[Federal Register Volume 64, Number 171 (Friday, September 3, 1999)]
[Notices]
[Pages 48420-48432]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-23029]


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DEPARTMENT OF THE INTERIOR

National Park Service


Standard Concession Contract; Revision

ACTION: Proposed revision of the National Park Service Standard 
Concession Contract.

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SUMMARY: The National Park Service (NPS) authorizes business entities 
to operate concessions in areas of the national park system. The 
agreements embodying these authorizations consist primarily of standard 
language that incorporate NPS terms and conditions established by law 
and prudent contract administration. In 1998, Public Law 105-391 was 
enacted which in many significant ways affects the content of 
concession contracts to be entered into after its effective date. 
Accordingly, NPS proposes to amend its existing standard concession 
contract to conform to the requirements of Public Law 105-391 and to 
otherwise make improvements to the standard form. NPS, although not 
legally required to do so, seeks public comments on the proposed 
standard concession contract to assist it in the development of a final 
version as a matter of public policy.

DATES: NPS will accept written comments on the proposed standard 
contract on or before November 2, 1999.

ADDRESSES: Comments should be addressed to: Concession Program Manager, 
National Park Service, 1849 ``C'' Street, NW, Washington, DC 20240.

FOR FURTHER INFORMATION CONTACT: Wendelin Mann, Concession Program, 
National Park Service, 1849 ``C'' Street, NW, Washington, DC 20240 
(202/565-1219).

Supplementary Information: Public Law 105-391, enacted on November 13, 
1998, among other matters, amended the statutory policies and 
procedures under which NPS operated its concession program. The new law 
requires adoption of new regulations governing the award, content and 
management of concession contracts. On June 30, 1999, NPS published for 
public comment

[[Page 48421]]

proposed regulations implementing the new law. The proposed standard 
concession contract set forth in this notice reflects the requirements 
of the new law and the concomitant requirements of the proposed 
regulations. It also reflects a variety of improvements NPS wishes to 
make to its standard concession contract, including a new 
organizational structure for the sake of clarity. NPS is not publishing 
for public comment the various exhibits that will be attached to the 
standard contract. The exhibits only encompass legally mandated 
provisions, ministerial procedures under the terms of the standard 
concession contract, or documents that will substantially vary from 
contract to contract. These exhibits will be publicly available after 
adoption of the standard contract language. NPs plans to adopt both the 
new regulations and the new standard concession contract 
contemporaneously after due consideration of all public comments 
received on both documents.
    NPS, after adoption of the new regulations and the new standard 
contract, also intends to develop and adopt a ``short-form'' concession 
contract that will be used for smaller concession operations that do 
not involve the concessioner obtaining a compensable interest in real 
property located on park area lands.

United States Department of the Interior

National Park Service

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[Name of Area]
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[Site]
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[Type of Service]

Concession Contract No.------------------------------------------------
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[Name of Concessioner]
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[Address, including email address and phone number]

Doing Business As
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Covering the Period---------------------------------------------------
through----------------------------------------------------------------

Concession Contract

Table of Contents

Identification of the Parties
Purpose and Authorities
Sec. 1  Term of Contract
Sec. 2  Definitions
Sec. 3  Services and Operations
    A. Required and Authorized Visitor Services
    B. Operation and Quality of Operation
    C. Operating Plan
    D. Merchandise and Services
    E. Rates
    F. Impartiality as to Rates and Services
Sec. 4  Concessioner Personnel
    A. Employees
    B. Employee Housing, Meals, and Recreation
Sec. 5  Legal, Regulatory, Policy Compliance
    A. Legal, Regulatory, Policy Compliance
    B. Notice
    C. How and Where to Send Notice
Sec. 6  Environmental and Cultural Protection
    A. Environmental Protection
    B. Protection of Cultural and Archeological Resources
Sec. 7  Interpretation of Area Resources
    A. Concessioner Obligations
    B. Director Review of Content
    C. Provision of Interpretation Not Exclusive
Sec. 8  Concession Facilities Used In Operation by Concessioner
    A. Assignment of Concession Facilities
    B. Concession Facilities Withdrawals
    C. Effect of Withdrawal
    D. Right of Entry
    E. Personal Property
    F. Condition of Concession Facilities
    G. Utilities Provided by the Director
    H. Utilities Not Provided by the Director
Sec. 9  Construction or Installation of Concession Facilities
    A. Construction of Real Property Improvements
    B. Removal of Concession Facilities
    C. Leasehold Surrender Interest
    D. Concession Facilities Improvement Program
Sec. 10  Maintenance
    A. Maintenance Obligation
    B. Maintenance Plan
    C. Maintenance Reserve
Sec. 11  Fees
    A. Franchise Fee
    B. Payments Due
    C. Reconsideration of Franchise Fee
Sec. 12  Indemnification and Insurance
    A. Indemnification
    B. Insurance in General
    C. Commercial Public Liability
    D. Property Insurance
Sec. 13  Bonds and Liens
    A. Bonds
    B. Liens
Sec. 14  Accounting Records and Reports
    A. Accounting System
    B. Annual Financial Report
    C. Other Financial Reports
Sec. 15  Other Reporting Requirements
    A. Insurance Certification
    B. Environmental Reporting
    C. Miscellaneous Reports and Data
Sec. 16  Suspension and Termination
    A. Suspension
    B. Termination
    C. Bankruptcy or Insolvency
    D. Requirements in the Event of Termination
Sec. 17  Compensation
    A. Just Compensation
    B. Compensation for Contract expiration or termination
    C. Compensation when Contract Terminated for Default
    D. Procedures for Establishing the Value of a Leasehold 
Surrender Interest
    E. Compensation for Personal Property
Sec. 18  Assignment, Sale or Encumbrance of Interests
Sec. 19  General Provisions
Exhibits
    Exhibit ``A'': Nondiscrimination
    Exhibit ``B'': Assigned Land, Real Property Improvements
    Exhibit ``C'': Assigned Government Personal Property
    Exhibit ``D'': Leasehold Surrender Interest as of the Effective 
Date of This Contract
    Exhibit ``E'': Insurance Requirements
    Exhibit ``F'': Maintenance Plan
    Exhibit ``G'': Operating Plan
    Exhibit ``H'': Construction, Installation Approval Procedures
    Exhibit ``X'': 36 CFR Part 51

[Corporation]

    This Contract is made and entered into by and between the United 
States of America, acting in this matter by the Director of the 
National Park Service, through the Regional Director of the ________ 
Region, hereinafter referred to as the ``Director,'' and, a corporation 
organized and existing under the laws of the State of ____________ 
doing business as hereinafter referred to as the ``Concessioner'':

[Partnership]

    This Contract is made and entered into by and between the United 
States of America, acting in this matter by the Director of the 
National Park Service, through the Regional Director of the ________ 
Region, hereinafter referred to as the ``Director'', and of 
____________, ____________, and ____________ of, partners, doing 
business as, pursuant to a partnership agreement dated ________, with 
the principal place of business at ________, hereinafter referred to as 
the ``Concessioner'':

[Sole Proprietorship]

    This Contract made and entered into by and between the United 
States of America, acting in this matter by the Director of the 
National Park Service, through the Regional Director of the ________ 
Region, hereinafter referred to as the ``Director,'' and, an individual 
of, doing business as ____________, hereinafter referred to as the 
``Concessioner'':

WITNESSETH

    That Whereas, [Name of Park, Recreation Area, etc.] is administered 
by the Director as a unit of the national park system to conserve the 
scenery and the natural and historic objects and the wild life therein, 
and to provide for the public enjoyment of the same in such manner as 
will leave such Area unimpaired for the enjoyment of future 
generations; and
    Whereas, to accomplish these purposes, the Director has determined 
that certain visitor services are necessary and appropriate for the 
public use and enjoyment of the Area and

[[Page 48422]]

should be provided for the public visiting the Area; and
    Whereas, the Director desires the Concessioner to establish and 
operate these visitor services at reasonable rates under the 
supervision and regulation of the Director;
    Now, Therefore, pursuant to the authority contained in the Acts of 
August 25, 1916 (16 U.S.C. 1, 2-4), and November 13, 1998 (Pub. L. 105-
391), and other laws that supplement and amend the Acts, the Director 
and the Concessioner agree as follows:

Sec. 1  Term of Contract

    This Concession Contract No. ________ (``Contract'') shall be 
effective as of ____________, and shall be for the term of 
[approximately] ________ (____) years from ________, 20______, [if 
the Concessioner satisfactorily completes the Concession Facilities 
Improvement program described in Section 9(e) of this Contract. If 
the Concessioner fails to complete this program to the satisfaction 
of the Director within the time specified, then this Contract shall 
be for the term of ________ (______) years from ________.]

Sec. 2  Definitions

    The following terms used in this Contract will have the following 
meanings, which apply to both the singular and the plural forms of the 
defined terms:
    (a) ``Applicable Laws'' means the laws of Congress governing the 
Area, including, but not limited to, the rules, regulations, 
requirements and policies promulgated under those laws, whether now in 
force, or amended, enacted or promulgated in the future, including, 
without limitation, federal, state and local laws, rules, regulations, 
requirements and policies governing nondiscrimination, protection of 
the environment and/or protection of public health and safety.
    (b) ``Area'' means the property within the boundaries of [Name of 
Park Unit].
    (c) ``Capital Improvement'' shall have the meaning set forth in 36 
CFR Part 51 as of the effective date of this Contract.
    (d) ``Concession Facilities'' shall mean all Area lands assigned to 
the Concessioner under this Contract and all real property improvements 
assigned to or constructed by the Concessioner under this Contract. The 
United States retains title and ownership to all Concession Facilities.
    (e) ``Director'' means the Director of the National Park Service 
and his duly authorized representatives unless otherwise indicated.
    (f) ``Exhibit'' or ``Exhibits'' shall mean the various exhibits, 
which are attached to this Contract, each, of which is hereby made a 
part of this Contract.
    (g) ``Gross Receipts'' means the total amount received or realized 
by, or accruing to, the Concessioner from all sales for cash or credit, 
of services, accommodations, materials, and other merchandise made 
pursuant to the rights granted by this Contract, including gross 
receipts of subconcessioners as herein defined, commissions earned on 
contracts or agreements with other persons or companies operating in 
the Area, and gross receipts earned from electronic media sales, but 
excluding:
    (i) Intracompany earnings on account of charges to other 
departments of the operation (such as laundry);
    (ii) Charges for employees' meals, lodgings, and transportation;
    (iii) Cash discounts on purchases;
    (iv) Cash discounts on sales;
    (v) Returned sales and allowances;
    (vi) Interest on money loaned or in bank accounts;
    (vii) Income from investments;
    (viii) Income from subsidiary companies outside of the Area;
    (ix) Sale of property other than that purchased in the regular 
course of business for the purpose of resale;
    (x) Sales and excise taxes that are added as separate charges to 
approved sales prices, gasoline taxes, fishing license fees, and 
postage stamps, provided that the amount excluded shall not exceed the 
amount actually due or paid government agencies;
    (xi) Receipts from the sale of handcrafts that have been approved 
for sale by the Director as constituting authentic American Indian, 
Alaskan Native, Native Samoan, or Native Hawaiian handicrafts.
    All monies paid into coin operated devices, except telephones, 
whether provided by; the Concessioner or by others, shall be included 
in gross receipts. However, only revenues actually received by the 
Concessioner from coin-operated telephones shall be included in gross 
receipts. All revenues received from charges for in-room telephone or 
computer access shall be included in gross receipts.
    (h) ``Gross receipts of subconcessioners'' means the total amount 
received or realized by, or accruing to, subconcessioners from all 
sources, as a result of the exercise of the rights conferred by 
subconcession contracts hereunder without allowances, exclusions or 
deductions of any kind or nature whatsoever.
    (i) ``Leasehold Surrender Interest'' shall have the meaning set 
forth in 36 CFR Part 51 as of the effective date of this Contract.
    (j) ``Leasehold Surrender Interest Value'' or the ``value'' of a 
Leasehold Surrender Interest shall have the meaning set forth in 36 CFR 
Part 51 as of the effective date of this Contract.
    (k) ``Major Rehabilitation'' shall have the meaning set forth in 36 
CFR Part 51 as of the effective date of this Contract.
    (l) ``Possessory Interest'' shall have the meaning set forth in 36 
CFR Part 51.
    (m) ``Real Property Improvements'' means real property other than 
land, including, but not limited to, capital improvements.
    (n) ``Superintendent'' means the manager of the Area.
    (o) ``Visitor services'' means the accommodations, facilities and 
services that the Concessioner is required and authorized to provide by 
section 3(a) of this Contract.

Sec. 3  Services and Operations

(a) Required and Authorized Visitor Services
    During the term of this Contract, the Director requires and 
authorizes the Concessioner to provide the following visitor services 
for the public within the Area:
    (1) Required Visitor Services. The Concessioner is required to 
provide the following visitor services during the term of this 
Contract:

[Provide detailed description of required services. Broad 
generalizations such as ``any and all facilities and services 
customary in such operations'' or ``such additional facilities and 
services as may be required'' are not to be used. A provision 
stating ``The Concessioner may provide services incidental to the 
operations authorized hereunder at the request and written approval 
of the Director'' is acceptable.]

    (2) Authorized Visitor Services. The Concessioner is authorized but 
not required to provide the following visitor services during the term 
of this Contract:

[Provide detailed description of authorized services.]
(b) Operation and Quality of Operation
    The Concessioner shall provide, operate and maintain the required 
and authorized visitor services and any related support facilities and 
services in accordance with this Contract to such an extent and in a 
manner considered satisfactory by the Director. The Concessioner shall 
provide the plant, personnel, equipment, goods, and commodities 
necessary for providing, operating and maintaining the required and 
authorized visitor services in accordance with this Contract. The 
Concessioner's authority to provide visitor services under the terms of 
this Contract is non-exclusive.

[[Page 48423]]

(c) Operating Plan
    The Director, acting through the Superintendent, shall establish 
and revise, as necessary, specific requirements for the operations of 
the Concessioner under this Contract in the form of an Operating Plan 
(including, without limitation, a risk management program, that must be 
adhered to by the Concessioner). The initial Operating Plan is attached 
to this Contract as Exhibit ``G.'' The Director in his discretion, 
after consultation with the Concessioner, may make modifications to the 
initial Operating Plan provided that these modifications shall not be 
inconsistent with the terms and conditions of the main body of this 
Contract.
(d) Merchandise and Services
    (1) The Director reserves the right to determine and control the 
nature, type and quality of the visitor services described in this 
Contract, including, but not limited to, the nature, type, and quality 
of merchandise, if any, to be sold or provided by the Concessioner 
within the Area.
    (2) All material, regardless of media format (i.e., printed, 
electronic, broadcast media), provided to the public by the 
Concessioner, including promotional material, must be approved in 
writing by the Director prior to use. All such material will identify 
the Concessioner as an authorized Concessioner of the National Park 
Service, Department of the Interior.
    (3) The Concessioner, where applicable, will develop and implement 
a plan satisfactory to the Director that will assure that all gift 
merchandise, if any, to be sold or provided reflects the purpose and 
significance of the Area, including, but not limited to, merchandise 
that reflects the conservation of the Area's resources or the Area's 
geology, wildlife, plant life, archeology, local Native American 
culture, local ethnic culture, and historic significance.
(e) Rates
    All rates and charges to the public by the Concessioner for visitor 
services shall be reasonable and appropriate for the type and quality 
of facilities and/or services required and/or authorized under this 
Contract. The Concessioner's rates and charges to the public must be 
approved by the Director in accordance with rate approval procedures 
and guidelines promulgated by the Director from time to time.
(f) Impartiality as to Rates and Services
    (1) In providing visitor services, the Concessioner must require 
its employees to observe a strict impartiality as to rates and services 
in all circumstances. The Concessioner shall comply with all Applicable 
Laws relating to nondiscrimination in providing visitor services to the 
public including, without limitation, those set forth in Exhibit ``A.''
    (2) The Concessioner may grant complimentary or reduced rates under 
such circumstances as are customary in businesses of the character 
conducted under this Contract. However, the Director reserves the right 
to review and modify Concessioner's complimentary or reduced rate 
policies and practices.
    (3) The Concessioner will provide Federal employees conducting 
official business reduced rates for lodging, essential transportation 
and other specified services necessary for conducting official business 
in accordance with guidelines established by the Director. 
Complimentary or reduced rates and charges shall otherwise not be 
provided to Federal employees by the Concessioner except to the extent 
that they are equally available to the general public.

Sec. 4  Concessioner Personnel

(a) Employees
    (1) The Concessioner shall provide all personnel necessary to 
provide the visitor services required and authorized by this Contract.
    (2) The Concessioner shall comply with all Applicable Laws relating 
to employment and employment conditions, including, without limitation, 
those identified in Exhibit ``A.''
    (3) The Concessioner shall ensure that its employees are hospitable 
and exercise courtesy and consideration in their relations with the 
public. The Concessioner shall have its employees who come in direct 
contact with the public, so far as practicable, wear a uniform or badge 
by which they may be identified as the employees of the Concessioner.
    (4) The Concessioner shall establish pre-employment screening, 
hiring, training, employment, termination and other policies and 
procedures for the purpose of providing visitor services through its 
employees in an efficient and effective manner and for the purpose of 
maintaining a healthful, law abiding, and safe working environment for 
its employees. The Concessioner shall conduct appropriate background 
reviews of applicants for employment to assure that they conform to the 
hiring policies established by the Concessioner.
    (5) The Concessioner shall hire, to the greatest extent possible, 
people who are both interested in serving the public in a national park 
environment and interested in being positive contributors to the park's 
purpose.
    (6) The Concessioner shall ensure that its employees are provided 
the training needed to provide quality visitor services and to maintain 
up-to-date job skills.
    (7) The Concessioner shall review the conduct of any of its 
employees whose action or activities are considered by the Concessioner 
or the Director to be inconsistent with the proper administration of 
the Area and enjoyment and protection of visitors and shall take such 
actions as are necessary to fully correct the situation.
    (8) The Concessioner shall maintain, to the greatest extent 
possible, a drug free environment, both in the workplace and in any 
employee housing within the Area.
    (9) The Concessioner shall publish a statement notifying employees 
that the unlawful manufacture, distribution, dispensing, possession, or 
use of a controlled substance is prohibited in the workplace and in the 
Area, and specifying the actions that will be taken against employees 
for violating this prohibition. In addition, the Concessioner shall 
establish a drug-free awareness program to inform employees about the 
danger of drug abuse in the workplace and the Area, the availability of 
drug counseling, rehabilitation and employee assistance programs, and 
the Concessioner's policy of maintaining a drug-free environment both 
in the workplace and in the Area.
    (10) The Concessioner shall take appropriate personnel action, up 
to and including termination or requiring satisfactory participation in 
a drug abuse or rehabilitation program which is approved by a Federal, 
State, or local health, law enforcement or other appropriate agency, 
for any employee that violates the prohibition on the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance.
(b) Employee Housing, Meals and Recreation
    (1) If the Concessioner is required to provide employee housing 
under this Contract, the housing must be in good condition and must 
meet employee needs. The Concessioner's charges to its employees for 
this housing must be reasonable.
    (2) If the visitor services required and/or authorized under this 
Contract are located in a remote or isolated area, the Concessioner 
shall provide adequate

[[Page 48424]]

employee recreational facilities and services.

Sec. 5  Legal, Regulatory, Policy Compliance

(a) Legal, Regulatory and Policy Compliance
    This Contract, operations thereunder by the Concessioner and the 
administration of it by the Director shall be subject to all Applicable 
Laws. The Concessioner must comply with all Applicable Laws in 
fulfilling its obligations under this Contract at the Concessioner's 
sole cost and expense. Certain Applicable Laws governing protection of 
the environment are further described in this Contract. Certain 
Applicable Laws relating to nondiscrimination in employment and 
providing accessible facilities and services to the public are further 
described in this Contract.
(b) Notice
    The Concessioner shall give the Director immediate written notice 
of any violation of Applicable Laws and, at its sole cost and expense, 
must promptly rectify any such violation.
(c) How and Where To Send Notice
    All notices required by this Contract, shall be in writing and 
shall be served on the parties at the following addresses. The mailing 
of a notice by registered or certified mail, return receipt requested, 
shall be sufficient service. Notices sent to the Director shall be sent 
to the following address:

Superintendent
Park name
Address
Attention:

    Notices sent to the Concessioner shall be sent to the following 
address:

Concessioner
Address
Attention:

Sec. 6  Environmental and Cultural Protection

(a) Environmental Protection
    (1) In addition to complying with all Applicable Laws pertaining to 
the protection of natural resources within the area, the Concessioner 
will conduct its operation, construction, maintenance, acquisition, and 
provision of visitor services in a manner that prevents or reduces 
environmental degradation and that promotes the use of environmentally 
beneficial products. The Concessioner will develop, pursuant to 
guidelines provided by the Director, and carry out, to the satisfaction 
of the Director, a documented environmental monitoring program or 
programs to ensure that park resources affected by concessioner 
activities under this Contract are not unduly impaired. The 
Concessioner shall be financially responsible for environmental audits 
that may be required by the Director for each three-year period of this 
Contract.
    (2) The Concessioner shall obtain the Director's approval prior to 
using any chemicals, pesticides, any hazardous or toxic substance, 
material, or waste of any kind, including building materials such as 
asbestos, or any contaminant, pollutant, petroleum, petroleum product 
or petroleum by-product.
    (3) The Concessioner shall monitor, test, maintain, repair, 
upgrade, replace, remove, or mitigate, in accordance with Applicable 
Laws and in accordance with the requirements of the Director:
    (i) Any discharge, release or threatened release (whether solid, 
liquid or gaseous in nature) of any hazardous or toxic substance, 
material, or waste of any kind, including building materials such as 
asbestos, or any contaminant, pollutant, petroleum, petroleum product 
or petroleum by-product on or to the Area, including soil, surface 
water or groundwater;
    (ii) Any materials, equipment, and facilities associated with such 
discharge, release or threatened release; or
    (iii) Any materials, equipment and facilities used in the handling, 
storage, disposal, transport or other use of any such hazardous or 
toxic substance, material, or waste of any kind, including building 
materials such as asbestos, or any contaminant, pollutant, petroleum, 
petroleum product or petroleum by-product.
    (4) The Concessioner shall timely contact, notify and/or otherwise 
confer with appropriate federal, state and/or local agencies with 
respect to any reporting obligation arising out of Concessioner's 
operations under this Contract and the Concessioner shall 
simultaneously provide notice of such contact to the Director and allow 
the Director the opportunity to participate in any such proceedings.
    (5) The Concessioner shall give the Director immediate notice of 
any discharge, release or threatened release (whether solid, liquid or 
gaseous in nature) of any hazardous or toxic substance, material, or 
waste of any kind, including building materials such as asbestos, or 
any contaminant, pollutant, petroleum, petroleum product or petroleum 
by-product.
    (6) The Concessioner shall give the Director immediate written 
notice of any threatened or actual notice of violation of any federal, 
state or local law, rule, regulation, requirement or policy relating to 
or governing the use, handling, storage, disposal, transport, presence, 
acceptable concentration, or remediation of any hazardous or toxic 
substance, material, or waste of any kind, including building materials 
such as asbestos, or any contaminant, pollutant, petroleum, petroleum 
product or petroleum by-product received by Concessioner.
    (7) The Concessioner, at its sole cost and expense, shall promptly 
rectify any discharge or release as set forth in this section or any 
threatened or actual violation as set forth in this section, including, 
but not limited to, payment of any fines or penalties imposed thereon.
    (8) The Concessioner shall indemnify the United States in 
accordance with section 12 of the Contract from losses, damages or 
judgements (including, without limitation, fines and penalties) and 
expenses (including, without limitation, attorneys fees and experts 
fees) arising out of the activities of the Concessioner pursuant to 
this section. Such indemnification shall survive termination of this 
Contract.
    (9) If the Concessioner does not promptly rectify the discharge or 
release (whether solid, liquid or gaseous in nature) of any hazardous 
or toxic substance, material, or waste of any kind, including building 
materials such as asbestos, or any contaminant, pollutant, petroleum, 
petroleum product or petroleum by-product, the Director may, in its 
sole discretion and after notice to Concessioner, take any such action 
the Director deems necessary to minimize, remediate, or otherwise clean 
up such release or discharge, and recover any costs associated with 
such action from the Concessioner upon demand.
    (10) Even if not specifically required by Applicable Laws, the 
Concessioner shall comply with directives of the Director to clean up 
or remove any materials, product or by-product used, handled, stored, 
disposed, transported onto or into the Area by the Concessioner to 
ensure that the Area remains in good condition.
    (11) The Concessioner shall be responsible for managing weeds, 
harmful insects, rats, mice and other pests on all lands and 
improvements assigned to the Concessioner under this Contract. All such 
weed and pest management activities shall be in accordance with 
guidelines established by the Director.

[[Page 48425]]

(c) Protection of Cultural and Archeological Resources
    The Concessioner shall ensure that any protected sites and 
archeological resources within the Area are not disturbed or damaged by 
the Concessioner, including the Concessioner's employees, 
subcontractors or agents, except in accordance with Applicable Laws, 
and only with the prior approval of the Director. Discoveries of any 
archeological resources by Concessioner shall be promptly reported to 
the Director. The Concessioner shall cease work or other disturbance 
which may impact any protected site or archeological resource until the 
Director grants approval, upon such terms and conditions as the 
Director deems necessary, to continue such work or other disturbance.

Sec. 7  Interpretation of Area Resources

(a) Concessioner Obligations
    (1) The Concessioner shall provide all visitor services in a manner 
that is consistent with and supportive of the interpretive themes, 
goals and objectives of the Area.
    (2) The Concessioner may assist in Area interpretation at the 
request of the Director to enhance visitor enjoyment of the Area. Any 
additional visitor services that may result from this assistance must 
be recognized in writing through written amendment of Section 3 of this 
Contract.
(b) Director Review of Content
    The Concessioner must submit the proposed content of any 
interpretive programs, exhibits, materials or displays to the Director 
for review and approval prior to offering such programs, exhibits or 
displays to Area visitors.
(c) Provision of Interpretation Not Exclusive
    Notwithstanding any provision of this Contract to the contrary, the 
Director retains the right to provide Area interpretation, including 
without limitation, the conduct of interpretive programs and the sale 
of interpretive materials, directly or through cooperative or other 
agreements with third parties, as the Director determines to be 
necessary or appropriate.

Sec. 8  Concession Facilities Used in Operations by Concessioner

(a) Assignment of Concession Facilities
    (1) The Director hereby assigns the following Concession Facilities 
to the Concessioner for the purposes of this Contract:
    (i) Certain parcels of Area land as described in Exhibit B upon 
which, among other matters, the Concessioner may be authorized to 
construct real property improvements; and
    (ii) Certain real property improvements described in Exhibit B in 
existence as of the effective date of this Contract, as may be modified 
from time to time to include additional real property improvements 
completed in accordance with the terms and conditions of this Contract.
    (2) The Director shall from time to time amend Exhibit B to reflect 
changes in Concession Facilities assigned to Concessioner, including, 
without limitation, real property improvements completed in accordance 
with the terms and conditions of this Contract.
(b) Concession Facilities Withdrawals
    The Director may withdraw all or portions of these Concession 
Facilities assignments at any time during the term of this Contract if:
    (1) The withdrawal is for the purpose of enhancing or protecting 
Area resources or visitor enjoyment or safety;
    (2) The operations utilizing the assigned Concession Facilities 
have been terminated or suspended by the Director; or
    (3) Land or real property improvements assigned to the Concessioner 
are no longer necessary for the concession operation.
(c) Effect of Withdrawal
    Any permanent withdrawal of assigned Concession Facilities which 
the Director considers as essential for the Concessioner to provide the 
visitor services required by this Contract will be treated by the 
Director as a termination of this Contract pursuant to Section 16. The 
Concessioner will be compensated pursuant to Section 17 for the value 
of any Leasehold Surrender Interest it may have, if any, in permanently 
withdrawn Concession Facilities. No other compensation is due the 
Concessioner in these circumstances.
(d) Right of Entry
    The Director shall have the right at any time to enter upon or into 
the Concession Facilities assigned to the Concessioner under this 
Contract for any purpose he may deem necessary for the administration 
of the Area.
(e) Personal Property
    (1) Personal Property Provided by the Concessioner. The 
Concessioner shall provide all personal property, including removable 
equipment, furniture and goods, necessary for its operations under this 
Contract.
    (2) Personal Property Provided by the Government. The Director may 
provide certain items of government personal property and equipment for 
the Concessioner's use in the performance of this Contract. The 
Director hereby assigns government personal property and equipment 
listed in Exhibit C to the Concessioner as of the effective date of 
this Contract. This Exhibit C will be modified from time to time by the 
Director as items may be withdrawn or additional items added. The 
Concessioner shall be accountable to the Director for the government 
personal property and equipment assigned to it and shall be responsible 
for maintaining the property and equipment as necessary to keep it in 
good and operable condition. If the property ceases to be serviceable, 
it shall be returned to the Director for disposition.
(f) Condition of Concession Facilities
    Concessioner has inspected the Concession Facilities and any 
assigned government personal property, is thoroughly acquainted with 
their condition, and accepts the Concession Facilities, and any 
assigned government personal property, ``as is.''
(g) Utilities Provided by the Director
    The Director may provide utilities to the Concessioner for use in 
connection with the operations required and/or authorized under this 
Contract when available at rates to be fixed by the Director under 
applicable guidelines.
(h) Utilities Not Provided by the Director
    If the Director does not provide these utilities, the Concessioner 
shall, with the written approval of the Director and under any 
requirements that the Director shall prescribe, secure necessary 
utilities at its own expense from sources outside the Area or shall 
install the utilities within the Area with the written permission of 
the Director, subject to the following conditions:
    (1) Any water rights deemed necessary by the Concessioner for use 
of water on Area or other federal lands must be acquired at the 
Concessioner's expense in accordance with applicable State procedures 
and law. Upon expiration or termination of this Contract for any 
reason, the Concessioner must assign these water rights to the United 
States without compensation, and these water rights will become the 
property of the United States;
    (2) If requested by the Director, the Concessioner must provide to 
the

[[Page 48426]]

Director any utility service provided by the Concessioner under this 
section to such extent as will not unreasonably restrict anticipated 
use by the Concessioner. Unless otherwise agreed by the Concessioner 
and the Director, the rate per unit charged the Director for such 
service shall be approximately the average cost per unit of providing 
such service; and
    (3) All appliances and machinery to be used in connection with the 
privileges granted in this Section, as well as the plans for location 
and installation of such appliances and machinery, shall first be 
approved by the Director.

Sec. 9  Construction or Installation of Real Property Improvements

(a) Construction of Real Property Improvements
    The Concessioner may construct or install upon lands assigned to 
the Concessioner under this Contract only those real property 
improvements that are determined by the Director to be necessary and 
appropriate for the conduct by the Concessioner of the visitor services 
required and/or authorized under this Contract. Construction or 
installation of real property improvements may occur only after the 
written approval by the Director of their location, plans, and 
specifications. The form and content of the application and the 
procedures for such approvals, as may be modified by the Director from 
time to time, are set forth in Exhibit H. All real property 
improvements constructed or installed by Concessioner will immediately 
become the property of the United States and be considered Concession 
Facilities.
(b) Removal of Real Property Improvements
    (1) The Concessioner may not remove, dismantle, or demolish real 
property improvements without the prior approval of the Director.
    (2) Any salvage resulting from the authorized removal, severance or 
demolition of a Capital Improvement shall be the property of the 
Concessioner. Any salvage resulting from the authorized removal, 
severance or demolition of real property improvements other than a 
Capital Improvement shall be the property of the United States.
    (3) In the event that an assigned real property improvement is 
removed, abandoned, demolished, or substantially destroyed and no other 
improvement is constructed on the site, the Concessioner, at its 
expense, shall promptly, upon the request of the Director, restore the 
site as nearly as practicable to its original condition.
(c) Leasehold Surrender Interest
    (1) This Contract hereby provides the Concessioner, subject to all 
applicable definitions, requirements and limitations of 36 CFR Part 51 
as it existed as of the effective date of this Contract, a Leasehold 
Surrender Interest in Capital Improvements constructed by the 
Concessioner under the terms of this Contract, including, but not 
limited to, those Capitol Improvements constructed as part of the 
Concession Facilities Improvement Program and those Capitol 
Improvements which result from the major rehabilitation, as defined by 
36 CFR Part 51, of an existing real property improvement. Upon 
completion of a major rehabilitation by the Concessioner, an existing 
real property improvement assigned to the Concessioner in which the 
Concessioner had no Leasehold Surrender Interest prior to the major 
rehabilitation shall be considered as a Capital Improvement for all 
purposes of this Contract.
    (2) This Contract also provides the Concessioner a Leasehold 
Surrender Interest in real property improvements resulting from 
possessory interest obtained under the terms of a possessory interest 
concession contract where required by 36 CFR Part 51 as it existed as 
of the effective date of this Contract. Exhibit D to this Contract 
describes the real property improvements in which the Concessioner has 
such a Leasehold Surrender Interest and states the value of this 
Leasehold Surrender Interest as of the effective date of this Contract.
    (3) The Concessioner shall not obtain Leasehold Surrender Interest 
under this Contract except as may be provided in 36 CFR Part 51 as it 
exists as of the effective date of this Contract. Among other matters, 
no Leasehold Surrender Interest shall be obtained as a result of 
expenditures from the Maintenance Reserve described in this Contract 
and this Contract does not provide a Leasehold Surrender Interest as a 
result of expenditures for repair and maintenance of Concession 
Facilities of any nature.
(d) Concession Facilities Improvement Program
    (1) The Concessioner shall undertake and complete an improvement 
program (hereinafter ``Concession Facilities Improvement Program'') 
costing not less than $________ as adjusted for each project to reflect 
par value in the year of actual construction in accordance with the 
appropriate indexes of the Department of Commerce's ``Construction 
Review.''
    (2) The Concession Facilities Improvement Program shall include:

[Provide detailed description of the Concession Facilities 
Improvement Program.]

    (3) The Concessioner shall commence construction under the 
Concession Facilities Improvement Program on or before ________ in a 
manner that demonstrates to the satisfaction of the Director that the 
Concessioner is in good faith carrying the Concession Facilities 
Improvement Program forward reasonably under the circumstances. No 
construction may begin until the Concessioner receives written approval 
from the Director of plans and specifications in accordance with 
Exhibit H. During the period of construction, the Concessioner shall 
provide the Director with such evidence or documentation, as may be 
satisfactory to the Director, to demonstrate that the Concession 
Facilities Improvement Program duly is being carried forward. The 
Concessioner shall complete and have the improvements and buildings 
available for public use on or before ______.

Sec. 10  Maintenance

(a) Maintenance Obligation
    The Concessioner shall be solely responsible for maintenance, 
repairs, housekeeping, and groundskeeping for all Concession Facilities 
to the satisfaction of the Director.
(b) Maintenance Plan
    For these purposes, the Director, acting through the 
Superintendent, shall undertake appropriate inspections, and shall 
establish and revise, as necessary, a Maintenance Plan consisting of 
specific maintenance requirements which shall be adhered to by the 
Concessioner. The initial Maintenance Plan is set forth in Exhibit F. 
The Director in his discretion may modify the Maintenance Plan from 
time to time after consultation with the Concessioner. Such 
modifications shall not be inconsistent with the terms and conditions 
of the main body of this Contract.
(c) Maintenance Reserve
[No Maintenance Reserve is included in this Contract.] or

    (1) The Concessioner shall establish and manage a Maintenance 
Reserve. The funds in this Reserve shall be used to carry out, on a 
project basis, repair and maintenance of Concession Facilities that are 
non-recurring within a seven year time frame. Such projects may include 
repair or replacement of

[[Page 48427]]

foundations, building frames, window frames, sheathing, subfloors, 
drainage, rehabilitation of building systems such as electrical, 
plumbing, built-in heating and air conditioning, roof replacement and 
similar projects. Projects will be carried out by the Concessioner as 
the Director shall direct in writing in advance of any expenditure 
being made and in accordance with project proposals approved by the 
Director. No projects may be commenced until the Concessioner receives 
written approval from the Director.
    (2) Projects paid for with funds from the Maintenance Reserve will 
not include routine, operational maintenance of facilities or 
housekeeping and groundskeeping activities. Nothing in this section 
shall lessen the responsibility of the Concessioner to carry out the 
maintenance and repair of Concession Facilities as required by this 
Contract from Concessioner funds exclusive of the funds contained in 
the Maintenance Reserve.
    (3) The Concessioner shall establish within its accounting system a 
Maintenance Reserve. The Concessioner shall debit to this Reserve, 
within fifteen (15) days after the last day of each month that the 
Concessioner operates a sum equal to: ______ percent (____%) of the 
Concessioner's Gross Receipts for the previous month. If the 
Concessioner fails to make timely debits to the Maintenance Reserve, 
the Director may terminate this Contract for default or require the 
Concessioner to post a bond in an amount equal to the estimated annual 
Maintenance Reserve allocation, based on the preceding year's Gross 
Receipts.
    (4) The balance in the Maintenance Reserve shall be available for 
projects in accordance with the Reserve's purpose. For all expenditures 
made for each project from the Maintenance Reserve, the Concessioner 
shall maintain auditable records including invoices, billings, canceled 
checks, and other documentation satisfactory to the Director.
    (5) Maintenance Reserve funds shall not be used for a major 
rehabilitation as defined in this Contract. The Concessioner shall 
obtain no ownership, Leasehold Surrender Interest, or other compensable 
interest as a consequence of the expenditure of Maintenance Reserve 
funds.
    (6) Any Maintenance Reserve funds not duly expended by the 
Concessioner as of the termination or expiration of this Contract shall 
be immediately remitted by the Concessioner to the Director as an 
additional franchise fee under section 11 of this Contract.

Sec. 11  Fees

(a) Franchise Fee
    (1) For the term of this Contract, the Concessioner shall pay to 
the Director for the privileges granted under this Contract a franchise 
fee equal to ________ percent (____%) of the Concessioner`s Gross 
Receipts for the preceding year or portion of a year.
    (2) Neither the Concessioner nor the Director shall have a right to 
an adjustment of the fees except as provided below. The Concessioner 
has no right to waiver of the fees under any circumstances.
(b) Payments Due
    (1) The franchise fee shall be due on a monthly basis at the end of 
each month and shall be paid by the Concessioner in such a manner that 
the Director shall receive payment within fifteen (15) days after the 
last day of each month that the Concessioner operates. This monthly 
payment shall include the franchise fee equal to the specified 
percentage of gross receipts for the preceding month.
    (2) The Concessioner shall pay any additional fee amounts due at 
the end of the operating year as a result of adjustments at the time of 
submission of the Concessioner's Annual Financial Report. Overpayments 
shall be offset against the following year's fees.
    (3) All franchise fee payments consisting of $10,000 or more, shall 
be deposited electronically by the Concessioner using the Treasury 
Financial Communications System.
(c) Interest
    An interest charge will be assessed on overdue amounts for each 
thirty (30) day period, or portion thereof, that payment is delayed 
beyond the fifteen (15)-day period provided for above. The percent of 
interest charged will be based on the current value of funds to the 
United States Treasury as published quarterly in the Treasury Fiscal 
Requirements Manual. The Director may also impose penalties for late 
payment to the extent authorized by Applicable Law.
(d) Reconsideration of Franchise Fee
    (1) The Concessioner may request, in the event the Concessioner 
considers that extraordinary, unanticipated changes have occurred after 
the effective date of this Contract, a reconsideration and possible 
subsequent adjustment of the franchise fee established in this section. 
For the purposes of this section, the phrase ``extraordinary, 
unanticipated changes'' shall mean extraordinary, unanticipated changes 
from the conditions existing or reasonably anticipated before the 
effective date of this Contract which have or will significantly affect 
the probable value of the privileges granted to the Concessioner by 
this Contract. For the purposes of this section, the phrase ``probable 
value'' means a reasonable opportunity for net profit in relation to 
capital invested and the obligations of this Contract.
    (2) The Concessioner must make a request for a reconsideration by 
mailing, within thirty (30) days from the date that the Concessioner 
becomes aware, or should have become aware, of the possible 
extraordinary, unanticipated changes, a written notice to the Director 
that includes a description of the possible extraordinary, 
unanticipated changes and why Concessioner believes they will 
significantly effect the probable value of the privileges granted by 
this Contract. A government official subordinate to the Director may 
also initiate such a reconsideration by so notifying the Concessioner 
in accordance with this section.
    (3) If a franchise fee reconsideration is timely initiated in this 
manner, the Director shall make a written determination as to whether 
extraordinary, unanticipated changes exist. If a subordinate official 
to the Director initiated the reconsideration, an official appointed by 
the Director other than the subordinate initiating official shall make 
the determination. If the Director determines that extraordinary, 
unanticipated changes have not occurred, the reconsideration process 
shall terminate without an adjustment to the franchise fee. If the 
Director determines that extraordinary, unanticipated changes did 
occur, the Concessioner and the Director will undertake a good faith 
negotiation as to an appropriate adjustment of the franchise fee.
    (4) The negotiation will last for a period of sixty (60) days from 
the date the Director makes his or her determination that extraordinary 
unanticipated changes occurred. If the negotiation results in agreement 
as to an adjustment (up or down) of the franchise fee within this 
period, the franchise fee will be adjusted accordingly, retroactive to 
the date for which the notice of reconsideration was given.
    (5) If the negotiation does not result in agreement as to the 
adjustment of the franchise fee within this sixty (60) day period, then 
either the Concessioner or the Director may request binding arbitration 
to determine the adjustment to franchise fee in accordance with this 
section. Such a request for arbitration

[[Page 48428]]

must be made by mailing notice to the other party within fifteen (15) 
days of the expiration of the sixty (60) day period.
    (6) Within thirty (30) days of receipt of such a notice, the 
Concessioner and the Director shall each select an arbiter. These two 
arbiters, within thirty (30) days of selection, must agree to the 
selection of a third arbiter to complete the arbitration panel. The 
third arbiter shall be the chairperson of the panel. The Director and 
the Concessioner shall share equally the expenses of the third arbiter 
and other common expenses associated with the arbitration. Within 
thirty (30) days of the selection of the third arbiter, the arbitration 
panel must hold an informal meeting with the Concessioner and the 
Director. At such meeting, the Concessioner and the Director shall be 
permitted to present their written and oral views and any accompanying 
documentation as to their position on an adjustment to the franchise 
fee and the members of the panel may pose questions to the Concessioner 
and the Director. Non-adjudicative procedures only shall be used in the 
arbitration proceedings. The arbitration panel shall not have the power 
to compel the production of documents or witnesses and shall not 
receive or take into account information or documents developed by the 
Concessioner or the Director for pre-negotiation or negotiation 
purposes. All actions related to the arbitration are subject to the 
applicable requirements of 36 CFR Part 51 as it may be amended from 
time to time.
    (7) The arbitration panel shall consider the written submissions 
and any oral presentations made by the Concessioner and the Director 
and provide its decision on an adjusted franchise fee (up, down or 
unchanged) that is consistent with the probable value of the privileges 
granted by this Contract within sixty (60) days of the informal 
meeting.
    (8) Any adjustment to the franchise fee resulting from this Section 
shall be effective retroactive to the date for which the notice of 
reconsideration was given and for the remaining term of this Contract, 
subject to the results of any further reconsideration.
    (9) If an adjustment to the franchise fee results in higher fees, 
the Concessioner will pay all back franchise fees due (with accrued 
interest) at the time of the next regular franchise fee payment. If an 
adjustment results in lower franchise fees, the Concessioner may 
withhold the difference from future franchise fee payments until such 
time as the Concessioner has recouped the overpayment. Any payments 
made in arrears by the Concessioner shall include interest at a percent 
based on the current value of funds to the United States Treasury as 
published quarterly in the Treasury Fiscal Requirements Manual.
    (10) Any adjustment to the franchise fee will be embodied in an 
amendment to this Contract.
    (11) During the pendency of the process described in this Section, 
the Concessioner shall continue to make the established franchise fee 
payments required by this Contract.

Sec. 12  Indemnification and Insurance

(a) Indemnification
    The Concessioner agrees to assume liability for and does hereby 
agree to save, hold harmless, protect, defend and indemnify the United 
States of America, its agents and employees from and against any and 
all liabilities, obligations, losses, damages or judgments (including 
without limitation penalties and fines), claims, actions, suits, costs 
and expenses (including without limitation attorneys fees and experts 
fees) of any kind and nature whatsoever on account of fire or other 
peril, bodily injury, death or property damage, or claims for bodily 
injury, death or property damage of any nature whatsoever, and by 
whomsoever made, in any way relating to or arising out of the 
activities of the Concessioner, his employees, subcontractors or agents 
under this Contract. This indemnification shall survive the termination 
or expiration of this Contract.
(b) Insurance in General
    (1) The Concessioner shall obtain and maintain during the entire 
term of this Contract at its sole cost and expense, the types and 
amounts of insurance coverage necessary to fulfill the obligations of 
this Contract. The Director shall approve the types and amounts of 
insurance coverage purchased by the Concessioner.
    (2) The Director will not be responsible for any omissions or 
inadequacies of insurance coverages and amounts in the event the 
insurance purchased by the Concessioner proves to be inadequate or 
otherwise insufficient for any reason whatsoever.
    (3) At the request of the Director, the Concessioner shall at the 
time insurance is first purchased and annually, thereafter, provide the 
Director with a Certificate of Insurance that accurately details the 
conditions of the policy as evidence of compliance with this section. 
The Concessioner shall provide the Director thirty (30) days advance 
written notice of any material change in the Concessioner's insurance 
program hereunder.
(c) Commercial Public Liability
    (1) The Concessioner shall provide commercial general liability 
insurance against claims arising out of or resulting from the acts or 
omissions of the Concessioner or its employees in carrying out the 
activities and operations required and/or authorized under this 
Contract.
    (2) This insurance shall be in the amount commensurate with the 
degree of risk and the scope and size of the activities required and/or 
authorized under this Contract, as more specifically set forth in 
Exhibit E. Furthermore, the commercial general liability package shall 
provide the coverages and limits described in Exhibit E.
    (3) All liability policies shall specify that the insurance company 
shall have no right of subrogation against the United States of America 
and shall provide that the United States of America is named an 
additional insured.
    (4) From time to time, as conditions in the insurance industry 
warrant, the Director may modify Exhibit E to revise the minimum 
required limits or to require additional types of insurance.
(d) Property Insurance
    (1) In the event of damage or destruction, the Concessioner will 
repair or replace those Concession Facilities and personal property 
utilized by the Concessioner in the performance of the Concessioner's 
obligations under this Contract.
    (2) For this purpose, the Concessioner shall provide fire and 
extended insurance coverage on Concession Facilities in amounts that 
the Director may require during the term of the Contract. The values 
currently in effect are set forth in Exhibit E. This Exhibit will be 
revised at least every three (3) years, or earlier if there is a 
substantial change in value of Concession Facilities.
    (3) Commercial property insurance shall provide for the 
Concessioner and the United States of America to be named insured as 
their interests may appear.
    (4) In the event of loss, the Concessioner shall use all proceeds 
of such insurance to repair, rebuild, restore or replace Concession 
Facilities and or personal property utilized in the Concessioner's 
operations under this Contract, as directed by the Director. Policies 
may not contain provisions limiting insurance proceeds to in situ 
replacement. The lien provision of

[[Page 48429]]

Section 13 shall apply to such insurance proceeds.
    (5) Insurance policies that cover Concession Facilities shall 
contain a loss payable clause approved by the Director which requires 
insurance proceeds to be paid directly to the Concessioner without 
requiring endorsement by the United States. The use of insurance 
proceeds for repair or replacement of Concession Facilities will not 
alter their character as properties of the United States and, 
notwithstanding any provision of this Contract to the contrary, the 
Concessioner shall gain no ownership, Leasehold Surrender Interest or 
other compensable interest as a result of the use of these insurance 
proceeds.
    (6) The commercial property package shall include the coverages and 
amounts described in Exhibit E.

Sec. 13  Bonds and Liens

(a) Bonds
    The Director may require the Concessioner to furnish appropriate 
forms of bonds acceptable to the Director conditioned upon faithful 
performance of its obligations under this Contract, in such form and in 
such amount as the Director may deem adequate.
(b) Lien
    As additional security for the faithful performance by the 
Concessioner of its obligations under this Contract, and the payment to 
the Government of all damages or claims that may result from the 
Concessioner's failure to observe any such obligations, the Government 
shall have at all times the first lien on all assets of the 
Concessioner within the Area, including, but not limited to, all 
personal property of the Concessioner used in performance of the 
Contract hereunder and any Leasehold Surrender Interest of the 
Concessioner.

Sec. 14  Accounting Records and Reports

(a) Accounting System
    (1) The Concessioner shall maintain an accounting system under 
which its accounts can be readily identified with its system of 
accounts classification. Such accounting system shall be capable of 
providing the information required by this Contract, including but not 
limited to the Concessioner's repair and maintenance obligations. The 
Concessioner's system of accounts classification shall be directly 
related to the Concessioner Annual Financial Report Form issued by the 
Director.
    (2) If the Concessioner's annual gross receipts are $250,000 or 
more, the Concessioner must use the accrual accounting method.
    (3) In computing net profits for any purposes of this Contract, the 
Concessioner shall keep its account in such manner that there can be no 
diversion or concealment of profits or expenses in the operations 
authorized hereunder by means of arrangements for the procurement of 
equipment, merchandise, supplies or services from sources controlled by 
or under common ownership with the Concessioner or by any other device.
(b) Annual Financial Report
    (1) The Concessioner shall submit annually as soon as possible but 
not later than ninety (90) days after the last day of its fiscal year a 
financial statement for the preceding fiscal year or portion of a year 
as prescribed by the Director (``Concessioner Annual Financial 
Report'').
    (2) If the annual gross receipts of the Concessioner are in excess 
of $1,000,000, the financial statements shall be audited by an 
independent Certified Public Accountant in accordance with the 
Generally Accepted Auditing Standards (GAAS) and procedures promulgated 
by the American Institute of Certified Public Accountants.
    (3) If annual gross receipts are between $250,000, and $1,000,000, 
the financial statements shall be reviewed by an independent Certified 
Public Accountant in accordance with the Generally Accepted Auditing 
Standards (GAAS) and procedures promulgated by the American Institute 
of Certified Public Accountants.
    (4) If annual gross receipts are less than $250,000, the financial 
statements may be prepared without involvement by an independent 
Certified Public Accountant, unless otherwise directed by the Director.
(c) Other Financial Reports
    (1) Balance Sheet. Within ninety (90) days of the execution of this 
Contract or its effective date, whichever is later, the Concessioner 
shall submit to the Director a balance sheet as of the beginning date 
of the term of this Contract. The balance sheet shall be audited or 
reviewed, as determined by the gross receipts, by an independent 
Certified Public Accountant. The balance sheet shall be accompanied by 
a schedule that identifies and provides details for all capital 
improvements in which the Concessioner claims a Leasehold Surrender 
Interest. The schedule must describe these capital improvements in 
detail showing for each such capital improvement the date acquired, 
useful life, cost and book value.
    (2) Statements of Reserve Activity The Concessioner shall submit 
annually, not later than ________ (____) days after the end of the 
Concessioner's accounting year, a statement reflecting total activity 
in the Maintenance Reserve for the preceding accounting year. The 
statement must reflect monthly inflows and outflows on a project by 
project basis.

Sec. 15  Other Reporting Requirements

    The following describes certain other reports required under this 
Contract:
(a) Insurance Certification
    As specified in Section 12, at the time insurance is first 
purchased, and annually thereafter, the Concessioner shall provide the 
Director with a Certificate of Insurance for all insurance coverages 
related to its operations under this Contract. The Concessioner shall 
give the Director thirty (30) days advance written notice of any 
material change in its insurance program.
(b) Environmental Reporting
    The Concessioner shall submit a quarterly report on any matters 
related to the Concessioner's environmental compliance requirements 
under this Contract.
(c) Miscellaneous Reports and Data
    The Director from time to time may require the Concessioner to 
submit other reports and data regarding its performance under the 
Contract or otherwise, including, but not limited to, operational 
information.

Sec. 16  Suspension and Termination

(a) Suspension
    The Director may temporarily suspend operations under this Contract 
in whole or in part when necessary for administrative purposes or to 
enhance or protect Area resources, visitor enjoyment or safety. No 
compensation of any nature shall be due the Concessioner in the event 
of a suspension of operations, including, but not limited to, 
compensation for losses based on lost income, profit, or the necessity 
to make expenditures as a result of the suspension.
(b) Termination
    (1) The Director may terminate this Contract in whole or part at 
any time when necessary for the purpose of enhancing or protecting Area 
resources or visitor enjoyment or safety.
    (2) The Director may terminate this Contract in whole or part for 
default if the Director determines that the

[[Page 48430]]

Concessioner has breached any requirement of this Contract, including, 
but not limited to, the requirement to maintain and operate visitor 
services to the satisfaction of the Director, the requirement to 
provide only visitor services required or authorized by the Director, 
the requirement to pay the established franchise fee, and the 
requirement to comply with Applicable Laws.
    (3) In the event of a breach of the Contract, the Director will 
provide the Concessioner an opportunity to cure by providing written 
notice to the Concessioner of the breach. In the event of a monetary 
breach, the Director will give the Concessioner a fifteen (15) day 
period to cure the breach. If the breach is not cured within that 
period, then the Director may terminate the Contract for default. In 
the event of a nonmonetary breach, if the Director considers that the 
nature of the breach so permits, the Director will give the 
Concessioner thirty (30) days to cure the breach, or to provide a plan, 
to the satisfaction of the Director in his sole discretion, to cure the 
breach over a specified period of time. If the breach is not cured 
within this specified period of time, the Director may terminate the 
Contract for default. Notwithstanding this provision, repeated breaches 
of the same nature shall be grounds for termination for default without 
a cure period. In the event of a breach of any nature, the Director may 
suspend the Concessioner's operations as appropriate in accordance with 
Section 16(a).
    (4) The Director may terminate this Contract upon the filing or the 
execution of a petition in bankruptcy by or against the Concessioner, a 
petition seeking relief of the same or different kind under any 
provision of the Bankruptcy Act or its successor, an assignment by the 
Concessioner for the benefit of creditors, a petition or other 
proceeding against the Concessioner for the appointment of a trustee, 
receiver, or liquidator, or, the taking by any person or entity of the 
rights granted by this Contract or any part thereof upon execution, 
attachment or other process of law or equity. The Director may 
terminate this Contract if the Director determines that the 
Concessioner is unable to perform the terms of Contract due to 
bankruptcy or insolvency.
    (5) Termination of this Contract for any reason shall be by written 
notice to the Concessioner.
(c) Notice of Bankruptcy or Insolvency
    The Concessioner must give the Director notice fifteen (15) days 
prior to filing any petition in bankruptcy, filing any petition seeking 
relief of the same or different kind under any provision of the 
Bankruptcy Act or its successor, or making any assignment for the 
benefit of creditors. The Concessioner must also give the Director 
immediate notice of any petition or other proceeding against the 
Concessioner for the appointment of a trustee, receiver, or liquidator, 
or, the taking by any person or entity of the rights granted by this 
Contract or any part thereof upon execution, attachment or other 
process of law or equity. For purposes of the bankruptcy statutes, this 
Contract is not a lease, but is an executory contract exempt from 
inclusion in assets of Concessioner pursuant to 11 U.S.C. 1135.
(d) Requirements in the Event of Termination
    (1) In the event of termination of this Contract by the Director 
for any reason, the total compensation due the Concessioner for such 
termination shall be as described in section 17 of this Contract. No 
other compensation of any nature shall be due the Concessioner in the 
event of a termination of this Contract, including, but not limited to, 
compensation for losses based on lost income, profit, or the necessity 
to make expenditures as a result of the termination.
    (2) Upon termination of this Contract for any reason, and except as 
otherwise provided in this section, the Concessioner shall, at 
Concessioner's expense, promptly vacate the Area, remove all of 
Concessioner's personal property, repair any injury occasioned by 
installation of removal of such property, and ensure that Concession 
Facilities are in as good condition as they were at the beginning of 
the term of this Contract, reasonable wear and tear excepted.
    (3) To avoid interruption of services to the public upon the 
termination of this Contract for any reason, the Concessioner, upon the 
request of the Director, shall continue to conduct all operations 
hereunder under the terms and conditions of this Contract for a 
reasonable period of time as determined by the Director, not to exceed 
the time limitations contained in 36 CFR Part 51 as it existed as of 
the effective date of this Contract applicable to payment of leasehold 
surrender interest value.
    (4) To avoid interruption of services to the public upon expiration 
of this Contract or upon its termination for any reason, the 
Concessioner, upon the request of the Director, shall consent to the 
use by another operator of the Concessioner's personal property, 
excluding inventories if any, not including current or intangible 
assets, for a period of time not to exceed one year from the date of 
such termination or expiration. The other operator shall pay the 
Concessioner an annual fee for use of such property, prorated for the 
period of use, in the amount of the annual depreciation of such 
property, plus a return on the book value of such property equal to the 
prime lending rate, effective on the date the operator assumes 
managerial and operational responsibilities, as published by the 
Federal Reserve System Board of Governors. In such circumstances, the 
method of depreciation applied shall be either straight line 
depreciation or depreciation as shown on the Concessioner's Federal 
income tax return, whichever is less. To avoid interruption of services 
to the public upon expiration of this Contract or termination of this 
Contract for any reason, the Concessioner shall, upon the request of 
the Director, sell its existing inventory to another operator at the 
purchase price as shown on applicable invoices.

Sec. 17  Compensation

(a) Just Compensation
    The compensation provided by this Section shall constitute full and 
just compensation to the Concessioner for all losses and claims 
occasioned by the circumstances described below.
(b) Compensation for Contract Expiration or Termination
    If, for any reason, including Contract expiration or termination, 
the Concessioner shall cease to be authorized by the Director to 
conduct operations under this Contract, the Concessioner shall convey 
to a person designated by the Director (including the Director if 
appropriate) any Leasehold Surrender Interest it has under the terms of 
this Contract and the Director shall assure, subject to subsection (c) 
below, that the Concessioner is paid the Leasehold Surrender Interest 
Value in accordance with the requirements of 36 CFR Part 51 as they 
existed as of the effective date of this Contract. The Concessioner 
shall not be required to convey such Leasehold Surrender Interest until 
the Concessioner is paid in accordance with 36 CFR Part 51 as it 
existed as of the effective date of this Contract.
(c) Compensation When Contract Terminated for Default
    Notwithstanding any other provision of this Contract to the 
contrary, in the event of termination of this Contract for default, the 
Concessioner shall be entitled to the payment of any

[[Page 48431]]

Leasehold Surrender Interest Value it may have under the terms of this 
Contract, but such payment may be offset by the Director by any damages 
due the Director from the Concessioner as a result of the breach of 
Contract which resulted in the termination for default or by other 
funds due the Director under the terms of this Contract.
(d) Procedures for Establishing the Value of a Leasehold Surrender 
Interest
    (1) In the event that agreement as to the value of a Leasehold 
Surrender Interest cannot be reached by the Concessioner and the 
Director such value shall be determined by binding arbitration, subject 
to applicable limitations of 36 CFR Part 51 as it existed as of the 
effective date of this Contract. In these circumstances, the 
Concessioner and the Director shall each select an arbiter. These two 
arbiters, within thirty (30) days of selection, must agree to the 
selection of a third arbiter to complete the arbitration panel. The 
third arbiter shall be the chairperson of the panel. The Director and 
the Concessioner shall share equally the expenses of the third arbiter 
and other common expenses associated with the arbitration. Within 
thirty (30) days of the selection of the third arbiter, the arbitration 
panel must hold an informal meeting with the Concessioner and the 
Director. At such meeting, the Concessioner and the Director shall be 
permitted to present their written and oral views and any accompanying 
documentation as to their position on the value of the Leasehold 
Surrender Interest and the members of the panel may pose questions to 
the Concessioner and the Director. Non-adjudicative procedures only 
shall be used in the arbitration proceedings. The arbitration panel 
shall not have the power to compel the production of documents or 
witnesses and shall not receive or take into account information or 
documents developed by the Concessioner or the Director for pre-
negotiation or negotiation purposes. All aspects of the arbitration are 
subject to the applicable requirements of 36 CFR Part 51 as it existed 
as of the effective date of this Contract.
    (2) The arbitration panel shall consider the written submissions 
and any oral presentations made by the Concessioner and the Director 
and provide its decision on the value of the Leasehold Surrender 
Interest consistent with the terms of this Contract and 36 CFR Part 51 
as it existed as of the effective date of this Contract.
    (3) The Concessioner shall, at any time requested by the Director, 
enter into negotiations with the Director as to the value of the 
Concessioner's Leasehold Surrender Interest under this Contract. In the 
event that such negotiations fail to determine an agreed upon value, 
the Director may initiate arbitration proceedings to determine such 
value upon written request to the Concessioner. Such arbitration 
proceedings shall be conducted in accordance with the arbitration 
procedures set forth in this section. The arbitration panel shall 
determine the value of the Concessioner's Leasehold Surrender Interest 
consistent with the terms of this Contract and 36 CFR Part 51 as it 
existed as of the effective date of this Contract. The arbitration 
panel shall also provide a means to calculate the change in the value 
of such Leasehold Surrender Interest as may occur for up to two years 
from the date of the initial determination. The determination of the 
arbitration panel shall be binding on the Director and the 
Concessioner.
(d) Compensation for Personal Property
    Except as otherwise provided in this Contract, upon expiration or 
termination of this Contract for any reason, the Concessioner shall 
remove its personal property from the Area unless it is sold to the 
Director or a successor concessioner. No compensation is due the 
Concessioner from the Director or a successor concessioner for such 
personal property. The Director or a successor concessioner may 
purchase such personal property from the Concessioner subject to 
mutually agreed upon terms. Personal property not removed from the Area 
by the Concessioner as of the date of expiration or termination of this 
Contract, unless the Director in writing extends such date of removal, 
shall be considered abandoned property subject to disposition by the 
Director, at full cost and expense of the Concessioner, in accordance 
with Applicable Laws. Any cost or expense incurred by the Director as a 
result of such disposition may be offset from any amounts owed to 
Concessioner by the Director.

Sec. 18  Assignment, Sale or Encumbrance of Interests

    (a) This Contract is subject to the requirements of 36 CFR Part 51 
as it may be amended from time to time with respect to proposed 
conveyances and encumbrances as those terms are defined in 36 CFR Part 
51, including, but not limited to, proposed management and 
subconcession agreements. Failure by the Concessioner to comply with 36 
CFR Part 51 is a material breach of this Contract for which the 
Director may terminate this Contract for default. The Director shall 
not be obliged to recognize any right of any person or entity to an 
interest in this Contract of any nature, including, but not limited to, 
Leasehold Surrender Interest or operating rights under this Contract, 
if obtained in violation of 36 CFR Part 51.
    (b) The Concessioner shall advise any person(s) or entity proposing 
to enter into a transaction which may be subject to 36 CFR Part 51 of 
the requirements of that regulation.

Sec. 19  General Provisions

    (a) The Director and Comptroller General of the United States, or 
any of their duly authorized representatives, shall have access to the 
records of the Concessioner as provided by 36 CFR Part 51 as it may now 
exist or be amended from time to time.
    (b) All information required to be submitted to the Director by the 
Concessioner pursuant to this Contract is subject to public release by 
the Director to the extent required or authorized by Applicable Laws.
    (c) Subconcession or other third party agreements, including 
management agreements, for the provision of principal services required 
and/or authorized under this Contract are not permitted. However, 
subconcession or other third party agreements may be allowed for 
incidental or specialized services which are incidental to the 
principal services required and/or authorized under this Contract. Any 
proposal to provide incidental or specialized services through 
subconcession or other third party agreements must be submitted to the 
Director in writing, along with a copy of the proposed subconcession or 
third party agreement, and shall be effective only if approved in 
writing by the Director. If the Director approves a subconcession or 
other third party agreement, the Concessioner and the Director will 
amend the Contract to reflect such approval. Agreements with others to 
provide vending or other coin-operated machines shall not be considered 
subconcession agreements.
    (d) The Concessioner is not entitled to be awarded or to have 
negotiating rights to any Federal procurement or service contract by 
virtue of any provision of this Contract.
    (e) Any and all taxes or assessments of any nature that may be 
lawfully imposed by any State or its political subdivisions upon the 
property or business of the Concessioner shall be paid promptly by the 
Concessioner.

[[Page 48432]]

    (f) No member of, or delegate to, Congress or Resident Commissioner 
shall be admitted to any share or part of this Contract or to any 
benefit that may arise from this Contract but this restriction shall 
not be construed to extend to this Contract if made with a corporation 
or company for its general benefit.
    (g) This Contract is subject to the provisions of 43 CFR, Subtitle 
A, Subpart D, concerning nonprocurement debarment and suspension. The 
Director may recommend that the Concessioner be debarred or suspended 
in accordance with the requirements and procedures described in those 
regulations, as they are effective now or may be revised in the future.
    (h) This Contract contains the sole and entire agreement of the 
parties. No oral representations of any nature form the basis of or may 
amend this Contract. This Contract may be extended, renewed or amended 
only when agreed to in writing by the Director and the Concessioner.
    (i) The Concessioner is not granted by this Contract any rights to 
renewal of this Contract or to award of a new contract of any nature.
    (j) This Contract does not grant rights or benefits of any nature 
to any third party.
    (k) The invalidity of a specific provision of this Contract shall 
not affect the validity of the remaining provisions of this Contract.
    In Witness Whereof, the duly authorized representatives of the 
parties have executed this Contract as of the ______ day of ______, 
______.

Concessioner

By---------------------------------------------------------------------
(Title)
(Company Name)

United States of America

By---------------------------------------------------------------------
Director
National Park Service

[corporations]

    Attest:

By---------------------------------------------------------------------
Title

[Sole Proprietorship]
    Witnesses:

Name
Address
Title

Name
Address
Title

[Partnership]

    Witnesses as to each:
Name-------------------------------------------------------------------
Address
Name-------------------------------------------------------------------
Address

[Concessioner]
(Name)
(Name)

    Dated: August 20, 1999.
Maureen Finnerty,
Associate Director, Park Operations and Education, National Park 
Service.
[FR Doc. 99-23029 Filed 9-2-99; 8:45 am]
BILLING CODE 4310-70-P