Proposed Concession Contract for Shenandoah National Park-Alternative Formula for Calculating Leasehold Surrender Interest, 1723-1725 [2012-279]

Download as PDF Federal Register / Vol. 77, No. 7 / Wednesday, January 11, 2012 / Notices Posey County I.O.O.F. and Barker Buildings, 402–406 Main St.,Vernon, 85002133 [FR Doc. 2012–289 Filed 1–10–12; 8:45 am] BILLING CODE 4312–51–P DEPARTMENT OF THE INTERIOR National Park Service [NPS–NCR–POHE–0911–7946; 3991–0101– SZS] Notice of Availability, Potomac Heritage National Scenic Trail National Park Service, Interior. Notice of Availability of a ‘‘Foundation for Planning, Administration, Management and Interpretation of Potomac Heritage National Scenic Trail Segments and for Coordination among Trail Segment Management Partners.’’ AGENCY: ACTION: Pursuant to the National Trails System Act of 1968 (as amended), the National Park Service (NPS) announces the availability of a ‘‘Foundation for Planning, Administration, Management and Interpretation of Potomac Heritage National Scenic Trail Segments and for Coordination among Trail Segment Management Partners (Foundation).’’ This document is intended to serve as a resource for NPS staff and Potomac Heritage National Scenic Trail (Trail) segment management partners and to help create continuity of experience throughout the Trail network. DATES: The ‘‘Foundation’’ is available for review and reference on the NPS Web site as of January 11, 2012. ADDRESSES: The ‘‘Foundation’’ and appendices are available online at http://www.nps.gov/pohe/parkmgmt/ planning.htm. SUMMARY: pmangrum on DSK3VPTVN1PROD with NOTICES FOR FURTHER INFORMATION CONTACT: Donald E. Briggs, Superintendent, Potomac Heritage National Scenic Trail, National Capital Region, National Park Service, at (304) 535–4016 or by email at don_briggs@nps.gov. SUPPLEMENTARY INFORMATION: In 1983, based on a feasibility study completed by the Bureau of Outdoor Recreation in 1974, Congress amended the National Trails System Act of 1968, designating a corridor for the Trail between the mouth of the Potomac River and the Allegheny Highlands in western Pennsylvania. Based on extensive coordination among the staff of local, regional, state and other federal agencies; representatives of non-profit organizations; volunteers; and other Trail stakeholders, the Trail network VerDate Mar<15>2010 15:02 Jan 10, 2012 Jkt 226001 today includes over 830 miles of existing and planned Trail segments for non-motorized travel. Communities have invested in the Trail concept for a variety of reasons, including a desire to increase opportunities for outdoor recreation, non-motorized transportation, education and/or heritage tourism. The Foundation assembles in one document decisions and recommendations made over the past 11 years and establishes a basis for future local, regional, state and Federal planning; NPS administration of the Federal interest in the Trail; management of individual Trail segments, including Trail segment marking; interpretation; coordination among Trail management partners; and creating ‘‘continuity of experience’’ through the diverse Trail network. The document recognizes a change in authorizing legislation—Trail segments are recognized through cooperative management agreements between the NPS and Trail segment management partners, replacing an application process—and emphasizes that Trail blazes, where used to mark Trail routes, should employ a color used in the official Trail marker. The Foundation, along with regional and state plans to be added in the future as appendices, will serve as a comprehensive management plan for the Trail network, will reflect accurately the Trail as a set of partnerships, and will provide a means to address efficiently the need for adaptive planning and management. Dated: July 21, 2011. Stephen E. Whitesell Regional Director, National Capital Region. [FR Doc. 2012–280 Filed 1–10–12; 8:45 am] BILLING CODE P DEPARTMENT OF THE INTERIOR National Park Service Proposed Concession Contract for Shenandoah National Park— Alternative Formula for Calculating Leasehold Surrender Interest National Park Service, Interior. Notice. AGENCY: ACTION: The National Park Service invites public comments on a proposed alternative formula for the value of leasehold surrender interest to be included in its proposed ten-year concession contract for Shenandoah National Park. The contract will cover operation of the lodging, food and beverage, retail sales, gasoline, and horseback riding operations at the Park. SUMMARY: PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 1723 Public comments will be accepted on or before February 10, 2012. ADDRESSES: Send comments to Ms. Jo A. Pendry, Chief, Commercial Services Program, National Park Service, 1201 Eye Street NW., 11th Floor, Washington, DC 20005 or via email at jo_pendry@nps.gov or via fax at (202) 371–2090. FOR FURTHER INFORMATION CONTACT: Jo A. Pendry, (202) 513–7156. SUPPLEMENTARY INFORMATION: The National Park Service will be soliciting proposals for operation of the lodging, food and beverage, retail sales, gasoline, and horseback riding operations at Shenandoah National Park in 2012. The new contract is intended to be for a term of 10 years and will include an alternative formula for calculating leaseholder surrender interest. In this notice, we are soliciting comments on our use of this alternative formula. While we aren’t required by law to solicit comments on this alternative formula, we are providing an opportunity for public comment because this is only the second time that we have proposed using an alternative LSI formula. Leasehold surrender interest (LSI) is the interest in real property improvements that a concessioner provides under an NPS concession contract. Public Law 105–391 of 1998 (the 1998 Act) established the standard LSI valuation formula. The formula is generally as follows: • The initial construction cost of the related capital improvement. • adjusted by the percentage increase or decrease in the Consumer Price Index (CPI). • less physical depreciation of the related capital improvement. The 1998 Act also allows alternative LSI-value formulas for contracts with an LSI value over $10 million. Because the new contract for Shenandoah National Park will exceed $10 million, we are proposing to use an alternative LSI formula. Under our proposed alternative formula, the LSI value of all eligible capital improvements will be depreciated annually, in equal portions, on a forty (40) year, straight-line basis during the contract’s 10-year term. DATES: We Have Made Two Determinations We have determined, subject to consideration of public comments, that: • The proposed alternative LSI formula, in comparison to the standard LSI formula, is necessary to provide a fair return to the Government and to foster competition for the new contract by providing a reasonable opportunity for profit to the new concessioner. E:\FR\FM\11JAN1.SGM 11JAN1 1724 Federal Register / Vol. 77, No. 7 / Wednesday, January 11, 2012 / Notices pmangrum on DSK3VPTVN1PROD with NOTICES • The proposed alternative LSI formula is consistent with the objectives of the 1998 Act, particularly, as discussed below, with respect to the fair return it will provide to the Government and the new concessioner and the enhanced competition it will foster. The 1998 Act does not require these determinations and this Federal Register notice for alternative LSI formulas (such as the one we propose) that are based on annual straight line depreciation of the initial value as provided under 1998 Federal income tax laws and regulations. However, because this is only the second time that we have proposed using an alternative LSI formula, we have made these determinations and are publishing this notice to solicit public comment. If we adopt the alternative LSI formula, it will apply only to the new contract, SHEN001–13. We have made no decision to apply the proposed LSI formula or any other LSI alternative to future concession contracts. If we consider using an alternative LSI formula for any other contracts, we will ask for public comments if required or appropriate. First Determination: Fair Return to the Government We have determined, subject to consideration of public comments, that the proposed alternative LSI formula is necessary to provide a fair return to the Government, as well as helping to provide a fair return to the new concessioner. We consider that ‘‘fair return’’ to the Government includes the requirement of the 1998 Act that we include in concession contracts a franchise fee payable to the Government that is based upon consideration of the probable value to the concessioner of the privileges granted by the contract. However, under the standard LSI formula, the amount of money that we would pay (directly or indirectly) for LSI as of the expiration of the new contract is inevitably speculative as of the time of contract solicitation, contract award, and during the contract term. This is because we and prospective concessioners must estimate in advance the future CPI rate, the amount of depreciation that will occur over the term of the contract, and the cost to cure the depreciation. Thus, if we use the standard LSI formula to establish the required minimum franchise fee for the new contract, that fee will reflect speculative estimates of CPI and depreciation rates over the term of the contract. Likewise, when a prospective concessioner offers to meet or exceed the minimum VerDate Mar<15>2010 15:02 Jan 10, 2012 Jkt 226001 franchise fee that we would establish under the standard LSI formula, this business decision relies on speculative estimates of future CPI and depreciation rates. A more dependable LSI value will allow us to better project the long-term cost of the concessioner’s investment and to calculate a franchise fee that provides a fair return. For these reasons, we consider it necessary to include the proposed alternative LSI formula in the new contract in order to provide a fair return to the Government. Second Determination: Fostering Competition Elimination of the speculative nature of LSI value by using the proposed LSI formula is also considered necessary to foster competition for the new contract by providing a reasonable opportunity for the concessioner to make a profit under the new contract. This is because prospective concessioners will know with a high degree of certainty (subject only to estimates of the value of any new capital improvements constructed or installed during the term of the contract) how much money they will be paid for initial LSI upon the expiration of the new contract. The proposed LSI formula eliminates speculation regarding CPI and depreciation required under the standard LSI formula. The resulting lower risk and greater certainty in the business opportunity provides the concessioner reasonable opportunity for profit under the terms of the new contract. It should also encourage businesses to apply for the new contract, thereby fostering competition. Private firms not familiar with the NPS concession program have indicated that the complexities and uncertainty of the standard LSI formula have deterred them from submitting offers for concessions. We believe that using the proposed alternative LSI formula in the new contract will foster competition by providing interested entities with a reasonable opportunity for profit that, with respect to LSI, is assured, understandable, and more comparable to practices in the private sector. In addition, the estimated lower LSI payment under the alternative formula (as opposed to a higher estimated value provided by the standard LSI formula) allows us to charge a lower minimum franchise fee. This will ensure the concessioner greater cash flows during the term of the contract, in contrast to the standard LSI formula’s higher (and uncertain) LSI payment at the expiration of the contract. Since many prospective concessioners will likely prefer the higher cash flows throughout the contract term under the proposed LSI PO 00000 Frm 00060 Fmt 4703 Sfmt 4703 formula, the alternative formula should foster competition for the new contract. The proposed LSI formula will also enhance competition for the concession contract that will succeed the new contract. This is because the final value of the contract’s LSI should be significantly lower than it would be under the standard LSI formula, thereby lowering the amount of LSI purchase money needed by a prospective new concessioner. This lower entry cost should encourage competitive proposals from prospective concessioners. The proposed LSI formula should not materially affect the new concessioner’s projected rate of return under the new contract. This is because, in developing the new contract’s minimum franchise fee, we assessed projected revenues and expenses and used industry standards to estimate a fair return to the new concessioner. This estimate includes the cost of acquiring existing LSI. The new contract’s minimum franchise fee thus reflects the financial consequences of the proposed LSI formula. This means that the estimated fair return to the new concessioner would be approximately the same whether the new contract included the standard LSI formula or the proposed LSI formula (taking into account the time value of money). The proposed LSI formula will not materially change the projected fair return to the new concessioner, but will reduce the speculative nature of LSI value under the standard formula. With respect to the rate of return, the impact of the use of the proposed LSI formula is neutral, but not adverse, to the requirement of fostering competition. Public Availability of Further Information Complete details and further explanation of the proposed LSI formula will be in the proposed prospectus for the new contract that is publically available at http://www.nps.gov/ commercialservices. In the interest of time, we may issue a prospectus for the new contract in FedBizOpp.gov that incorporates the proposed LSI formula. If consideration of public comments in response to this notice causes us to alter the proposed alternative LSI formula, we will amend the prospectus accordingly (through publication in FedBizOpp.gov) before the deadline for submission of proposals. We invite your comments and will consider all comments that we receive by the deadline in the DATES section of this notice. Before including your address, phone number, email address, or other identifying information in your E:\FR\FM\11JAN1.SGM 11JAN1 Federal Register / Vol. 77, No. 7 / Wednesday, January 11, 2012 / Notices comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so. Peggy O’Dell, Deputy Director, Operations. [FR Doc. 2012–279 Filed 1–10–12; 8:45 am] BILLING CODE P INTERNATIONAL TRADE COMMISSION [Investigation No. 337–TA–824] Certain Blu-Ray Disc Players, Components Thereof and Products Containing Same; Notice of Institution of Investigation U.S. International Trade Commission. ACTION: Notice. AGENCY: Notice is hereby given that a complaint was filed with the U.S. International Trade Commission on December 5, 2011, under section 337 of the Tariff Act of 1930, as amended, 19 U.S.C. 1337, on behalf of Walker Digital, LLC, of Stamford, Connecticut. Letters supplementing the complaint were filed on December 21, 2011, and December 22, 2011. The complaint, as supplemented, alleges violations of section 337 based upon the importation into the United States, the sale for importation, and the sale within the United States after importation of certain Blu-ray disc players, components thereof and products containing same by reason of infringement of certain claims of U.S. Patent No 6,263,505 (‘‘the ‘505 patent’’). The complaint further alleges that an industry in the United States exists as required by subsection (a)(2) of section 337. The complainant requests that the Commission institute an investigation and, after the investigation, issue an exclusion order and cease and desist orders. SUMMARY: The complaint, except for any confidential information contained therein, is available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Room 112, Washington, DC 20436, telephone (202) 205–2000. Hearing impaired individuals are advised that information pmangrum on DSK3VPTVN1PROD with NOTICES ADDRESSES: VerDate Mar<15>2010 15:02 Jan 10, 2012 Jkt 226001 on this matter can be obtained by contacting the Commission’s TDD terminal on (202) 205–1810. Persons with mobility impairments who will need special assistance in gaining access to the Commission should contact the Office of the Secretary at (202) 205– 2000. General information concerning the Commission may also be obtained by accessing its internet server at http://www.usitc.gov. The public record for this investigation may be viewed on the Commission’s electronic docket (EDIS) at http://edis.usitc.gov. FOR FURTHER INFORMATION CONTACT: The Office of Unfair Import Investigations, U.S. International Trade Commission, telephone (202) 205–2560. Authority: The authority for institution of this investigation is contained in section 337 of the Tariff Act of 1930, as amended, and in section 210.10 of the Commission’s Rules of Practice and Procedure, 19 CFR 210.10 (2011). Scope of Investigation: Having considered the complaint, the U.S. International Trade Commission, on January 5, 2012, ordered that— (1) Pursuant to subsection (b) of section 337 of the Tariff Act of 1930, as amended, an investigation be instituted to determine whether there is a violation of subsection (a)(1)(B) of section 337 in the importation into the United States, the sale for importation, or the sale within the United States after importation of certain Blu-ray disc players, components thereof and products containing same that infringe one or more of claims 7, 8, 10, 12, 14, and 15 of the ‘505 patent, and whether an industry in the United States exists as required by subsection (a)(2) of section 337; (2) For the purpose of the investigation so instituted, the following are hereby named as parties upon which this notice of investigation shall be served: (a) The complainant is: Walker Digital, LLC, 2 High Ridge Park, Stamford, CT 06905. (b) The respondents are the following entities alleged to be in violation of section 337, and are the parties upon which the complaint is to be served: D&M Holdings, Inc., D&M Building 2– 1, Nisshin-cho, Kawasaki-ku, Kawasakishi, Kanagawa 210–8569, Japan. D&M Holdings US, Inc., 100 Corporate Drive, Mahwah, NJ 07430. Denon Electronics (USA) LLC, 100 Corporate Drive, Mahwah, NJ 07430. Funai Electric Co., Ltd., 7–7–1 Nakagaito, Daito City, Osaka 574–0013, Japan. Funai Corporation, Inc., 201 Route 17 North, Suite 903, Rutherford, NJ 07070. PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 1725 Haier Group Corporation, 1 Haier Road, Hi-Tech Zone, Qindao 266101, China. Haier America Trading, LLC, 1356 Broadway, New York, NY 10018. Harman International Industries, Inc., 400 Atlantic Street, 15th Floor, Stamford, CT 06901. Inkel Corporation, 3–8, CheongcheonDong, Bupyeong-Gu, Incheon, 4.3–853, South Korea. LG Electronics, Inc., LG Twin Towers, 20 Yeouido-dong, Yeongdeungpo-gu, Seoul 150–721, South Korea. LG Electronics U.S.A., Inc., 1000 Sylvan Avenue, Englewood Cliffs, NJ 07632. Marantz America LLC, 100 Corporate Drive, Mahwah, NJ 07430. Onkyo Sound & Vision Corporation, 2–1 Nisshin-cho, Neyagawa-shi, Osaka 572–8540, Japan. Onkyo USA Corporation, 18 Park Way, Upper Saddle River, NJ 07458. Orion America, Inc., 1150 S. Main Street, Princeton, IN 47670. Orion Electric Co., Ltd., 41–1 Iehisacho, Echizen-shi, Fukui 915–8555, Japan. Panasonic Corporation, 1006 Oaza Kodoma, Kadoma-shi, Osaka 571–8501, Japan. Panasonic Corporation of North America, One Panasonic Way, Seacaucus, NJ 07094. P&F USA, Inc., 3015 Windward Plaza, Suite 100, Alpharetta, GA 30005. Philips Electronics North America Corp., 3000 Minuteman Road, Andover, Massachusetts 01810. Pioneer Corporation, 1–1 Shin-ogura, Saiwai-ku, Kawasaki-shi, Kanagawa 212–0031, Japan. Pioneer Electronics (USA) Inc., 1925 East Dominguez Street, Long Beach, CA 90810. Samsung Electronics Co., Ltd., 1320– 10, Seocho 2-dong, Seocho-gu, Seoul 137–857, South Korea. Samsung Electronics America, Inc., 105 Challenger Road, Ridgefield Park, NJ 07660. Sharp Corporation, 22–22 Nagaikecho, Abeno-ku, Osaka 545–8522, Japan. Sharp Electronics Corporation, 1 Sharp Plaza, Mahwah, NJ 07495. Sherwood America, Inc., 14730 Beach Boulevard, #102, La Mirada, CA 90638. Sony Corporation, 1–7–1 Konan, Minato-ku, Tokyo 108–0075, Japan. Sony Computer Entertainment, Inc., 1–7–1 Konan, Minato-ku, Tokyo 108– 0075, Japan. Sony Corporation of America, 1550 Madison Avenue, New York, NY 10022. Sony Electronics, Inc., 6530 Via Esprillo, San Diego, CA 92127. Sony Computer Entertainment, America LLC, 919 East Hillsdale Boulevard, Foster City, CA 94404. E:\FR\FM\11JAN1.SGM 11JAN1

Agencies

[Federal Register Volume 77, Number 7 (Wednesday, January 11, 2012)]
[Notices]
[Pages 1723-1725]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-279]


-----------------------------------------------------------------------

DEPARTMENT OF THE INTERIOR

National Park Service


Proposed Concession Contract for Shenandoah National Park--
Alternative Formula for Calculating Leasehold Surrender Interest

AGENCY: National Park Service, Interior.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The National Park Service invites public comments on a 
proposed alternative formula for the value of leasehold surrender 
interest to be included in its proposed ten-year concession contract 
for Shenandoah National Park. The contract will cover operation of the 
lodging, food and beverage, retail sales, gasoline, and horseback 
riding operations at the Park.

DATES: Public comments will be accepted on or before February 10, 2012.

ADDRESSES: Send comments to Ms. Jo A. Pendry, Chief, Commercial 
Services Program, National Park Service, 1201 Eye Street NW., 11th 
Floor, Washington, DC 20005 or via email at jo_pendry@nps.gov or via 
fax at (202) 371-2090.

FOR FURTHER INFORMATION CONTACT: Jo A. Pendry, (202) 513-7156.

SUPPLEMENTARY INFORMATION: 
    The National Park Service will be soliciting proposals for 
operation of the lodging, food and beverage, retail sales, gasoline, 
and horseback riding operations at Shenandoah National Park in 2012. 
The new contract is intended to be for a term of 10 years and will 
include an alternative formula for calculating leaseholder surrender 
interest. In this notice, we are soliciting comments on our use of this 
alternative formula. While we aren't required by law to solicit 
comments on this alternative formula, we are providing an opportunity 
for public comment because this is only the second time that we have 
proposed using an alternative LSI formula.
    Leasehold surrender interest (LSI) is the interest in real property 
improvements that a concessioner provides under an NPS concession 
contract. Public Law 105-391 of 1998 (the 1998 Act) established the 
standard LSI valuation formula. The formula is generally as follows:
     The initial construction cost of the related capital 
improvement.
     adjusted by the percentage increase or decrease in the 
Consumer Price Index (CPI).
     less physical depreciation of the related capital 
improvement.
The 1998 Act also allows alternative LSI-value formulas for contracts 
with an LSI value over $10 million. Because the new contract for 
Shenandoah National Park will exceed $10 million, we are proposing to 
use an alternative LSI formula. Under our proposed alternative formula, 
the LSI value of all eligible capital improvements will be depreciated 
annually, in equal portions, on a forty (40) year, straight-line basis 
during the contract's 10-year term.

We Have Made Two Determinations

    We have determined, subject to consideration of public comments, 
that:
     The proposed alternative LSI formula, in comparison to the 
standard LSI formula, is necessary to provide a fair return to the 
Government and to foster competition for the new contract by providing 
a reasonable opportunity for profit to the new concessioner.

[[Page 1724]]

     The proposed alternative LSI formula is consistent with 
the objectives of the 1998 Act, particularly, as discussed below, with 
respect to the fair return it will provide to the Government and the 
new concessioner and the enhanced competition it will foster.
The 1998 Act does not require these determinations and this Federal 
Register notice for alternative LSI formulas (such as the one we 
propose) that are based on annual straight line depreciation of the 
initial value as provided under 1998 Federal income tax laws and 
regulations. However, because this is only the second time that we have 
proposed using an alternative LSI formula, we have made these 
determinations and are publishing this notice to solicit public 
comment.
    If we adopt the alternative LSI formula, it will apply only to the 
new contract, SHEN001-13. We have made no decision to apply the 
proposed LSI formula or any other LSI alternative to future concession 
contracts. If we consider using an alternative LSI formula for any 
other contracts, we will ask for public comments if required or 
appropriate.

First Determination: Fair Return to the Government

    We have determined, subject to consideration of public comments, 
that the proposed alternative LSI formula is necessary to provide a 
fair return to the Government, as well as helping to provide a fair 
return to the new concessioner.
    We consider that ``fair return'' to the Government includes the 
requirement of the 1998 Act that we include in concession contracts a 
franchise fee payable to the Government that is based upon 
consideration of the probable value to the concessioner of the 
privileges granted by the contract. However, under the standard LSI 
formula, the amount of money that we would pay (directly or indirectly) 
for LSI as of the expiration of the new contract is inevitably 
speculative as of the time of contract solicitation, contract award, 
and during the contract term. This is because we and prospective 
concessioners must estimate in advance the future CPI rate, the amount 
of depreciation that will occur over the term of the contract, and the 
cost to cure the depreciation.
    Thus, if we use the standard LSI formula to establish the required 
minimum franchise fee for the new contract, that fee will reflect 
speculative estimates of CPI and depreciation rates over the term of 
the contract. Likewise, when a prospective concessioner offers to meet 
or exceed the minimum franchise fee that we would establish under the 
standard LSI formula, this business decision relies on speculative 
estimates of future CPI and depreciation rates. A more dependable LSI 
value will allow us to better project the long-term cost of the 
concessioner's investment and to calculate a franchise fee that 
provides a fair return.
    For these reasons, we consider it necessary to include the proposed 
alternative LSI formula in the new contract in order to provide a fair 
return to the Government.

Second Determination: Fostering Competition

    Elimination of the speculative nature of LSI value by using the 
proposed LSI formula is also considered necessary to foster competition 
for the new contract by providing a reasonable opportunity for the 
concessioner to make a profit under the new contract. This is because 
prospective concessioners will know with a high degree of certainty 
(subject only to estimates of the value of any new capital improvements 
constructed or installed during the term of the contract) how much 
money they will be paid for initial LSI upon the expiration of the new 
contract. The proposed LSI formula eliminates speculation regarding CPI 
and depreciation required under the standard LSI formula. The resulting 
lower risk and greater certainty in the business opportunity provides 
the concessioner reasonable opportunity for profit under the terms of 
the new contract. It should also encourage businesses to apply for the 
new contract, thereby fostering competition.
    Private firms not familiar with the NPS concession program have 
indicated that the complexities and uncertainty of the standard LSI 
formula have deterred them from submitting offers for concessions. We 
believe that using the proposed alternative LSI formula in the new 
contract will foster competition by providing interested entities with 
a reasonable opportunity for profit that, with respect to LSI, is 
assured, understandable, and more comparable to practices in the 
private sector.
    In addition, the estimated lower LSI payment under the alternative 
formula (as opposed to a higher estimated value provided by the 
standard LSI formula) allows us to charge a lower minimum franchise 
fee. This will ensure the concessioner greater cash flows during the 
term of the contract, in contrast to the standard LSI formula's higher 
(and uncertain) LSI payment at the expiration of the contract. Since 
many prospective concessioners will likely prefer the higher cash flows 
throughout the contract term under the proposed LSI formula, the 
alternative formula should foster competition for the new contract.
    The proposed LSI formula will also enhance competition for the 
concession contract that will succeed the new contract. This is because 
the final value of the contract's LSI should be significantly lower 
than it would be under the standard LSI formula, thereby lowering the 
amount of LSI purchase money needed by a prospective new concessioner. 
This lower entry cost should encourage competitive proposals from 
prospective concessioners.
    The proposed LSI formula should not materially affect the new 
concessioner's projected rate of return under the new contract. This is 
because, in developing the new contract's minimum franchise fee, we 
assessed projected revenues and expenses and used industry standards to 
estimate a fair return to the new concessioner. This estimate includes 
the cost of acquiring existing LSI.
    The new contract's minimum franchise fee thus reflects the 
financial consequences of the proposed LSI formula. This means that the 
estimated fair return to the new concessioner would be approximately 
the same whether the new contract included the standard LSI formula or 
the proposed LSI formula (taking into account the time value of money). 
The proposed LSI formula will not materially change the projected fair 
return to the new concessioner, but will reduce the speculative nature 
of LSI value under the standard formula. With respect to the rate of 
return, the impact of the use of the proposed LSI formula is neutral, 
but not adverse, to the requirement of fostering competition.

Public Availability of Further Information

    Complete details and further explanation of the proposed LSI 
formula will be in the proposed prospectus for the new contract that is 
publically available at http://www.nps.gov/commercialservices. In the 
interest of time, we may issue a prospectus for the new contract in 
FedBizOpp.gov that incorporates the proposed LSI formula. If 
consideration of public comments in response to this notice causes us 
to alter the proposed alternative LSI formula, we will amend the 
prospectus accordingly (through publication in FedBizOpp.gov) before 
the deadline for submission of proposals.
    We invite your comments and will consider all comments that we 
receive by the deadline in the DATES section of this notice.
    Before including your address, phone number, email address, or 
other identifying information in your

[[Page 1725]]

comment, you should be aware that your entire comment--including your 
personal identifying information--may be made publicly available at any 
time. While you can ask us in your comment to withhold your personal 
identifying information from public review, we cannot guarantee that we 
will be able to do so.

Peggy O'Dell,
Deputy Director, Operations.
[FR Doc. 2012-279 Filed 1-10-12; 8:45 am]
BILLING CODE P