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The Manufactured Crisis

A Digression: Some 38 years ago, on a cold January morning, I stepped off a Northwest Airlines plane at the Minneapolis airport. Minnesota was buried under two feet of snow and frozen in solid. At the terminal gate, Jim Spradley and David McCurdy were waiting for me, with a pair of what they called iron pants and a wolf fur-lined parka. I had flown in from Boston to sign a new book contract. As anthropologists, our purpose was to put together yet another textbook on the basics of understanding culture. But they had ice fishing on their minds. “We’re going to drive out on to the lake, drill a hole in the ice, and catch us some of the best eating fish in the world. You’re gonna’ love it,” Jim said.

Well, Jim was right about the walleye. The fish were great eating. But it took drilling down through a solid foot of ice to get at them. Just thinking of that day, I can still taste that pan-seared walleye. Last night, I was reminded what it took to get at those fish. The surface of that lake is almost a mile wide. You have to drive clean out into the middle, drill down with a chainsaw, and sit patiently at the hole with your pole to get at the best walleye.

That’s what I’d like you to do now: Go with me out on to this broad expanse of facts frozen in place. We’ll drill down to where the real meaning of those facts lurk and see what comes up on our line. I think you will agree that below the raw facts lies a tale of deceit, betrayal, and scandal the likes of which we’ve not seen in California for some time, if ever. Yes, if this was just a fish tale, it would be a whopper.

First things first: Collect the Facts

To understand how this scandal came about and why it may well shape the future of state parks, we have to have a plan where to dig for the basic facts (“artifacts” if you like). What follows is a sampling of chronological “artifacts” collected in a search for how a crisis evolved over time. The collection is only a sampling, but it is a representative sampling. Another collector of facts (“artifacts”) might cover the same ground, dig in different places, and unearth different “artifacts.” But the results of both samplings should construct the same picture, albeit with minor variations. The same is also true of walleye fishermen. Each fisherman chooses where to poke holes in the ice to catch fish. They all catch fish and they all agree about what a walleye tastes like. Let’s begin, then, with a time-based sampling of events, facts, actions that contributed to the manufactured crisis still unfolding in Sacramento.

• 1996. H.R. 2107 Fee-Demo Program passes without debate or notice. The genie is loose.

• 1996. DPR institutes incentive program to generate more revenue “entrepreneurially” (PERC).

• 1997. PERC issues privatization blue print in “Parks in Transition: A Look At State Parks.”

• 2000? Two secret funds, “hidden assets” are set up at State Parks, off the books.

• 2002. Ruth Coleman appointed by Gray Davis as Director of State Parks. July 1, Gov. Davis raises park fees; Coleman says alternative is closing parks, lay-offs.

• 2003. April 21, The Liberal Slant publishes Bill Willers, “The Strategy to Privatize The Public Domain”

• 2003. July 1, Gov. Schwarzenegger raises state park fees to all time high. Stearns (DPR) says fees are not taxes — people can save money by not using parks. DPR reorganized, reduces workforce, plans for more cuts to budget.

• 2004. Elizabeth Goldstein heads Cal. State Parks Foundation, supports private/public partnerships.

• 2009. Publication of California Outdoor Recreation Plan 2008.

•  2011 January, Governor Brown directs state agencies to cut 9% from budgets. January to May, 12 DPR executives meet in secret to make list of 70 parks to close. May 13, Secret DPR Committee list of 70 parks to close released by Governor. June, 29, Roy Stearns (DPR) and Elizabeth Goldstein state “privatization is not an option.”

Roy Stearns (DPR) “Budget has dropped 43% the last three years.” October. Manuel Thomas Lopez, deputy director and 56 “unauthorized vacation buyouts”

• 2012 January 8-11, 2012, Ruth Coleman speaks at The American Recreation Coalition, Williamsburg, Virginia. Theme of the event is “Partners Outdoors.” March 20, Sacramento, Park Advocacy Day. On privatization, “Don’t Go There!” April 5, Announcement on Request for Proposals sent out to for-profit companies. May, Demoted/transferred Manuel Thomas Lopez resigns. June, Requests to Roy Stearns (DPR) for info on for profit proposals goes unanswered. July 3, News release identifies five state park units go to American Land and Leisure, Inc. July 20, Ruth Coleman abruptly resigns as Director of State Parks Department. Michael F. Harris, Ruth Coleman’s 2nd in Command, fired without explanation. July 26, Attorney General launches a tip hotline to investigate financial fraud at DPR. July 26, SacBee reports: Lopez says he repeatedly informed Coleman of “hidden assets.” July 27, Jay Walsh, special Assistant to Coleman, leaves without explanation. Ann Malcolm, Chief Counsel at DPR departs, leaves without explanation. July 27, Mike Rosenberg, San Jose Mercury News: review finds 500-plus “special funds.”

* * *

As I said at the outset, this is but a sampling. There’s much, much more. But time and space are limited. The immediate challenge is to make sense of what all this adds up to. We can start by examining the first “artifact,” the Fee-Demo program instituted in 1996. At the end, we’ll focus on the state level institutionalization of private, for profit operating agreements that effectively remove “high value” camping venues from the revenue stream of State Parks by turning them over to American Land and Leisure Company. It is demonstrated that it took the actions and acquiescence of many players to create a “manufactured crisis” At the State Parks Department.

Pay-to-Play: The Fee Demo Program

I am indebted to Scott Silver, the director of Wild Wilderness for bringing to my attention “The Recreation Fee Demonstration Program” which he describes as “a major milestone in the evolution of public land management.” (www.wildwilderness.org ). In 1995, Silver writes, Senator Wallop (R-Wyoming) founded Frontiers of Freedom. Frontiers of Freedom’s aims closely resemble a Cato Institute publication (1994) which asserts that “privately owned resources have been better protected than their politically managed counterparts…” Even earlier, in the Cato Journal 1981, James P. Beckwith, Jr. wrote that public parks are a “monopoly that allows for suboptimal pricing.” Thus, the objective is to privatize “the air, water, most species of mammals and fish and public lands…” The goal is to decrease, and ultimately halt the funding of parks and public lands. Scott Silver labeled this trend the “commoditization” of the commons. Parks contain “marketable trees, minerals, water, and opportunities for recreation and tourism.”

The passage of Fee-Demo, for the first time ever, provided the means to collect fees for recreational activities on Federal land and test the viability of “commoditization.” In spite of objections to the proliferation of fees throughout the park system, from the Federal level down to the state, county, and local levels, the trend has been in one direction — the ever increasing number of fees and fee increases. At the state level, the pay-to-play ethos has institutionalized within the State Park Department an acceptance that the park budget must rely upon revenues from visitor fees, donors, volunteer, and profit entities. General Fund Revenues (Taxpayer Support) is not an option. From a support level of 90% in the 1970s, General Fund support has dropped to 29% and a decreasing trend is unmistakable. As recently as June 2011, Stearns (DPR spokesman) insisted that fees are not a tax. However, fees are indeed a regressive tax placed on every park visitor. The DPR will not fight to restore General Fund support for parks, in spite of every analysis that shows that state parks contribute $4.2 billion annually to the State and local economies.

The Rise of For-Profit Coalitions

Dozens of powerful privatization groups, such as PERC (The Property and Environment Research Center), have been formed to keep the drumbeat up for privatization of public lands. Their blueprint has become the 1999 publication by the Cato Institute, “How and Why to Privatize Federal Lands.” It is their mantra that anything of value held as a common good is nothing more than the “failure of socialism.” As Bill Willers points out (2003) in The Strategy To Privatize The Public Domain, “User fees as tools for controlling use and “rationing access” to public land is a central aspect of the privatization agenda.” Instead of supporting public lands with their taxes, the argument goes, the public must be transformed into a paying public. It is, of course, a most regressive form of controlling access to the public commons, i.e., state parks.

Into this mix of privateers, as a frequent invited guest speaker, we find DPR Director Ruth Coleman. At the most recent annual meeting in Williamsburg, Virginia (January 8-11, 2012) Ms. Coleman spoke of the fiscal crisis at State Parks and the downward trend in General Fund support. In her remarks, she suggests that non-profits and donors “don’t know how to run a campground,” and private entities “do know how.” Indeed, she jovially portrayed volunteers as people who like to dress up and tell stories to children, as if that is what volunteers are good for. As for private companies there is fresh opportunity to respond to Requests for Proposals (RFPs). It is their “sweet spot.” The implication is clear: DPR is open for business to for-profit operators. Director Coleman does go on to say that parks will never be run in the private sector because they are a public good. Parks are what she calls “Cathedrals” of religious significance for Americans as a place to find God. How do we square contradictory stances in a single speech? As Director of a public entity, she must say that parks are for the public good. However, she clearly views volunteer and donor efforts as incapable of carrying the load in times of economic downturn. There is a “sweet spot” opening up for private/public partnerships (PPPs) to capture valuable, profitable elements of the system.

Remember that we have already made the connection between PPPs and Elizabeth Goldstein, head of the California State Parks Foundation (CSPF) since 2004. In her bio, Goldstein acknowledges that she is an advocate for PPPs. After all, of the 30 Board Directors of the CSPF, not one is a trained parks management professional. They are, to a person, wealth fund managers, real estate developers, corporate lawyers, bankers, executives at Disney and PG&E. You will not find in their midst an “ordinary” park user, biologist, or self-identified “environmentalist” — not one. We need to recognize the three basic objectives that California State Parks Foundation is set up to perform: 1) Capture the money. The money comes from a 130,000 paid up membership base, corporations and donors who funnel their donations to parks through CSPF, grants, principally. 2) CSPF controls the use to which the money is applied, not the general membership, and 3) it claims to be the voice, the lobbyist for influencing policy that affects how parks are managed. Thus, it captures the money, controls its use, and influences and shapes policy. For public consumption, it portrays itself as a benevolent protector and guardian of State Parks.

In the most recent major public initiative to show support for State Parks, the CSPF held its 10th annual Park Advocacy Day, an opportunity for 200 active members to lobby legislators on behalf of two pending legislative initiatives (SB974 and AB 1589) to save parks from closure. But what was pointedly excluded from discussion was the issue of privatization. When, as an attendee, I raised the issue of privatization in general session, I was told quite pointedly, “Don’t Go There.”

The Rise of the Elite

We have seen the steady rise of a corps of professionalized elites to manage every level of government, including the Department of Parks and Recreation. Members of this elite cadre move from one department or agency to another throughout their career, always with a common cognitive framing. Their objectives are to carry out their duties with a minimum of contact with the public they serve, resist initiatives to make their role and work product transparent or accountable to others, and, when challenged, close ranks. Their entire careers are spent inside the halls of power and their pay is commensurate with the status of an elite. To support such elites, an entire bureaucracy grows up to further insulate department and agency heads from pressures or influence from the outside. They are, in effect, unaccountable and virtually invisible to the public they are sworn to serve. To compound this systemic problem, the executive and legislative bodies charged with oversight seldom, if ever, examine the biases of nominees to head departments and agencies. Ongoing oversight has been almost non-existent. Questions and concerns about how policies are administered go unanswered.

Clearly, this needs to change.

In this “bubble” of unaccountable power, the State Parks elite, some time back about 2000, created two “hidden accounts” into which almost $54 million dollars was sequestered for purposes no one has been able to fully discern to date. So far as anyone outside the elite bubble knew, there was no such “hidden asset” to put to use. For ten years, Ruth Coleman, the longest serving director in the DPR’s history, oversaw the relentless erosion of General Fund support for her department, watched a deferred maintenance problem explode from $50 million to $1.3 Billion, oversaw the downsizing of essential staff and loss of equipment to operate parks, took few initiatives to improve normal fee collection methods, and still had time to keep the line of communication open with private for-profit entities that are not shy about their objectives to strip State Parks of its most revenue rich operations, such as campgrounds. As a leader, it can be argued, she oversaw the creation of this “manufactured crisis.” Upon resigning, on July 20, Coleman claimed ignorance of the “hidden assets” and blamed subordinates. However, she was in place long before her subordinates took up their positions. How could she not know? It is unclear if she will ever be compelled to testify under oath as to her role in this “manufactured crisis.” More ironic, she may end up becoming a highly paid employee of the very for-profit entities that are determined to undermine the viability and sustainability of the state parks, which are still, for the most part, a public good.

To insure that the crisis reached a critical point, Ruth Coleman authorized a secret committee of 12 Parks executives to meet and select 70 parks for closure. This was deemed the only acceptable action to meet Governor Brown’s demand that the General Fund Budget be cut by yet another 9%. She did not initiate public forums, invite public comment, or put up a spirited defense of other means to meet the Governor’s demand. Nor was there any hint of a “hidden asset” of $54 million dollars to meet problem in the short term. If the Director’s intentions were to stir the pot until it boiled over, she got her wish. On May 13, 2011, the announcement came down that for the first time in 110 years, the DPR was announcing the closure of 70 “marginally” important parks.

On November 1st, 2011, almost six months into the manufactured crisis, the State’s legislature finally held a half-day session to inquire into how a committee of 12 unidentified officials could meet in secret, come up with the list of 70 parks to close, and then destroy their notes as to how they reached their decision. It is still a question why it took the legislature so long to become involved. With little or no transparency, little or no accountability, and no political will to fight for an adequate level of taxpayer funding for State Parks from the DPR leadership, it is no wonder that it all came to this.

Where do things stand with respect to the privatization initiatives that are certain to reappear? For one thing, the president of The California Parks Company has stated his company’s objectives for increasing their operational presence in state parks. Ironically, his claim of what his company has to offer in operating park units (especially campground rich venues) closely mirrors the three criteria that park officials admitted influenced their decisions as to which parks to close. It is still unclear, however, if the RFPs (requests for proposals) for operating North Coast state parks by a for profit in the Spring of 2012 were from The California Parks Company. After all, State Parks won’t tell you a thing about for profit initiatives or proposals. Even Senator Evans and Assemblyman Jared Huffman have been rebuffed when they have raised the matter. What we do know is that American Land and Leisure, without public input or knowledge, succeeded in reaching agreement with parks officials to operate 5 state park units, beginning August 1st, including, for example, the campground fee rich venues of Brannan Island SRA, Benbow Lake SRA.

Next week, this column will focus on the blowback that this “manufactured crisis” has engendered among donors and volunteers who so generously and selflessly stepped forward when they were told it was up to them to stave off the onslaught of closures scheduled for July 1, 2012.

We will also update the current legislative initiatives that are still pending that seek to stabilize the funding for state parks and put them on a sustainable footing. At the forefront of these initiatives are Senator Noreen Evans and Assemblyman Jared Huffman. All of our state elected officials are now much more aware of what they are up against. Don Eberly, a principle in the conservative movement, as Bill Willers has deftly pointed out in the article cited above, made it plain that privatization advocates believe that they “simply will not have power on the national level until they declare war on state legislators.” What our elected officials face is not simply the legitimate advocacy of private companies that see themselves as having a role to play in operating state parks, they face dozens of well-organized, committed think tanks and lobbyists whose ultimate goal is to, in Grover Norquist’s famous dictum, the shrink government down to the size where it can be drowned in a bathtub. (paraphrased).

Our immediate challenge is to see that state parks are not one of those victims thrown into the bathtub. As a state, California is often portrayed as out in front when it comes to policies that affect the health and welfare of all Americans, from pollution standards to clean water and air, from protection of wildlife habitat to consumer protection.

Without question, how our elected leaders resolve this crisis of managing a public good (State Parks) will reverberate across the country and affect how other states and the federal government for decades to come deal with one of their most sacred trusts---the care and protection of the public good, the people’s commons, our parks and public lands.

2 Comments

  1. Harvey Reading August 4, 2012

    The article pretty well describes the patronage system that has developed since the early 70s in California state government. There truly is a “corps” of political appointees who wander from department to department at the whim of whatever administration holds power. I would say that former Thompson aide, Ms. Coleman, is a perfect example of this It is also apparent that, particularly since Pete Wilson’s first election, an attitude has developed that government should run like a business has taken over, with citizens being viewed as customers rather than as constituents with needs to be served.

    What I don’t understand is the author’s depiction of dedicated accounts. If I recall correctly, the Off-Highway Motor Vehicle Recreation Trust Fund, which accounts for over half the $54 million discrepancy in reporting, was set up through legislation in the early 1970s, with Parks designated as the administrator of the fund, in accordance with expenditure requirements contained in the legislation (found in part in the Vehicle Code, since the funds come from an off-road stamp fee assessed to off-road vehicle owners operating their vehicles on those public lands where their use is allowed). The fund did not appear by magic in the first decade of the 21st Century. Nor was it created as part of some evil conspiracy against publicly-owned parks.

    Dedicated accounts, particularly those associated with groups of people who enjoy outdoor recreation, such as hunters, anglers, and off-road vehicle owners, are often funded through fees, or taxes, that target only the groups that benefit from the expenditures, with the overwhelming support of the groups affected.

    The Federal Aid in Wildlife Restoration Act (Pittman-Robertson Act), which became law in 1937, established a federal excise tax on sporting arms and ammunition, paid at the manufacturer level, and passed along to purchasers. It came into being through the efforts of sport hunters dismayed at lack of funding for wildlife management activities of state game management agencies. Funds are distributed to the states on a cost-share basis (generally a 25 percent state match). Similarly, the Federal Aid in Sport Fish Restoration Act, because of strong support of anglers, imposed an excise tax on sport angling equipment, and later was amended to include a tax on motorboat fuel, the latter funds earmarked for improved boating access facilities.

    In California, the Striped Bass Stamp Act of the early 1980s resulted from lobbying by striped bass anglers desirous of improving the striped bass sport fishery in the Bay, Delta and spawning rivers. At about the same time, commercial salmon trollers sponsored legislation to assess a fee on themselves to provide funding for projects to restore the fishery on which their livelihoods depended. The trollers were later joined by salmon party boat operators.

    In a state where, since approval of Proposition 13 in 1978, a minority of one-third plus one in the legislature can block tax increases, dedicated accounts, funded by groups willing to tax themselves, is about the only way for these groups to achieve their goals. Naturally, the sponsoring groups demand that the enabling legislation provide safeguards against the funds being spent for other purposes. As long as the dim-witted view that taxes are bad, no matter what, continues to prevail in the wealthiest state in the union, dedicated accounts will continue to exist.

  2. wineguy August 3, 2012

    Very good review and analysis of Sacto political corruption at its worst. And what about our man Brownie? He wants us to believe the State will come to a halt if his tax raises do not pass. This guy knows where the bodies are buried, he knows about these funds and hopes we do not. Remember he has been an insider for 40 odd years! Others too Burton brothers, Wille, Duke, Wilson on and on they know the inside game by heart. We are kept in the dark and lied to.
    Ironic news of the day The Terminator is now a Prof at USC with his own Institute!
    That my friends damages USC’s reputation gravely, the school for those who can’t get into a real college (UC) is so true

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