Posted by Incorporating Financial Sustainability Considerations into the Planning and Design of New Facilities in the National Parks
Management Track
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Abstract:
The backlog of maintenance in the National Park System is reaching crisis proportions. The total deferred maintenance (DM) backlog was estimated at $8 to $10 billion in 2008. This problem has worsened in recent years despite a concerted effort to combat it. The National Park Service (NPS) cannot hope to limit and reduce deferred maintenance without significant increases to its budgets for the Repair & Rehabilitation and Line Item Construction programs, which combined provide less than $100 million annually to address DM. Faced with this seemingly intractable problem, park planners should heed the maxim, “First, do no harm.” In other words, parks should guarantee that sufficient operations & maintenance (O&M) funding is available for all planned assets before construction of new assets begins.
Newly constructed capital assets can accumulate DM rapidly if not adequately maintained. The World War II Memorial on the National Mall has accumulated $725,000 in DM since completion in 2004. Perhaps because life cycle costs are so unexpectedly high, park stakeholders, typically cooperating associations and member of congress, often advocate and provide funding for new construction without providing adequate O&M funding.
The NPS can better ensure the financial sustainability of parks and the preservation of mission critical assets by requiring comprehensive life cycle cost estimates for construction and rehabilitation projects during the general management planning process. The General Management Plan (GMP) is the master plan that guides the development of infrastructure and major policy decisions concerning visitation, usage, and commercial activities in a park.
In July 2008, the NPS produced comprehensive cost estimates for an update of the GMP of Golden Gate National Recreation Area. In considering the requirements for effective and rigorous project selection, the planning team identified a need for comprehensive, quality cost estimates. This effort coincided with the interest of Park Facility Management Division of the NPS in promoting financial sustainability principles in planning.
Hundreds of project options were evaluated, some involving the construction of new facilities, some the rehabilitation of existing assets, and others the disposal of underutilized and excess assets. Cost estimates were produced for all facility projects contemplated within the three management alternatives considered as viable options for the basis of the GMP. The estimates were then used to help identify and improve the preferred alternative.
A review of this engagement yielded a number of insights. Foremost among these is the conclusion that comprehensive evaluations of financial sustainability for facility projects can be economically and efficiently incorporated into NPS General Management Plans. Incorporating life cycle cost estimating into the park planning process would result in improved project accountability and help the parks to reduce DM and calibrate the size of their asset portfolios in keeping with available O&M funding.
Author(s):
Fred Richardson
Mr. Richardson is an Associate at Booz Allen Hamilton. He received a B.A. degree in English from Kenyon College and a Master of Public Affairs degree from the Lyndon B. Johnson School of Public Affairs at the University of Texas.
Mr. Richardson brings a range of professional experiences to his current position in capital asset management at Booz Allen Hamilton. He began his career as a legislative aide in the U.S. Senate, and complemented this work with several positions managing political campaigns. During graduate school Mr. Richardson accepted a consulting internship with the National Park Service to develop a business plan for the Statue of Liberty & Ellis Island National Monument. He has produced business plans for three national parks, and managed nine consulting teams in the production of business plans for national forests. This work led Mr. Richardson to the capital asset management group at Booz Allen Hamilton, where he works with the National Park Service. His portfolio of work includes the management of cost estimating work for NPS General Management Plans, the development of a pilot process for the holistic improvement of degraded park areas, and Booz Allen Hamilton’s support of the NPS Sustainable Operations and Climate Change program. He has 17 years of professional experience, including certifications in mediation, negotiation, facilitation.
Matthew Tetreault
Mr. Tetreault, a Senior Consultant at Booz Allen Hamilton, received a BBA degree in Finance from James Madison University and a MBA degree in Management from Johns Hopkins University.
Mr. Tetreault has 9 years of professional experience encompassing cost estimating, financial analysis, capital asset management, and budget control. He currently provides capital asset management support to Federal Government clients. Recent projects include the development of Operations and Maintenance (O&M) cost models, General Management Plan cost estimating, and development of a Total Cost of Facility Ownership cost model. Past experience include development of life cycle cost estimates, estimation of quantitative benefits, and qualitative benefit assessments for Intelligence Community clients.