the
University of Utah. Federal funds are to be used for the design,
planning, furnishing and equipping of the museum.
The University of Utah is in Salt Lake City and the Museum of
Natural History has been designated by the state legislature as the
State museum of natural history. Current exhibit and storage facilities
are inadequate and place the collection in danger. We realize that
museum facilities throughout the country, including the University of
Utah Museum of Natural History, are in need of improved conditions to
allow them to adequately protect and preserve the objects in their
care.
Due to the financial implications of the bill on national parks and
park programs, we must oppose H.R. 1491. However, the Department is
willing to work with all of the involved agencies and the museum to
thoroughly assess all possible alternatives for providing the highest
level of care to the objects currently housed at the museum, including,
if necessary, the transferring of collections to Federal repositories.
This completes my statement. I will be pleased to answer any
questions you or other members of the Subcommittee may have.
______
Mr. Hefley. Mrs. Christensen.
Mrs. Christensen. Thank you, Mr. Chairman. Good morning Mr.
Ring. I have a few questions. There will be two on 1461, one on
1491.
Does the exemption language of section 418 seek or create
any problems with you for protecting park resources or
providing for visitors' safety. This is with regard to the
nonprofit.
Mr. Ring. Does the exemption in the proposed bill?
Mrs. Christensen. Is it problematic for you, has it
provided problems for the Park Service who manage the
resources, because of the exemption for the nonprofit groups?
Mr. Ring. No, it has not.
Mrs. Christensen. It has not. Also do you have any way--
would you characterize the nonprofit groups that have outings
in our national parks commercial operations?
Mr. Ring. For the most part they are not; but again, the
current law makes a very clear distinction that it is not just
nonprofit status but it is nonprofit status where the activity
is not generating taxable income.
Mrs. Christensen. And there is a provision if there is any
taxable income.
Mr. Ring. Then they would have to get a commercial use
authorization and pay all the fees that would normally apply.
Mrs. Christensen. And the other bill, until I heard the
testimony this morning I wasn't really aware that 75 percent of
the artifacts were Federal, as Congressman Matheson has said.
Do you consider those as belonging to the Federal Government?
Mr. Ring. I think that is a matter that bears a lot of
examination. Many of the artifacts may have been collected
before the designation or the establishment of a national park
unit, and there may be some relationship to the Smithsonian if
they were public lands. I think that bears a very detailed
examination as to the ownership of them.
Mrs. Christensen. Thank you. I don't have any other
questions, Mr. Chairman.
Mr. Hefley. Thank you. Mr. Hansen.
Mr. Hansen. Thank you, Mr. Chairman.
Mr. Ring, you stated in the opposition that the
administration has to 1491 that you do not believe they should
fund construction or operation of a non-national park project.
Do you believe that the Department of Interior has the
responsibility, financial responsibility, to assist States,
organizations, universities, whoever, that have taken it upon
themselves to preserve natural resources such as artifacts,
fossils, things that have national significance?
Mr. Ring. We are most willing to work with State and local
governments on those kinds of issues, and we are very
interested in sitting down and examining what are the options,
what choices are there to best accomplish that.
Mr. Hansen. You say State and local governments. Do we
expand that to mean State-owned institutions.
Mr. Ring. Certainly, sir.
Mr. Hansen. So you do accept the fact that possibly the
Federal Government should have a hand in those things, is that
right?
Mr. Ring. I believe we work with all of these kinds of
institutions, both directly and with technical assistance, and
work with them on a range of these kinds of problems.
Mr. Hansen. And do you accept the fact that the Federal
Government has done this for other institutions?
Mr. Ring. Well, yes, sir. I mentioned, that particularly in
the last year alone, about $80 million of past grants were
authorized through the Park Service budget for these kinds of
activities. The concern that we have is facing such an enormous
backlog within the national park system that these grants are
being passed through the National Park Service budget and it is
very difficult with scarce allocations to pursue a wide range
of very important priorities. So I think that is more the
issue.
I also think, sir, that the scope of this concern needs to
be understood. There are approximately 583 nonFederal museums
that house some portion of collections that are either owned by
or collected from Federal land. Of these, about 142 are
associated with National Park Service collections.
Mr. Hansen. Do you accept the fact that the majority of
these artifacts or things that are found basically come off of
Federal grounds; therefore, there is somewhat of a correlation
or a responsibility of the Federal Government, if they have an
interest in that, and I think in my 20 some years they have
always declared they have an interest in it, the Federal
Government does have a responsibility to be part and particle
of this, as you have stated is done all over America basically?
Mr. Ring. Yes, sir, I do. When a problem arises that we
welcome the opportunity to sit down with the institution and
discuss what happens and the best way to solve the problem.
Mr. Hansen. Have you been out there, by any chance, and
looked at the present repository of these things?
Mr. Ring. No, sir, I have not seen--.
Mr. Hansen. The dilapidated Thomas Library.
Mr. Ring. No, sir, I have not seen this particular site,
but I have visited a number of other repositories that the
National Park Service manages directly and seen equally
deplorable conditions. We have a very large problem with the
collections.
Mr. Hansen. I don't argue the facts at all that the Park
Service has an infrastructure problem. When I chaired this
Committee, I went through that same frustration with the
literally billions of dollars of backlog. That is one of the
reasons we did the demonstration project and others to bring
those things to light. I notice in your testimony that you
stated that the University really ought to look at other
existing programs that are put out by the Federal Government
for additional monies. How much did you have in mind?
Mr. Ring. Sir, I don't have a specific program to mention
to you today, but I would be happy to provide to you that
information.
Mr. Hansen. I would be happy if you would do that so we can
see what other avenues we can explore.
[The information referred to follows:]
Question: In reference to the NPS testimony that the museum should
``continue to seek funding and other solutions for the preservation and
protection of the collections, including working with existing programs
managed by all of the federal agencies with collections stored at the
museum,'' Mr. Hansen asked the specifics about which programs the
museum should look to.
Answer: The following list provides information on potential
funding sources for the Utah Museum of Natural History (UMNH) to use in
caring for Federal collections. The UMNH has been successful in
obtaining funds from most of the Federal granting agencies. We note
that in 1935 Federal WPA funds financed the construction of the
building that currently houses the Museum.
National Endowment for the Humanities
LChallenge Grants-Challenge grants help institutions and
organizations secure long-term support for, and improvements in, their
humanities programs and resources. In special circumstances challenge
grants can also help with limited direct costs, such as the purchase of
capital equipment, construction and renovation, and even debt
retirement. Because of the matching requirements, these NEH awards also
strengthen the humanities by encouraging non-Federal sources of
support.
LPreservation Assistance Grants-Preservation Assistance Grants can
help museums enhance their capacity to preserve their humanities
collections. Applicants may request support for general preservation
assessments or consultations with preservation professionals to develop
a specific plan for addressing an identified problem. Awards will also
be made to purchase basic preservation supplies, equipment, and storage
furniture.
Institute for Museum and Library Services
LGeneral Operating Support-The IMLS General Operating Support
program encourages the best in museum service. Museums use these funds
to strengthen collections care and raise funds from other sources. The
two-year award provides unrestricted funds for ongoing institutional
activities.
LConservation Project Support-Grants are available for five broad
types of conservation activities, including collections treatment and
environmental improvements.
National Science Foundation
LThe Biological Research Collections (BRC) program provides support
for collection improvement, for collection computerization, for
research to develop better techniques of curation and collection
management, and for collections community based development
undertakings. Physical improvements typically involve rehousing a
collection, replacing inadequate resources, providing new resources for
continued growth, or incorporating one or more collections donated by
another institution or individual. Allowable costs generally include
the purchase and installation of new storage systems, the purchase of
curatorial materials, as well as new curatorial and technical
assistance specifically designed to effect the proposed improvements
for the duration of the proposed project.
National Park Service
LNative American Graves Protection and Repatriation Act (NAGPRA)
Grants-NAGPRA grants are awarded on a competitive basis to Indian
tribes, Native Hawaiian organizations, and museums that need financial
assistance to carry out duties associated with NAGPRA compliance.
Although Congress does not make the distinction between funds intended
for distribution to the two groups of eligible applicants--Indian
tribes and Native Hawaiian organizations, and museums--the NAGPRA.
Grants office administers these grants separately. The number of
proposals submitted, as well as the total amount of requested funds, by
each group of applicants determines the distribution of the
Congressionally appropriated grant funds.
LSave America's Treasures-Grants are available for preservation
and/or conservation work on nationally significant intellectual and
cultural artifacts and nationally significant historic structures and
sites- Intellectual and cultural artifacts include artifacts,
collections, documents, monuments and works of art. Historic structures
and sites include historic districts, sites, buildings, structures and
objects. Grants are awarded through a competitive process. Each grant
requires a dollar-for-dollar nonFederal match
LHistoric Preservation Fund Grants-Among the kinds of activities
funded are design guidelines and preservation plans and rehabilitation
or restoration of National Register listed properties. The UMNH
currently occupies the George Thomas Library building which is on the
National Register of Historic Places. This building was financed with
WPA funds and completed in 1935. In 1968 the University remodeled it to
house the UMNH. If the UMNH were to continue to occupy this historic
building, Historic Preservation Fund Grants could be applied to its
rehabilitation.
Non-Grant Options for Support from Federal Bureaus with Collections at
UMNH
LDepartment of the Interior-The Department is developing discount
agreements with vendors of specialty museum supplies to apply to non-
Federal museums that house Federal collections. It has agreements in
place with six vendors.
LBureau of Indian Affairs (BIA)-BIA is currently developing
curation agreements with nonFederal institutions to facilitate
providing funding to manage BIA collections at those institutions. It
has contracted with the Army Corps of Engineers to survey BIA
collections in non-Federal institutions. Utah is covered in the current
survey. Very limited funding is currently available to support these
activities- The bureauwide museum program is funded at $247,000.
Bureau of Land Management (BLM)
LMuseum Partnership Program-This program supports cooperative
projects that involve 13LM collections at non-Federal museums. Modest
funding of $5,00010,000 per project is provided. UMNH has been
receiving $5,000 annually from Utah BLM as well as a one-time payment
of $47,160 this fiscal year.
Bureau of Reclamation (BOR)
LBOR provides funding to non-Federal repositories on a case-by-case
basis. To date, BOR has provided $242,000 to UMNH to care for BOR
collections stored at the museum. This funding has supported
cataloging, rehousing and reconciliation of records. In addition, each
summer since 1999, BOR has provided the museum with a student intern to
work on-the BOR collections. The current cost of the intern is $5,160.
Fish and Wildlife Service (FWS)
LBecause the FWS collections at UMNH occupy an estimated 14 cubic
feet and FWS could accommodate this material in another facility, there
is no need to seek support for keeping these FWS collections at UMNH.
National Park Service (NPS)
LBacklog Cataloging-The Backlog Catalog program is funded by a
line-item in the NPS appropriation to catalog the backlog of 52 million
items in park collections. This program is funded at $2.$ million in
fiscal year 2001. Under contracts or agreements, parks can pay non-
Federal museums to catalog park .collections into the NPS cataloging
system, the Automated National Catalog System (ANCS+). No non-Federal
match required.
LMuseum Collections Preservation and Protection Program-The Museum
Collections Preservation and Protection Program (MCPP) is funded by a
line-item in the NPS appropriation to address deficiencies in the
preservation and protection of park collections. Service-wide
facilities housing park collections meet only 66% of museum collections
preservation and protection standards. The program addresses storage,
environmental control, 'security and fire protection deficiencies. This
program is funded at $3.0 million in fiscal year 2001. Parks may
purchase supplies and equipment needed to maintain park collections in
non-Federal museums, e.g. storage cabinetry. The equipment, while used
in the non-Federal museum, remains Federal property. No nonFederal
match is required.
LStorage in NPS Facility-To date, the UMNH has identified and
estimated 216 cubic feet of archaeological collections that belong to
the NPS. NPS could accommodate these collections in existing NPS
facilities without incurring any construction costs. UMNH has indicated
there may be additional natural history collections belonging to NPS,
but has not yet provided information on storage space required or
number of specimens. When this information is provided, NPS will
evaluate its capability to store this material- NPS anticipates that
this material could also be accommodated in existing NPS facilities.
Storage in NPS facilities would obviate. the need for UMNH to seek
funding to store these park materials.
Question: Mr. Matheson asked if the funding for the museum were
spread out over time and spread across the Department, rather than just
the NPS, would the Department still oppose the bill.
Answer: Although the museum may have merit, the Department would
still oppose the bill. Even if the funding for this non-Federal museum
were spread out over time and across the Department, it would still
take away funds :flora what is available for agencies to address
priorities and take care of existing Federal responsibilities. Thus,
this project would not be a top priority compared to other needs ,
including Federal facilities where curatorial needs cannot be met.
Given the large backlog of deferred maintenance and construction
projects, agencies need to establish clear priorities and focus
resources on their priority needs. These needs cannot be addressed if
large portions of construction funds are diverted to non-Federal
facilities.
______
Mr. Hansen. Thank you, Mr. Chairman. That is all the
questions I have for Mr. Ring.
Mr. Hefley. Thank you. Ms. McCollum.
Ms. McCollum. No, thank you.
Mr. Hefley. Mr. Simpson.
Mr. Simpson. Thank you, Mr. Chairman. On H.R. 1461, the
commercial uses authorization for the nonprofits, how much
revenue are we talking about? What is the average cost of a
commercial use authorization?
Mr. Ring. We are still in the process of converting these
authorizations from the old from the way we did them under the
old law into the new law, but these things have been issued at
100 to 200 a year, has been the valuation on them.
Mr. Simpson. Do you have any idea what the total loss of
income would be by exempting the nonprofits if they were to
be--if they were required to have commercial use authorization?
Mr. Ring. Well, currently we have a little over 3,100 of
these types of authorizations that we will be converting to the
new type of authorization under the new law. Right now, about
77 of those are issued to nonprofits. That is slightly less
than 2-1/2 percent.
Mr. Simpson. Okay, thank you. On H.R. 1491, if the State of
Utah were to declare these artifacts belong to the State of
Utah and not the Federal Government, would the Federal
Government have a problem with that?
Mr. Ring. I think we would like to sit down and understand
what were those artifacts, where were they collected, when were
they collected, because I think that there is a lot of
information that would need to be reviewed to understand
exactly who they belong to.
Mr. Simpson. I certainly appreciate the concern that the
Park Service has with the unmet backlog that they have not only
in the Park Service, as Congressman Matheson said, and in the
Forest Service and BLM and other public agencies. I would hope
that those agencies when legislation comes forwards in this
Committee dealing with--I believe it is called CARA--that puts
$900 million into the State and Federal Land and Water
Conservation Funds--that there are going to be some amendments
offered to take some of that money to address the backlog needs
of the National Park Service and in other areas.
I notice that Secretary Norton was out in Yellowstone and
Grand Teton National Park a couple of weeks ago and she
commented on the extraordinary need to address the backlog in
these national parks, and I would like to see the Park Service
and the Forest Service and the BLM get together on the need to
address this backlog and hopefully they can support some of
these amendments which would direct some of that money to this
backlog. If we can do that, it would actually free up some
money not only to address the backlog, but to do some of these
things that I think are necessary. But I do think the Federal
Government has a responsibility to maintain some of these
artifacts that obviously have been collected off Federal lands,
and I suspect that the Federal Government would object if the
State of Utah said that they are the State of Utah's and not
the Federal Government's.
Mr. Ring. I certainly agree that the issue of care for
these collections nationwide is a very large issue. The
Department of Interior alone has over 117 million artifacts.
About 25 percent of them are being cared for in nonFederal
institutions. About 3.7 percent of National Park Service's
collections are being cared for in nonFederal institutions. It
is a challenge. We recognize it as a challenge to the State of
Utah, but also to many of us in terms of providing the proper
care for these artifacts.
Mr. Simpson. Thank you.
Mr. Hefley. Thank you, Mr. Simpson.
Mr. Ring, it is certainly not the purpose of any of us, I
think, to restrict nonprofit organizations from taking in
groups and enjoying our great national resources, particularly
groups like the Boy Scouts and all. The only thing was we had
some feeling that there are some groups that do make money on
this that operate like a commercial operator, and those are the
only groups that we would want something like this, if it were
to go forward, to affect. If they are a commercial operator,
even under the guise of nonprofits, then they should pay for
the permit. If they are not a commercial operator and they take
their Boy Scout troops or their members in there for something
and don't make any money offer of it, then they shouldn't pay.
You in your testimony state that this legislation would
result in an added administrative burden to evaluate the
commercial value of nonprofit operations that do generate
taxable income. How does there Park Service make this
determination currently?
Mr. Ring. We would be asking, in an application, for the
applicant to tell us what their status is and provide a
certification to us with regards to whether or not they were a
nonprofit, and, whether or not the revenue being generated by
this activity was under their nonprofit status or whether it
would be subject to taxation. If we had any question in that
regard, we certainly would query the Internal Revenue Service
and pursue any false statements that may be made to us.
Mr. Hefley. Well, suppose you have a big organization. You
were asking them, you know, where they make a taxable income
profit--and the big organization does not make a taxable income
profit, let's say, but on this particular operation they make a
considerable profit, a profit which goes back into their
organization for lobbying or for education or for fund-raising
or for other things. Do you have any way of determining whether
this particular operation makes a profit as opposed to whether
the whole organization makes a profit?
Mr. Ring. We basically would turn to the rules set up for
nonprofit organizations that the IRS administers, and if funds
are expended on certain activities that are within the scope of
the law governing nonprofit organizations, then we would be
guided by IRS' determination on that.
Mr. Hefley. Okay. Let me mull that a bit while I turn to
Mr. Matheson. I didn't mean to ignore you. I want to give you
the opportunity to ask any questions you would like to ask as
well.
Mr. Matheson. Well, thank you, and I appreciate the
Subcommittee allowing me to sit up on the panel today. I
appreciate that again, Mr. Chairman. I just had a couple of
questions.
Mr. Ring, in your statement you took issue with the project
because it would take resources from the National Park Service
budget at a time when the administration made national parks a
priority and what we have all agreed is an important backlog of
projects that needs to be addressed. If the funding for this
program is spread out over time, and it came from other sources
within the Department of Interior, would you then maintain your
opposition?
Mr. Ring. That is something I would need to go back and
examine. We certainly would consider that and be happy to
respond to you on it.
Mr. Matheson. In reading this legislation, I see mention of
the National Park Service only once, and that is sort of a
cursory mention in the findings section along with all public
land management agencies that are in the State of Utah. Do you
see a place in this bill where it says the funding would only
come from the National Park Service?
Mr. Ring. I do not see it in this bill, but the routine
practice is that these types of grants are placed in the
National Park Service budget.
Mr. Matheson. Well, I applaud you making the point in your
testimony that the administration believes this is a valuable
project and you would be willing to assist this project somehow
in the future. Do you have a sense of how you could--how we
could assist this project from a Federal level, if not through
the funding that is suggested in this bill itself?
Mr. Ring. We would welcome the opportunity to sit down and
meet with the museum and discuss what our range of options are.
Mr. Matheson. Thank you, Mr. Chairman.
Mr. Hefley. Ms. McCollum.
Ms. McCollum. Thank you, Mr. Chairman. If I could ask a
follow-up on what you were talking about earlier, Mr. Ring, I
think the Chair raises a good question about not-for-profit
groups--sometimes what they are paying CEOs, what they are
doing for lobbying and other things--in essence are doing quite
well.
Do you ever look at the fee that is being charged by a
nonprofit for the individuals coming in? I mean, let's say you
know--I know as a Girl Scout leader, if we go in someplace, how
much it is going to cost for me for the food for cookouts, for
incidentals. Sometimes we take it out of dues, or the girls
ante up. Maybe it would cost me $5 per girl for one night. If
we are doing something that is $35 for 1 week, that is breaking
even, that is covering my costs.
Let's say I charge $100 for the girls to participate that
night. Then I am increasing the coffers of my treasury. Do you
ever look at, or do people submit what they are charging for
using the park as part of when people are coming in?
Mr. Ring. With these incidental scale authorizations, we
are focused more on what their status is and whether or not
they are generating revenue that is subject to taxation. If the
revenue is being applied to the nonprofit purposes of the
organization, whether on the same trip or on something else
that is associated with their nonprofit status, we have not
made a distinction. In the law that we have on the books now,
we certainly would be focused on whether or not any of that
revenue is being devoted to do things that under the Internal
Revenue Code a nonprofit organization would be taxed on.
Ms. McCollum. Mr. Chair, if I may, another question. Mr.
Ring, I find it also kind of, as I am mulling this through--
Girl Scouts--you know my Girl Scout troop might come in once a
year, maybe once every 4 years. The Girl Scout Council would
come in more often because of an umbrella group. Would anything
maybe trigger that you will want to do a further investigation
versus how--you know, how often a group is coming in, a
nonprofit group is coming in to use a particular facility?
Mr. Ring. Well, certainly, we would take any information
that we got that raised any question concerning the status--
either the nonprofit status or the taxable nature of the
activity that the nonprofit organization was engaged in, and
pursue it with the IRS. We also could consider just random spot
checks on those.
Ms. McCollum. Thank you, Mr. Chairman.
Mr. Hefley. Mr. Simpson.
Mr. Simpson. Mr. Chairman, could I ask a couple more
questions?
Mr. Hefley. Sure.
Mr. Simpson. Mr. Ring, you mentioned--back to this
nonprofit status. I think we all know what we are talking
about. We are not talking about the Girl or Boy Scouts, those
types of organizations. People are using the national parks in
a nonprofit status, not having to pay the commercial fee. And
they are using them, organizations are, I suspect for advocacy,
to try to advance their agenda and so forth, which is okay. But
you would think that many of these organizations, these
environmental groups that use this in that manner, would in
fact want to pay the fee that goes into supporting the national
parks instead of opposing that fee, wouldn't you?
Mr. Ring. We would have to ask those organizations. We
certainly get donations from quite a range of groups and
individuals. The question you raised with regards to what we
require versus what they are interested in doing is the issue.
We feel that in the case of the nonprofits, most, if not all of
the nonprofits that are not engaged in collecting taxable
income, are very much dedicated to purposes that are
educational and have been looked at under the IRS Code and
determined to be appropriate and consistent with the purposes
of the national parks. The level of activities that is under
the $25,000 level that we are talking about, and the nature of
the activity, where it is typically a group coming in for an
organized visit or a guided or an educational visit, lies very
lightly on the land.
From a resources standpoint, we have very little concern
over it. We think these are appropriate and are very supportive
of them.
Mr. Simpson. If we were to try to change this and not just
withdraw the nonprofit status, is the only way we could do that
is go through the IRS Code and change the nonprofit designation
in the IRS Code, or could we change this so that we were
actually addressing those groups that do quite well that are
nonprofits, versus the Boy Scouts and Girl Scouts?
Mr. Ring. I think you have raised a question of how do you
set a standard. The standard in the law right now refers to the
IRS Code. The IRS has reviewed these organizations from the
standpoint of their purposes, as well as routinely requiring
them to report their income. It makes distinctions as to which
of that income is going toward those educational purposes
versus not. We are certainly willing to work with the Committee
on an appropriate way to address this issue. But the question
is what standard do you use and how do you make a distinction
that is fair and impartial?
Mr. Simpson. I guess what surprises me, to some degree what
it remind me of is the demonstration fee project we have in
some of our national forests. That money stays within the
national forest to upgrade the trails, and the people that
object to that the most are the very people that want us to
upgrade the trails and the forest and so forth, the same hikers
and backpackers that are opposed to the demonstration fee
project. And I think the same type of thing is going on within
the National Park Service and the commercial use fee.
Mr. Ring. I don't know--.
Mr. Hefley. I am sorry, we will have to go and vote. If you
will hold that thought, we will recess and vote and come back.
[Recess.]
Mr. Hefley. The Committee will come back to order. Mr.
Ring, you were in the middle of answering Mr. Simpson's
question. Mr. Simpson is not here, but if you would like to
continue it for the record.
Mr. Ring. For the record, if I could have that read back,
it would help.
Mr. Hefley. Do we have someone who can do that? I don't
think we do. Forget that question. Let's go to another one.
The IRS has looked askance at recent times in what they
call unrelated earned income or unrelated business income, and
one example that is often used is of the YMCA. And the YMCA had
lofty purposes and they accomplished wonderful things. I am a
big fan of the YMCA.
Many of them operate very lucrative health clubs as a part
of their operation, and the IRS has looked at this as a--well,
is this really--they are out competing with private health
clubs. Is this really a part of their basic charitable mission,
the reason they have a 501(c)(3)? And this is, I think what we
are getting at is, do some of these organizations who are
exempt really operate a business, a profitable business, an
unrelated earned income?
Now, you can always--you can always figure some
relationship. For the Y, for instance, one of our charges is to
keep people healthy, so they have a health club and a masseuse
and exercise machines and all that goes with that. But do you
have groups that operate tours that are essentially commercial
tours but they are doing it under the guise of their 501(c)(3),
and do you have any way to determine that, any rules and
regulations that you promulgated based upon the law to
determine that, other than to just simply, if you checked--and
I am not sure you do check, because in your testimony there
seemed to me there was a lot of could have and should have and
we are able to do this, we are able to check the IRS and so
forth, but there doesn't seem much indication you are really
doing that.
Are you really doing it? Do you have a way to check and
find out if these suboperations of an overall organization are
big profit centers for the organization?
Mr. Ring. That is a good question, Mr. Chairman. I think
the law itself basically places a limit on the scale of these
at $25,000, so that there is one constraint. We wouldn't be
getting into large profit-making operations or nonprofit
operations in this section of the law.
We are still in the process of promulgating the regulations
associated with the commercial use authorizations. The question
you have raised is a very good one. We would go back and
examine that in the context of the promulgation of these rules.
Mr. Hefley. Okay. We are having a--I think we are having a
hard time getting at what we are trying to get at here, but you
have been very helpful and I appreciate it. And since there is
no one else to ask--Mr. Matheson? Or Dale, do you have any--.
Mr. Kildee. No.
Mr. Hefley. Thank you very much. We will go to the next
panel, then.
The next panel is made up of J. Bernard Machen, President,
University of Utah, Salt Lake City; Dave Simon, Director of
Outdoor Activities for the Sierra Club; and Dan Mastromarco,
Executive Director, Travel Council for Fair Competition.
And if you all would take your place, and I think we will
start with President Machen from the University of Utah. And if
you would, try to keep your comments to 5 minutes, and you will
see the little lights there that go off, but your full
statements will, without objection, will be put into the
record.
STATEMENT OF J. BERNARD MACHEN, PRESIDENT, UNIVERSITY OF UTAH,
SALT LAKE CITY, UTAH
Mr. Machen. Thank you, Mr. Chairman. Mr. Chairman and
members of the Subcommittee, we very much appreciate the
opportunity to appear before you today. We are here to seek
Congressional support through H.R. 1491 for a new museum of
science and nature on the University of Utah campus in Salt
Lake City.
Utah and the intermountain West is a place that is world
renowned for it natural and cultural history, and millions of
Americans and foreign guests visit our State and this region
every year. Over the years, Utah has yielded vast and unique
collections recording its history, and these are now in the
care of the Utah Museum of Natural History at the University of
Utah. Displayed before you over here on my left are photos of
some of the extraordinary objects that are in our collection.
As was stated earlier, Utah is a State that is almost 70
percent owned by the Federal Government. By necessity, research
on the State's natural and cultural history takes place on
Federally managed lands. Collections obtained through this kind
of research and through other Federally mandated recovery
programs indicate that these collections are in fact Federally
owned. The University has numerous pieces of correspondence
from the Federal Government which clearly establishes their
presumption of ownership over this collection.
The museum and the University have not shrunk from our
responsibility as caretakers. Over the years we have made
significant investments in infrastructure, personnel and
programs to support the care for these important collections.
We have asked for and received very little from the Federal
Government. In fact, during the collection's history, we have
received less than $300,000 in direct Federal support for the
management of these collections.
But at this point, we do need help. We have made
significant and successful efforts to conserve these
collections, but our building is not suitable for any further
upgrading and renovation as a museum. I draw your attention to
some of the photographs that were included in the written
testimony. The overhead water pipes clearly threaten these
irreplaceable objects, and the accident referred to by
Congressman Matheson is, unfortunately, not a rare occurrence.
We have run out of room for existing collections, much less
any future additions, and yet research in the natural sciences
continues on the public lands, and the research facilities and
the exhibit space that is accessed by the American public is
extraordinarily insufficient for what we are trying to do.
The University has stepped up to the plate and has designed
a plan to secure these collections and to meet the American
public's desire to have access to them. We already have a donor
who has pledged the largest ever single gift to a cultural
institution in Utah, and in fact 20 percent of the cost of the
project has already been raised.
We have secured the land, 14 acres adjacent to the
University, with a commercial value of $4.2 million. And the
state of Utah has agreed to cover the building operation and
maintenance costs in perpetuity, which is currently estimated
at $800,000 per year. We are confident that we can match every
Federal dollar 3 to 1.
The total cost of the project could be as much as $60
million, and we are asking from the Federal Government for 25
percent of that cost, $15 million.
Museums are places of hope. The American public trusts
museums implicitly. Museums are about the future, and in them
we learn about our past in order to make more informed
decisions about our future. This museum was founded by the
University and by the community so that Americans could have
access to the Federal collections that have been recovered in
our region. And we do ask for your partnership in creating this
extraordinary new museum for the future. Thank you, sir.
[The prepared statement of Mr. Machen follows:]
Statement of J. Bernard Machen, President, University of Utah, Salt
Lake City, Utah
Introduction
We are here today to seek Congressional support for a project to
build a new museum of science and nature on the University of Utah
campus in Salt Lake City. Our request is for about 25 percent of the
cost of the facility. There are compelling reasons for this project and
for Federal participation in it. The new museum will ensure the safety
and future preservation of a vast and priceless collection of Federally
owned objects that have been recovered from Federally managed lands in
Utah and surrounding regions during the last 150 years. It will greatly
improve the accessibility of these collections for scientific study and
it will make them available to the citizens of the United States and
their children and visitors. The project addresses several issues of
deep and abiding interest to the American people: the need to
understand the natural systems and process that have shaped the Earth
and life on Earth, to understand the human experience on this continent
and to be literate in the methods and processes scientists use to
achieve that understanding.
Utah Museum of Natural History
The nationally accredited Utah Museum of Natural History \1\ (the
Museum) is Utah's state museum of natural history. It is a public
educational institution committed to creating and sharing knowledge in
all aspects of natural science and human cultures, with emphasis on the
astonishing richness of the Intermountain West, especially the Great
Basin and northern Colorado Plateau. The Museum is a primary repository
for Federal agencies in Utah, holding collections from lands managed by
the Bureau of Land Management (BLM), Bureau of Reclamation (BOR),
United States Forest Service (USFS), National Park Service (NPS), Fish
and Wildlife Service (FWS), Department of Defense (DOD), Bureau of
Indian Affairs (BIA) and from various National State Recreation Areas
(NRA) and National Monuments. In addition, the Museum is charged by the
legislature with creating exhibits and other educational programs in
the natural sciences for the citizens of Utah and their visitors,
supporting museum activities in the State, and oversight responsibility
for the State's archaeological and paleontological collections.
---------------------------------------------------------------------------
\1\ The Museum is accredited by the American Association of Museums
(AAM). The achievement of is recognition of a museum's commitment to
and achievement of high professional standards of operations. Museum
accreditation certifies that a museum has undergone a rigorous,
professional examination established by the AAM. At present 750 U.S.
Museums (out of approximately 8,000) are accredited by the AAM . The
Museum was first accredited in 1972 (first museum in the State and
among the first nationally); reaccredited in 1985 and again in 1999,
although the latest accreditation was tabled for almost a year because
of concerns related to the age, structural integrity and HVAC systems
in collections storage and lab spaces in its building.
---------------------------------------------------------------------------
The Museum contains collections of more than one million objects
and specimens, representing all of the natural sciences and describing
the natural and human history of this region of North America. These
systematic collections in the disciplines of geology, biology and
anthropology rank among the largest and most comprehensive in the
western states. They are regional in scope but global in importance.
More than 75 percent of the Museum's collections are Federally owned,
that is, recovered from Federally managed public lands. Ninety percent
of some collections, such as the vertebrate fossils and botanical
holdings, are Federally owned. Of the remaining 25 percent of the
Museum's collections, significant portions were collected on state
lands under Federally mandated permitting procedures.
The large number of Federal collections in the Museum is the
consequence of the high percentage of Federal lands in Utah. The State
contains vast tracts of Federally managed public lands. Almost 70
percent of the land area (32.5 million acres) is administered by the
Federal Government, the second highest percentage for any state in the
nation. As a consequence, research in the natural sciences in Utah
predominantly occurs on Federal lands. \2\
---------------------------------------------------------------------------
\2\ Of this amount, 42.0 percent is managed by the Bureau of Land
management, 15.3 percent by the National Forest Service, 3.6 percent by
the Department of Defense, 3.3 percent by the National Park Service and
1.7 percent by other Federal agencies.
---------------------------------------------------------------------------
The Present
The Museum is housed in the old University library, built in 1932.
The building does not meet current professional standards for
collections care, research or interpretation, and is completely full,
with no room for growth.
Most collection store rooms, work areas and research laboratories
are located in a portion of the building that was originally
constructed as closed-stacks storage. The 7' 2'' ceilings are supported
at regular 4' by 3' intervals by load-bearing posts designed to hold
bookshelves. The building was assessed in 1989 (Reaveley Engineers &
Associates), \3\ 1993 (Patterson), \4\ and 1994 (Lord Cultural
Resources) \5\ and found to contain points of serious deficiency,
especially given that it is located within a quarter mile of the second
most active seismic fault in the continental United States. These
deficiencies pose threats to the collections and dramatically constrain
adequate public access. They include seismic instability, inadequate
fire protection, an antiquated HVAC system, no expansion for
overcrowded collections storage, inadequate laboratories, no loading
dock or freight elevator, oversubscribed classrooms and inadequate
exhibit space.
---------------------------------------------------------------------------
\3\ Reaveley Engineers & Associates, 1989 Rapid Seismic Evaluation
of University of Utah Buildings. Report on file, Utah Museum of Natural
History, Salt Lake City.
\4\ Peterson, Carl, 1993 Utah Museum of Natural History: IMS
Conservation Assessment of Anthropology Collections. Report on file,
Utah Museum of Natural History, University of Utah, Salt Lake City.
\5\ Lord Cultural Resources Planning and Management, 1994 Utah
Museum of Natural History Master Plan: Phase I. Report on file, Utah
Museum of Natural History, University of Utah, Salt Lake City.
---------------------------------------------------------------------------
Over the years, the Museum and University have made considerable
effort and invested significant sums to overcome the worst of these
problems. For example, seismic bracing has been installed on the open
rack and shelf systems; special rooms have been constructed with their
own heating, ventilating and air handling systems to house the most
delicate specimens; open, wooden shelf storage has been covered with
inert padding. Consultants, including those from Lord Cultural
Resources Planning and the American Association of Museums have noted
that significant and successful efforts have been made by the Museum to
adequately house and conserve the collections, but the building,
designed as a library, is not suitable for any further upgrading and
renovation as a museum and in fact puts the collections at risk.
The Project
The Museum has conducted a series of studies to assess needs,
determine operational feasibility, and lay a solid foundation of
facility planning. Lord Cultural Resources Planning and Management was
retained in 1994 to write a Master Plan, which articulated the urgent
need for the Museum to move to a new facility with climate control and
seismic stability for the fragile collections, larger exhibit galleries
allowing greater public access to the collections, state of the art
research laboratories, and significantly improved ease of access for
the public.
The Museum Building Committee then weighed a variety of site
options against the criteria laid out in the Lord Master Plan. \6\
These criteria included: site area, visibility, compatibility,
partnership opportunities, accessibility, serviceability, and technical
and financial factors. The site that best met the criteria was in
University Research Park. It is still a part of the University campus,
enabling students and faculty easy access, necessary for meeting the
Museum's crucial educational mission. At the same time, it is adjacent
to Salt Lake City's zoo, living history heritage park, and state
arboretum; such clustering of cultural institutions encourages
cooperative and coordinating programs as well as ease of access by the
public. Located in the eastern foothills of Salt Lake City, the site
allows extraordinary opportunities in research and interpretation for
the Museum. Although within the city limits, the site is bounded to the
east by land controlled by the U.S. Forest Service. It is unusual for
an urban museum to have such immediate access to wild lands.
---------------------------------------------------------------------------
\6\ The Museum Building Committee is comprised of the University
Facilities Planning Office, Museum Management staff, and Museum
Advisory Board members.
---------------------------------------------------------------------------
In 1998, the Museum retained Ralph Appelbaum Associates to develop
a conceptual plan for the new facility at the Research Park site. The
plan conceives of a facility carefully integrated into the site,
relatively invisible from the city side. Collections, exhibits,
laboratories, classrooms will all be seamlessly connected, with the
institution serving as a window into the process of science and the
natural history of Utah.
The Museum has just completed an architectural pre-program study to
estimate the project scope and budget, analyze comparable facilities,
and conduct a site analysis and detailed parking study. The following
is a summary of the budget for the project, calculated with inflation
(construction estimated to begin in 2004).
[GRAPHIC] [TIFF OMITTED] T2929.002
Public-Private Partnership
The new Museum facility is envisioned as a private-state-Federal
partnership. The University is confident of its ability to match any
congressional investment in the new facility which, of course, is
concerned with housing and interpreting primarily Federally owned
collections. University donors are very much interested in the project
and have indicated that, should congressional funds become available,
they will be leveraged three private/state dollars for each Federal
dollar. The Federal willingness to participate in the project is, of
course, key to its success.
The University of Utah has contributed the land, 14 acres with a
market value of almost $8,000,000. The State of Utah has guaranteed the
ongoing funds to operate and maintain the building ($800,000 annually).
To date, $11,955,000 in cash or pledges has been received from eight
private foundations and individuals for the building itself; this
includes a single gift of $10,000,000 explicitly pledged as a match for
congressional funding.
History of Federal Support
The citizens of Utah have invested a great deal in assembling and
caring for the Federal collections that are housed in the old library
on the University of Utah campus. The Museum, its donors, the
University and the State are heavily vested in the research, planning,
infrastructure, trained personnel, and ongoing resources required to
assemble and adequately care for and interpret Federally owned objects.
Federal laws and regulations govern the recovery and subsequent care of
objects and data from Federal lands and set properly high standards for
collections storage conditions, treatment, management and access. The
Museum uses primarily state and private funds to meet those standards.
Federal support for the collections has come in the form of grant
awards for specific collections related projects rather than ongoing
care.
Since its founding in 1969, and excluding competitive Federal
grants, the Museum has received less than $300,000 in Federal funding
for collections inventory and care. During that period, the Museum also
has benefited from a number of competitive Federal grants from the
Institute of Museum and Library Services, the National Science
Foundation, Department of Education, National Historic Publications and
Records Commission, the National Endowment for the Humanities and the
National Endowment for the Arts, to support exhibit development,
programming, research and collections care. \7\ Some of these awards
have supported activities required by the provisions of the Native
American Graves Protection and Repatriation Act (NAGPRA). For example,
in partnership with the State Division of Indian Affairs and the State
Division of History, the Museum was recently awarded $67,840 by the NPS
to provide one year of salary for a State NAGPRA Coordinator. The
position will be housed at the Museum and will facilitate compliance
efforts by Federal and state land managing agencies, museums and Indian
nations throughout the State.. The Museum also recently was honored to
receive a $50,000 Save America's Treasure grant to support the study
and conservation of a remarkable trove of prehistoric moccasins
recovered in the 1930's from a cave near the Great Salt Lake. To date,
however, there have been no Federal investments in the infrastructures
(storage facilities, research laboratories etc.) that provide the
critical foundation for good collections care. \8\ Clearly, more needs
to be done to keep this important scientific resource safe and
available to the citizens of United States, their children and
visitors.
---------------------------------------------------------------------------
\7\ Since its founding, the Museum has received a total of slightly
more than $1.3 million in competitive Federal grants for the entire
scope of its activities.
\8\ It is important to note that Congress recently directed a
$500,000 Economic Development Initiative grant to the University to
support design and planning for the new museum building.
---------------------------------------------------------------------------
Detailed Descriptions of Federal Collections at the Utah Museum of
Natural History
The collections curated at the Museum document all aspects of the
region's natural history: birds, mammals, reptiles, insects, plants,
rocks, minerals. They describe its ancient human past and affirm the
vibrant contemporary lives of its First Nation inhabitants. They
testify to the changes resulting from 150 years of urbanization and
modernization and to hundreds of millions of years of adaptations and
evolution of its animal and plant communities. Many aspects of the
collections are of global interest: the carnivorous dinosaurs from the
world famous Cleveland Lloyd quarry and other Utah sites, the
perishable prehistoric artifacts from Utah's remarkable dry cave sites,
and the diversity of the montane life inhabiting the mountain islands
of the western Utah. The collections constitute a primary resource for
Native American communities, students, artists, tourists, and the
general public.
This region has been a center for research in the natural sciences
for more than a century. Its arid lands provide large exposures of
ancient landscapes that produce bones and fossils that date from 10,000
to over 1 billion years ago, its famous dry caves have captured the
essence of more than 10,000 years of human occupation prior to
Euroamerican settlement. In fact, every major period of the earth's
geologic history is represented in natural exposures in the State. This
landscape provides remarkable opportunities for geologists,
paleontologists, archaeologists, historians, and biologists to advance
the knowledge in their fields for the benefit of the American public.
Along all these dimensions, and others, the collections held by the
Utah Museum of Natural History are national public treasures.
Archaeological Collections
Approximately 3/4 million artifacts recovered from about 3,800
sites are stored at the Museum. Taken as a whole, the archaeological
collections describe the deep antiquity and full breadth of human
experience in the Great Basin. The collections contain material from
the earliest investigations in the area, including the seminal work at
Ancestral Pueblo (Anasazi) sites during the first decade of the 20th
century, and investigation of the caves around the Great Salt Lake
during the 1930s. The Museum also houses complete collections from
major Federal salvage programs including the Glen Canyon and Flaming
Gorge dam projects. Approximately 71 percent of the archaeological
collections are Federal: 33% BLM, 53% BOR, 7% USFS, 4% NPS, and the
balance from the FWS and DOD. All of the Museum's archaeological
collections recovered prior to November 1990 are subject to the
provisions of NAGPRA. \9\
---------------------------------------------------------------------------
\9\ Because the anthropology collections have special significance
for Utah's Native American communities, the Museum convened an Indian
Advisory Committee. The Committee meets regularly to consult on the
use, care, disposition, and interpretation of Native American
materials, and repatriation issues. This committee is composed of
tribal representatives from Utah's eight nations. The committee also
includes representation from the University's Native American student
association and Department of Ethnic Studies, the State Division of
Indian Affairs, the Native American Education Specialist for the State
Division of Education, and urban Indian organizations. The Museum has
and continues to implement all applicable provisions of Native American
Remains Protection and Repatriation Act.
---------------------------------------------------------------------------
Biological Collections
These collections constitute one of the most complete sources of
information on biodiversity of the Intermountain West, and represent an
invaluable resource for regional research in systematics, biogeography,
zooarchaeology, and conservation biology. They include specimens and
associated data acquired during decades of biological research at the
University of Utah, as well as material received from other regional
institutions. The biology collections include:
Plant Collections
The Garrett Herbarium contains many examples of rare or endangered
species, including most of Utah's 300+ endemic plants, and
irreplaceable specimens from riverine environments that are now
reservoirs (e.g., Glen Canyon and Flaming Gorge). Many recent
acquisitions are voucher specimens for biochemical and/or cytogenetic
analyses that have exceptional research value. Other features of the
Herbarium contribute to the value of the collection. Recent analysis
indicates that the Herbarium will be an important resource for future
DNA studies of regional flora. The collection also shows uncommonly
high levels of seed and spore germination, providing scientists the
rare opportunity to grow living plants from dried specimens collected
many years ago. This makes the collection extraordinarily valuable as a
source of living research materials. The collection comprises nearly
121,000 specimens, 70 percent from Utah and the remaining 30 percent
from around the United States and the world. It is the third largest
herbarium in Utah and ranks in the top 15 percent worldwide. No other
collection has such a complete representation of plants from Utah's
Wasatch front and Salt Lake Valley. The flora of this area is rapidly
being altered and displaced by urbanization and the Herbarium provides
a crucial historic baseline from which to judge the environmental
health of the entire Salt Lake region. An estimated 90% of the
collections are Federal; of those 48% are USFS, 39% are BLM; 1.2% are
NPS, 1.4% are BIA; 0.62% are NRA; 0.03% are DOD.
Zoological Collections
The zoology collections housed at the Museum contain materials
dating from the 1870's. These collections grew rapidly during the first
half of the 20th century and include the results of pioneering
statewide biological inventories. By the late 1950's, the University of
Utah was widely recognized as an important center for work on
evolutionary systematics of birds, mammals, reptiles and various
arthropods, (insects, crustaceans, etc.). The research collections
devoted to these groups are historical archives documenting the rich
natural diversity of the Intermountain Region and major changes in its
animal populations.
The Museum's collection of mammals (30,0000 specimens) is one of
the 30 largest collections of its kind in the western hemisphere. While
the collection is primarily regional in scope, from the eastern Great
Basin, southern Columbia Plateau, northern Colorado Plateau and central
Rocky Mountains, there are also significant numbers of specimens from
the eastern U.S., Alaska, Central America and the Philippines.
The bird collection (20,000 specimens) is one of the largest and
most complete assemblages in the Intermountain Region, with a large
number of specimens and nesting records from the late 19th and early
20th centuries. The collection also includes important holding from
Alaska, Kansas, Oregon, Arizona, Thailand and the South Pacific.
The reptiles and amphibian collection (18,000 specimens) is one of
the largest collections of turtles in the world, and includes Utah
specimens from the early decades of the 20th century.
The Museum also holds two separate collections of invertebrates.
The insect collections (120,000 specimens) contain historically
significant material collected during the first half of the 20th
century throughout the western United States. The mollusks (shells)
includes 25,000 research specimens of native Utah species and shells
from around the globe. These collections support basic research in
areas of evolutionary systematics, zoogeography, functional morphology,
ecology and zooarchaeology and are also a resource for intellectual and
popular public interest in biological diversity. About 90% of the
vertebrate specimens and 62% of the balance of the biological
collections from Utah were recovered on lands managed by agencies of
the Federal Government (BLM, USFS, NPS, FWS, and DOD).
Paleontology Collections
The world class paleontology collections at the Utah Museum of
Natural History contain fossil vertebrates, invertebrates and plant
specimens collected from Utah and surrounding western states as well as
numerous international localities. This region is recognized as one of
the most important sources of Jurassic aged fossils on earth, with
museums worldwide displaying dinosaurs recovered here.
The vertebrate fossil collection (animals with backbones,
approximately 12,000 specimens), is the largest of three paleontology
collections at the Museum. This collection is rapidly expanding as a
result of ongoing work in Utah. Currently, the collections are
dominated by classic dinosaurs from the Late Jurassic (about 150
million years ago). Most numerous are specimens collected from the
internationally renowned Cleveland Lloyd Dinosaur Quarry. This gigantic
predator trap preserves thousands of bones representing numerous
dinosaur species, but by far the most dominant is Allosaurus fragilis,
Utah's state fossil. Indeed the Cleveland-Lloyd Quarry includes the
largest accumulation of Allosaurus known anywhere in the world. The
Museum is also the repository of thousands of Cretaceous aged (85-65
million years old) fossils, including fishes, amphibians, and mammals,
as well as dinosaurs. This region is also famous for Pleistocene (Ice
Age) remains, and the Museum houses a representative collection of
large mammals from this period, including giant bears, bison, mammoths
and mastodons.
Recently, the Museum accepted transfer of the Ash Paleobotany
Collection, an important assemblage of fossil plants that represents
the largest Triassic fossil plant collection outside of the Smithsonian
Institution. Although a precise count is not yet available, the
collections occupies some 150 large storage drawers. The paleobotany
collections also include fossil plants from other geological periods
and international localities as well.
Other important aspects of the Museum's holdings include the
invertebrate fossil collection (animals without backbones), and 7,000
rocks and minerals recovered from sites around the globe. About 80% of
the fossil collections are from Federal lands. The remaining 20%
represent material collected from the Long Walk Quarry, an important
early Cretaceous dinosaur site that is owned by the Museum, and
materials from state lands and international sites.
Conclusion
The project we have described today is one with relevance for an
important number of American people. The Federally owned collections
housed at the Utah Museum of Natural History and the research, exhibits
and programs they support deal with issues of serious concern. They
document the recent and distant past and thus inform decisions about
the future.
The new Museum is proposed to be built at the University of Utah,
an internationally recognized center for scientific research, in a
landscape that is known around the world for its natural and cultural
history and antiquities. It is proposed to be built in Salt Lake City,
the capital city of Utah and indeed, of the Intermountain West; Salt
Lake City is the largest city between Denver and San Francisco. It is
proposed to be built in a state with the second highest percentage of
Federally managed land in the United States. Federal dollars will be
matched at a 3:1 ratio. The project will protect a priceless collection
of Federally owned objects, specimens, records and photographs
currently at risk, and will make this resource available to the
American public, their children and their visitors. The Committee's
favorable consideration of this project is essential to its success. We
thank you for your time.
______
Mr. Hefley. Thank you, Dr. Machen, and I think we will go
ahead with the questions for you, because Mr. Matheson is here
for that purpose, I think, and I don't want to unduly delay
him.
Mr. Matheson, do you have questions?
Mr. Matheson. Well, thank you, Mr. Chairman. I will just
ask a couple of questions, if I may. President Machen, welcome.
I would like to ask how much of your future funding is
contingent upon receipt of Federal support for this project.
Mr. Machen. The initial $10 million gift we received from
the Jones Foundation that you mentioned is in fact a matching
gift. We must raise the additional monies in order to leverage
this kind of gift, and in our part of the country, private
donors are very interested in public-matched contributions.
That is why this partnership is so appealing to our people, and
that is why I think we have been successful to date and why I
think it is fundamental for the rest of the project to come
together.
Mr. Matheson. When the project is completed, what will the
role of the Federal Government be in terms of either
maintenance or administration of the museum?
Mr. Machen. Their contribution is one time, the part that
we think is the most palatable to the Federal Government. We
will maintain the project--the building and the collections--in
perpetuity with funds from the State and from the University.
Mr. Matheson. If the natural history museum receives the
funding we talked about in this bill today, what proportion of
remaining funds would still be needed, and how is the museum
going go about--how do you intend to go about raising
additional funding?
Mr. Machen. If we were fortunate enough to get the Federal
contribution, that would put us over 50 percent in our fund-
raising efforts. And we think that kind of support will
catalyze the remaining fund-raising efforts. The kinds of
things we are looking at for private contributions are
individual exhibit halls and individual naming opportunities
that would come in after the bricks and mortar for the main
building is secured. We think that would be the easy part. The
hard part is getting the basic structure built.
Mr. Matheson. Can you talk a little bit about your sense of
the public support for this project in Utah and elsewhere
maybe?
Mr. Machen. This is the State Museum of Natural History.
Within 50 miles of the University of Utah campus, 75 percent of
the people of Utah live. As I told you, most of the land in
Utah is not private land, so we have a very high concentration
of people right around our urban campus. Currently the number
of public school children who visit the current facility is
extraordinary. We have a constant traffic jam with the yellow
buses that are parked outside. We believe that the availability
of additional education space will simply mean that more of our
school children and more of our visitors will come to this
facility.
Mr. Matheson. Well, I appreciate you coming, and, Mr.
Chairman, I will yield back the balance of my time.
Mr. Hefley. Thank you. Mr. Simpson?
Mr. Simpson. Mr. Chairman.
Dr. Machen, I am sorry that I missed your testimony. Let me
clarify one thing. The $10 million that you received needs to
be matched. Does the Federal--if this is appropriate, does that
qualify as a match, or does it have to be privately raised?
Mr. Machen. No. This would be qualifying as the match.
Mr. Simpson. I appreciate that. While I do intend to
support this, because I think it is important, I must admit
that I could enthusiastically support it if it went to my alma
mater, to Utah State University, but that is--you know, that is
one of those things. Utah is beating up on us too often, but
that is okay. I appreciate you being here today.
Mr. Machen. Thanks for your understanding.
Mr. Hefley. Mr. Simpson, I will entertain an amendment to
that effect if you would like.
Mr. Simpson. Well, I am sure that when this comes before
the full Committee--that as long as we are building a new
building, Mr. Chairman.
Mr. Hefley. Are you through, Mr. Simpson?
Dr. Machen, I think Mr. Simpson does raise an issue,
though. Does Utah State or Brigham Young have similar
facilities--similar museums?
Mr. Machen. They do not.
Mr. Hefley. They do not. So yours is the only museum--
archaeological museum of this type in Utah?
Mr. Machen. That is correct. And it is designated as the
State Museum of Natural History.
Mr. Hefley. Okay. So you wouldn't be duplicating--.
Mr. Machen. No, sir.
Mr. Hefley. --that resource?
Can you tell me--you mentioned the water pipes, but except
for the crowdedness of the building, what kind of damage is
likely to occur to the collections if they are kept there? And
I suppose one of the things is that you can't display them
properly, and that is a major concern. But what about damage to
the collections?
Mr. Machen. Well, we mentioned the potential for
earthquakes--this is an old library where Congressman Hansen
studied as a student, and it is poorly constructed. I won't--I
am glad he is not here now. But--.
Mr. Hefley. Let me make sure I spell your name right.
Mr. Machen. Oh, he knows how to spell it. But the building
itself is--it is in danger of imploding on the collection. It
is conceivable that if we can't figure out a way to move it to
a place where we can display it more openly, we are going to
have to think in terms of just the safety of the collection,
because the current facility is dangerous in terms of the fact
that it could fall in on it.
Mr. Hefley. I don't think I have any further questions,
except my background is with the University of Oklahoma, and
they have an outstanding museum such as this there now. Would
you consider moving the collection down there? I suppose that
would be out of the question.
Mr. Machen. Well, it is a long way to Oklahoma.
Mr. Hefley. Indeed it is. Thank you very much for making
the trip out here and for making this case. You make a very
good--a very good case.
Mr. Machen. Thank you, sir.
Mr. Hefley. We appreciate it.
If there are no further questions related to this subject,
let us go to the next subject, and Dave Simon, we will start
with you. Dave, as I mentioned earlier, is the director of
outdoor activity for the Sierra Club.
STATEMENT OF DAVE SIMON, DIRECTOR OF OUTDOOR ACTIVITIES, SIERRA
CLUB, SAN FRANCISCO, CALIFORNIA
Mr. Simon. Mr. Chairman, thank you, members of the
Committee. My name is Dave Simon, as he mentioned, and I am the
Sierra Club's director of outdoor activities. Thank you for the
opportunity to testify on behalf of the Sierra Club's 700,000
members in opposition to H.R. 1461, legislation to amend the
National Parks Omnibus Management Act of 1998. We strongly
oppose H.R. 1461. It does not benefit the public nor the
national park resources, and it would curtail or eventually
terminate the Sierra Club's voluntary educational-led trips in
the national parks.
This legislation will not only impair the manner and scope
of the Sierra activities but those of others. The other groups
includes such diverse organizations as the Boy Scouts, the Girl
Scouts, Catholic Youth Organizations and summer camps.
This year the Sierra Club is celebrating the centennial of
our outdoor activities program. Beginning with John Muir and
continuing throughout the Club's history, direct outdoor
experience has motivated Club members to become advocates for
environmental protection. As Muir said, ``If people in general
could be got out into the woods, even for once, to hear the
trees speak for themselves, all difficulties in the way of
forest preservation would vanish.'' The only reason we have an
outdoor activities program is to inspire our members about the
natural world.
Outings are led by volunteer leaders and are conducted with
high regard for the safety of our participants and ethical
standards of land use. There is a small administrative staff in
San Francisco. Outdoor activity programs range from locally
organized day hikes and overnights to week-long backpacking and
service trips to outings for inner-city youth. Many outings are
free and others are priced with a goal of recovering cost to
the extent possible so that this vital educational program is
not a drain on other Club activities or resources.
Unfortunately, this is a difficult goal to achieve. In
fiscal 2000, for example, the audited financial statements of
the Sierra Club indicate that the outdoor activities program
had revenues of $4.1 million, expenses of $4.9 million. In 1999
revenues were 4 million and expenses were 4.4 million.
Despite the perception of some in the outdoor recreation
industry, the Sierra Club does not generate a surplus from its
outdoor activities that it uses to subsidize other programs.
One-week backpack trips are priced at $450, 10-day service
trips at $350. There is no surplus to be generated at those
prices.
With that background, I would now like to talk about why we
oppose H.R. 1461. The 1998 act challenged the assumption that
all visitor services should be provided by commercial
outfitters. The act allows groups to provide their own guide
services for their members, as long as no taxable income is
derived from those trips. This change is good public policy.
Institutional groups have the competence to guide their own
trips and do not need commercial outfitter services and should
not be forced to either pay for them or be denied access to the
national parks, as is currently the case in some of the parks.
The reality is that institutional groups and commercial
outfitters are not in competition with each other for
commercial recreation users. Unlike commercial outfitters,
groups conduct far fewer trips involving far fewer visitors.
And institutional groups engage in educational and civic
activities that are not generally offered by for-profit travel
organizations. A dozen Sierra Club members on a trip I led last
summer to the High Sierra had a Sierra Club experience. They
learned about leaving little or no trace on the land. They
shared with the cooking and cleaning chores. They hauled their
own gear and some of the communal gear. They learned about
local environmental threats. They did all sorts of things that
are not the focus of other fine for-profit travel programs.
The Sierra Club is not looking for preferences. In reality,
the 1998 act does not confer a preference onto institutional
groups nor does it lead to a misuse of resources. Institutional
groups like the Sierra Club must still compete for wilderness
permits, and we must still conduct our trips in accordance with
land management plans and regulations.
If H.R. 1461 is implemented, the Sierra Club, the Boy
Scouts, the Girl Scouts, church groups, summer camps, groups
which work with the Park Service on providing visitor education
and conduct service trips to improve park resources, will be
unfairly precluded from continued use of the national parks.
Accordingly, we urge you to reject 1461 so that valuable
children's educational and civic programs in our national parks
are not endangered. And I would like to thank you for the
opportunity to convey the views of the Sierra Club and our
700,000 members, and we look forward to working with the
Committee as it further considers H.R. 1461. Thank you.
Mr. Hefley. Thank you.
[The prepared statement of Mr. Simon follows:]
Statement of Dave Simon, Director of Outdoor Activities, The Sierra
Club, on H.R. 1461
The Sierra Club, a non-profit organization with 700,000 members
nationwide, appreciates the opportunity to submit testimony to the
Subcommittee regarding H.R.1461, legislation to Amend the National
Parks Omnibus Management Act of 1998. Sierra Club strongly opposes H.R.
1461 because it does not benefit the public or National Park resources
and it would curtail or eventually terminate the Club's volunteer-led
environmental education trips in the National Parks.
The Sierra Club's mission is to explore, enjoy and protect the wild
places of the earth; to practice and promote the responsible use of the
earth's ecosystems and resources; to educate and enlist humanity to
protect and restore the quality of the natural and human environment;
and to use all lawful means to carry out these objectives. Thus the
Club operates at local, national and international levels to promote
and protect the environment, through volunteer leadership and with paid
staff.
H.R. 1461 rescinds a key provision of the National Parks Omnibus
Management Act of 1998 that ensures a better balance of access in the
National Parks by bona fide non-profit institutional groups and the use
made by outfitter and guide concessionaires. The proposed legislation
will not only impair the manner and scope of Sierra Club outdoor
activities conducted in the National Parks, it will also damage or
curtail activities of other groups operating children's, educational,
and civic programs.
Over the years, institutional groups that make no taxable income
from Park use have been increasingly required to use outfitter and
guide concessionaires to access several National Parks. In other cases,
these groups have had to compete with for-profit ventures for
commercial use authorizations. The 1998 Act recognized that these
groups provide a service to their members that is often unavailable
from commercial ventures. In addition, these groups have the competence
to guide their own trips without the need for the services of outfitter
and guide concessionaires. These groups should not be denied access to
the Parks or forced to pay for services that are not required.
I. SIERRA CLUB OUTDOOR ACTIVITIES OVERVIEW
In 2001, the Sierra Club is celebrating the Centennial of its
outdoor activities program. A hundred years ago, at the request of John
Muir, William Colby led one hundred Sierra Club members on a one-month
trip in Yosemite that later became known as the ``High Trip''.
The Sierra Club now has three Outdoor Activities program areas:
National/International Outings, Group/Chapter Outings, and Inner City
Outings. All of these programs are integrally related to the mission of
the Sierra Club--to explore, enjoy and protect the wild places of the
Earth. Beginning with John Muir and continuing throughout the Club's
history, direct outdoor experience has motivated and prepared Club
members to become advocates for wilderness preservation and
environmental protection. As Muir said, ``If people in general could be
got out into the woods, even for once, to hear the trees speak for
themselves, all difficulties in the way of forest preservation would
vanish.''
In general, the goal is to conduct outings on which participants:
Lhave an enjoyable, consciousness-raising outdoor
experience
Llearn about the conservation issues relating to the area
visited and the Club's general conservation goals
Llearn new outdoor conduct and skills
Lincrease their natural history awareness
Lexperience a broad range of cultural values.
Outings are led by volunteer leaders and are conducted with a high
regard for the safety of participants and ethical standards of land
use.
National/International Outings. The program is conducted on a
fiscally self-sustaining basis with trip prices set so that the program
breaks even in the long-term. The program has about 700 active
volunteers leading approximately 310 domestic and 40 international
trips per year that provide an outdoor experience for about 4,000
Sierra Club members. Most trips are between one and two weeks in
length, with approximately 150 trips in the National Parks, and another
50 trips on other Federal lands. There is a small staff in the San
Francisco headquarters that handle administrative duties such as
answering member questions and taking reservations, publicizing trips,
arranging volunteer leader training and travel, and paying trip
expenses.
The National/International Outing program consists of four
categories of trips that advance the mission of the Sierra Club in
unique ways:
LDomestic Trips. There are a variety of trips throughout
the United States ranging from base camp (one location) and highlight
trips (several locations with transportation provided between
locations), to hard-core Sierra backpacks, to easy family trips. There
are also specialty trips: women-oriented trips, age-specific trips, and
singles trips.
LService Trips. Ever since the first service trip in 1958
to remove trail garbage in Kearsarge Pass in the southern Sierra
Nevada, the Club's service trips program has become one of the pre-
eminent wilderness restoration and public lands maintenance programs in
the United States. Service trip participants build trails, repair
damage from campers, survey and map fragile Native American
archaeological sites, and re-vegetate distressed areas.
LActivist Trips. The activist trips take members to areas
that the Sierra Club is working to protect and provide trip
participants with the tools and inspiration to become advocates for
those areas. Trip participants then return to their local communities
to share their newly acquired skills, knowledge, and passion with other
environmentalists and the general public.
LInternational Trips. A variety of trips are conducted
including trekking, rafting, alpine hiking, van touring and naturalist
excursions. International trip participants learn about the native
cultures and fragile ecosystems while respecting local traditions.
Group/Chapter Outings. The program is conducted on a direct cost
recovery basis (park entry fees, etc.) with many outings being free.
The program has approximately 5,000 active volunteers leading
approximately 20,000 outings serving several hundred thousand Sierra
Club members and guests. Most trips are day trips and few are run on
National Park and other Federal lands. There is a staff of two in the
San Francisco headquarters that handle administrative duties such as
providing policy guidance, addressing risk management issues, assisting
local programs in providing leader training and certification, and
helping enhance the educational aspects.
Inner City Outings: The Inner City Outings (ICO) program is
entirely grant funded through tax-deductible donations. ICO provides
outdoor experiences for persons who might not otherwise have them,
including low-income youth of diverse cultural and ethnic backgrounds,
hearing or visually impaired individuals, and the physically disabled.
Currently, the 47 ICO groups provide about 1,000 outings per year,
totaling 19,000 participant days. Only a few of these trips are run on
Federal lands. The goals of ICO are to:
Lpromote personal development by linking cultures,
fostering respect of self and others, and providing leadership skills
Lpromote appreciation and protection of our local and
global environments through a process of educating and sharing.
All of the different types of Sierra Club outings incur some level
of overhead costs, in particular insurance, publicity, and logistical
coordination. The Sierra Club Board of Directors has directed the
Outings Department to recover these costs to the extent possible so
that this vital program is not a drain on other Club activities or
resources. Unfortunately, this is a difficult goal to achieve. In
fiscal year 2000, for example, the audited financial statements of the
Sierra Club indicate that the Outdoor Activities program had revenues
of $4.1 million and expenses of $4.9 million; in 1999, revenues were
4.0 million and expenses were 4.4 million.
Despite the perception of some in the outdoor recreation industry,
the Sierra Club does not generate a surplus from its outdoor activities
that it uses to subsidize other programs. On the contrary, the opposite
is true - general Club funds are used to subsidize this vital education
program. The Sierra Club wants to expose our members to the natural
world so that they will be inspired and take responsibility for its
protection. That is why one-week backpacking trips are priced at $450
and ten-day service trips at $350. There is no surplus to be generated
at these prices.
II. OPPOSITION TO H.R. 1461
The National Parks Omnibus Management Act of 1998 challenged the
assumption that all visitor services should be provided through either
concessionaires or holders of commercial use authorizations. For non-
profit institutional groups not deriving taxable income from their
trips, the 1998 Act allows groups to provide their own guide services
for their members. These groups have the competence to guide their own
trips and do not need the services of concessionaires and guides - and
should not be forced to pay for them.
When its provisions are implemented, the 1998 Act will remove the
requirement that groups either compete with for-profit ventures for
commercial use authorizations or, as is required in some Parks, use
outfitter and guide concessionaires in order gain access. These changes
are good public policy. Unlike commercial outfitters, institutional
groups, many relying on volunteer leadership, take many fewer trips
involving far fewer visitors to the Parks. Institutional groups engage
in educational and civic activities and do not compete with outfitters
and guides concessionaires for commercial recreation users.
The Sierra Club is not looking for preferences - it is trying to
avoid being either denied access to the National Parks or being forced
to use outfitter or guide concessionaires. In reality, the 1998 Act
does not confer a preference for institutional groups nor does the 1998
Act lead to misuse of resources. Non-profit institutional groups like
the Sierra Club must still compete for wilderness permits and conduct
its trips in accordance with land management plans and regulations.
However, while the Club and other groups are not looking for
preferences, we do want a fair allocation of any resource use that is
allowed.
If H.R. 1461 is implemented, various institutional groups which now
use units of the National Park System would not be able to continue
their patterns of use. These groups not only include various types of
youth camps, but also outdoor organizations who typically organize and
lead their own trips to many types of public land areas. Many of these
groups work with the Park Service on visitor education. Some even
conduct service trips to improve Park resources. It would be unfair to
preclude these groups from continuing this type of use of the National
Park System.
Accordingly, we urge you to reject H.R. 1461 so that valuable
children's, educational and civic programs conducted in our National
Parks are not endangered.
We thank you for the opportunity to convey our views and look
forward to working with the Subcommittee as it further considers H.R.
1461.
______
Mr. Hefley. Mr. Mastromarco.
STATEMENT OF DAN MASTROMARCO, EXECUTIVE DIRECTOR, TRAVEL
COUNCIL FOR FAIR COMPETITION, ALEXANDRIA, VIRGINIA
Mr. Mastromarco. Thank you, Mr. Chairman. It is nice to
begin my testimony knowing that the Sierra Club and the
administration both support 1461. If it weren't for the first
and last sentences of their testimony, I would think they fully
endorse the bill.
Let me begin in an unusual way by recognizing what this
hearing is not about today. It is not about denying Boy Scouts
access to National Parks, nor is it about denying nonprofits
the ability to use parks or even to conduct profitmaking
activities in the parks. The hearing is about repealing a
gaping loophole that allows tax-free, license-free and
regulatory-free use of National Park lands by a special class
of business, depending on what tax return they file. It is
about restoring equity between commercial users of parks;
returning to local managers the ability to oversee resource
use; abandoning an ill-conceived notion that nontaxable equates
to noncommercial.
Through section 418, Congress gave park managers authority
to issue CUAs--commercial use authorizations--but only when
that use has minimal impact on resources, is consistent with
the preservation and conservation of park resources, and is
either incidental or involves commercial operations of less
than $25,000.
However, during the 11th-hour consideration of this
language, without debate, without the knowledge of small firms,
and without any apparent rationale, Congress exempted
nonprofits from the need to obtain CUAs unless they have
taxable income.
So what is the harm in exempting nonprofits who don't have
taxable income?
If we listen to the testimony of the Administration, there
is no problem, but for one: Section 418(c) really just exempts
all nonprofits from the requirement to obtain CUAs at all
without expressly doing so.
Taxable income implicitly refers to the notorious unrelated
business income tax, a provision that taxes income only when it
is, not substantially related, to the exempt purposes of the
organization.
By requiring a subjective balancing act, UBIT offers a nice
theoretical and academic standard but one that is famously
unenforceable. Even the Department of Treasury has admitted
that UBIT's practical result is an ad hoc test that offers
inadequate guidance to the courts, exempt organizations and
revenue agents. In fact, unless advised by thoroughly
incompetent and bumbling counsel, nearly any nonprofit can
successfully exempt fees for recreational purposes from tax.
And they do.
Take the Sierra Club. The Sierra Club mission is to partly,
explore and enjoy the wild places of the Earth. So the more the
exploration, the more enjoyment, the more closely it furthers
this exempt purpose. There is no surprise that the Sierra
Club's Form 990 tax return shows more than $6 million in
taxable income from trips totally exempt.
Even if the National Park Service decided to train its
personnel to be tax lawyers and the UBIT bar was raised,
technical problems with the UBIT standard exist. For example,
how would the National Park Service determine the appropriate
level of deductions allocable to that activity?
The unworkability of the UBIT standard is no small matter,
because nonprofit activity is not small business anymore. UBIT
was enacted when nonprofits constituted less than 1 percent of
the gross domestic product of this country and numbered fewer
than 46,000. That was in 1950. Tax-exempts constitute more than
12 percent of gross domestic product today, and there are more
than 1.5 million of them, 650,000 501(c)(3)s. If you are still
wondering why small businesses are upset, consider that unfair
competition was rated a top concern in both the 1995 and 1986
White House Conferences on Small Businesses. Small businesses
hoped to see a dismantling of competitive barriers, not
construction of new ones.
But you don't need to be a tax lawyer to ask a more
fundamental question, Mr. Chairman. Is the UBIT standard the
right standard to employ for resource management reasons? What
connection is there between the furtherance of an objective to
explore and enjoy the wild places of the Earth and the need of
park managers to regulate use? The more exploration, the more
enjoyment, the more park managers should be able to regulate.
But don't take our word for it. Take the word of Outward
Bound, another nonprofit. They said the larger issue here is
one of accountable use by all parties, regardless of tax
status. The objective should be to partner with park managers
and provide quality visitor services, while simultaneously
protecting and preserving park resources. We could not have
said it more eloquently. Section 418(c) will not be missed by
anyone with the exception of a few abusive nonprofits.
Mr. Hefley. Thank you very much.
[The prepared statement of Mr. Mastromarco follows:]
Statement of Dan R. Mastromarco, Executive Director, Travel Council for
Fair Competition (TCFC)
Chairman Hefley and Members of the Subcommittee on National Parks,
Recreation and Public Lands:
As Executive Director of the Travel Council for Fair Competition
(TCFC), I thank you for focusing this hearing on H.R. 1461 and the
problem it addresses. TCFC was formed 7 years ago with two objectives:
first; to raise public awareness of a growing problem of unfair
commercial competition by nonprofits against for-profits; and second,
to defeat misguided public policies which contribute to that problem.
We are comprised of eight small business trade associations.
1 In turn, these organizations represent tens of thousands
of tax-paying small firms--campground owners, concessionaires,
outfitters, and hospitality providers--with hundreds of thousands of
employees who struggle against unfair nonprofit competition. TCFC
member companies introduce Americans to the National Parks and other
treasures on a daily basis.
---------------------------------------------------------------------------
\1\ National Tour Association, the American Society of Travel
Agents, United Motorcoach Association, American Bus Association,
American Hotel & Motel Association, America Outdoors and the National
Park Hospitality Association.
---------------------------------------------------------------------------
TCFC applauds Chairman Hefley for your legislation. H.R. 1461 would
repeal a rifle shot provision in section 418(c) of Public Law 105-391,
the National Parks Omnibus Management Act of 1998, that effectively
exempts commercial ``nonprofits'' from the requirement to obtain
``Commercial Use Authorizations'' or CUAs. H.R. 1461 would simply
require all commercial organizations to play by the same rules when
selling goods or services to visitors, regardless of whether the
commercial enterprise happens to be organized under Subchapter S,
Subchapter C, Subchapter K or Subchapter F of the Internal Revenue Code
(IRC). H.R. 1461 is common sense. It is sound resource management
policy. It is sound environmental policy. It is fundamentally fair.
With the changes recommended here, we urge your inclusion of this
legislation in the first available vehicle for passage.
Section 418(c) has functioned very well in one respect: it has
given tax-exempt organizations (tax-exempts) a huge competitive
advantage when offering the same commercial service as their for-profit
competitors on public lands. Section 418(c), however, is not a garden
variety special interest break. Section 418(c) provides a lose-lose
situation for park managers, resource managers, small firms that serve
the public though the Parks, and the visiting public at large. In
essence, the provision creates a sort of enterprise zone for entities
organized as tax-exempt on lands in public trust. Through this
wholesale exemption, tax-exempts excuse themselves from limitations on
use, environmental and resource oversight, fees, safety requirements
and a host of rules. They undermine park management by exonerating
themselves from oversight. Ironically, they are the very organizations
that ought to embrace these rules, not seek immunity from them.
It is important for members of this Subcommittee to recognize what
this hearing is not about. This hearing is not about denying access to
Boy Scouts, clubs and church groups who are engaged in noncommercial
activities inside National Parks. Your legislation can easily be
written to exclude such noncommercial groups. In fact, it is not even
about denying access to the Parks by our Nation's largest and most
commercially oriented nonprofits. We would not support the legislation
if it were. Instead, this hearing is about closing a gaping loophole
that allows tax-free, license-free and regulatory free use of national
park lands by a special class of business. It is about restoring equity
between commercial users of Parks. It is about returning to local
managers the ability to oversee resource use. It is about replacing an
unworkable, unenforceable, illusory and incorrect standard for granting
CUAs with a realistic standard. It is about abandoning an ill-conceived
notion that non-taxable equates to noncommercial. It is about adding
revenues of the Parks, and increasing safety for park users. Tax-exempt
entities are the largest commercial users of Federal lands, and they
should be subject to the same regulatory strictures and oversight as
their for-profit competitors.
This testimony breaks the issue into several parts. First, we
discuss the genesis of section 418 and the double-blanketed immunity it
provides nonprofits. Second, we discuss the problems created by this
grant of immunity. Third, we discuss the operation of H.R. 1461 and
offer views on ways your legislation might be improved.
Section 418 ``Commercial Use Authorizations'': How it Operates
a. The General Rule
Today there are two basic methods by which the Department of
Interior can authorize commercial activities in National Parks:
concessions contracts and ``commercial use authorizations''
(``CUA's''). 2 Through section 418 3 Congress
delegated authority to the Secretary (and derivatively to park
managers) to issue CUAs. Congressional intent in enacting Section 418
was to fill a void existing since the 1965 National Park Service (NPS)
authorizing legislation. That legislation had failed to specify the
processes by which the agency might sanction incidental commercial use.
The agency filled this gap through executive fiat, specifically by
issuing ``Incidental Business Permits [IBPs]'' (formerly ``Commercial
Use Licenses [CULs]). When issuing IBPs the agency was not discharging
its duties under the organic statute, but acting under assumed
authority derived from a need to avoid the cumbersome concessions
contracting mechanism. Section 418 was meant to formalize the agency's
authority to permit limited commercial activity in Parks, streamline
the method for seeking and granting such authorizations (a goal not yet
achieved), and set forth general standards by which requests for such
for authorizations could be evaluated.
---------------------------------------------------------------------------
\2\ Section 418 provides: ``IN GENERAL- To the extent specified in
this section, the Secretary--may authorize a private person,
corporation, or other entity to provide services to visitors to units
of the National Park System through a commercial use authorization.
\3\ Title IV, section 418, November 13th, 1998 (112 Stat. 326).
---------------------------------------------------------------------------
The standards for exercising discretion to issue CUAs are described
in Section 418 as ``limitations,'' ``criteria'' and ``elements of
authorization.'' The agency may grant CUA's only when: ``the Secretary
determines [they] will have minimal impact on resources and values of
the unit of the National Park System and are consistent with the
purpose for which the unit was established and with all applicable
management plans and park policies and regulations. 4 The
Secretary shall, ``require payment of a reasonable fee for issuance of
an authorization--to recover associated management and administrative
costs. 5 Additionally the Secretary is to ``require that the
provision of services under such an authorization be accomplished in a
manner consistent to the highest practicable degree with the
preservation and conservation of park resources and values,
6--take appropriate steps to limit the liability of the
United States arising from the provision of services under such an
authorization, 7 and issue [no] more authorizations than are
consistent with the preservation and proper management of park
resources and values ``. 8 In the ``limitation'' section of
the Act, Congress provided the general rule that CUAs are limited to
``commercial operations with annual gross receipts of not more than
$25,000 resulting from services originating and provided solely within
a unit, 9 [or] incidental use of resources of the unit by
commercial operations which provide services originating and
terminating outside of the boundaries of the unit''. 10
---------------------------------------------------------------------------
\4\ Section 418(b)(1).
\5\ Id. at section 418(b)(2)(B).
\6\ Section 418(b)(2)(A).
\7\ Section 418(b)(2)(C).
\8\ Section 418(b)(2)(D). Finally, the Secretary ``shall establish
such other conditions for issuance of such an authorization as the
Secretary determines appropriate for the protection of visitors,
provision of adequate and appropriate visitor services, and protection
and proper management of the resources and values of the park.
\9\ Section 418 c (1).
\10\ Section 418 c (2).
---------------------------------------------------------------------------
b. A Double-Blanketed Exemption for Tax-Exempts
The restrictions are significant for for-profits. However, during
the 11th hour consideration of Public Law 105-391, without debate,
without hearings, without the knowledge of small firms and most
nonprofits and without any apparent rationale--the following language
was added: ``[n]onprofit institutions are not required to obtain
commercial use authorities unless taxable income is derived by the
institution from the authorized use. 11 In one fell swoop,
Congress exempted any ``nonprofit'' from any of the above requirements,
without so much as defining ``nonprofit. 12 Section 418
created three distinct standards: a stringent one for commercial for-
profit firms, and two lenient ones for commercial nonprofits.
---------------------------------------------------------------------------
\11\ Section 418(c).
\12\ ``Nonprofits'' are distinguishable from tax-exempts, in that
the former is exempt from tax under Section 501(c)(3). Surprisingly,
the Sierra Club and other 501(c)(4) organizations also claim exemption
from Section 418(c).
---------------------------------------------------------------------------
Just how lenient the standard is for nonprofits depends on whether
it declares taxable income from the commercial enterprise. The vast
majority of nonprofits enjoy the greatest leniency the law can provide:
they are fully excused from seeking CUAs because they have no
``taxable'' income. 13 Section 418, however, provides a
double layer of protection. On the few occasions taxable recreational
fee income is earned by a tax-exempt, the so-called ``limitation''
section of 418 makes it clear that CUA's can still be provided to
``nonprofit institutions (including back country use),''14
irrespective of the conditions applicable to for-profit operations.
More specifically, when they qualify for CUAs, tax-exempts are
apparently immune from either the $25,000 dollar limit or the
requirement that their use shall be ``incidental'' or originate and
terminate outside of the boundaries.
---------------------------------------------------------------------------
\13\ It should be noted that some nonprofits, including Outward
Bound, have adhered to the CUA's by their own volition, despite their
ability to escape its purview.
\14\ Section 418(c) (3).
---------------------------------------------------------------------------
What are the Problems with Section 418(c)
a. Section 418(c) ``Taxability Standard'' Effectively Exempts All
Nonprofits from the Requirement to Obtain CUAs
As noted, section 418(c) effectively exempts tax-exempts from the
need to seek and obtain permits if no taxable income is derived form
the commercial enterprise. By employing the term of art ``taxable
income,'' the section implicitly refers to a notorious section of the
Internal Revenue Code (26 U.S.C. 512 et seq) commonly referred to as
the ``unrelated business income tax'' or ``UBIT''. Under IRS sections
512, income that ``contributes importantly'' (i.e. is ``substantially
related'') to the exempt mission of a tax-exempt is considered
nontaxable. Only income that is not ``substantially related'' is UBIT.
Additionally, unrelated business income (UBI) is gross income from an
unrelated business regularly carried on, less deductions connected with
that business.
To understand why this 52 year-old standard is illusory requires a
brief tax policy history lesson. The ``substantially related'' UBIT
standard was indeed developed to forestall unfair competition, but
mostly in response to a specific anecdote. The quintessential case
giving rise to the law was the gift of Mueller's Macaroni Company to
New York University Law School, which wanted to operate the pasta
producer tax-free, arguing that the income was directed to an
eleemosynary purpose (i.e. the destination principle). Needless to say,
their competitors cried foul, arguing the proper goal of NYU was to
produce students, not pasta. Congress reacted by imposing the regular
corporate income tax ``with respect to so much of [a tax-exempt's
income] as arises from active business enterprises--unrelated to the
exempt purposes of the organizations. `` 15
---------------------------------------------------------------------------
\15\ That Congress intended UBIT to help prevent unfair competition
by tax-exempt entities against taxable entities is clear. According to
the Senate and House reports: ``The problem at which the tax on
unrelated income is directed is primarily that of unfair competition.''
P.L. 814 (Ch. 994), 81st Cong., 2nd Sess., 64 Stat. 479, 906. See, S.
Rep. No. 2375, 81st Congress, 2d Session (1950). See also, H. Rep. No.
2319, 81st Congress, 2d Session (1950). The Supreme Court has so held
that this was the legislative intent of the UBIT in the Court's 1986
decision, U.S. v. American Bar Endowment, 477 U.S. 105. 91 L.Ed.2d 89,
106 S.Ct. 2426, 2432.
---------------------------------------------------------------------------
UBIT was enacted when nonprofits constituted less than 1 percent of
the Gross Domestic Product and numbered fewer than 46,000, and the
growth in the breadth and scope of nonprofit commercial activity was
unforeseeable. Tax-exempts constitute more than 12 percent of GNP
today, and their growth rate has far outstripped the growth of the
private sector. In 1996 there were over 650,000 501(c)(3)'s.
16 Over the next five years, the IRS projects Form 990
returns will be filed by 618,000 such organizations. 17
There were more than 65,059 applications pending in 1999 just for
501(c)(3) status, and out of 73,605 applications filed in that year,
only 585 were denied. During the 20-year period from 1975 to 1995, the
real assets and revenues of nonprofit organizations filing information
returns with the IRS more than tripled, to $1.9 trillion and $899
billion, respectively. This compares to real growth in gross domestic
product (GDP) of 74 percent during the same 20-year period.
---------------------------------------------------------------------------
\16\ This figure is understated because it excludes certain
organizations such as farmer's cooperatives and religious
organizations.
\17\ Returns are filed only when gross receipts are greater than
$25,000.
---------------------------------------------------------------------------
The UBIT was never meant to withstand the vast volume of nonprofit
commercial activity, and has failed miserably in application. If the
``substantially related'' test is a toll bridge upon which all
commercial activity of nonprofits was expected to cross, it is broken
in an upward position. Taxes paid by nonprofits have not kept pace with
their growth. In 1994, all exempt organizations paid a total of $195.1
million in taxes of all kinds, and the amount of UBIT (unrelated
business income tax) paid by 501(c)(3) nonprofit organizations was a
paltry $64.7 million or 1 percent of revenues. While some nonprofits
did pay taxes on net unrelated business income (UBI), they also claimed
total deductions of $4.1 billion, for a combined net loss of $955.1
million. This amounted to about 5/100ths of one percent of their
program service revenue, or less than 1/20th of what private
corporations pay in income tax as a percentage of revenues.
18 Most nonprofits consider commercial activities that
compete against for-profit small firms as ``substantially related'' and
therefore tax-free under the UBIT. Finally, the nation's largest
nonprofits disproportionately rely on commercial as opposed to donative
sources of revenue. 19
---------------------------------------------------------------------------
\18\ This contrasts to more than one percent of gross receipts in
income tax paid by corporations. In other words, significantly more
than 20 times as much. See SOI Bulletin, Table 13, Fall 1998.
\19\ Only 1 percent of all 990T filers in 1991, or 433
organizations, had gross income of $1 million or more from unrelated
sources. These organizations accounted for nearly half of all UBI
reported and 64 percent of all tax liability from the UBI. Conversely,
only 2 percent of the total tax, or $2.4 million was reported by the
smallest nonprofits, which comprised more than 50 percent of the
taxpayer population.
---------------------------------------------------------------------------
Understanding the full scope of the problem requires us to see its
economic dimension. Tax-exempt commercial enterprises are not only
business competitors, they are large businesses, which become
increasingly more commercially oriented the larger they get.
[GRAPHIC] [TIFF OMITTED] T2929.001
Organizations with assets of $50 million and above rely on
contributions, gifts and grants for only 11 percent or their income in
1991.
UBIT offers a nice theoretical standard, but its subjective nature
makes it almost impossible to apply in the real world. Whether or not a
rafting trip is taxable for example depends on the relationship of the
particular income producing activity to the tax-exempt's mission. To
properly apply the provision, the NPS must know precisely how the
commercial activity furthers the exempt mission of each organization.
To take an example, let us explore briefly the factors that might enter
into a decision about the relationship of the commercial activity to
the exempt mission of a nonprofit. At least 20 factors are most
apposite to tour and travel activities of educationally based
organizations:
LWhether the tour utilizes traditional modes of education;
LWhether the tour ``focuses'' on or is ``geared toward''
education of students or those who have exhibited an interested in the
subject, 20
---------------------------------------------------------------------------
\20\ E.g. Revenue Ruling 69-400, 1969-2 C.B. 114, Revenue Ruling
70-534, 1970-2 C.B. 113.
---------------------------------------------------------------------------
LWhether the tour is to the location furthered by the
mission of the group;
LWhether the tour has qualified scholars and certified
teachers, 21 or minister and priests, 22
---------------------------------------------------------------------------
\21\ Revenue Ruling 69-400, 1969-2 C.B. 114, Revenue Ruling 70-534,
1970-2 C.B. 113.
\22\ Revenue Ruling 77-430, 1977-2 C.B. 194.
---------------------------------------------------------------------------
LWhether the tour mandates organized study, as
demonstrated by the number of classroom hours or required seminars or
lectures, 23
---------------------------------------------------------------------------
\23\ Revenue Ruling 77-430, 1977-2 C.B. 194.
---------------------------------------------------------------------------
LWhether the tour does not schedule recreational
activities and recreational activities that do exist are only
``incidental, 24
---------------------------------------------------------------------------
\24\ Revenue Ruling 70-534, 1970-2 C.B. 113, Revenue Ruling 77-430,
1977-2 C.B. 194.
---------------------------------------------------------------------------
LWhether a library is provided, 25
---------------------------------------------------------------------------
\25\ Revenue Ruling 70-534, 1970-2 C.B. 113.
---------------------------------------------------------------------------
LWhether the organization administers exams, 26
---------------------------------------------------------------------------
\26\ Revenue Ruling 70-534, 1970-2 C.B. 113.
---------------------------------------------------------------------------
LWhether a governing board allows credit, 27
---------------------------------------------------------------------------
\27\ Revenue Ruling 70-534, 1970-2 C.B. 113.
---------------------------------------------------------------------------
LWhether the tour was commercial in nature 28
or did not differ substantially from commercially operated tours,
29
---------------------------------------------------------------------------
\28\ Revenue Ruling 67-327, 19677-2 C.B. 187.
\29\ Revenue Ruling 78-43, 1978-1 C.B. 164.
---------------------------------------------------------------------------
LWhether the tour provided formal educational training,
30
---------------------------------------------------------------------------
\30\ Revenue Ruling 78-43, 1978-1 C.B. 164.
---------------------------------------------------------------------------
LWhether the tour devoted extensive resources to social
and recreational programs 31 or those programs were ``not
insubstantial, 32 of a ``wide range, 33 or
scheduled; 34 and
---------------------------------------------------------------------------
\31\ Revenue Ruling 77-366, 1977-2 C.B. 192.
\32\ Schoger Foundation v. Commissioner, 76 T.C. 380 (1981).
\33\ Schoger Foundation v. Commissioner, 76 T.C. 380 (1981).
\34\ Revenue Ruling 77-366, 1977-2 C.B. 192.
---------------------------------------------------------------------------
LWhether the tour's educational activity was not
mandatory. 35
---------------------------------------------------------------------------
\35\ Schoger Foundation v. Commissioner, 76 T.C. 380 (1981).
---------------------------------------------------------------------------
Despite the many pages of authority, neither the statute, the
regulations, nor the dozens of underlying rulings have so much as dimly
illuminated what is meant by unrelated in the myriad contexts in which
the standard must be applied. The subjective standard is not only
difficult to understand in the abstract, it is impossible for the IRS
to adequately enforce. Frustration in enforcing this standard has been
acknowledged at various times by the Congress, the Department of
Treasury, by the Commissioners of the IRS by the IRS'' field agents and
by everyone else affected by the standard, except for the nonprofits.
Treasury, IRS and the General Accounting Office, 36 have
also, at one time or another, taken swipes at the ``substantially
related'' standard. According to testimony by former Assistant
Secretary Don Chapoton during extensive Ways and Means Committee
hearings on the failure of the law:
---------------------------------------------------------------------------
\36\ According to Jeannie Stathis, at the same hearings (then
Associate Director, General Government Division, U.S. General
Accounting Office): ``Administering this tax can be difficult because
of the individual circumstances that must be considered to determine
whether an activity is ``substantially related'' to an exempt purpose.
---------------------------------------------------------------------------
Our primary concern with the ``substantially related'' test is
whether in practice it has been useful in distinguishing
activities entitled to exemption, from those that are not. The
general concepts enunciated in the regulations inherently
require facts and circumstances determinations that are not
likely to achieve consistency among different exempt
organizations. The practical result appears to be an ad hoc
test that, in may cases offers inadequate guidance to the
courts, exempt organizations and revenue agents. Moreover, to
the extent the relatedness standard has provided guidance, ``it
has been applied in an overly generous manner. 37
---------------------------------------------------------------------------
\37\ Id.
---------------------------------------------------------------------------
According to then IRS Commissioner, Lawrence Gibbs, at those same
hearings:
...application of the tax requires a very subjective decision
that is based on the facts and circumstances of each case.
Again, I will not go into them in detail other than to mention
them and to express my opinion that they do cause
administrative difficulties for the Internal Revenue Service--
this has been a difficult area for us in making decisions that
require an examination of the relationship between the income-
producing activity itself and the accomplishment of the exempt
purpose....
It should come as little surprise that few if any of the well-
healed tax-exempts ever make the mistake of deriving taxable income
from the activity. Indeed, unless they are poorly advised by bumbling
counsel, nearly any nonprofit can successfully exempt the vacations
they offer their members from taxation. To take the Sierra Club as an
example, one of their stated missions is ``to explore and enjoy the
wild places of the earth. 38 Seemingly, the more
exploration, the more enjoyment and the more commerciality, the more
related it is to its exempt function. Perhaps it is for this reason
that the Sierra Club's Form 990 nonprofit tax return shows that more
than 6 million in taxable income from trips is totally exempt.
---------------------------------------------------------------------------
\38\ Sierra Club, Mission Statement.
---------------------------------------------------------------------------
Tax-exempts can not only circumvent the UBIT and the CUA process by
ensuring their mission is loose, or their commercial activates are
wordsmithed to match the mission, but also because the nonprofit
charter is merely a technicality. Section 418(c) will encourage groups
to consider setting up adjuncts so, through the miracle of
technicalities, they can take advantage of a loophole that exempts
those activities from the need to obtain use authorizations in National
Parks. Any for-profit can establish a nonprofit organization to either
conduct the tours directly or contract out.
The truth is that the UBIT standard is one the Internal Revenue
Service cannot enforce, let alone the park ranger. Even if one could
find a nonprofit willing to pay taxes on income produced from
``commercial'' activity in Parks, how would the NPS determine if they
should pay tax on that income when the IRS cannot do so? How would the
NPS determine the appropriate level of deductions applied to gross
income from the Parks? There is no agreement to share micro data with
the Internal Revenue Service and the nonprofit Form 990T--their tax
return--is not disclosable. And how would the NPS determine if the
activity is ``regularly conducted'' within the meaning of IRC section
512?
b. Section 418(c) Is Unfair To Small Firms and Files in the Face of
Federal Policy Goals
1. In General
Since section 418 only applies when services are being offered to
the public, the effect of adopting the illusory UBIT standard is to
exempt commercial tax-exempts from the requirements to pay for a CUA,
from the monetary ceiling, from the governance or control over the
number of commercial services provided, from park fees, and from
control over the impact of the nonprofit on resources. The absence of
meaningful regulations has therefore fostered an environment where tax-
exempt organizations compete with impunity against small businesses.
In order to fully understand small firm's frustration with the
special treatment accorded nonprofits in section 418(c), we should view
the provision in the context of the burgeoning awareness of unfair
competition. In both the 1995 and 1986 (the last two conferences) White
House Conference on Small Business, small firm owners rated unfair
competition resulting from governmental and nonprofit activities as one
of their top 15 issues. According to the delegates' recent 1995
recommendation:
Support fair competition: Congress should enact legislation
that would prohibit government agencies, tax-and antitrust-
exempt organizations from engaging in commercial activities in
direct competition with small business. 39
---------------------------------------------------------------------------
\39\ Report on the 60 Final Recommendations of the White House
Conference on Small Business (1995).
---------------------------------------------------------------------------
Through the White House Conference, small firms hoped to see a
dismantling of competitive barriers, not the construction of new and
subtle ones.
The concerns of small firms has also been echoed by the Department
of Treasury, which establishes tax policy respecting nonprofits:
Limits on the scope of such tax exemption are appropriate and
necessary. This Nation has prepared through its reliance on
private, market-based economy to supply necessary goods and
services. The role of the government generally has been
restricted to those socially important activities not
adequately supported by the private sector. The role of the
quasi-governmental, not-for-profit sector should similarly be
restricted to that of supplementing, and not supplanting, the
activities of for-profit businesses. 40
---------------------------------------------------------------------------
\40\ Hearings before the Subcommittee on Oversight, Committee on
Ways and Means (Serial 100-26 (June 1987)).
---------------------------------------------------------------------------
The for-profit small firms that provide the bulk of our nation's
travel and tour activities do not resent competition per se, even from
the Nation's largest commercial nonprofits. However, they do resent
regulatory and congressional policy that is insensitive to, indifferent
to, or worse yet, supportive of, unfair competition. When a tax-exempt
unfairly competes against a small firm, it invariably treads on the
interests of struggling entrepreneurs. Entrepreneurs contribute not
only by providing a competing service, but also by paying taxes on that
service. These small businesses find themselves regularly competing
against their own tax dollars. Moreover, when nonprofits compete,
social goals are often reversed because nonprofits frequently market
their tax-subsidized tours and outings to the most educated and wealthy
segment of our population. Consumers suffer from the lessening of
choice. Taxpayers suffer when they pay higher tax rates for the benefit
nonprofits and the government receives when engaging in such commercial
activity. Section 418 comes at a time when small businesses are united
in their fundamental opposition to unfair competition from commercial
nonprofits, especially when the business community has traditionally
filled those market needs on their own.
Underneath their ``halo'', commercial tax-exempts are simply
business competitors. They can sometimes be viewed as closely held
businesses operated to no small degree to augment the salaries and
benefits of the management of the organization. The difference between
tax-exempt and for-profit business competitors does not lie in the
markets they serve, the services they market, or the means of marketing
but in the unjustifiable policy distinctions that are too frequently
drawn. Both are businesses, but the for-profit business pays tax and
the nonprofit does not. Commercial nonprofits are often accountable to
no one--not shareholders, not donors, and not the objects of their
mission. In this case, they are not even accountable to resource and
environmental managers.
2. One Example
To see the potential for abuse within National Parks, one needn't
look beyond this hearing room. The Sierra Club alone conducts an
estimated 330 tours and many rafting trips (some utilize for-profit
rafting operations and river runners, but they needn't do so). The
Sierra Club is one of the nation's largest adventure travel companies.
One need only look at the web site to see the numerous tours they
operate. When reading just a few of the excerpts below from the
hundreds of extensive printed brochures of the Sierra Club ask yourself
this question: how do they differ from commercial tours that could be
offered by a for-profit?:
LEscape to the Great Outdoors, but enjoy a hearty meal
and warm bed at night! Nestled in Donner Summit's pine forest
near Lake Tahoe, California, Clair Tappaan Lodge offers outdoor
adventures for those eager to escape civilization, but who
still want access to the basic amenities--and not-so-basic
luxuries, like our hot tub. Activities for all levels of
ability.
LSierra Club Water Trips: ride the exhilarating rapids
of canyon country! Float serenely down a canyon, shoot rapids,
sample swimming holes and side hikes. For help deciding what to
bring on your trip, refer to our Raft Equipment List.
LJoin an exciting four-day family float through the
wild and scenic section of the Rogue River in western Oregon.
We'll raft through a lush, forested canyon filled with rapids
(Class III) and spectacular scenery. Enjoy the wildlife,
swimming in the clear, refreshing water, and hiking to a
historic homestead. Minimum age is seven.--We'll stop to visit
fern grottos, splash in waterfalls, and play on sandy beaches.
We decided to ask the Sierra Club leaders that very question. They
were hard-put to answer. Some actual responses included these: ``all
Sierra Club members and share common interests and values,'' ``the
whole group has a common thought,'' ``our rafters are like-minded
(environmental etc.) people'' who ``share camping chores such as
cooking, gathering water etc.'' As for the environment, they said
``concern for the environment is evident,'' or that they ``place a
conservation emphasis on our trips, which [they] ``feel'' adds value,''
or that they ``appeal to those who want to help save wilderness areas,
not just recreate in them.'' They also justify it on the basis that
``they have a great tradition and history...well over 100 years old,''
My favorite is that they differ because of ``the looks on people's
faces after our trips.'' Each of these factors could just as easily
apply to the for-profit outfitters.
The more honest answers focused on product differentiation. ``As
far as I know, we are the only ones that do the full trip--Everybody
else splits it into two trips. We avoid Phantom Ranch, and that way,
are able to do more side-canyon hikes that most commercial trips do not
take advantage of.'' As for money, they claim, ``it is an excellent
value for the money!'' ``Our prices on water trips are about the same
or a little more than commercial trips when any add-on taxes and permit
fees are included in their prices.
The real differences? The blanket exemption provided nonprofits in
Section 418 ensures that they are also exempt from fees and
environmental oversight. The enjoyment of the vacation is not taxable
to the ``volunteers.'' Contributions to the Sierra Club Foundation (and
to other tax-exempts operating as a 501(c)(3)) are normal deductible,
so the Sierra Club has lower costs of capital than the commercial
enterprises. The Sierra club does not pay state sales taxes and real
estate taxes. They can market services for half the cost, compliments
of postal rates subsidized by for-profits. And they enjoy instant
goodwill from their ``halo.'' And because resource use is finite, for
every use assumed by the tax-exempt, the for-profit must forego their
use.
c. Section 418(c) Frustrates Resource Management Policy
One needn't be a tax lawyer to seriously question the
appropriateness of this standard for CUAs. A more fundamental question
should be posed. Is the UBIT tax standard the right standard to employ
for resource management, environmental and safety reasons?
Whether or not a use should be exempted should depend more on the
frequency of use, the type of use and the consumption of resources. The
UBIT standard is relative to a tax-exempts primary purpose. If a tax
exempt were to have as its mission, ``To explore and enjoy the wild
places of the earth,'' 41 what does the nexus of that
mission have to do with the need of the park managers to regulate use?
In fact, the more exploration, the more enjoyment, the more park
managers should be able to regulate.
---------------------------------------------------------------------------
\41\ See, Sierra Club, Mission Statement.
---------------------------------------------------------------------------
To make this point more clear, we can list the standards now
applicable to for-profit firms. For example, a CUA requires for-profits
to adopt an environmental management program (EMP) that includes: (1) a
specification of goals with specific targets with measurable results,
(2) responsibility and accountability, 42 (3) plans,
procedures, manuals, and other documentation maintained by the
concessionaire, (4) document controls, (5) training and communication
plans, (6) procedures for notification of discharges. Additionally, NPS
must approve of promotional materials (including Websites, broadcast
and print media) and rates and charges, outfitters and guides must wear
name badges, the business must produce employee manuals for pre-
employment screening, hiring, training, employment and termination, and
conduct a background review of applicants. They must training
applicants with up-to-date job skills. They must establish performance
review procedures, and drug free workplace programs. They must notify
park officials of violation of any applicable laws by employees, agents
and contractors, including environmental laws, nondiscrimination laws.
They must establish environmental management objectives and comply with
all laws pertaining to protection of human health and the environment.
Moreover, a concessionaire shall develop, document, implement and
comply fully with a comprehensive EMP.
---------------------------------------------------------------------------
\42\ Must have an environmental program manager and program to
evaluate employee and contractor performance under these
responsibilities.
---------------------------------------------------------------------------
As none of these requirements apply to tax-exempts which side-step
the CUA process, there is no benefit to tourists, to the NPS or to the
environment from Section 418(c). The exemption excludes the tax-exempts
from the governance of the NPS over the number of commercial services
provided and the impact of these services on the Parks resources. Under
section 418(c), there are no limits on the numbers of nonprofits that
can provide commercial services, like rafting trips. There is no
oversight in terms of enduring minimal impact on resources, and there
is no requirement that they adhere to resource management practices.
If you desire proof of the merits of this argument, you needn't
listen only to tax-paying firms. An anonymous Forest Service manager
had this to say: ``Many non-profits feel that they are entitled to non-
fee, permit-free access. If this was ever the case, my fear is that
every for-profit would soon have a non-profit arm of their business and
``soon become unregulated when it came to outfitter and guided use.''
The exemption is also opposed by responsible nonprofits, whose managers
could benefit from its unfair advantages. In criticizing the proposed
rulemaking on Concession Contracts (Title IV,) the National Outdoor
Leadership School and Outward Bound USA made the following observations
in their regulatory comment letter:
LWEC members did not support this language as a part
of S. 1693 and were not involved in or aware of its inclusion
in the Act. The members of the WEC are all non-profit
institutions with a long history of accountability in our use
of public lands. This language will allow unrestricted and
unaccountable access by a single category of user--regardless
of the amount of use or impact on park resources.
LWEC members question ... how effectively [park
managers] can--control access and manage use in backcountry
venues. This is especially true in a world where many General
Management Plans [GMPs] are still in process, and wilderness or
backcountry plans are not in place and may not be for years to
come.
LThe larger issue here is one of accountable use by
all parties, regardless of tax status. The objectives should be
to partner with park managers in providing quality visitor
services while simultaneously protecting and preserving park
resources for future generations. This language provides a
limited user class with exemption from administrative,
financial and physical accountability.
We could not have said it more eloquently.
Suggestions for Improving H.R. 1461
TCFC believes the legislation is primary directed at the heart of
the problem--it repeals the ability of nonprofits to self-exclude
themselves from the requirements of obtaining CUAs. This is a critical
change; however, we would recommend two additional changes.
First, we recommend subjecting all organizations in the park to the
requirements specifically applicable to for-profits. For a for-profit
firm to obtain a CUA, their services must either generate less than
$25,000 in gross fees or be incidental to the Park. To grant such a
CUA, the Secretary must affirmatively find that the provision of
services will have minimal impact on resources, will be conducted in a
manner consist to the highest practicable decree with the preservation
and conservation of park resources and values and in a number
consistent with the preservation and proper management of park
resources. However, if those same commercial enterprises are conducted
by a nonprofit, even if that nonprofit were to pay tax on its
commercial income, it would be able to obtain a CUA. Merely using the
phrase ``[n]onprofit institutions are not required to obtain commercial
use authorities unless taxable income is derived by the institution
from the authorized use'' as the bill would do, would not address this
problem. It would still allow commercial nonprofits unwarranted leeway
to conduct sales or services regardless of the gross earnings ceiling
or the incidental use restriction. Subjecting nonprofits to those
requirements is simply ensuring that they are placed on a level playing
field with their for-profit competitors.
Second we believe it is important to make clear that an exception
for CUAs is warranted in the case of noncommercial endeavors. We would
defined these endeavors to encompass scout outings and churches, for
example, when there is no requisite element of commerciality. For
example, we might seek to repeal Section 418(c)(3) in its entirely, and
add the following section:
(g) Commercial defined. Commercial use means recreational use of
the public lands and related waters for business or financial gain. The
activity is commercial if:
(1) it is conducted by a for-profit organization, or,
(2) if conducted by an organization organized under section 501(c)
of the Internal Revenue Code, and such organization
(A) makes or attempts to make a profit, receive money, amortize
equipment or obtain goods or services as compensation from
participating in recreational activities;
(B) collects a fee or received other compensation that is not
strictly a sharing of actual expenses, or exceeds actual expenses
incurred for the purposes of the activity, service or use;
(C) charges participants for a duty of care or an expectation of
safety; or,
(D) publicly advertises to seek participants.
We would be pleased to work with the Subcommittee and responsible
nonprofits in developing these modifications to the language.
Conclusion
Section 418(c) is one sentence on one page comprising many chapters
in a book of advantages accorded nonprofits unfairly competing against
small businesses, but it is an excellent example of how commercial
nonprofits are exempted from the laws that apply with vigor to their
for-profit competitors. This provision does not affect Boy Scouts, Girl
Scouts, clubs and church group activities in the Parks. However, it
does mean that all commercial users are on a level playing field.
Nonprofits, particularly those who are founded on environmental
missions, should not seek to avoid rules established for the protection
of the Parks. They should embrace those rules. Your legislation is a
win-win. Section 418(c) may be missed by abusive nonprofits, but few
others.
______
Mr. Hefley. Mrs. Christensen?
Mrs. Christensen. Can I pass and come back--.
Mr. Hefley. Sure.
Mrs. Christensen. --in another round?
Mr. Hefley. Sure.
Mr. Simpson?
Mr. Simpson. Thank you, Mr. Chairman. Mr. Simon, how much
would it cost you if you were subjected to the commercial use
permit?
Mr. Simon. As the Park Service said, they have not yet
implemented the new regulations. So we do currently have to go
through what is called the incidental business permit process.
So we currently operate under the old law. Nothing has changed
since 1998, as no regs have been issued. The issue for us is
not fees. My understanding of the fees is actually slightly
higher than that. They are closer to 2- or $300. But that is
not the issue. The issue is access. We are denied in certain
parks the ability to get an IBP, an incidental business permit.
The park will say we have enough commercial providers, we are
not issuing anymore, you can't do your backpack for 1 week for
12 people.
That is what I am here today about. I am not here today to
try to exempt ourselves from the $200 fee in the 40 or 50 parks
that we run trips in. We just want access.
Mr. Simpson. So you wouldn't be opposed to paying the fee;
is that correct?
Mr. Simon. I pay them now.
Mr. Simpson. You know, it is interesting that you bring up
the issue of access, because that, quite frankly, is the issue
surrounding many of the bills and legislation and proposals in
the West that the Sierra Club opposes, is the issue of access
of the public to public lands, not just parks but to other
public lands.
Mr. Simon. There are two levels of access in the national
parks and in most public lands. The first is you have to cross
the hurdle of getting an incidental business permit in the
parks. Then you go and try to get a back-country permit. So the
land managers still have the ability to restrict use, and we in
no way want to upset that balance. If they are going to not
allow any more trips, there is too much use on a particular
trail at a particular time of year and there are no trips going
through there, we are fine with that. But there is this
preliminary hurdle that you have to go through of getting an
IBP, or, in the new language, a commercial use authorization,
that we feel has been unevenly administered and has actually
precluded us from getting to the second hurdle, which is the
back-country permits.
Mr. Simpson. Why should you have an advantage, though, over
someone else to use that--to use that park?
Mr. Simon. That is an excellent question, because we feel
the--
Mr. Simpson. Of course it is.
Mr. Simon. We feel the 1998 act--we feel there are more
than two types of use. We feel that history shows and we feel
the reality is that it is not just the public and commercial
providers. We believe that there is a long history and a long
need of this third body, and that is nonprofit, noncommercial
providers, such as hiking organizations, boy's clubs, all of
those organizations. We provide different types of services.
You can't go into the high Sierra--you can't find someone that
will lead you--or it is very difficult to find someone who will
lead you on a 1-week backpack. You can find someone who--where
you can stay at a posh lodge, who will take you out with a mule
train and things like that, but there just aren't businesses
providing those services. Plus they are not providing them to
our members at a loss, as my testimony stated.
Mr. Simpson. But I mean, some people prefer to experience
it at a posh lodge or a pack train or something like that. Why
should they be disadvantaged? Why should they have less of an
access to it than you have to it?
Mr. Simon. But they are not. This bill does not address
that level of access. That level of access is in the land
management policies, land management plans created by each land
manager, and they will allocate a certain portion of their
resource for outfitters, a certain portion for their
concessionaires, a certain portion for the public at large, and
we are not trying to upset that balance. This law doesn't even
deal with it. This law is at a higher level.
Mr. Simpson. Well, some commercial operations that I have
seen, as an example, some of the snow machine trips you take
into Yellowstone Park, commercial operations regulated by the
Park Service are very educational, and that is the purpose of
them. They are not just to go in there and rip up the park and
throw snow around. They are actually to go in and see
Yellowstone in the winter and see the bison and so forth, and
they are as educational, I would suggest, as anything that you
do, and I don't know why they have one level that they have to
meet and you have an unrestricted level because you have--
because you don't have to have this commercial license. That
just confounds me. I am not seeing the difference in the two.
It is like somehow we are--we provide something that is better
than some commercial organization does, so we shouldn't have to
meet the same standard as they do. This is kind of what is
confusing me.
Mr. Simon. I believe that nonprofit institutions are
providing different services, and I don't think that the
activities on our public lands conducted by nonprofits are the
same as those by for-profit providers. I am not sure I can
actually respond to your question.
Mr. Simpson. They may not be the same, but are they of
higher quality and benefit, obviously to you, but maybe not to
the individual that is deciding what they want to do? Why
should we decide that your use is more beneficial than some
commercial operators's use?
Mr. Simon. I believe that commercial operators--there is a
fundamental difference, and I believe the law in this country--
and I am getting a little out of my field, I am sorry, but I
believe the law in this country recognizes that there are
organizations that are doing something for the public good or
the perception of the public good, and that is why we have the
concept of nonprofits. And I think if you don't buy into the
idea that nonprofits provide a service that for-profits
organizations don't, then you are right. Your view is
consistent. But I actually--I believe nonprofits do provide a
different kind of service.
Mr. Simpson. If I might ask one more question, do you ever
use commercial operators on your trips?
Mr. Simon. Yes, we do; where we are obligated to in order
to gain access to the park. There have been certain cases where
we were denied access unless we were to use a commercial
provider, and for certain types of trips, our insurance doesn't
actually allow us to own boats and things like that, so every
raft trip that we run uses a commercial outfitter.
Mr. Simpson. Thank you.
Mr. Hefley. Mr. Holt?
Mr. Holt. Thank you, Mr. Chairman. It does seem that it is
access that we are talking about here, and we have an
obligation to see that these areas that are intended for the
public have the access of the public. And of course, that
access could be apportioned in various ways. It could be on a
first-come, first-served basis; it could be by some sort of
geographic quota. It could be by passing a physical fitness
test. It could be by strict economic restrictions--the highest
bidder.
What I would like to know--let me first ask you, Mr.
Mastromarco, for a 1-week backpacking trip in the Sierra, what
would one of your providers charge?
Mr. Mastromarco. Well, I--.
Mr. Holt. If there is such a trip.
Mr. Mastromarco. Well, the providers charge approximately
what the Sierra Club charges, and I can get back with you on
the specifics, but I don't have the precise fees in hand. If I
can, would you permit me--.
Mr. Holt. Yes.
Mr. Mastromarco. --to address something I think needs to be
addressed before it is dangling out there? And you hit the nail
on the head in the early part of your remarks. We are not
talking about denying the Sierra Club access to the parks. What
they want, frankly, and the whole genesis of the provision of
418(c) was through their lobby effort, is simply to exempt
themselves so they don't have to compete for access for
commercial use authorizations. But the question here is, if
their mission is founded on environmental principles, then
should they not embrace those principles? Should they not be
the first group in line to say, I want to subject myself to the
regulations that govern park resources and use?
Now, we have mentioned earlier the question that was asked
by Mr. Simpson about posh trips. Well, we can probably live
with a posh trip standard. It might be better having a posh
trip standard as opposed to the unrelated business income tax
standard. But let me point out a specific example from one of
their trips. Here is one from their brochure, Mr. Holt. This is
specifically from their brochure.
Mr. Holt. This is in your testimony. I have read that. You
probably don't need to put that in the record again.
Mr. Mastromarco. Okay. Very good.
Mr. Holt. I understand. Let me just say further that there
is certainly a long tradition--many of us had our first--most,
I would argue, Americans had their first and most memorable
introduction to these areas through Boy Scouts, Sierra Club-
type organizations.
But let me turn to a related matter. Let me ask you, Mr.
Simon, let's just choose some area. You seem to be familiar
with the Sierra. How many service trips a year do you have, you
know, say in the State of California or something of the sort?
And then let me ask the same question for you of your
providers, Mr. Mastromarco.
Mr. Simon. Mr. Holt, of our roughly 330 national outings,
approximately this year about 90 or 95 are service trips. In
the State of California, I don't have the exact number, my
guess is it is about a dozen, including things like--.
Mr. Holt. So for that fraction of your trips, the
percentage of your trips is what?
Mr. Simon. Just under a third.
Mr. Holt. Mr. Mastromarco?
Mr. Mastromarco. We are slightly comparing apples and
oranges, because Mr. Simon is the outings expert for the Sierra
Club. I am not. I am a policy spokesman for the Travel Council.
So--.
Mr. Holt. Service trips, would it be in the hundreds or the
dozens or--.
Mr. Mastromarco. Hundreds.
Mr. Holt. And what fraction of the total outings would that
be?
Mr. Mastromarco. I would say that--and this is just a
guess, but I think that they are commensurate with the use of
park country, and so a lot of it is on national forestland.
Maybe a quarter--
Mr. Holt. Could you get that number for me?
Mr. Mastromarco. Yes.
Mr. Holt. For us, please.
Mr. Mastromarco. I would be delighted to.
Mr. Holt. The fraction of your outings that are service
outings, in the same sense that the Sierra Club are service
outings?
Mr. Holt. And if you would like, Mr. Simon, to refine your
numbers on that, we would appreciate it. Thank you.
Thank you, Mr. Chairman.
Mr. Hefley. Thank you, Mr. Holt. Mrs. Christensen?
Mrs. Christensen. Thank you, Mr. Chairman. I guess before I
ask my question, I have not had the pleasure of going on a
Sierra trip or a commercial trip, but I do think that not-for-
profit organizations provide a different kind of service, and
the people ought to have a choice. And I also heard in the
prior testimony that the nonprofit organization trips are such
a small percentage of the overall number of trips that access
our park system, that I can't really see where that would be
unfair competition, and I would invite both of you to comment
on that.
I guess my question first would go to Mr. Simon. We have
heard some discussion about the not-for-profit organizations
operating without restriction, and to my understanding, you do
have restrictions. I imagine the park restricts how many people
can enter at any given time. You have to buy permit
regulations. Would you comment on the charge that you operate
without restriction?
Mr. Simon. The charge that we operate without restriction
is absolutely untrue. Every trip has to get a back-country
permit. That permit has certain restrictions that vary from
park to park, and often within a park. It varies from park to
park based on the land management plan for that Park Service
unit. Those permits govern number of people, where you can go,
where you cannot go. It is very specific. You can be going down
the John Muir Trail and you absolutely cannot camp in these 3
miles along the John Muir Trail and you need to plan your trip
accordingly. Full itineraries are submitted with each trip
application. So there is a high degree of oversight of each of
these trips.
Mrs. Christensen. And the other thing that I heard that I
had sort of a different understanding just came to the response
of some of the questions, that without the nonprofit status,
your membership might not have access. Is that true, that your
having that status does somehow allow your members some access
that they might not otherwise have?
Mr. Simon. Yes.
Mrs. Christensen. Because you said that your being here is
to talk about the need for access, and while you operate under
restrictions, there are members of the Sierra Club, of Boy
Scouts, of other nonprofit organizations that might not have
access, were it not for the provision that allows nonprofits to
also come in.
Mr. Simon. That is our belief. We are currently--again,
pointing out that the regs that relate to the 1998 act have not
been issued yet, currently there are a number of parks in which
we cannot operate trips. We have been denied the ability to get
an incidental business permit, which then denies you the
ability to apply for a back-country pass. So the current
reality is that we cannot get into certain parks, and we feel
that without this exemption in the 1998 law, that that will
only become more commonplace.
Mrs. Christensen. What are the justifications? Is this why
are you not able to get into certain parks? I am not sure I
understand.
Mr. Simon. I don't have firsthand knowledge of some of
them, but I do know--we have heard things like we have enough
commercial providers, you are a commercial provider. There are
other things. I believe it has gotten down to personalities. I
can't--it is hard for me to speculate on the motivations behind
all these cases. We have not asked for written justifications
of those positions, on the assumption that that would--.
Mrs. Christensen. Is this the Sierra Club, or do other
nonprofits have the same experience, to the best of your
knowledge?
Mr. Simon. I only know anecdotally of some groups in the
Northwest, the Mozamas and the Mountaineers that have also had
trouble getting into some of the national parks in the
northwest.
Mrs. Christensen. To the other gentlemen, whose name I
can't see quite--.
Mr. Mastromarco. You're forgiven. It looks like an eye
chart at 30 feet.
Mrs. Christensen. I saw you taking some notes, and I would
give you an opportunity to comment on anything.
Mr. Mastromarco. Well, I appreciate it. Thank you. I think
it is important to point out that nonprofit organizations,
those, for example, that are exempted under Title 26, United
States Code, section 501, in one way or another, are the
largest users, by far, in our country of back-country use in
the United States. They are the largest users. And all we are
saying is that tax-exempt entities should function--they should
be subject to the same regulatory strictures and oversight as
their for-profit competitors. That is what we are saying.
Mrs. Christensen. Well, I don't know how that reconciles
with the small percentage that I heard Mr. Ring--.
Mr. Mastromarco. Well, I think the small percentage that
Mr. Ring suggested needs to be clarified. He said, if I
remember correctly, that there were 700 or so commercial use
authorizations issued, and only a handful were to nonprofits.
Well, there is a very good reason for that. What Mr. Ring
didn't point out is that nonprofits don't need to get
commercial use authorizations. Therefore, those statistics are
not relevant.
Mrs. Christensen. As I recall, that wasn't quite what he
said. Of all of the--sorry. Of all of the groups,
organizations, that are given access, a very small--I seem to
remember that he said about 2 percent are nonprofits. But I
thank you for your comments. But I disagree with your
interpretation of what Mr. Ring said.
Thank you, Mr. Chairman.
Mr. Hefley. Thank you. Mr. Simpson?
Mr. Simpson. Thank you, Mr. Chairman. I do have a couple
other questions that I just need to ask, and then I have to
slip out to preside. So I appreciate you letting me take this
opportunity. You said, Mr. Simon, that there were incidental
business permits that you have been denied in some parks. I
assume that there are commercial operations that have been
denied permits in those same parks?
Mr. Simon. I don't know what the parks--I don't know what
other--.
Mr. Simpson. But they are probably full, they figured they
had enough activity and therefore it is tough to get a permit?
Mr. Simon. I think in some cases they feel they are full. I
think in other cases there are other pressures, and sometimes
the Sierra Club is singled out and denied access while others
get them. That is only my perception. I could not support that,
but I could do research if you like.
Mr. Simpson. And I want to tell you that I am not opposed
to the trips of the Sierra Club. I think they do good work in
many cases, and I don't have a problem with their trips. I just
think they ought to be treated like everybody else.
And I want you to respond to this comment that was made by
Herb Grench, who is the Chairman of the Water Trip Subcommittee
for the Sierra Club. He was asked: I am curious as to the
difference between your rafting trips and those of other
companies. I know that you are a nonprofit and focus on
conservation, but where do the real differences lie? Is there a
favorable price difference?
And this was his response: We use commercial outfitters to
run our trips, along with a trained Sierra Club volunteer
leader. We feel we employ the best outfitters. Our trips are
different from most commercial trips, in that our passengers
are all Sierra Club members and share common interests and
values. This helps make for a very compatible group. We do
place a conservation emphasis on our trips, which we feel adds
value. Our prices on water trips are about the same or a little
more than commercial trips when any add-on taxes and permit
fees are included in their prices.
Now, if that is the difference, that all the members in
your trip are Sierra Club members and that they share common
values and that you add an environmental or conservation
emphasis on your trips, why should you have an advantage over
someone that does a commercial? This just blows me away I guess
is the answer.
Mr. Simon. Well, Mr. Simpson, in that case, we have
actually hired a commercial outfitter to take that trip. As I
mentioned, all of our water trips are conducted by commercial
outfitters. We are just a customer of that commercial outfitter
at that point, just like the public. Even under the new rules,
we would not have to get a commercial use authorization, I
don't believe, to run that trip, depending on how the rules are
issued.
I agree with what Mr. Grench said. I believe you
paraphrased his statement, leaving out a couple of the key
components. He said say there was a conservation emphasis on
our trips, and I believe people do learn about the history of
where they have been, both from a natural history but also from
public policy standpoint, and we do believe that that does add
a fair amount of value, and water trips comprise about 25 of
our 330 nationally run trips.
Mr. Simpson. I find it interesting that you--as you said in
this case here, that you are just a customer of this outfitter,
like any other public customer. And I am wondering why you
shouldn't be a customer of the public Park Service, just like
any other customer that uses it.
Mr. Simon. But at that point, the outfitter is conducting
the trip, and the Park Service is regulating the outfitter.
Mr. Simpson. Well, I think we are making a distinction
without difference here in many cases.
Mr. Simon. I don't believe so, sir. In this case the Park
Service has issued the permits to the outfitter, and because
there is no other way the Sierra Club could possibly get
anybody on the water, we just go out and hire an outfitter. So
that is not the kind of trip I believe that would need to be
affected by the law as it is currently written or as it is
proposed to be amended.
Mr. Simpson. I am saying why should other trips be affected
by the law? Why shouldn't that same regulation apply in all
trips, whether it is back-country packing or whatever?
Mr. Simon. Because then we are not using commercial
outfitters, for the primary reason that there are no commercial
outfitters, and also we feel that we are providing a different
kind of experience.
Mr. Simpson. Well, I appreciate your testimony, and we are
going to have to--you are going to have to stop by my office, I
guess. We are a long ways apart on what we are talking about
here, I think. Thank you.
Thanks, Mr. Chairman.
Mr. Hefley. Thank you very much. I used to be a commercial
outfitter, or more accurately, I suppose, I worked for a
commercial outfitter, packing people on horseback in the
wilderness areas, and I loved the experience. Whether it is
done by a nonprofit or it is done by commercial groups, I
personally love the experience, whether it be a river rafting
trip, which I have done, or the wilderness trips, which I spent
a lot of time on my own in the wilderness. And I notice in this
expensive four-color ad here in the magazine, for Sierra Club
trips, they range from--oh, there is 460. There is 355, 495,
495, 1,995, $2,095. And I am familiar with a lot of--a number
of outdoor magazines, and you get the ads there for commercial
outfitters, and these prices seem to be pretty much in
compliance with--with those kind of prices, and they make a
profit, or they don't stay in business.
And I guess if you don't make a profit, Mr. Simon, I wonder
why. And I am a little confused. In reviewing the Sierra Club's
form 990, which is the tax return for tax-exempt organizations,
for the calendar year 1998, on Schedule 6, the Sierra Club
lists its total annual lodging and outing expenses at $315,500
and your annual exemption income from outing and lodging
expenses at approximately $4.5 million. In 1999, that $4.5
million went from $5.2 million, with the expenses at $358,000.
Now, in your written testimony, you indicated the Sierra
Club's expenses for its outdoor activities program is $4.9
million, and it revenues are $4.1 million.
I guess I may be reading these forms wrong. Gosh knows that
the IRS forms are a bit confusing, even to the experts, and I
am sort of not an expert on it. But I would like to request,
Mr. Simon, that you submit some kind of supplemental material
to the Subcommittee to clarify what appears to be a discrepancy
between your tax returns and your written testimony. And if you
would like to comment now, fine, or if you would like to submit
it, fine.
Mr. Simon. Mr. Hefley, we would be happy to do so, and I
would like to say that in support of my testimony, I did give
the Subcommittee staff our audited financials by the company
KPMG. You know, the nationally known, internationally known,
CPA firm. So we will be happy to get back to you to map
accrual-based financial statements to IRS forms.
Mr. Hefley. Yeah. If we could tie that in. You also
testified that this proposed legislation would damage or
curtail activities of many groups operating children,
educational, and civic programs, and you talked about this
denying access to the parks. It appears to me that what the
Park Service does is try to determine how many visitors the
resource will accommodate and still protect the resource, which
is of course a very important thing to the Sierra Club.
And I don't know, can either one of you show--you have
already talked about this some. Can you show any evidence that
the Sierra Club had been denied over and above commercial
outfitters? It seems to me that both are denied if they meet
the maximum that they think that that park can accommodate.
Mr. Simon. Mr. Hefley, I can state that in several of the
park units, we have run trips for many years, and then all of a
sudden we were denied commercial incidental business permits.
If you would like details of time and place, those can be
provided.
The kinds of parks I am talking about are Glacier, Rocky
Mountain, Teton, and that is just reality. Now, in that year
that they started denying us our permits, did they deny others?
I don't know. Did they do it on first come, first out? I don't
know. I do not know what their criteria was for deciding who
would no longer be able to run trips on their lands.
Mr. Hefley. Mrs. Christensen asked a question about whether
your people that you take in, the Sierra Club members, would be
able to take trips if you didn't have this exemption. You
indicated that some would be denied that. It is my
understanding that members of the Sierra Club, the average
income is several times the median income in America, that most
Sierra Club members are not poor folks. Also the indication is
that your costs are about the same. So do you still say that
some would be denied if the law is changed?
Mr. Simon. I don't have any specific information about the
income of our members. I do know that we price our trips to
cover field costs and overhead costs, such as insurance,
publicity in our magazine and things of that nature. I do also
know that there are cases where there are not commercial
providers providing the services that we do, and I do know that
on every single one of our trips, it is a different experience
than those provided from the commercial providers in the areas
where they operate and that we operate.
Mr. Hefley. I don't believe I have any further questions.
Do either of you have any further comments you would like to
make?
Mr. Mastromarco. I would just like to make one briefly. If
the Sierra Club is operating at a loss, as they claim, then I
think that it is important to understand what salary, for
example, the CEO of Sierra Club would make or how much they pay
their paid staff. They have to be one of the poorest managed
tour operators in the country, because commercial firms charge
the same amount for trips and outings, and they make money.
Either that, or they have a very creative system of accounting.
The primary difference--and I will just leave you with
this--with both for-profits and nonprofits now which constitute
the growing and commercial share of our gross domestic product,
is this: The difference is not in the markets they serve or the
services that they market; the difference is that one pays tax,
one is subject to the regulations and oversight of Park Service
resource managers, and one is seeking a thorough exemption from
that.
Mr. Hefley. Thank you. Mr. Simon, do you have any further
comments?
Mr. Simon. No, sir.
Mr. Hefley. Thank you both very much. It has been very
helpful and the Committee stands adjourned.
[Whereupon, at 11:59 a.m., the Subcommittee was adjourned.]
[Additional statements submitted for the record follow:]
[The prepared statement of Mr. Coughlin follows:]
Statement of Cris Coughlin, President, Glacier Wilderness Guides, Inc.,
Montana Raft Company, West Glacier, Montana
Chairman Hefley and Members of the Subcommittee on National Parks,
Recreation and Public Lands:
Glacier Wilderness Guides, Inc, has been a concessioner since 1983
in Glacier National Park that guides day hikes and extended backpacking
trips. The Montana Raft Company has operated under a permit from the
Flathead National Forest since 1987 on the North and Middle Forks of
the Flathead River.
RE: Non profits exempt from requirements of concession contracts
and CUA's
I would like to begin by stating that I do not have anything
against non-profit organizations, as a matter of fact, I think many of
them provide a wonderful means of education and service. However,
simply because they do not pay taxes, should not be reason to exempt
them from any compliance of the vast requirements in the outfitting
industry.
As the guided hiking concessioner in Glacier National Park, the
following is a list of some of the requirements that our guides and
company are currently required to comply with:
LAttend NPS Bear Management Training
LCurrent copies of first aid and CPR certification on
file, with a list of those expiration dates to the Park
L``Leave No Trace'' training
LMonitoring of trips by the NPS staff
LApproval of rates
LLoss Control Plan implemented
LLimits to the party size acceptable in the backcountry
LThat our advertising is not misleading in any way
LThat the educational and environmental messages that we
relay to the public are correct and in sync with that of the NPS
All of these regulations have been put in place to protect the
visitor in areas of safety and to protect the resource to environmental
damage. The new language of future concession contracts will have many
more requirements to comply with on appropriate service in overseeing
the outfitting industry. However, under the current law if you are a
non-profit organization you are exempt from any of these requirements.
My question to you is why would we want to exempt a large segment
of the outfitting industry from meeting these standards that provide
for assured quality and safety of operations? The non-profit outfitting
industry is grand in scale and needs the same regulations from which to
adhere. Some of these companies are professional enough in scale to
give the appearance of a regular outfitter, yet the consumer has no way
of knowing that the staff taking them on these tours may not have been
through the types of training assigned to commercial outfitters.
An example of this would be an experience that we shared with a
non-profit organization in the late ``80's and early ``90's. They are a
counseling school for troubled teens, many of which had drug and
alcohol related problems. The clients were from all walks of life and
from all across the country. The parents pay $6,000 per month for their
child's tuition. The school was told by the NPS that they needed to use
our services. We felt that the schools principles were very worthy and
for three years we bent over backwards to do everything we could to
make the trips successful for them and convenient under our contract.
We offered a $10 per person per day rate for our guides to accompany
them (normal rate was $80) and they were to provide the food and
equipment. To start out with the quantity and quality of food on the
trip became a safety issue in the cold fall weather. We took some of
their staff and put them through our guide training. On subsequent
trips in years to follow they showed total disregard to the policies
the NPS had in place for the backcountry, or to adhere to any of our
policies. In Glacier, we have approximately 350 grizzly bears and the
same number of black bears. There are many ``do's and don'ts'' in
regard to camping in bear country. Of main concern is when it comes to
food storage and handling. You must hang your food and keep your
sleeping area away from the food preparation area. They kept some of
their food in ziplock bags under a rock in a stream. They spent the
last three days of each trip doing what they called the ``Solo''
portion of the trip where the clients needed to be completely separated
from everyone. This practice alone is not advised in the backcountry
but they also kept food items in their tents during this portion.
Needless to say we arrived at the point that we could no longer work
with this company as they jeopardized our contract after repeated
attempts for compliance by our guides went unheeded.
The main point, is that I'm sure the parents of these teens assumed
that they were in safe hands because the company appeared to be very
professional. The current exemption of non-profits opens the doors to
companies as these that don't have the proper supervision to provide
safe quality services.
There is a strong need to be consistent in the requirements of the
outfitters and guides in our National Parks and the only way to achieve
that is through contracting. Non-profits should not be exempt from the
contractual and selection process that is designated to protect our
resources and the safety of the public.
I thank you for the opportunity to share my views on this much-
needed change in legislation.
______
[The prepared statement of Mr. Jackson follows:]
Statement of Stefan J. Jackson, Public Policy Manager (Acting),
National Outdoor Leadership School, Lander, Wyoming
Mr. Chairman and members of the Subcommittee, today I address you
on behalf two partners of the Alliance for Wilderness Education and
Stewardship (AWES): The National Outdoor Leadership School (NOLS),
based in Lander, Wyoming, and Outward Bound USA, based in Garrison, NY.
We support the removal of the provision that exempts non-profit groups
from the requirement that they obtain Commercial Use Authorizations
under Public Law 105-391, the ``National Park Omnibus Management Act of
1998.
We support this removal as a matter of sound public policy and most
importantly in seeking what is best for management of the public's
natural resources--our National Parks. As the law currently stands, we
will be relieved of an administrative burden, the associated cost in
money (fees) and time, but our use will go unaccounted for and we will
not be enabling land management to recover costs for administering our
programmatic use of public resources--our National Parks.
We are 501(c)(3), non-profit educational organizations. Critical to
the comments that follow is the fact that--on Federally managed lands
and waters--all program days operated by NOLS and Outward Bound are
fully authorized commercial use days regulated by permit, license or
contract.
NOLS, with operations in 12 states, has operations in 22 NPS units.
This includes three concessions permits/contracts and twenty Incidental
Business Permits (IBPs). Outward Bound, with operations in 25 states,
has operation in 19 NPS units. This includes three concession permits/
contracts.
Through concessions permits/contracts and IBPs all of our access to
and use of National Park Service units is fully authorized and
regulated. We are members of the outfitter and guide community. We are
members of America Outdoors, the national trade association of the
outfitter and guide industry.
Our two organizations are the recognized leaders in wilderness
education. We are non-profit organizations with long histories of
accountability in our use of public lands. We operate almost
exclusively on Federal Public Lands. For over 35 years, we have
utilized the National Parks. The backcountry wild places of the
National Parks are our classrooms. We have hundreds of thousands of
graduates in the United States. We have dealt with a dazzling array of
law, regulation, policy, directive and guidance related to our
authorized use of public resources.
The larger issue here is one of accountability of use by all
parties, regardless of tax status. As it currently stands, this
exemption will allow unrestricted and unaccountable access by a single
category of user--regardless of the amount of use or impact on park
resources. The objectives should be to partner with park managers in
providing quality visitor services while simultaneously protecting and
preserving park resources for future generations. This provision
provides a limited user class with exemption from administrative,
financial, and physical accountability. The environmental impacts from
over-use by non-monitored, non-permitted organized user groups are
likely to be devastating in popular areas, thereby degrading the
``visitor experience'' for all categories of users.
A very real threat of accountability of use is that use (access)
will be capped once land managers understand the true number of users
and user groups. There exist park units where no more permits are being
issued and new or infrequent users, or relatively unsophisticated users
(unschooled in the ways of permit authority) are shut out of the permit
acquisition process. Despite these frustrations, the problems of
allocation of limited resources will not be resolved by providing
statutory pretense that the use does not exist or that land managers do
not have the authority count such use. Our public resources need all
users to take responsibility for their activities and to do all they
can to improve resource management rather than seek paths that
undermine it.
National Park Service officials have offered that the need to
secure backcountry permits and other allocation or administrative tools
will effectively limit access and account for use within this category
despite the exemption. We question whether this is the case in all
parks and how effectively these tools can and will be utilized to
control access and manage use in backcountry venues. This is especially
true in a world where many General Management Plans (GMPs) are still in
process and wilderness or backcountry plans are not in place and may
not be for years to come. We wonder what sort of challenges Section
418(c)-exempt-non-profits (or Congress) might raise to an NPS devised
permit authority that is not explicit in statute.
Use and enjoyment of these public resources must be subject to
restraints in order to sustain resources and benefits such as clean air
and healthy watersheds. As organized users of public resources, we
should be obligated to protecting natural resources in areas where we
operate; providing for the public health and safety; and paying an
equitable share of the agency's cost of administrating recreational and
educational programs. We should be willing to be held accountable for
our use of public resources. An agent's consideration of use allocation
should reflect the complete picture of actual use and not be undermined
in law by some hidden, unknown, and typically growing X factor (use
under the exemption).
In point of fact, some of our operations could exploit the non-
profit exemption. With clever and creative accounting a greater portion
of our operations could avoid the administrative burden of the
commercial use authorization. Nonetheless, in the best interest of
sound resource management, our desire is for accountability for our
use. The only benefits we would find under the exemption would be some
cost savings and our avoidance of administrative entanglements.
Meanwhile the cost of our striving for un-accountability is too high
for the public resources it is our mission to serve and our privilege
to use. While the exemption encourages non-profit use to remain
unaccounted, it also draws artificial distinction between organizations
that use public resources. Whether or not an organization is non-profit
and derives income from its authorized use, for- and non-profit
organizations come in all sizes, in significant numbers and with
sufficient organization and sophistication to leave tremendous and
lasting impact on National Park resources.
Thank you for your careful consideration of this matter. We ask you
to remove the exemption.
______
[The prepared statement of Mr. Jenkins follows:]
Statement of David Jenkins, Director of Conservation and Public Policy,
American Canoe Association
The American Canoe Association (ACA), on behalf of its members, and
on behalf of the more than 200 canoe and kayak clubs who teach safety
clinics and paddling skills on the nation's public lands and waters,
respectfully submits its comments regarding H.R.1461, a bill that would
remove the exemption for nonprofit organizations from the general
requirement to obtain commercial use authorizations. This legislation
would adversely affect the ability of local canoe and kayak clubs,
summer camps, and organizations such as the Boy Scouts of America to
conduct activities on National Park Service (NPS) managed lands by
forcing them to directly compete with commercial outfitters for
allocation of user days.
Many non-profit organizations require only sporadic use of specific
public lands or waters and rely heavily on volunteer help. To treat
them exactly as commercial outfitters who operate on the resource daily
and have paid staff is unfair. Often the trigger that allows the agency
to regard non-profit organized trips to be considered ``commercial'' is
something such as paying for equipment rental or the compensation of an
instructor hired for a day. Whether the NPS recognizes it or not, there
is a big difference between an organization simply trying to cover the
cost of an activity, and a commercial outfitter running trips for
profit.
If a local nonprofit canoe club hires an outside instructor to
teach a class on swiftwater rescue, suddenly the activity is
``commercial.'' Neither the club nor the instructor is an outfitter,
neither has a regular operation on the river, yet under this bill they
would apparently need to become an authorized outfitter. In places
where such authorizations are limited, these users can be denied access
because the commercial outfitters have already taken all the commercial
permits or commercial allocation.
A good example of this has occurred on the Nantahaha River, a river
in North Carolina that is managed by the USDA Forest Service. A few
years ago, summer Camps, schools, and clubs were determined by the
Forest Service to be commercial users and forced to compete with
outfitter operations for a limited number of commercial permits. Canoe
clubs and summer camps that had been teaching kids to paddle on that
river for decades were suddenly locked out. The ACA managed to secure a
revoked outfitter permit and use it as an umbrella permit in order to
restore access for these ``semi-public/institutional'' users.
Still, that was not enough to restore fairness. Even though ACA is
treated as a commercial outfitter with respect to the amount of
paperwork required and the fees required, the ACA (and by extension the
clubs and camps) is denied weekend use during the summer. The agency
gives those ``priority use'' days to the truly commercial outfitters.
The outfitters have been able to convince agencies to give nonprofits
the burdens of being commercial without giving them the benefits of
being commercial. There is nothing even remotely fair about this.
While the example just given is from a USDA Forest Service managed
resource, the NPS has its own legacy of treating nonprofits unfairly.
In many national parks the agency has failed to address the allocation
needs of nonprofit (semi-public/institutional) groups. In many popular
parks, such as Grand Canyon National Park, NPS does not assign any
allocation to ``semi-public/institutional'' use. In order to access the
Colorado River through the Grand Canyon a nonprofit group must hire a
commercial outfitter--which for many groups makes such a trip
financially impossible.
The language that H.R. 1461 would strike was originally proposed
because of other provisions in S.1693 (the 1998 legislation that became
the National Parks Omnibus Management Act of 9998) that would adversely
affect nonprofit organizations. To simply strike this corrective
language, as H.R. 1461 does, instead of proposing a bill that attempts
to address the concerns of outfitters and nonprofits alike, seems
unusually hostile to the nonprofit community. Surely there is a way to
enact legislation that would protect outfitters from the possibility of
unfair competition in the arena of outfitter services, while still
fairly addressing the issue of access for nonprofits.
The mission-based work of nonprofits in areas such as boating
safety, teaching outdoor skills, and promoting the stewardship of
natural resources provide a valuable service to society. Much of this
work is geared toward providing youth with skills that will keep them
safe and enrich their lives. Congress should be encouraging these types
of activities, not throwing roadblocks in the way of them. For these
reasons the American Canoe Association strongly opposes H.R. 1461 and
respectfully asks the Committee to reject this legislation.
-