Utilities and several upkeep expenses like maintenance lawn upkeep, insurance etc are considered direct cost meaning they are necessary expenses to make the campground suitable for human habitation. This doesn't include the paper work and salaries of office workers. This is another cost considered indirect expense but yet a necessity for a sound operation of a legitimate business.
Unless the business is run "under the table" could they even break even. I used to run a contracting business and the business model mentioned with deep discount is simply untenable.
I think that running a campground is not any different. . .you gotta make profit to survive.