[House Report 110-532]
[From the U.S. Government Publishing Office]



110th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     110-532

======================================================================



 
 TO AUTHORIZE THE SECRETARY OF THE INTERIOR TO LEASE CERTAIN LANDS IN 
          VIRGIN ISLANDS NATIONAL PARK, AND FOR OTHER PURPOSES

                                _______
                                

 February 28, 2008.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

  Mr. Rahall, from the Committee on Natural Resources, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1143]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Natural Resources, to whom was referred the 
bill (H.R. 1143) to authorize the Secretary of the Interior to 
lease certain lands in Virgin Islands National Park, and for 
other purposes, having considered the same, report favorably 
thereon with an amendment and recommend that the bill as 
amended do pass.
  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. DEFINITIONS.

  In this Act, the following definitions apply:
          (1) Secretary.--The term ``Secretary'' means the Secretary of 
        the Interior.
          (2) RUE.--The term ``RUE'' means the retained use estate 
        entered into by the Jackson Hole Preserve and the United States 
        on September 30, 1983.
          (3) Park.--The term ``park'' means Virgin Islands National 
        Park.
          (4) CBI.--The term ``CBI'' means CBI Acquisitions, LLC.
          (5) Resort.--The term ``Resort'' means Caneel Bay Resort on 
        the island of St. John in Virgin Islands National Park.

SEC. 2. LEASE AGREEMENT.

  (a) Authorization.--The Secretary may enter into a lease agreement 
with CBI governing the use of property for the continued management and 
operation of the Resort.
  (b) Additional Lands.--Any lease entered into pursuant to this Act 
shall include the property covered by the RUE and any associated 
property owned by CBI donated to the National Park Service.
  (c) Terms.--The lease agreement authorized under subsection (a) 
shall--
          (1) require that operations and maintenance of the Resort are 
        conducted in a manner consistent with the preservation and 
        conservation of the resources and values of the Park as well as 
        the best interests of the Resort;
          (2) be for the minimum number of years practicable to enable 
        the lessee to secure financing for any necessary improvements 
        to the Resort, taking into account the financial obligations of 
        CBI, but in any event shall not exceed 40 years;
          (3) prohibit any transfer, assignment or sale of the lease or 
        otherwise convey or pledge any interest in the lease without 
        prior written notification to and approval by the Secretary;
          (4) prohibit any increase in the number of guest 
        accommodations available at the Resort;
          (5) prohibit any increase in the overall size of the Resort;
          (6) prohibit the sale of partial ownership shares or 
        timeshares in the Resort;
          (7) be designed to facilitate transfer of all property 
        covered by the lease to Federal administration upon expiration 
        of the lease; and
          (8) include any other provisions determined by the Secretary 
        to be necessary to protect the Park and the public interest.
  (d) Appraisals.--The Secretary shall require appraisals to determine 
the fair market value of all property covered by the RUE and any 
property, including the value, if any, of the surrendered term of the 
RUE, owned by CBI to be donated, or otherwise conveyed, to the National 
Park Service. Such appraisals shall be conducted pursuant to the 
Uniform Appraisal Standards for Federal Land Acquisition.
  (e) Compensation.--
          (1) In general.--The lease authorized by this Act shall--
                  (A) require payment to the United States of the 
                property's fair market value rent, taking into account 
                the value of any associated property transferred by CBI 
                as well as the value, if any, of the surrendered term 
                of the RUE;
                  (B) include a provision--
                          (i) allowing recalculation of the amount of 
                        the payment required under this subsection, at 
                        the request of the Secretary or CBI, in the 
                        event of extraordinary unanticipated changes in 
                        conditions anticipated at the time the lease 
                        was finalized; and
                          (ii) providing for binding arbitration in the 
                        event the Secretary and CBI are unable to agree 
                        upon an adjustment to the payment in these 
                        circumstances.
          (2) Distribution.--Eighty percent of the payment to the 
        United States required by this subsection shall be available to 
        the Secretary, without further appropriation, for expenditure 
        within the Park. The remaining twenty percent shall be 
        deposited in the Treasury.
          (3) Applicability of certain law.--Section 321 of the Act of 
        June 30, 1932 (40 U.S.C. 1302), relating to the leasing of 
        buildings and property of the United States, shall not apply to 
        the lease entered into by the Secretary pursuant to this Act.

SEC. 3. RETAINED USE ESTATE.

  As a condition of the lease, CBI shall relinquish to the Secretary 
all rights under the RUE and transfer, without compensation, ownership 
of improvements covered by the RUE to the United States.

                          PURPOSE OF THE BILL

    The purpose of H.R. 1143 is to authorize the Secretary of 
the Interior to lease certain lands in Virgin Islands National 
Park, and for other purposes.

                  BACKGROUND AND NEED FOR LEGISLATION

    Caneel Bay is a luxury resort operated pursuant to a 
Retained Use Estate (RUE) on federal land within Virgin Islands 
National Park. The RUE expires in 2023, when any improvements 
on the land will revert to the National Park Service.
    The current holder of the RUE has embarked on major 
renovations to Caneel Bay. However, the operators claim that 
the remaining life of the RUE does not afford sufficient time 
to provide the capital and attract the long-term financing for 
the improvements which are necessary to reverse the recent 
decline of the facilities at the resort.
    H.R. 1143 authorizes the Secretary of the Interior, after 
expiration of the RUE, to enter into a lease with the holders 
of the RUE for continued operation of the resort on terms and 
conditions determined by the Secretary to be reasonable.

                            COMMITTEE ACTION

    H.R. 1143 was introduced on February 16, 2007, by Rep. 
Donna Christensen (D-VI). The bill was referred to the 
Committee on Natural Resources, and within the Committee to the 
Subcommittee on National Parks, Forests, and Public Lands. On 
October 30, 2007, the Subcommittee held a hearing on the bill, 
during which the Administration testified in support of the 
bill's concept but requested the opportunity to work with the 
Committee regarding the bill's provisions.
    On February 13, 2008, the full Natural Resources Committee 
met to mark up the bill. Subcommittee Chairman Raul Grijalva 
(D-AZ) offered an amendment in the nature of a substitute that 
retained the original intent of the bill while placing 
additional conditions on the lease authority authorized under 
the bill. The Grijalva amendment was adopted by unanimous 
consent. The bill as amended was then ordered favorably 
reported to the House of Representatives by unanimous consent.

                      SECTION-BY-SECTION ANALYSIS

Section 1. Definitions

    Section 1 defines the terms used in this act.

Section 2. Lease agreement

    Subsection 2(a) authorizes the Secretary of the Interior to 
enter into the lease agreement with the current operators of 
Caneel Bay Resort. Subsection 2(b) defines the property covered 
by the lease.
    Subsection 2(c) sets the terms of the lease. In particular, 
Section 2(c)1 requires resort operations and maintenance to be 
consistent with the preservation and conservation values of the 
Park and the best interests of the Resort. Section 2(c)2 sets 
the term of the lease as the minimum number of years necessary 
for the lessee to secure financing for improvements to the 
Resort, not to exceed 40 years. Section 2(c)3 prohibits any 
transfer or sale of the lease by the current lessee without 
approval by the Secretary. Section 2(c)4 prohibits any increase 
in the number of guest accommodations at the Resort. Section 
2(c)5 prohibits expansion of the size of the Resort. Section 
2(c)6 prohibits the sale or ownership of timeshares in the 
Resort. Section 2(c)7 states that the lease shall be designed 
to facilitate transfer of all facilities to Federal management 
upon expiration. Section 2(c)8 permits the inclusion of other 
provisions determined by the Secretary to be necessary to 
protect the Park and the public interest.
    Subsection 2(d) requires the appraisal of all property 
covered by the RUE as well as any property to be donated or 
otherwise conveyed to the Federal government.
    Section 2(e)1 requires the payment of fair market value 
rent to the United States by the lessee and permits 
recalculation of the rental payment in the event of unexpected 
circumstances and arbitration if the Secretary and the lessee 
disagree upon adjustments to the rental payment. Section 2(e)2 
requires that 80% of the rental payments be made available 
without further appropriation for expenditure within the Park 
and the remaining 20% deposited in the Treasury.

Section 3. Retained Use Estate

    Section 3 directs the lessee to relinquish to the Secretary 
all rights under the RUE and transfer, without compensation, 
ownership of improvements covered by the RUE to the United 
States.

            COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Natural Resources' oversight findings and 
recommendations are reflected in the body of this report.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Article I, section 8 and Article IV, section 3, of the 
Constitution of the United States grants Congress the authority 
to enact this bill.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act. As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, spending 
authority, credit authority, or an increase or decrease in 
revenues or tax expenditures.
    3. General Performance Goals and Objectives. This bill does 
not authorize funding and therefore, clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives does not 
apply.
    4. Congressional Budget Office Cost Estimate. Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 
Office:

H.R. 1143--A bill to authorize the Secretary of the Interior to lease 
        certain lands in Virgin Islands National Park

    H.R. 1143 would authorize the National Park Service (NPS) 
to execute a lease with the owners of the Caneel Bay Resort on 
St. John in the Virgin Islands. Based on information provided 
by the NPS, CBO estimates that implementing the bill would have 
no effect on discretionary spending. Enacting the bill would 
increase both offsetting receipts (from lease payments) and 
direct spending of those receipts beginning in fiscal year 
2009, but CBO estimates that any net effect on the federal 
budget would be negligible.
    H.R. 1143 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    Under the lease authorized by H.R. 1143, the owners of 
Caneel Bay would continue to operate the resort, which is 
located within the boundary of the Virgin Islands National 
Park, for up to 40 years. The resort is currently operated 
under a retained use estate (RUE) that will expire at the end 
of fiscal year 2023. The RUE was granted by the original owners 
of the resort when they donated the land under that facility to 
the NPS in 1983. The original RUE agreement did not provide for 
any lease payments to the federal government; the lease 
authorized by H.R. 1143 would. In addition, the bill would 
authorize the NPS to spend, without further appropriation, 80 
percent of any new lease receipts.
    The CBO staff contact for this estimate is Deborah Reis. 
The estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                    COMPLIANCE WITH PUBLIC LAW 104-4

    This bill contains no unfunded mandates.

                           EARMARK STATEMENT

    H.R. 1143 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9(d), 9(e) or 9(f) of rule XXI.

                PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

    This bill is not intended to preempt any State, local or 
tribal law.

                        CHANGES IN EXISTING LAW

    If enacted, this bill would make no changes in existing 
law.

                                  
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