The Commons Blog's icon is for sale:
A natural wonder may be priceless, but the owners of Natural Bridge in Virginia's Shenandoah Valley want $32.5 million. The price includes the limestone arch, bearing the initials of George Washington when he surveyed the site, as well as 1,600 acres containing a hotel, gift shop, wax museum, caverns, and an attraction called "Foamhenge," a Stonehenge look-alike.
Natural Bridge's history of private ownership dates back to 1774, when Thomas Jefferson purchased it from King George III. It is the second nature site to go on the selling block recently in the Fifth District. In January, the Morse family agreed to sell Chimney Rock Park to the state of North Carolina for $24 million. Both sales resurrect the question of whether public or private owners make better stewards of natural resources like parks and scenic attractions.
Is it just me, or would it be delicious if the Commonwealth of Virginia bought it up and made it their newest state park? Just to tweak the free marketeers?
The rest of the piece from the Federal Reserve Bank of Richmond is below the fold. It includes a talk with the owner of Grandfather Mountain (just up the road from me) and the benefits and costs of private ownership of wonderful places with public goods characteristics.
Holly Fretwell, an analyst at the Property and Environment Research Center in Bozeman, Mont., has researched national parks. Overall, she says that the management of federal parks has improved over the last decade, but there are still some fundamental problems.
Congressional politics, rather than park managers' priorities, can sometimes dictate the initial allocation of federal park funds. Also, until recently, managers did not face sound incentives regarding the collection of fees at their parks. Revenue went back into a central pot to be reallocated, giving them little incentive to closely monitor actual costs and benefits of their activities. Since 1996, managers have been able to retain 80 percent of the fees they collect.
"When people visit your park, you get to keep the money," Fretwell says. That kind of incentive more closely resembles private enterprise.
Still, prices are low or nonexistent at many public parks. The National Park Service's philosophy is to encourage as many people as possible to visit. In 2006, nearly 2.9 million entered the gates of Yellowstone. A car and its occupants can cruise the park for $25 a week. In contrast, it would cost $28 for a couple to visit Grandfather Mountain in North Carolina for just one day (children ages 4 to 12 would pay $6 each). Admission to Chimney Rock Park is $14.
With rock formations dating back a billion years, Grandfather Mountain has been in Crae Morton's family since 1885. Morton says he can react quickly to travel trends to "benefit the customer and ultimately, the mountain" because it's a private business.
Nature requires more maintenance than people think. Managing a park is more about picking up trash, Morton says, than simply enjoying the mountain air. He sympathizes with public park managers bound by tight budgets and no ability to "raise a ticket price or sell a new concession at the drop of a hat to get the funds they need."
As a private owner of parkland, Morton walks the line between managing natural assets profitably and conserving them for future generations. His business plan includes being a good steward. "We're trying to do good things for [the mountain] in an absolute blink of the eye when you look at the amount of time since the mountain's formation," he notes. Much of the backcountry around the mountain, accessible by trail only, is conserved through easements, which can reduce property taxes.
Fretwell says parks could be privately owned and managed, with some exceptions. "There are some areas we might like protected that wouldn't get the visitation. Maybe that [funding] could come through the public sector or could come from the private sector, such as the Nature Conservancy."
If private management is efficient, though, then why were Chimney Rock and Natural Bridge put up for sale? Rising real estate prices have saddled private owners of parks and scenic attractions with higher property and estate taxes, says Fred Annand, associate director of the Nature Conservancy's North Carolina office.
Three of Natural Bridge's eight owners are in their 80s and only willing to invest so much in the property given their ages, adds Dave Kleppinger, who directs an economic development group in Rockbridge County, home to Natural Bridge. "It's probably good for [new] owners to come in who can make significant investments."
