This Week’s Outsourcing Scan 9-21-2015

1. National: Next Sunday, Pope Francis is to visit the Curran-Fromhold Correction Facility in Philadelphia. “Faith leaders, criminal justice advocates, and others will use the Pope’s visit to highlight the harmful effects of companies that profit from the incarceration of prisoners and immigrants. These companies profit from providing health care, food, telecommunications, money exchange services, and even management of entire facilities. At Curran-Fromhold, at least five different companies, all with either appalling or suspect track records, have contracts to provide services to those currently incarcerated.”

2. NationalThe U.S. Commission on Civil Rights issues a 250-page report on the mistreatment of immigrant detainees, including in privately-run facilities. Martin R. Castro, USCCR chairman, writes, “One of the most profound experiences during my Chairmanship of this Commission occurred on our fact-finding visits to immigration detention centers in Texas in May 2015. At Karnes Family Detention Center, a CDF, run by the GEO Group, Inc. (GEO), we were immediately given a taste of what life can be like in these detention centers. (…) Yet, a short time later, I personally spoke to mothers who were part of the hunger strike. They told me in Spanish, over the protests of the detention center officials who were demanding that I not speak to the women and who were pulling at my sleeve to get me to move on, that they had been at Karnes with their children for almost a year; that they were part of the hunger strike until the detention center officials threatened to take away their children unless they gave up the hunger strike.”

In June, the American Civil Liberties Union and the National Immigration Law Center filed a class action lawsuit arguing that widespread mistreatment of family detainees was taking place and demanding their immediate release. On Friday the Obama administration filed an appeal of U.S. District Court Judge Dolly Gee’s endorsement of the lawsuit’s claims and order to show cause why the mothers and children shouldn’t be released. Joane Lin, ACLU’s legislative counsel, replied that “Secretary Johnson’s statement today is proof positive that DHS plans to continue detaining Central American families, despite last month’s court order by Judge Gee. Today’s statement dispels any hope that the Obama administration will end family detention on its own, or the practice of placing families in expedited removal.” The case now goes up to the Federal Ninth Circuit.

3. National: The share price of the Apollo Education Group, owner of the for-profit University of Phoenix, has dropped nearly 30% over the past three months. Its year-to-date stock performance is -66.43%.

4. National: The $20 billion Hudson River Tunnel Project may be gaining traction, and private financing could be part of the mix. “Asked whether the funding proposal would include private financing, a spokesperson for Governor Christie said, ‘We’ll let the letter stand right now in terms of any more comments on the project.’ He did, however, refer us to one particular paragraph in the letter: ‘If the federal government will provide grants to pay for half of the cost of the project, the Port Authority, New York and New Jersey will take responsibility for developing a funding plan for the other half, convening all relevant agencies, and utilizing the proposed federal low-interest loan, local funding sources, and other funding strategies necessary to complement the federal grant commitment.’” [Sub required]

5. National: Josh Barro of The New York Times looks at Republican presidential primary candidate Donald Trump’s past relationships with and attitude toward the public sector.

6. National: Management consultant reports released Friday may lead to a further push to privatize the Veterans Administration. “More than a dozen assessments—from analysts including Mitre Corp., Rand Corp. and McKinsey & Co.—show that the Veterans Heath Administration, the healthcare arm of the department known as VHA, is still plagued by long-standing issues, including unsustainable costs in the future and a system that veterans find tough to navigate. (…) Questions about further privatization were highlighted recently when Ben Carson, a leading Republican presidential candidate and physician, suggested the VA make a push toward privatization and elimination of the VHA, its health-care delivery arm. Earlier this week, a number of major veterans groups sent an open letter to Mr. Carson stressing the need to keep the VHA solvent.”

7. NationalThe Washington Post’s Valerie Straus, who regularly publishes penetrating stories on education privatization, lifts the curtain on a cozy and untransparent meeting of private philanthropists to secretly discuss their priorities. “While some see these philanthropists as performing a public good, given that there aren’t enough public funds to support science and health research, others worry that science research — and public education — should not be subject to the likes and dislikes of the wealthy or that private philanthropists should be the people who, by leveraging their own fortunes, set the public agenda.”

8. California: As rising sea levels threaten shoreline marshes and structures around San Francisco Bay and the Delta, “a public-private partnership called the San Francisco Estuary Authority is considering sponsoring a Bay Area-wide ballot measure seeking a parcel tax next year to finance flood protection and wetland restoration.”

9. California: The California Public Utilities Commission will have to approve a recently announced 20-year deal whereby Southern California Edison will buy the entire output of Sempra U.S. Gas & Power’s Mesquite Solar 2 complex in Arlington, Arizona, on which construction will begin this fall. [Sub required]

10. Colorado: The Department of Transportation and High Performance Transportation Enterprise issue a draft Request for Proposals for the I-70 East ‘public private partnership’ road project. The RFP process will produce several drafts, which will be made available to the four shortlisted bidding teams and to the public. [Sub required]. This follows last month’s adoption by CDOT of an “Open Records Policy Relating to Public Private Partnerships” and a “First Amended Transparency Policy Relating to Public Private Partnerships.” Adoption of the policy followed widespread criticism of CDOT and HPTE for a lack of transparency on the US 36 “public private partnership.”

11. GeorgiaBetter Georgia blogger Brandon Hanick blows the whistle on the “opportunity school district” plan, writing that Gov. Deal’s “cronies” are “striking gold” with it. “His plan? First, starve public schools. Then, designate them as ‘failing.’ Next, without local input, turn the schools over to out-of-state corporations who will profit from the misfortune of underprivileged students and the teachers trying to do their jobs without adequate resources.”

12. Illinois: The Chicago Infrastructure Trust issues a Request for Information from potential bidders as it looks for a private investor in Chicago’s streetlight system. “The request for information says the trust is looking at a public-private partnership that allows for ‘appropriate risk sharing’ and assumes all project costs would be fully funded from energy and operational savings as well as generated revenue. ‘Risk associated with generating revenue or savings should be borne by the providing entity or otherwise guaranteed,’ the RFI says.” The deadline for replies is November 16, 2015. [Sub required]

13. Iowa: Two state lawmakers have appealed to the federal Centers for Medicare and Medicaid Services to block or slow down Gov. Branstad’s plan to privatize Iowa’s Medicaid program. Sens. Amanda Ragan Liz Mathis say “We have already witnessed the tragic and unnecessary deaths of three Iowans caused by the Governor’s unilateral decision to close two mental health institutes in our state. The Governor appears to be on a similar path with his hasty, unilateral decision to privatize Iowa’s Medicaid program. That’s why we are worried that hundreds or even thousands of Iowans will be put at risk by management companies that will profit by denying critical services to seniors, people with physical and mental disabilities, children and moms.”

14. MassachusettsCharter school proponents open a new legal front, filing suit in Suffolk Superior Court over charter school admissions lotteries. Gov. Baker is expected to propose a bill expanding caps on charter schools, and may push a ballot initiative on charters in 2016.

15. Missouri: Tony Messenger denounces “Gov. Jay Nixon’s contention that elected officials deserve no say in whether taxpayers’ hard-earned dollars are tapped to subsidize a billionaire’s National Football League investment in St. Louis.” Jeannette Mott-Oxford, a founder of the Coalition Against Public Funding for Stadiums, says “when it comes to sports, we socialize the risk and privatize the profit. And that frosts my pumpkin. The lack of transparency is appalling.”

16. New JerseyGov. Christie’s lottery privatization deal is turning into a disaster, according to the Asbury Park Press, as it faces a $136 million shortfall. Communications Workers of America political director Seth Hahn says “it’s exactly what everybody thought was going to happen. Unfortunately this is business as usual when it comes to privatization in New Jersey. When we look at motor vehicle or some of these other things we have a company with a record of failure who comes in because they have political connections and then taxpayers and people who depend on services are left out in the cold.”

17. Ohio: Ohio University journalism professor Thomas Suddes denounces the Ohio Supreme Court for upholding “some starkly one-sided charter school contracts, one-sided against Ohio taxpayers. The contracts benefitted the White Hat companies, companies associated with Akron’s David L. Brennan, a generous donor to Ohio Republican campaigns.” He also criticized the court for blocking efforts by three counties to vote on new charter schools in the November election. Suddes says the actions are “two more reasons why voters should pay attention to Ohio Supreme Court elections.” The Columbus Dispatch has also denounced the ruling for allowing “a for-profit charter school management company [to] make off with textbooks, computers, desks and other materials purchased with taxpayer dollars.”

18. Ohio: Corrections Corporation of America (CCA) PR director Jonathan Burns defends his company against criticism by the ACLU’s Adrienne Gavula, who wrote last month that by privatizing prisons Ohio was “selling the well-being of the brothers, uncles and fathers it houses there.”

19. Texas: Brazos County asks the state attorney general for a ruling on whether Texas A&M dormitories built using a “public private partnership” should be exempt from county property taxes. “The lease stipulations that limit tenants to students, staff, or faculty seem to resolve the public use requirement for exemption from county taxes but the public ownership of the dormitories is questionable, [Brazos County Attorney Rodney Anderson] said in his letter. The long-term agreement may remove public ownership of the Park West property because it gives the developer legal title to any improvements on the site at the end of the term, Anderson said. The student housing corporation that is acting as the private partner in the arrangement is not part of the state of Texas nor is it a political subdivision of the state, he said.” [Sub required]

20. Virginia: Robert Thomson, The Washington Post‘s “Dr. Gridlock,” takes a deep breath and brings us up to date on where things stand with improvements on I-66, which has been the subject of much debate and industry PR on possible modes of procurement and financing. “The decision on whether to publicly finance the project or enlist a private partner probably will be made in December, [Virginia Transportation Secretary Aubrey Lane] said.”

21. International: The Canadian Union of Public Employees (CUPE) releases a scathing report on privatizing hospital services that it sent to New Brunswick Health Minister Victor Boudreau in July. “Our research into the three companies being considered to take over those services, Sodexo, Aramark and Compass, shows a very troubling picture of the quality of the services provided. All over the world, all three competitors have shown very poor track records when it comes to cleaning and food preparation.” [Report]

22. International: As Greek voters apparently return Syriza Prime Minister Alexis Tsipras to power, questions linger over the Troika-imposed privatization program, including the pressure to privatize airports. “That the airport contractor in question [Fraport] comes from Germany, which many Greeks consider their chief antagonist among eurozone creditors, only adds to the tensions. For many Greeks, the airports deal is symbolic of their broader concerns about the bailout: They fear that the government is surrendering vital national assets at an extreme discount to Germans intent on forcing the country into economic subjugation.”

23. Think TanksCommon Good, a New York-based think tank, issues a report calling for faster environmental approvals for infrastructure projects. The report came out of a May 2015 forum Common Good co-hosted with the National Association of Manufacturers, the Bipartisan Policy Center, and Covington & Burling LLP. The Wall Street Journal editorial page enthusiastically endorsed the report.

Legislative Issues

1. National: Senator Bernie Sanders (I-VT), Reps. Raul Grijalva (D-AZ), Keith Ellison (D-MN), and Bobby Rush (D-IL) introduce legislation to ban private prisons. The companion bills also reinstate the federal parole system, and make changes to immigration detention law. “As long as there are corporate financial incentives for locking people up and keeping them behind bars, reforming drug laws and other sentencing policies will produce limited results for meaningfully decreasing the astronomical rate of incarceration in this country,” said Kymberlie Quong Charles, criminal justice programs director for Grassroots Leadership, in a press release. 

“The Justice is Not for Sale Act makes great strides in ending for-profit incarceration and detention, but more will need to be done,” said Cate Graziani, Mental Health Campaigns coordinator for Grassroots Leadership. “By exempting treatment centers, halfway houses, restitution centers, mental health facilities and alcohol or drug rehabilitation centers, the legislation could allow the same failed private prison companies to move into new markets — an alarming shift that is already underway.  Further legislation will need to address this growing and troubling trend.” [Billdescription]. The bill is supported by, among others, AFSCME, In the Public Interest, LatinoJustice PRLDEF, and the PICO National Network.

2. Alabama: Left in Alabama blogger Larry Lee reports that the state’s charter school legislation “came straight from [an] ALEC model bill.” He writes “the Alabama charter bill sets up a politically appointed Public Charter School Commission that has authority to approve charter school applications, or to overrule local charter authorizers who may deny an application. (…) Alabama charter proponents say they drafted SB 45 by taking the best of charter legislation in many states. But given the ties some legislators have to ALEC, as well as their track record of supporting bills Alabama educators oppose, one can’t help but question this claim. We also must ask, if the Supreme Court in Washington says charter schools set up by a politically appointed commission and governed by a local board that does not answer to taxpayers are not entitled to public funds, how does Alabama differ?”

3. California: Although the special legislative session adjourned without approving any new funding for transportation, in coming weeks a conference committee will meetto carry on the work of the session. “Despite bipartisan agreement that more road funding is needed, the Democratic majority in both chambers was not able to convince enough Republicans to increase taxes to meet the need.” [Sub required]. The Fix Our Roads Coalition applauded the move, saying “as the Governor pointed out, our broad coalition of local government, business, labor, and transportation advocates will intensify our efforts to push for a compromise agreement. Californians expect and deserve solutions to fix our deteriorating roads.”

4. FloridaPalm Beach Post columnist Frank Cerabino reports that “Florida’s continuing quest to privatize education by driving public schoolteachers crazy has taken a bizarre new turn.” The twist? Teacher bonuses will be tied to their own high school SAT and ACT scores. “That’s right, you could be a high-performing, beloved teacher who has been inspiring Florida’s schoolkids for a generation, but if you want a little extra money next year, you’d better hustle. You have until Oct. 1 to produce an official record of your own high school tests to see whether you are worthy of the extra money. To get this Best and Brightest Teacher Scholarship, your former high school self had to score at or above the 80th percentile on either the SAT or ACT. Who dreams up stuff like this?” He answers his own question: the idea is the brainchild of Rep. Erik Fresen, R-Miami, the chairman of the House Education Appropriations Subcommittee. “You see, he’s not just a powerful lawmaker. Fresen’s also a former lobbyist for Academica, a for-profit company that operates more than 100 charter schools, mostly in Florida. And he’s also a consultant for Civica, an architectural firm that builds charter schools for Academica. Oh yeah, and Fresen’s brother-in-law just so happens to be Academica’s chief executive officer.”

5. New Jersey: The College of New Jersey’s project to build a campus town center using a ‘public private partnership’ is in limbo after previous P3 legislative authority expired and Gov. Christie sent a new bill back to the state legislature requesting changes. “Christie’s conditional veto Aug. 11 supports P3s, but recommended that provisions imposing prevailing wage requirements and mandating project labor agreements, which were part of the 2010 P3 legislation, be removed from the bill.”

6. North Carolina: Votes are scheduled in the General Assembly this week on a bill to privatize the state’s $15 billion Medicaid program.

7. Pennsylvania: Despite major concessions on a number of issues, including liquor privatization, Republicans refuse to accept Gov. Wolf’s budget compromise, and the state’s funding crisis continues. On Friday, the Senate passed a short term funding bill that seems certain to be vetoed by Wolf. The governor proposed outsourcing the liquor stores by granting 20-25 year concession to private operators. The right wing Pittsburgh Post Gazette says “a major negative is the firm would have to keep the current workforce, who are paid at union scale and who therefore make the government system far more costly to operate than comparable retail stores. And where in the governor’s plan is the dynamic of competition—the hallmark of free enterprise—if just one private entity runs the entire statewide liquor system?”