36 CFR, Part 18

[Code of Federal Regulations]
[Title 36, Volume 1]
[Revised as of July 1, 2006]
From the U.S. Government Printing Office via GPO Access
[CITE: 36CFR18]

[Page 246-252]

TITLE 36--PARKS, FORESTS, AND PUBLIC PROPERTY

CHAPTER I--NATIONAL PARK SERVICE, DEPARTMENT OF THE INTERIOR

PART 18_LEASING OF PROPERTIES IN PARK AREAS--Table of Contents

Sec.
18.1 What is the authority and purpose for this part?
18.2 What definitions do you need to know to understand this part?
18.3 What property may be leased?
18.4 What determinations must the Director make before leasing property?
18.5 May property be leased without receiving fair market value rent?
18.6 Are there limitations on the use of property leased under this
part?
18.7 How are lease proposals solicited and selected if the Director
issues a Request for Bids?
18.8 How are lease proposals solicited and selected if the Director
issues a Request for Proposals?
18.9 When may the Director lease property without issuing a request for
bids or a request for proposals?
18.10 How long can the term of a lease be?
18.11 What general provisions must a lease contain?
18.12 What specific provisions must a lease contain?

Authority: 16 U.S.C. 1 et seq., particularly 16 U.S.C. 1a-2(k), and,
16 U.S.C. 470h-3.

Source: 66 FR 66759, Dec. 27, 2001, unless otherwise noted.

Sec. 18.1 What is the authority and purpose for this part?

16 U.S.C. 1 et seq., particularly 16 U.S.C. 1a-2(k), and, 16 U.S.C.
470h-3 are the authorities for this part. These authorities allow the
Director (or delegated officials) to lease certain federally owned or
administered property located within the boundaries of park areas. All
leases to be entered into by the Director under these authorities are
subject to the requirements of this part, except that, proposed leases
that were solicited pursuant to this part prior to January 28, 2002, may
be executed in accordance with the terms of the solicitation.

Sec. 18.2 What definitions do you need to know to understand this
part?

In addition to the definitions contained in 36 CFR Part 1, the
following definitions apply to this part:
(a) Associated property means land and/or structures (e.g., parking
lots, retaining walls, walkways, infrastructure facilities, farm fields)
related to a building or buildings and their functional use and
occupancy.
(b) Building means an enclosed structure located within the
boundaries of a park area and constructed with walls and a roof to serve
a residential, industrial, commercial, agricultural or other human use.
(c) Commercial use authorization means a written authorization to
provide services to park area visitors issued by the Director pursuant
to Section 418 of Public Law 105-391 and implementing regulations.
(d) Concession contract has the meaning stated in 36 CFR part 51.
(e) Fair market value rent means the most probable rent, as of a
specific date, in cash or in terms equivalent to cash, for which the
property to be leased, under the terms and conditions of the lease,
should rent for its highest and best permitted use after reasonable
exposure in a competitive market under all conditions requisite to a
fair leasing opportunity, with the lessor and the lessee each acting
prudently, knowledgeably, and for self-interest, and assuming that
neither is under undue duress. Determinations of fair market value rent
under this part are to be made taking into account the considerations
stated in Sec. 18.5.
(f) Historic building means a building or buildings located within
the boundaries of a park area if the building is part of a pre-historic
or historic district or site included on, or eligible for inclusion on,
the National Register of Historic Places.
(g) Historic land means land located within the boundaries of an
historic property.

[[Page 247]]

(h) Historic property means building(s) and land located within the
boundaries of a park area if the building(s) and land are part of a pre-
historic or historic district or site included on, or eligible for
inclusion on, the National Register of Historic Places.
(i) Land means unimproved real property.
(j) Lease means a written contract entered into under the authority
of this part through which use and possession of property is granted to
a person for a specified period of time.
(k) Non-historic building is a building (or buildings) and its
associated property located within the boundaries of a park area but not
part of a pre-historic or historic district or site included on, or
eligible for inclusion on, the National Register of Historic Places.
(l) Non-historic land means land located within the boundaries of a
park area that is not associated property and is not part of a pre-
historic or historic district or site included on, or eligible for
inclusion on, the National Register of Historic Places.
(m) Non-historic property means building(s) and/or land that are
located within the boundaries of a park area but are not part of a pre-
historic or historic district or site included on, or eligible for
inclusion on, the National Register of Historic Places.
(n) Park area means a unit of the national park system.
(o) Property means both historic and non-historic property that is
located within the boundaries of a park area and is federally owned or
administered.
(p) Request for bids refers to the lease bid process described in
Sec. 18.7.
(q) Request for proposals refers to the lease proposal process
described in Sec. 18.8.
(r) Responsive bid or proposal means a timely submitted bid or
proposal that meets the material requirements of a request for bids or a
request for proposals.

Sec. 18.3 What property may be leased?

(a) In general. The Director may lease any property (except non-
historic land) under this part if the Director makes the determinations
required by Sec. 18.4.
(b) Non-historic land. Non-historic land may not be leased under
this part. Certain non-historic land is eligible for leasing under 36
CFR part 17.

Sec. 18.4 What determinations must the Director make before leasing
property?

Before leasing property in a park area under this part, the Director
must determine that:
(a) The lease will not result in degradation of the purposes and
values of the park area;
(b) The lease will not deprive the park area of property necessary
for appropriate park protection, interpretation, visitor enjoyment, or
administration of the park area;
(c) The lease contains such terms and conditions as will assure the
leased property will be used for activity and in a manner that are
consistent with the purposes established by law for the park area in
which the property is located;
(d) The lease is compatible with the programs of the National Park
Service;
(e) The lease is for rent at least equal to the fair market value
rent of the leased property as described in Sec. 18.5;
(f) The proposed activities under the lease are not subject to
authorization through a concession contract, commercial use
authorization or similar instrument; and
(g) If the lease is to include historic property, the lease will
adequately insure the preservation of the historic property.

Sec. 18.5 May property be leased without receiving fair market value
rent?

Property may be leased under this part only if the lease requires
payment of rent to the government equal to or higher than the property's
fair market value rent. The determination of fair market value rent
shall take into account:
(a) Any restrictions on the use of the property or terms of the
lease that limit the value and/or the highest and best use of the
property; and
(b) Any requirements under the lease for the lessee to restore,
rehabilitate or otherwise improve the leased property.

[[Page 248]]

Sec. 18.6 Are there limitations on the use of property leased under
this part?

(a) A lease issued under this part may authorize the use of the
leased property for any lawful purpose, subject to the determinations
required by Sec. 18.4 and the limitations on activities set forth in
paragraph (b) of this section.
(b) Unless otherwise authorized by law, a lease issued under this
part may not authorize the lessee to engage in activities that are
subject to authorization through a concession contract, commercial use
authorization or similar instrument. Proposed lease activities are
subject to authorization under a concession contract if the Director
determines in accordance with 36 CFR part 51 and park area planning
documents and related guidelines and policies that the proposed
activities meet applicable requirements for issuance of a concession
contract. Proposed activities are subject to authorization under a
commercial use authorization if the Director determines in accordance
with park area planning documents and related guidelines and policies
that the proposed activities meet applicable requirements for issuance
of a commercial use authorization.

Sec. 18.7 How are lease proposals solicited and selected if the
Director issues a Request for Bids?

(a) If the amount of the rent is the only criterion for award of a
lease, the Director may solicit bids through issuance of a request for
bids as described in this section. If historic property is to be leased
under the authority of this section, the Director must comply with 36
CFR part 800 (commenting procedures of the Advisory Council on Historic
Preservation) at an appropriate time during the leasing process.
(b) A request for bids under this section shall be advertised by
public notice published at least twice in local and/or national
newspapers of general circulation. The notice shall provide at least a
thirty (30) day period from the last date of publication for the
submission of sealed bids. The notice will provide necessary information
to prospective bidders. It may specify a minimum rent and/or require
submission of a rent deposit or advance rent payment. Bids will be
considered only if timely received at the place designated in the
request. Bids must be in the form specified by the Director, or, if no
form is specified, a bid must be in writing, signed by the bidder or
authorized representative, state the amount of the bid, and refer to the
applicable public notice. If the notice requires submission of a rent
deposit or advance rent payment, the bids must include the required
funds in the form of a certified check, post office money order, bank
drafts, or cashier's checks made out to the United States of America.
The bid (and payment where applicable) must be enclosed in a sealed
envelope upon which the bidder shall write: ``Bid on lease of property
of the National Park Service'' and shall note the date the bids are to
be opened.
(c) Bids will be opened publicly by the Director at a time and place
specified in the public notice. Bidders or their representatives may
attend the bid opening. The bidder submitting a responsive bid offering
the highest rent will be selected for award of the lease (subject to a
determination of financial capability by the Director). A responsive bid
is a bid that meets the material terms and conditions of the request for
bids. The Director shall accept no bid in an amount less than the fair
market rental value as determined by the Director. If two or more bids
are equal, a drawing shall make the lease award by lot limited to the
equal responsive bids received.
(d) When a property is to be leased through a request for bids, the
bidder that is declared by the Director to be the high bidder shall be
bound by his bid and this part to execute the offered lease, unless the
bid is rejected. If the declared high bidder fails to enter into the
lease for any reason, the Director may choose to enter into the lease
with the next highest bidder (if that bidder offered to pay at least the
fair market rent value). The Director may reject any and all bids in his
discretion and resolicit or cancel a lease solicitation under this part
at any time without liability to any person.

[[Page 249]]

Sec. 18.8 How are lease proposals solicited and selected if the
Director issues a Request for Proposals?

(a) When the award of a lease is to be based on selection criteria
in addition to or other than the amount of the rent, the Director must,
subject to Sec. 18.9, solicit proposals for the lease through issuance
of a public Request for Proposals (RFP).
(b) An RFP may be preceded by issuance of a public Request for
Qualifications (RFQ). The purpose of an RFQ is to select a ``short
list'' of potential offerors that meet minimum management, financial and
other qualifications necessary for submission of a proposal in response
to an RFP. If the Director issues an RFQ, only persons determined as
qualified by the Director under the terms of the RFQ shall be eligible
to submit a proposal under the related RFP.
(c) The Director must provide public notice of the leasing
opportunity by publication at least twice in local and/or national
newspapers of general circulation and/or through publication in the
Commerce Business Daily. The public notice shall contain general
information about the leasing opportunity and advise interested persons
how to obtain a copy of the RFP (or RFQ where applicable). The RFP (and
RFQ where applicable) shall contain appropriate information about the
property proposed for lease, including limitations on the uses of the
property to be leased, information concerning the leasing process,
information and materials that must be contained in a proposal, the time
and place for submission of proposals, terms and conditions of the
lease, and the criteria under which the Director will evaluate
proposals. The RFP may state the fair market value rent as the minimum
acceptable rent if determined by the Director at that time. The RFP (and
RFQ where applicable) must allow at least sixty (60) days for submission
of proposals (or qualifications under an RFQ) unless a shorter period of
time is determined to be sufficient in the circumstances of a particular
solicitation.
(d) The Director may determine that a proposal is non-responsive and
not consider it further. A non-responsive proposal is a proposal that
was not timely submitted or fails to meet the material terms and
conditions of the RFP. After the submission of offers and prior to the
selection of the best overall proposal, the Director may request from
any offeror additional information or written clarification of a
proposal, provided that proposals may not be amended after the
submission date unless all offerors that submitted responsive proposals
are given an opportunity to amend their proposals. The Director may
choose to reject all proposals received at any time and resolicit or
cancel a solicitation under this part without liability to any person.
(e) (1) The criteria to be used in selection of the best proposal
are:
(i) The compatibility of the proposal's intended use of the leased
property with respect to preservation, protection, and visitor enjoyment
of the park;
(ii) The financial capability of the offeror to carry out the terms
of the lease;
(iii) The experience of the offeror demonstrating the managerial
capability to carry out the terms of the lease;
(iv) The ability and commitment of the offeror to conduct its
activities in the park area in an environmentally enhancing manner
through, among other programs and actions, energy conservation, waste
reduction, and recycling; and
(v) Any other criteria the RFP may specify.
(2) If the property to be leased is an historic property, the
compatibility of the proposal with the historic qualities of the
property shall be an additional selection criterion. If the RFP requires
proposals to include the amount of rent offered, the amount of rent
offered also shall be an additional selection criterion.
(f) The Director will evaluate all responsive proposals received.
The responsive proposal determined by the Director to best meet on an
overall basis the evaluation criteria will be selected for negotiation
of the lease. If two or more responsive proposals are determined by the
Director to be substantially equal under the evaluation criteria, the
Director shall provide an

[[Page 250]]

opportunity for those proposals to be amended by their offerors as
necessary for the Director to select the best amended proposal. In such
circumstances, the Director will provide each offeror that submitted a
substantially equal proposal appropriate information as to how their
proposals may be amended in order to enhance the possibility of
selection as the best amended proposal. If two or more proposals remain
as substantially equal after amendment, the Director will select for
negotiation of the lease from among these proposals the proposal that
the Director determines on an overall basis will be most beneficial to
effective management of the park area.
(g) The Director will provide the offeror that submitted the best
overall responsive proposal as determined by the Director a specified
period of time to negotiate the final terms of the lease (and may enter
into a letter of intent to negotiate in this connection). The final
terms of the lease must be consistent with the requirements of the RFP.
If the negotiations do not result in an executed lease within the
specified time period, the Director, in his discretion, may extend the
negotiation period, terminate negotiations and negotiate with the
offeror that submitted the next best responsive proposal, or, cancel the
solicitation.
(h) RFPs may state that the amount of rent to be paid will be
negotiated subsequently with the offeror that submitted the best
proposal, initially or as amended. The Director may execute a lease only
if the Director determines that it requires the lessee to pay at least
the fair market value rent of the leased property.
(i) The Director may execute a lease that includes historic property
only after complying with 36 CFR part 800 (commenting procedures of the
Advisory Council on Historic Preservation).

Sec. 18.9 When may the Director lease property without issuing a
request for bids or a request for proposals?

The Director, except as provided in this section, may not lease
property without issuing a request for bids or a request for proposals
in compliance with Sec. 18.7 or Sec. 18.8. The Director under this
part may enter into leases with non-profit organizations (recognized as
such by the Internal Revenue Service) or units of government without
complying with Sec. Sec. 18.7 or 18.8 if the Director determines that
the non-profit or governmental use of the property will contribute to
the purposes and programs of the park area. All other requirements of
this part are applicable to leases entered into or to be entered into
under authority of this section. The Director may enter into leases
under this part with a term of sixty (60) days or less without complying
with Sec. Sec. 18.7 or 18.8 if the Director determines that to do so
is in the best interests of the administration of the park area. If
historic land is to be leased under the authority of this section, the
Director must comply with 36 CFR part 800 (commenting procedures of the
Advisory Council on Historic Preservation) before entering into the
lease.

Sec. 18.10 How long can the term of a lease be?

All leases entered into under this part shall have as short a term
as possible, taking into account the financial obligations of the lessee
and other factors related to determining an appropriate lease term. No
lease shall have a term of more than 60 years. Leases entered under the
authority of this part may not be extended, except that, leases with an
initial term of one (1) year or more may be extended once for a period
not to exceed one (1) additional year if the Director determines that an
extension is necessary because of circumstances beyond the Director's
control.

Sec. 18.11 What general provisions must a lease contain?

All leases entered into under this part must contain terms and
conditions that are determined necessary by the Director to assure use
of the leased property in a manner consistent with the purposes of the
applicable park area as established by law, and where applicable, to
assure the preservation of historic property.

Sec. 18.12 What specific provisions must a lease contain?

All leases entered into under this part must contain:

[[Page 251]]

(a) A termination for cause or default provision;
(b) Appropriate provisions requiring the lessee to maintain the
leased property in good condition throughout the term of the lease;
(c) Appropriate provisions stating that subletting of a portion of
the leased property and assignment of a lease, if permissible under the
terms of the lease, must be subject to the Director's written approval.
Such subleases and assignments shall be approved only of the Director
determines, among other relevant matters, that the proposed sub-lessee
or assignee is financially and managerially capable of carrying out the
terms of the lease. Assignment of a lease for the purpose of
effectuating an encumbrance to the lease or the leased property is
subject to approval pursuant to the requirements of paragraph (l) of
this section;
(d) Appropriate provisions requiring the lessee to secure and
maintain from responsible companies liability insurance sufficient to
cover losses connected with or occasioned by the use and activities
authorized by the lease. Types and amounts of insurance coverage will be
specified in writing and periodically reviewed by the Director;
(e) Appropriate provisions, unless the Director determines otherwise
in the circumstances of a particular lease, requiring the lessee to
obtain from responsible companies casualty insurance (including flood
insurance if applicable) in an amount sufficient to protect the
interests of the lessee and the government. In the event of casualty,
the lessee shall be required to repair or replace damaged or destroyed
property unless otherwise determined by the Director;
(f) Appropriate provisions requiring the lessee to save, hold
harmless, and indemnify the United States of America and its agents and
employees for all losses, damages, or judgments and expenses resulting
from personal injury, death or property damage of any nature arising out
of the lessee's activities under the lease, and/or the activities of the
lessee's employees, subcontractors, sub-lessees, or agents. No lease
entered into this part may contain provisions intended to provide
indemnification or other assurances to the lessee regarding the conduct
or activities of the Director concerning the lease or the administration
of the applicable park area. Leases may contain appropriate provisions
that commit the Director to accept responsibility for tortious actions
of government officials to the extent authorized by the Federal Torts
Claim Act or as otherwise expressly authorized by law;
(g) Appropriate provisions requiring the lessee to pay for use of
all utilities used by the lessee and to pay all taxes and assessments
imposed by federal, state, or local agencies applicable to the leased
property or to lessee activities;
(h) Appropriate provisions stating that the lessee has no rights of
renewal of the lease or to the award of a new lease upon lease
termination or expiration and that the lease is subject to cancellation
by the Director in the exercise of the sovereign authority of the United
States to the extent provided by applicable law;
(i) Appropriate provisions stating that the lessee may not construct
new buildings or structures on leased property, provided that, a lease
may contain appropriate provisions that authorize the lessee to
construct, subject to the prior written approval of the Director, minor
additions, buildings and/or structures determined by the Director to be
necessary for support of the authorized activities of the lessee and
otherwise to be consistent with the protection and purposes of the park
area. Approval by the Director of new construction may only be granted
if the Director makes the determinations required by Sec. 18.4;
(j) Appropriate provisions requiring that:
(1) Any improvements to or demolition of leased property to be made
by the lessee may be undertaken only with written approval from the
Director;
(2) That any improvements to or demolition of historic property may
only be approved if the Director determines that the improvements or
demolition complies with the Secretary of the Interior's Standards for
the Treatment of Historic Properties (36 CFR part 68); and

[[Page 252]]

(3) Any improvements made by a lessee shall be the property of the
United States;
(k) Appropriate provisions that describe and limit the type of
activities that may be conducted by the lessee on the leased property.
The types of activities described in a lease may be modified from time
to time with the approval of the Director through an amendment to the
lease. The Director may approve modified activities only if the
determinations required by Sec. 18.4 remain valid under the proposed
modified activities and the proposed activities are otherwise determined
appropriate by the Director;
(l) Appropriate provisions, unless the Director determines not to
permit pledges or encumbrances in the circumstances of a particular
lease, authorizing the lessee to pledge or encumber the lease as
security, provided that any pledge or encumbrance of the lease and the
proposed holder of the pledge or encumbrance must be approved in writing
in advance by the Director and that a pledge or encumbrance may only
grant the holder the right, in the event of a foreclosure, to assume the
responsibilities of the lessee under the lease or to select a new lessee
subject to the approval of the Director. Pledges or encumbrances may not
grant the holder the right to alter or amend in any manner the terms of
the lease;
(m) Appropriate provisions stating that fulfillment of any
obligations of the government under the lease is subject to the
availability of appropriated funds. No lease issued under authority of
this part shall entitle the lessee to claim benefits under the Uniform
Relocation Assistance Act of 1970 (Public Law 91-646) and all leases
entered into under the authority of this part shall require the lessee
to waive any such benefits; and
(n) Appropriate provisions granting the Director and the Comptroller
General access to the records of the lessee as necessary for lease
administration purposes and/or as provided by applicable law.