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Reason Foundation

Annual Privatization Report

Privately Operated Zoos Now Considered the Standard

North Carolina, Los Angeles, Grand Rapids and Elsewhere Exploring Zoo Partnerships

Harris Kenny
May 29, 2012

North Carolina lawmakers are weighing a bill (House Bill 958) that would implement a public-private partnership (PPP) for operations of the state-owned North Carolina Zoo. The proposed management structure would reflect what’s already in place for a vast majority of zoos across the United States, three-quarters of which are privately operated according to some estimates. Meanwhile, similar agreements are being explored in cities like Los Angeles, California and Grand Rapids, Michigan.

North Carolina's proposed management agreement would turn operations of the zoo over to the North Carolina Zoological Society, Inc. for 25 years. In its current form, HB 958 includes the following appropriations:

The Carolina Journal reports that under its current managements structure the zoo only raises $6 million, or one-third, of its $17 million annual operating budget, and faces reduced appropriations if fundraising exceeds the allotted amount.[1]

This partnership would usher in several changes for the zoo. Most notably, HB 958 would significantly reduce the operating subsidies that the state provides the zoo. In its place, the Zoological Society would generate more revenue from visitors and increase private donations. The zoo’s state employees will also be affected by the management change. HB 958 includes legislative language to provide transition funding to cover severance wages for 300 employees in accordance with federal and state law. The Zoological Society would rehire most employees with new compensation and benefits packages.

HB 958 has the support of a broad coalition of advocates that want to improve the approximately 2,000-acre property. David Knight, assistant secretary for natural resources for the N.C. Department of Environment and Natural Resources (DENR) of which the zoo is a state agency, recently described the partnership saying:

It’s a new way of doing things... Everyone is in agreement this is the way we should go. This is a big deal.[2]

Similarly, state Rep. Harold Brubaker, R-Randolph, endorsed partnering with the private sector saying:

I fully support the public-private partnership. It’s the only way the zoo’s going to move forward... We don’t have the money to do additional programs and expansion (through state funding alone).[3]

It’s no surprise that zoo advocates support this new reform effort. And Reason Foundation has reported on the sustained trend of PPPs for zoos through the 2010 and 2011 editions of the Annual Privatization Report. The vast majority of accredited zoos and aquariums across the United States now rely on private operators—this includes major cities like Atlanta, Chicago, Dallas, Denver, Fresno, Houston and Seattle. Eight publicly owned zoos and aquariums have been transferred to private operators in the last ten years alone. Lawmakers in several other communities are exploring agreements similar to the one in North Carolina.

Los Angeles, California: Officials in Los Angeles are exploring privatizing the Los Angeles Zoo. Last year the Los Angeles City Council ordered feasibility studies on ways to privatize the operations of the Los Angeles Zoo & Botanical Gardens, partnering with a nonprofit organization like the Greater Los Angeles Zoo Association. This proposal progressed in 2011 when the city council voted to begin soliciting proposals from prospective operators. The zoo’s operating budget is projected to increase from $26 million to $33.7 million over the next five years, expenses the city can’t afford.

City analysts calculate a PPP for the zoo could save as much as $20 million over the next five years. A July report by Miguel Santana found that “Without an alternative (operating) model, the city’s fund subsidy is very likely to be reduced further or eliminated, resulting in the continual increase of admission fees and the possible eventual closure of the (zoo)."[4]

Tulsa, Oklahoma: One of Tulsa Mayor Dewey Bartlett’s first tangible wins was successfully transitioning the Tulsa Zoo to a PPP. The Tulsa Zoo is the fifth such PPP in Tulsa; other examples include: the BOK Center, Gilcrease Museum, the Performing Arts Center and Tulsa golf courses.[5] According to an analysis conducted by Schultz & Williams, the 78-acre complex houses 2,500 animals and attracts over 525,000 visitors annually and has operated within Mohawk Park since 1927. Lawmakers partnered with the newly created nonprofit Tulsa Zoo Management, Inc. (TZMI).

TZMI assumed a significant fundraising challenge since the facility renewal and reinvestment plan included $60–100 million for deferred maintenance and infrastructure investment. The zoo also faced a pressing need to meet compliance standards for accreditation with the Association of Zoos and Aquariums (AZA) after the death of two giraffes under public operation.

One year later the Tulsa World reports, “(the) Tulsa Zoo is prospering due to privatization.”[6] The zoo was able to retain its AZA accreditation meeting standards for governance, operations and quality animal care. Privatization allowed the zoo to increase its reliance on private funding for its $8.3 million operating budget—specifically raising over $1 million for capital investment and deferred maintenance projects—with only $3.6 million coming from the city in the form of a management fee. TZMI is planning on hiring 26 employees, replacing 12 vacant positions the city eliminated in January 2010 during budget cuts.

Grand Rapids, Michigan: Lawmakers announced an agreement to transition toward privatizing the John Ball Zoo after Kent County names a team composed of zoo employees and county representatives to guide the process. The John Ball Zoo Society is expected to play a significant role in the process as the nonprofit organization has been working in partnership with the zoo since 1950, and helps with fundraising, marketing, advertising, animal purchasing and other functions. The zoo received $2.5 million, or nearly two-thirds, of funding for its $4 million budget from the county in 2011.

Santa Ana, California: Policymakers in cash-strapped Santa Ana published a 116-page report detailing a variety of proposed solutions to help the city maintain fiscal stability. One of the proposals is privatizing the Santa Ana Zoo, whose $1.6 million annual budget receives almost $800,000 in support from the general fund. According to The Orange County Register, Friends of the Santa Ana Zoo—a local nonprofit organization—is the most likely operator since it has been conducting fundraising for the zoo for over 30 years. Friends of the Santa Ana Zoo already conducts fundraising, gift shop operations and operates the zoo trains and carousel.

Evansville, Indiana: Officials in Evansville continued the dialogue on privatizing the Mesker Park Zoo in 2011, after forming a Strategic Plan Committee to explore the issue in 2010.

For more on ways that policymakers are partnering with the private sector for zoos, and comparable services like animal shelters and parks, see Reason Foundation’s Annual Privatization Report 2011.

Harris Kenny is a policy analyst at Reason Foundation. A modified version of this article was published in Reason Foundation's Annual Privatization Report 2011: Local Government report.


Notes

[1] Dan Way, “N.C. Zoo Says Privatization Could Free It From Fiscal Captivity,” Carolina Journal, October 24, 2011.

[2] Kathi Keys, "Public-private N.C. Zoo partnership proceeds," The Courier-Tribune, May 2, 2012.

[3] Dan Way, “Plan to Make N.C. Zoo Public-Private Partnership On the Move,” Carolina Journal, October 24, 2011.

[4] Rick Orlov, “Report by CAO endorses private partnership for L.A. Zoo,” Daily News Los Angeles, July 16,2011.

[5] Tulsa Zoo and Living Museum: Tulsa Zoo Organizational Analysis and Governance Study. (Philadelphia: Schultz & Williams, March 15, 2011).

[6] Sara Plummer, “Tulsa Zoo is prospering due to privatization,” Tulsa World , September 9, 2011.


Harris Kenny is Policy Analyst


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