Glacier Park Inc. officials were shocked Tuesday to learn the Glacier National Park visitor services contract their company has held for more than 30 years had been awarded to Xanterra Parks and Resorts Inc., a large concession company that holds similar contracts in Yellowstone, Zion and Grand Canyon national parks.
The contract to run the park’s lodging, food and beverage, retail, transportation and other visitor services has been held by Glacier Park Inc. since 1981. The bidding process to award a new contract began in December 2012 and was the first official rebidding process undertaken since the contract was awarded to Glacier Park Inc. 32 years ago.
“It was a surprise,” said Ron Cadrette, vice president and general manager of Glacier Park Inc. “We only heard the news less than 24 hours ago. We’re still organizing ourselves.”
Pending a congressional review period, the new 16-year visitor services contract with Xanterra will begin in January 2014.
The contract calls for management of Lake McDonald Lodge, Apgar Village Inn, Rising Sun Motor Inn, Swiftcurrent Inn and Many Glacier Hotel, as well as the Two Medicine Camp Store, public showers and laundry facilities, and Glacier’s iconic red bus tours.
Park officials estimate the concessions managed by the contract holder will generate roughly $18.5 million annually.
“We put in what we thought was an excellent bid,” Cadrette said Wednesday afternoon from his office in Columbia Falls. “We really don’t have any insight into what the discrimination factors were that put Xanterra in the winning position.”
Glacier Park Inc. has requested the National Park Service conduct a “post-bid review” of the process, Cadrette said.
Glacier spokeswoman Denise Germann said Wednesday bidders can request a debriefing on the process. However, Germann said, she did not know if Glacier Park Inc. had made that request and was unsure if a review request would be public information.
The visitor services contract represents 40 percent of Glacier Park Inc.’s business, Cadrette said.
At peak season, the company employs 1,200 people.
“I think it’s premature to discuss its impact. There is a transition period that needs to take place. We haven’t even begun that,” Cadrette said.
Glacier Park Inc. was first awarded a 25-year visitor services contract in 1981. Beginning in 2006, Glacier Park Inc. was awarded what became the first of eight one-year extensions of that contract. The most recent one-year extension expires in December.
That long period of extensions was the only negative aspect of the company’s 30 years of service to Glacier, Cadrette said.
“When you go by year-by-year extensions, it makes future planing and investment challenging. Other than that, it was just a wonderful relationship and experience,” he said.
Xanterra is set to work with Glacier Park Inc. during the transition period.
As the visitor services contract holder for Glacier, Xanterra will pay a minimum franchise fee of 1 percent of annual gross receipts. That money will be returned to the government each year.
The contract also includes a repair and maintenance reserve of 2.35 percent and a “Red Bus Rehabilitation Reserve” of 2.5 percent, each based on annual gross receipts.
The contract calls for major upgrades on some of the park’s most popular hotels and lodges. It also requires Xanterra to carry out a plan to maintain and eventually renovate the park’s fleet of red buses.
Owned by Philip Anschutz, Xanterra provides visitor services for a wide variety of national and state parks and owns a long list of lodges and tourist attractions around the country.
Denver-based Anschutz Exploration Corp. announced in May that it would shut down its search for oil and gas on the Blackfeet Indian Reservation alongside Glacier after a petition was circulated opposing Xanterra’s bid.
Moving forward, Cadrette said, Glacier Park Inc. will focus on its businesses outside the park.
“More than 60 percent of our business exists outside of the park. We are positioned to look for opportunities in those areas,” Cadrette said.
Glacier Park Inc. owns Grouse Mountain Lodge in Whitefish, Glacier Park Lodge in East Glacier, St. Mary Lodge and Resort in St. Mary, and Prince of Wales Hotel in Waterton, Alberta.
The company will maintain ownership and management duties of the 30-room Stewart Hotel near Lake McDonald Lodge.
Glacier Park Inc. is owned by Viad Corp.
According to its website, Viad also owns Brewster Inc., a “major tourism operator in western Canada,” as well as a handful of marketing and events companies.
The Canadian government recently awarded the company a 42-year contract to manage visitor services at Waterton Lakes National Park.
In the short term, Cadrette said, Glacier Park Inc. will focus on providing top services to Glacier’s guests.
“We’re still in the middle of the season,” he said. “We have an obligation to serve the park to the best of our ability and to serve the visitors to the best of our ability.”