The Antiplanner

Entitled to a Free Ride

25th August 2008

Entitled to a Free Ride

posted in Public lands |

Whenever we get something for free, especially if it is from the government, we quickly feel we are entitled to it. Case in point: Last Wednesday, the Antiplanner and some friends took some kayaks to a lake. Despite being the middle of August, we arrived in the middle of a rain storm with a fierce south wind.

The nice thing about kayaking is that you can put on a spray skirt and raincoat and be almost completely shielded from the elements. So we happily paddled around the lake for a couple of hours.

On Saturday, after dinner, the Antiplanner invited Ms. Antiplanner to go on a short cruise on the same lake. The weather was much nicer, but when we arrived we were greeted by a gruff gatekeeper who demanded $5 to launch our boats. My immediate thought was: I went for free three days ago, so why should I have to pay now?

Of course, I support the idea of user fees, so I quickly dismissed that thought. As it happened, I didn’t have $5, and if I did, I probably wouldn’t have wanted to spend it on an hour-long trip, especially when I could see that many people had launched motorboats for the weekend for the same $5. So we went to another lake and had a nice little paddle.

Nevertheless, I can see why some people who have been recreating on the public lands for free for many years might feel resentful when the Forest Service or other agencies start charging money. We paid for this with our taxes, they say, so why should we have to pay twice? We aren’t causing near the environmental impact of loggers and cattle grazers, so why should we pay when the others are subsidized?

There are good answers to these questions. If you want to get what you pay for, it is better to pay a user fee than a tax, because your taxes are more likely to go to politically connected interests than to the things that you want, while your user fees (if they are designed properly) will give managers incentives to give you the things you want.

Since fees create incentives for the managers collecting the fees, making fees proportional to environmental impact would create some very dangerous incentives. Managers would promote the activities that caused the greatest impact — and therefore the most fees — and neglect the ones that cause the least impact.

In a way, this is the system that prevailed on the national forests for many years. Congress had thoughtfully allowed the Forest Service to keep a share of timber receipts to repair the environmental damage caused by timber sales. While that sounds good at first, forest managers soon discovered that if they designed their timber sales to cause the greatest environmental impact, they could keep a greater share of the receipts.

In 1950, the Forest Service bragged that it only used selection cutting to harvest trees. But clearcutting causes greater impacts that selection cutting, so by 1970 almost all national forests used clearcutting as their predominant harvest method.

One particular anti-fee recreationist claims that fees are some sort of conspiracy thought up by something called the American Recreation Coalition to turn public lands into some form of “industrial recreation.” This is a complete misreading of history.

The truth is that the Forest Service contracted out a lots of its recreation fee collection duties to members of the American Recreation Coalition before Congress allowed the agency to keep a share of its fees. Under the law at that time, the Forest Service could not keep the fees, but if it contracted it out, the contractor could keep the fees. Since contractors were required to maintain the fee sites, such contracting provided a way to keep some of the money on the forest.

As soon as Congress allowed the Forest Service to keep its own fees, it stopped contracting out fee collections. But the existing contracts remained in place, so people who paid the fees misinterpreted the contracts as being a result of the fees when in fact they were the result of no fees.
Since fees create incentives, they should be based on willingness to pay, not on impacts or the cost to the government of providing a good or service. Fees based on willingness to pay will encourage managers to emphasize the uses that provide the greatest public good as measured by the public’s willingness to pay.

How do you design fees to work properly? First, public land managers should be allowed to charge for anything and everything. You can rent a car by the hour, day, week, or year. Why not have a separate recreation fee for different kinds as well as different amounts of recreation?

Second, managers should be allowed to keep the same share of fees from all the resources they manage. Currently, managers can keep nearly 100 percent of timber fees, 100 percent of some recreation fees but 0 percent of others, 50 percent of grazing fees, and 0 percent of mineral fees. If they can keep the same percentage of all, they won’t be biased towards one resource or another.

Ideally, managers should keep a share of the net fees, not gross. This will give them an incentive to maximize net income. Giving managers an incentive to maximize gross income will inevitably lead to some cross-subsidization — where managers lose money on some resources simply because doing so increases their gross income even though it reduces their net.

In any case, next time I go to that first lake, I take $5 with me along with plans to say for longer than just an hour. As it turns out, I am pretty sure the Forest Service doesn’t get to keep any of the fees I would pay at that particular site. But eventually, Congress will fix those problems, and I hope by then public land recreationists are mentally adjusted to no longer be leaches on the taxpayers and instead to be willing to pay for what they get.

This entry was posted on Monday, August 25th, 2008 at 12:00 am and is filed under Public lands. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

There are currently 12 responses to “Entitled to a Free Ride”

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  1. 1 On August 25th, 2008, the highwayman said:

    The AP said: “Whenever we get something for free, especially if it is from the government, we quickly feel we are entitled to it.”

    That’s ironic, since often write of the need to charge people $1 for every mile that they drive.

    posted on August 25th, 2008 at 4:52 am

  2. 2 On August 25th, 2008, Dan said:

    sigh…

    In 1950, the Forest Service bragged that it only used selection cutting to harvest trees. But clearcutting causes greater impacts that selection cutting, so by 1970 almost all national forests used clearcutting as their predominant harvest method.

    No.

    Clearcutting was not enacted as a predominant harvest method because of its worse environmental impact, but despite of its worse environmental impact. Clearcutting is also cheaper and easier, and gets more bf per acre, which is why the more negative environmental impacts were downplayed, biologists who spoke out against were fired, and CA had to enact its own laws to limit clearcuts (fly in a plane from CA to OR and tell us where the state borders are).

    Since fees create incentives for the managers collecting the fees, making fees proportional to environmental impact would create some very dangerous incentives. Managers would promote the activities that caused the greatest impact — and therefore the most fees — and neglect the ones that cause the least impact.

    No.

    Why would managers a priori seek to create more negative impacts to collect more fees, when these impacts will be contested by multitudinous groups? Certainly some may, under political pressure. It is just as certain that these activities will be contested by folks who love the forest.

    ———-

    And as to Randal’s fee collection design, I’m all for it. As long as we privilege low-impact activities such as camping and hiking; our public lands were bequeathed to us for our enjoyment and for their use and preservation, and as such folks should be able to visit them.

    Paying for every little thing creates museum pieces and leads not to their preservation but for paying for the privilege of their resource exploitation.

    DS

    posted on August 25th, 2008 at 7:26 am

  3. 3 On August 25th, 2008, the highwayman said:

    Kind of like what Henry David Thoreau wrote back in 1859:

    “Each town should have a park, or rather a primitive forest, of five hundred or a thousand acres, where a stick should never be cut for fuel, a common possession forever, for instruction and recreation. All Walden Wood might have been preserved for our park forever, with Walden in its midst…”

    posted on August 25th, 2008 at 8:49 am

  4. 4 On August 25th, 2008, D4P said:

    Silly Thoreau. He just wants to make housing unaffordable. Typical New England liberal elitist.

    posted on August 25th, 2008 at 8:55 am

  5. 5 On August 25th, 2008, Neal Meyer said:

    Antiplanner,

    As a general principle, if we are to move to a fee based structure for access to parks and other natural resources for recreational purposes, what would probably happen is that the owner would implement price discriminatory charges on patrons. It should not (wave hands in the air here) matter if the park or resource owner is a governmental entity or if the resource is privately owned. Both would do so in the interest of profit maximization, though of course a resource in the care of a governmental body may come under political pressures to underprice access.

    The resource owner would be able to distinguish between patrons with little or no difficulty and one would not be able to resell your ticket or other fee that you paid for access, so both of the main requirements for successful price discrimination (or multi-tiered pricing) would be met. Effectively, Dan’s advocacy of no fees for low impact recreational activities such as camping or biking is its own form of price discrimination. Your idea of charging by the week, hour, or day, is a form of price discrimination (by time), but the idea of offering activities separately or together would probably be seen as a form of bundling.

    posted on August 25th, 2008 at 9:19 am

  6. 6 On August 25th, 2008, Dan said:

    Effectively, Dan’s advocacy of no fees for low impact recreational activities such as camping or biking is its own form of price discrimination.

    Nowhere have I advocated no fees for low impact recreational activities – either here, on another site, in coursework assignments, in casual conversation.

    Nonetheless,

    Public lands were set aside as public benefit, to be preserved in perpetuity for their benefits.

    Later, the MUSYA was implemented as an attempt to continue to allow access and limit resource extraction and its attendant ecological destruction.

    The purpose of public lands is not profit maximization.

    The purpose of public lands is preservation and sustained yield and multiple use. Pricing schemes such as the various above are to allow cash to flow into coffers for infrastructure maintenance, upgrades, and construction.

    Fee proposals commensurate with repair are in fact discriminatory and that’s fine, as uses have differential impacts and some uses require more cleaning up behind them. Pay to play, as it were.

    There is nothing wrong with this if the goals of public lands are kept in mind. When we start fantasizing about public lands having goals other than their stated goals, then we run into solutioning for nonexistent problems. Solutions for nonexistent problems are fine as thought experiments, not for policy proposals.

    DS

    posted on August 25th, 2008 at 10:57 am

  7. 7 On August 25th, 2008, LarryG said:

    I think folks sometimes think about these things a little too simplistically.

    …because certainly …the statement that “any amount of tax entitles me to any scope of use” is not true.

    So.. you really don’t know how much you pay in taxes for the Forest Service to start with much less how much their pure internal administrative costs are BEFORE they have to hire more folks to provide access facilities.

    and folks who think “walking” or “hiking” or “swimming” don’t cost money are fooling themselves. Where do you park your car?

    How did you get your car to the trailhead or lake?

    who created the trail and the trailhead signs?

    if there are even pit toilets… who paid for them?

    etc, etc…

    we have the same problem with highways…. folks think because we pay gasoline taxes that the roads are paid for. Roads are NEVER paid for no more than your house is paid for unless you never intend to fix the roof or make other maintenance and repairs as it needs them.

    posted on August 25th, 2008 at 12:39 pm

  8. 8 On August 25th, 2008, the highwayman said:

    Neal Meyer wrote:
    “Both would do so in the interest of profit maximization, though of course a resource in the care of a governmental body may come under political pressures to underprice access.”

    We already know that roads are under priced, though even with private sector alone it can be subjected to and exert political pressure too.

    posted on August 25th, 2008 at 2:55 pm

  9. 9 On August 26th, 2008, Ettinger said:

    User fees would be an improvement over the current everybody pays system.

    A further improvement may come by breaking up management of every park into a few separate independent entities. That way the different entities would have an incentive to compete with each other to provide services that are really wanted at non wasteful prices. That would also provide an incentive to diversify the amenities packages offered to visitors.

    If management of any one large park (e.g. Yellowstone, Yosemite) is kept under single management, a local monopoly with a more or less captive clientele forms. This monopolistic management has little incentive to use the fees efficiently and also has the incentive to continually expand services and fees (after all most managers would want to make their departments bigger and bigger so that they can become bigger and bigger managers). That way services that few want but all visitors have to pay would continually expand while personnel and budget would continually grow. Breaking the management into independent entities would help to avvoid this monopoly problem.

    posted on August 26th, 2008 at 12:27 am

  10. 10 On August 26th, 2008, Ettinger said:

    Of course a more immediate concern is that fees will simply be added to existing tax funded budgets (as opposed to fees replacing existing taxes). Seems quite likely that the fees will be added with the promise of adding new services while the taxes will remain to fund existing services, or, worse, fees will be added and taxes will be redirected to some other Leviathan of a government program.

    posted on August 26th, 2008 at 12:32 am

  11. 11 On November 15th, 2008, the highwayman said:

    http://www.youtube.com/watch?v=A-9kJ2iizgs&feature=related

    posted on November 15th, 2008 at 2:24 am

  12. 12 On November 20th, 2008, the highwayman said:

    This is the problem with roads. Streets have a important value as a commons, the problem starts when we over load them with too many automobiles, this is why people must have to pay for every mile that they drive.

    posted on November 20th, 2008 at 11:04 am

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