A new concessions contract is up for bid at Denali National Park, and it includes providing bus shuttle service along the Denali Park Road/NPS

The National Park Service recently released a prospectus soliciting proposals for concession operations in Denali National Park and Preserve in Alaska. Commercial operations required of a concessionaire in the Alaska park include transportation, retail sales, and campground management. There is no lodging component, as Denali has not housed a lodging facility within the park for nearly two decades. The prospectus also authorizes, but does not require, the concessionaire to offer winter transportation, garage service, equipment rental, and ATMs.

Transportation Services

Transportation services required of the concessionaire include seasonal courtesy shuttle buses in the visitor center/Riley Creek Campground area, plus on-and-off transit bus service along the park'™s only road. The courtesy shuttles are free while the transit service requires that riders pay a fee based on the distance of their trip. The major money item in the contract is operation of tour and charter buses. Transportation services generated nearly $20 million in 2012 revenues, an increase of over $1 million compared to the prior year.

Food Service and Campground Revenues

The concessionaire will provide cafeteria-style dining at Morino Grill near the park visitor center, along with a coffee shop service at the Wilderness Access Center, and box lunches for passengers on the longer tours. The concessionaire will be the only authorized provider of food service for special events in the Murie Dining Hall. Food and beverage receipts by the current concessionaire in 2012 amounted to $840,000 .

Five of the six park campgrounds will be managed by the concessionaire under the new agreement with the NPS-managed campground at Wonder Lake the only exception. Campground receipts averaged about $335,000 annually during the three years ending 2012, but the current concessionaire has been operating only two of the park'™s six campgrounds. Estimated revenues from campground operations are projected in the $460,000 to $540,000 range in 2016 after the new contract comes into effect.

Required Investment

Winning the 10-year contract by a company other than current concessionaire Aramark won'™t come cheaply. The NPS estimates an initial investment of approximately $23.6 million, much of which is for payment of personal property and the leasehold surrender interest (LSI) of the current concessionaire. For example, the contract requires a minimum fleet of 98 buses with an estimated minimum cost of nearly $12 million. Seventy-seven of the buses must be purchased from the current concessionaire at an estimated cost of $8.22 million. The initial investment also includes $356,000 in deferred maintenance, most of which is related to upgrades at three campgrounds.

The contract requires the winner to contribute four-tenths of 1 percent of revenues to a repair and maintenance reserve, and 11 percent of annual gross to the NPS as a franchise fee. Proposals by interested parties are required to be in the NPS Alaska Regional Office by July 5.