States Show Privatization's Good, Bad

News Sentinel, January 16, 2017 | Go to article overview

States Show Privatization's Good, Bad


CHATTANOOGA - Rooms with king beds at the Amicalola Falls State Park lodge near Ellijay, Ga., are going for $79 a night during the middle of the week in January.

Staying in the same room on the third weekend of October will cost you $279, a glance at the lodge's rates show.

With the lodge now under private management, rates can climb higher than what the state may have previously charged, especially during peak times like fall weekends, said Bill Donohue, executive director of the state's North Georgia Mountains Authority.

The price differences reflect an aggressive shift toward demand pricing and are one example of the corporate strategy that a private company could bring to Tennessee if the state finds one to run hospitality services at Fall Creek Falls State Park in Spencer.

"They (private companies) will try and make money for the owner," Donohue said. "They do a good job with that. Therefore, there's probably times where some may think the price-value relationship is pushed beyond where it needs to be in some people's eyes."

The way Donohue sees it, there are some services state governments are well-equipped to offer, such as roads provided by a department of transportation. Hotels, however, are a service best left to the private sector, said Donohue, who oversaw the privatization of lodges and golf courses at five Georgia state parks in 2013.

The early results, he said, have been positive, and they offer a glimpse into waters that Tennessee is testing with an attempt to demolish, rebuild and privatize the inn and conference center at Fall Creek Falls.

"To me," Donohue said, "the state running our facilities was a limiting factor."

Others, though, see privatization as a public land giveaway that can price ordinary citizens out of the parks.

'A manufactured crisis'

Former Alabama conservation commissioner Charley Grimsley, a full- throated opponent of privatization, calls it a means for politicians to solve fiscal issues they have created by underfunding parks.

"It's a manufactured crisis," said Grimsley, who oversaw Alabama State Parks from 1993-95. "That's what we're seeing with public lands all over the United States, and it's to line the pockets of their cronies. That's what's behind it.

"If you're a rich man and can sit on the balcony, smoke Cuban cigars, drink martinis and flick your ashes on the little people that walk by, if that's what you want, that's what you're going to get.

"Once you make enjoyment of state parks a function of the thickness of your billfold, at that point the parks become a rich man's playground, and poor folks can stay at home."

A March 2016 report prepared for the state of Tennessee by Goodwyn Mills & Cawood Inc. and IDM Hospitality recommended a new "upscale" inn designed in a modern, rustic style and offering expansive views of the lake.

"With a new facility, not only is it possible to increase occupancy rates but the average (room) rates, as well," the report said.

The state issued a request for proposals that attracted five companies to tour Fall Creek Falls earlier this month. The request highlighted how the average room rate could rise from $76 to $151 per night at a new, privately managed Fall Creek Falls Inn and Conference Center that would be finished by 2020.

Fall Creek Falls is the largest and most visited of Tennessee's 54 state parks. It covers more than 26,000 acres in Van Buren and Bledsoe counties, both labeled economically distressed by the Appalachian Regional Commission.

Southern states have toyed more frequently with privatization since the Great Recession led to funding reductions for already tight-budgeted park systems. Those systems compete with other state agencies for money from governors and lawmakers each year.

Privatization advocates see bringing in companies to run state park hotels, spas, golf courses and cabins as a way to save taxpayer money and reinvigorate aging park facilities by providing high- quality accommodations. …

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