When we set a percentage of revenue fee we start with the base premium.
The base premium takes into consideration the investment the concessionaire has made to establish their business on public conservation land. The investment must predominantly support their operations.
The base premium ranges from 3.5% to 7.5% of revenue depending on the extent of the investment made by the concessionaire. If they have made a larger investment the base premium is set lower.
Premium for land uniqueness/limited supply
This premium is added to the base premium if:
- the land has some uniqueness that makes it difficult to conduct the activity elsewhere. For example, developing a ski field
- demand to provide an activity exceeds land availability. For example, a walking trail that is limited to a set number of people.
The premium varies from 0.5% of revenue to 2% of revenue. In special cases where the area is unique and demand is very high the premium may be set at 2.5% of revenue.
If DOC has developed and/or maintained the local infrastructure that benefits a business, a contribution to the cost of the infrastructure is added to the base premium.
This contribution ranges from 0.5% of revenue for moderate infrastructure investment to 1% of revenue for large infrastructure investment.
If a concessionaire has exclusive access to an area, with the right to keep the public out, an exclusivity premium is added to the base premium. The exclusivity premium depends on the size of the land they have exclusive access to. These are:
- less than 5 ha – 0.5% of revenue
- greater than 5 ha – 1% of revenue
- greater than 20 ha – 1.5% of revenue.
Occasionally there may be unique circumstances that are considered when establishing a revenue percentage fee. In these cases DOC may adjust the revenue percentage fee accordingly.