Weekly privatization report

 

Here’s our weekly analysis of privatization in the news and in communities nationwide. Not a subscriber? Sign up here.

 

1) National: Voters made important decisions on privatization last Tuesday. In the Public Interest’s Jeremy Mohler writes that “voters chose to side with the common good in three powerful ways: stopping privatization, expanding democracy, and implementing progressive taxes to pay for much-needed public services.” Among the highlights are that Baltimore became the first major U.S. city to prohibit the sale and lease of its water and sewer system. 

Elsewhere, Mohler reports, Arizona voters rejected a massive expansion of the state’s private school voucher program that would’ve drained more money and support from public schools.

Austin, Texas, voted down a third-party “efficiency study” of the city’s operations and finances, which could have laid the groundwork for privatization of public services.

Voters in Florida’s Escambia County voted to prohibit the sale or lease of currently unleased properties on Santa Rosa Island, the site of the what was perhaps the very first privatization, the earliest European settlement in what is now the mainland United States. And voters in Florida struck down felon disenfranchisement, potentially shaking up Florida and national politics for decades.

Voters in San Diego chose to boost transparency in city contracts by requiring all businesses and individuals who would benefit financially to be revealed before the council approves any such deal.

California’s Monterey County is poised to take back its water from a multinational water corporation as a ballot measure exploring a public buyout was approved by voters. American Water spent $3 million — 19 times more than a local pro-public group — but the case for public water prevailed.

2) National: Despite some gains for criminal justice reform in last Tuesday’s election, Michelle Alexander, in “The Newest Jim Crow,” warns of the increasing transition to a racialized form of electronic incarceration and social control—the usage of “risk assessment” algorithms and electronic monitoring devices attached to the body. Alexander, author of the widely acclaimed book The New Jim Crow, writes in The New York Timesthat e-carceration “may prove more dangerous and more difficult to challenge than the one we hope to leave behind. Bail reform is a case in point… what’s taking the place of cash bail may prove even worse in the long run.” She points to incentives built into the e-carceration industry that are driving the changes. “Even if old-fashioned prisons fade away, the profit margins of these companies will widen so long as growing numbers of people find themselves subject to perpetual criminalization, surveillance, monitoring and control.”

3) National/New York: The New York Times reports that with Democratic wins across the country, charter schools are facing a backlash. The elections “strongly suggested that the golden era of charter schools is over in New York. The insurgent Democrats who were at the forefront of the party’s successful effort to take over the State Senate have repeatedly expressed hostility to the movement. John Liu, a newly elected Democratic state senator from Queens, has said New York City should ‘get rid of’ large charter school networks. Robert Jackson, a Democrat who will represent a Manhattan district in the State Senate, promised during his campaign to support charter schools only if they have unionized teachers. And another incoming Democratic state senator, Julia Salazar of Brooklyn, recently broadcast a simple message about charter schools: ‘I’m not interested in privatizing our public schools.’ (…) It seems highly likely that a New York Legislature entirely under Democratic control will restrict the number of new charter schools that can open, and tighten regulations on existing ones.”

4) National: @Nataliekitro points us to a Bloombergstory on how “7-Eleven is getting ICE to raid stores so that corporate can take control away from franchise owners.” Lauren Etter and Michael Smith report, “As detailed in a series of lawsuits and court cases, the company has plotted for much of [7-Eleven CEO] DePinto’s tenure to purge certain underperformers and troublemakers. It’s targeted store owners and spent millions on an investigative force to go after them. The corporate investigators have used tactics including tailing franchisees in unmarked vehicles, planting hidden cameras and listening devices, and deploying a surveillance van disguised as a plumber’s truck. (…) Anger was palpable at the franchisee meeting when Allison Carter Anderson, a special agent with the Department of Homeland Security, stood onstage in a ballroom before hundreds of 7-Eleven store owners.”

5) National: In an important victory for prison divestment campaigners, the $229.2 billion California public pension fund CalSTRS voted to divest from the GEO Group and CoreCivic. “After an uproar over Trump administration policies that separated children from their families at the U.S. border, Chief Investment Officer Christopher Ailman started the process for divestment at the pension system’s Investment Committee’s July meeting, beginning a review of the companies in question to determine what risks they brought to the portfolio.”

6) Arizona: The former director of a Goodyear charter school “is pleading guilty to exaggerating enrollment to secure millions of funding dollars. “The Arizona Attorney General’s Office says Daniel K. Hughes entered the plea Wednesday involving one felony count each of conspiracy and theft. He faces between three and 12-1/2 years in prison for the conspiracy charge. He will serve probation upon his release for the theft charge. Prosecutors say school officials and employees at Bradley Academy of Excellence plotted together to over-report the number of students during a two-year period before closing abruptly in December 2017.”

7) Arizona: A former charter school CEO has cut a plea deal with authorities. “The plea agreement shows that Hughes will have to payback at least $2.5 million to the Department of Education. Two issues, however, remain, including oversight, which the State Board has requested more help with regulation. Another issue is transparency. In the budget shadows of the RedforED walkout, GOP legislators pushed through a small amendment that allows charter schools more privacy with their budgets”

8) California: The closely fought battle for state schools superintendent has narrowed, with Marshall Tuck’s lead over Assemblyman Tony Thurmond shrinking. “San Joaquin County will next report on how far it is getting on its vote count” today, “while Stanislaus County will only report on its roughly 20,000 uncounted ballots once all of them have been tallied, according to the Los Angeles Times. In contrast, Orange County, which has 365 workers working 12-hour shifts tabulating 365,000 uncounted votes, is updating its count more regularly, the Times indicated.”

9) California: Capital & Mainreports that real estate interests “spent at least $74 million to demonize Proposition 10—which would only allow municipalities the right to consider rent control—to the point where even renters felt it was a nefarious plot to destroy property values and bankrupt elderly landlords. Unsurprisingly, Prop. 10 lost by a nearly two-thirds majority, and real estate special-interests groups will spend even more if another such measure ever goes statewide again.”

10) Colorado: Using a state public records law, the Denver teachers union has requested and obtained from the school district the names, email addresses, and salaries of every charter school teacher in the school district. “The request could signal that the union plans to try to get charter school teachers to join. Currently, only teachers at district-run schools belong to the Denver union. Given that more than a quarter of Denver’s 200 schools are charters, recruiting charter school teachers could significantly swell the union’s ranks and increase its political power.”

11) District of Columbia: Voters resoundingly backed a slate of school board candidates who strongly support traditional public schools rather than charters. “The usually sleepy races for the D.C. State Board of Education turned into a fight over the future of public education, with candidates backed by the teachers union facing off against contenders supported by a powerful charter advocacy organization. Voters gave a resounding answer: Three of the four seats on the ballot went to candidates who were backed by the teachers union and were portrayed as proponents of traditional public schools. And they achieved substantial victories, vanquishing their opponents by double-digit margins.”

12) Georgia: In a community near Atlanta airport, a “public-private partnership” project that aims to make housing more affordable is part of an effort to increase attendance at struggling public schools. “The project is part of a partnership between the city’s economic development and housing authorities, real estate investor TriStar—the owner—and nonprofit Star-C, which ‘assists economically disadvantaged families living in affordable housing communities by providing wraparound services ranging from after-school programs to healthcare,’ according to a press release. ‘We know that wraparound supports and family stability are critical factors that impact student learning and life outcomes,’ Atlanta Public Schools Superintendent, Maria Carstarphen, said in a prepared statement.”

13) Hawaii: Nanakuli charter school in Honolulu County, once hailed as educational leader, is in upheaval amid financial woes. “Earlier this month, the school’s ohana [family—ed.] got troubling letter. It said the Hawaii State Public Charter School Commission had reconstituted the board, then a transitional governing board put Parker and the school’s business manager and his wife, Renette Parker, on a 30-day administrative leave. The letter said, ‘Parker and Mrs. Parker will be restricted from any access to the school including but not limited to entering campus and school administration and operations systems.’ On its website, the charter school commission said, ‘Governing Board failed to manage the financial performance of the school.’ ‘They’ve been under a notice of concern for quite some time, a year, as we work with the school and as we tried to fix and resolve those issues that we had uncovered,’ said Sione Thompson, executive director of the Hawaii State Public Charter School Commission.”

14) Indiana: A charter operator has withdrawn its application to open a school in Muncie. The public school administrator says the district already provides the services that WAY Academy was offering. “Jim Williams, president of the MCS school board, spoke against the application at the hearing. He said he was unaware of any students being denied admission to MCS, which he said has been undertaking academic innovation for some time, ‘working with a challenged population under difficult circumstances, moving forward in all sorts of meaningful ways.’ MCS already offers alternative educational programming for students with social and behavioral disabilities. It also partners with the Youth Opportunity Center and operates an expulsion school as well.”

15) Iowa: Rob Sand, who promised to get tough on for-profit contractors profiting off of Medicaid, won election as Iowa State Auditor. Sand said that if he got elected, “MCOs will get subpoenas not raises.” He says his top priority will be to “investigate the privatization of Medicaid. Our state auditor sat through 48 alarm bells before finally starting an audit that likely won’t be released before the election.”

16) Louisiana: The Orleans Parish schools superintendent has announced plans to close four charter schools. “Administrative issues are also considered in the renewal process. Harney had a C which dropped to a D this year, but administrative problems at the Central City charter school are the reason the district is denying its charter. The school received 11 notices of non-compliance in the last year—for financial mismanagement, failing to follow charter school governance standards and inadequate special education services—district documents show.” Regarding Harney, “he also called for all members of the embattled charter school board to step down. Lewis said the district discovered matters it has referred to the Orleans Parish District Attorney’s Office, which handles criminal investigations. Lewis said the school district has also alerted the Louisiana Legislative Auditor about the school. ‘We didn’t just get here last week or this month,’ district administrator Amanda Aiken said. ‘There have been ongoing compliance issues with Harney.’”

17) Louisiana: The Orleans Parish school district has informed Cypress Academy parents that it will hand the school over to an outside operator next year, “in spite of the district’s promises to run the school directly through the 2019-2020 school year.” On Thursday, “some Cypress parents attended a district public hearing to express their frustration.”

18) Maine: The state’s first virtual charter school is up for renewal. “Maine Connections Academy is also seeking to lift its enrollment cap and expand into two new grades. The Maine Charter School Commission will vote on the renewal, which can be for up to 10 years, [today] and take up the enrollment cap and expansion at a later date.”

19) Michigan: Utica teachers complain that custodial outsourcing has left their schools in a filthy and disgusting state, and are demanding that the services be brought back in house. “The Utica Education Association, in its frustration with the Board of Education, released statements and photos from teachers fed up with conditions in their schools. The teachers reported ‘dirty and sometimes disgusting examples’ of unclean classrooms, bathrooms and hallways and trash not being emptied. Teachers have resorted to cleaning several of the areas on their own. ‘We have mice and a toilet that wasn’t cleaned for four days. We’ve named a hairball in our classroom “Trudy,”’ Utica Academy for International Studies teacher Brian Burak said. ‘I feel badly about it because the custodians who do a good job and care, are often so beaten down by the terrible company management I’ve witnessed, combined with unreasonable working conditions. The cleaning equipment is older than me, and our rooms are typically not vacuumed. Yeah, that’s right—vacuumed. That said, conditions have obviously gotten dramatically worse since privatization.’”

20) North Carolina: The newest charter school in the Twin Counties may be closing soon after its charter was revoked by the state. State charters chief Dave Machado “agreed that he feels the move to Rocky Mount was a factor in the drop in enrollment. But he also said he believes his office made the right decision based on the laws of the state. The appeals process will take about 30 to 60 days, he said. If those appeals are exhausted and the revocation of the charter stands, the school will have roughly 30 days to close its doors.”

21) North Carolina: A lawsuit has been filed against a charter school for its sexist dress code. “According to Pop Sugar, Charter Day School, located in Leland, NC, forbids all female students from wearing pants or shorts. The dress code left a bad taste in Erika’s mouth, so she was thrilled when she learned a previous lawsuit about the same issue had already been filed. ‘Once I found out there was a lawsuit, I was delighted. I felt like the rule was unfair to girls all along. When my daughter… found out she had to wear skirts the first day of kindergarten, she cried,’ the mom explained to Today.”

22) North Carolina: After the threat of a lawsuit, a charter school has moved its graduation ceremony out of a church. “Ian Smith, a staff attorney with Americans for Separation of Church and State in Washington D.C., said someone complained about the ceremony. ‘A local person who attended the Lake Norman Charter School graduation in the church contacted us, and very well thought this might be a violation,’ he told WFAE. ‘We took a look at it. It is a constitutional violation, and we agreed to write a letter.’”

23) Pennsylvania: A Philadelphia charter school has lost its appeal to stay open and will close next year. “In June 2017, the then School Reform Commission approved revoking the school’s charter. Khepera, which opened in 2004, had problems in the past that included issues with organizational compliance, financial practice deficiencies and academic under-performance.”

24) Puerto Rico: Financial Timescolumnist John Dizard reports that “‘bottom-feeding’ hedge funds are big winners on Puerto Rico bonds.” Some hedge funds have “doubled their money in a couple of defaulted Puerto Rico bond issues. The biggest winners among speculators in the Commonwealth of Puerto Rico’s debt were those who had bought its senior ‘Cofina’ bonds, secured by receipts from a ‘sales and use tax.’ The price of the Cofina seniors bottomed out last year at just under 30 cents on the dollar. Now, under a restructuring plan on track for approval in January, they will receive 93 cents on the dollar in notional value. (…) Brad Setser, an economist who worked on Puerto Rican issues in Obama’s Treasury department, writes that ‘the risk of the new (Cofina) bond . . . is that the amount Puerto Rico needs to pay will double (from under $500m to $1bn) over the next 20 years before levelling off . . . And the rise in payments does not help reduce Puerto Rico’s debt stock . . . The next five years will be fine. The five years that follow might not be.’ OK, but if you are a hedge fund manager or shady commonwealth official, who cares? You will be gone, having already taken your pay-offs or profits.”

And Puerto Rico is not the only likely target. Preqin says that hedge fund assets under management are now at a record high $3.61 trillion.

25) Virginia: Affordable housing advocates are increasingly worried that Arlington won’t force Amazon “to take action to mitigate the new office’s impact on housing prices” in the county. “Fears linger that the arrival of even a portion of those workers would further squeeze the county’s already tight housing market. County and state officials have steadfastly refused to release any details about their pitch to Amazon, including details on potential economic incentives for the company, or any community benefits designed to account for how a sudden influx of thousands of workers might drive up housing prices and demand.”

26) Wisconsin/National: Writing in The Wall Street Journal, the Bradley Foundation-funded Wisconsin Institute for Law & Liberty complains that vacant school district property is being put off limits for sale to charter schools. “In 2015, the Wisconsin Legislature had seen enough. It enacted the Surplus Property Law, which was supposed to force the sale of vacant MPS buildings to choice and charter schools. The law requires the city to list vacant buildings online and give choice and charter schools priority. But our organization found that MPS and Milwaukee have been flouting the law. So far, 13 charter and private schools have tried to purchase vacant public schools, but none have succeeded.” [Sub required]

27) Revolving Door News: The Project on Government Oversight has published a major 204-page, in-depth report on the revolving door between the Pentagon and private government contractors. Brass Parachutes: Defense Contractors’ Capture of Pentagon Officials through the Revolving Door “Laws are frequently insufficient,” the report says. “For instance, laws regulating the revolving door—the practice of government officials leaving public service to work for companies they oversaw or regulated—have been ineffective at slowing or stopping it. The revolving door between the government and the corporations it does business with often creates the appearance that government officials are improperly favoring a company in awarding or managing federal programs and contracts. Without transparency and more effective protections of the public interest the revolving door between senior Pentagon officials and officers and defense contractors may be costing American taxpayers billions. Taxpayers deserve protecting just as private sector companies do.” The report was supported by the Charles Koch Foundation and Philip A. Straus, Jr.

28) Upcoming Event: “The 2018 Elections: What Do They Mean for American Education?” Co-Sponsored by the Albert Shanker Institute and the American Federation of Teachers. Washington, DC, November 27, 2018, 12-2 pm.

Legislative Issues

1) National: As Congress returns this week to begin its lame duck session Suzanne Gordon, senior policy fellow at the Veterans Healthcare Policy Institute and author of  Wounds of War: How the VA Delivers Health, Healing, and Hope to the Nation’s Veterans, warns in The New York Timesthat Trump may be preparing to sell out veterans. “Studies have shown that private-sector doctors and hospitals are not prepared to deal with veterans’ complex needs. But foes of the V.H.A., backed by wealthy donors like the Koch brothers, want to dismantle its hospital and clinic network and contract out billions of dollars’ worth of veterans’ services to the private sector. (…) The head of the Department of Veterans Affairs, Robert Wilkie, perhaps influenced by a shadowy group of Trump associates nicknamed the Mar-a-Lago Crowd, is said to be developing rules that would significantly increase the number of veterans who get care outside the V.H.A.”

2) National: State and local support for public infrastructure and services appears to have gained last Tuesday. The State Innovation Exchange reports that progressive power is growing in state houses. “Tuesday night, progressives made significant gains in state houses across the nation, creating new opportunities to advance progressive policies and taking a critical next step in strengthening progressive power in the states. Candidates that ran on a progressive platform will now be focused on passing policies including expanding Medicaid, protecting pre-existing conditions, protecting abortion rights, increasing public education funding, protecting the rights of workers to join together in union, raising wages and increasing access to overtime pay, civil and voting rights protections, and protecting LGBTQ+ rights. Not only does the new map bode well for progressive legislation in 2019, but for a more fair and bipartisan process to redraw Congressional and legislative maps following the 2020 census.”

SIX also reports:

  • More than 360 state legislatives seats have flipped from red to blue since Trump’s election
  • Democrats gained majorities in seven chambers
  • Seven gubernatorial seats flipped from red to blue
  • Democrats gained six new trifectas
  • Democrats broke conservative supermajorities in four chambers
  • At least four Republican trifectas were broken
  • Dems gained or held 20 supermajorities in state chambers
  • Historic gains also mean a record number of women will be in power.
  • Women also made huge gains in Pennsylvania, Colorado, Minnesota, North Carolina, and numerous other states

Nevertheless, Government Executive’s Route Fifty reports that despite Democratic gains, the GOP is still dominant in state legislatures. “Republicans are on track to control at least 61 state legislative chambers going forward, compared to the Democrats’ 37, according tothe National Conference of State Legislatures. A sixth Democratic pickup was in the Connecticut Senate, which had been evenly divided.”

3) National: Rumors are flying that pro-privatization Education Secretary Betsy DeVos may be on her way out after the Democratic takeover of the House, but The Detroit Free Pressis quotes her staff as denying them. Education Weekhas reported that a slew of investigations may be headed DeVos’ way.

4) National: There’s a new sheriff in town on infrastructure. Rep. Peter DeFazio (D-OR), who will become House Transportation chairman, is “bullish on infrastructure. ‘Welcome to the day after the election,’ he told reporters Wednesday. ‘This is the day we begin planning to deliver a major infrastructure package.’ He’s met with the White House legislative affairs director and plans to meet with her again, and he’s optimistic he can work with Trump on a bipartisan infrastructure plan with ‘real investment’—not ‘pretend stuff’ like the asset recycling that former adviser D.J. Gribbin put into Trump’s proposal.” The Democratic-controlled committee next year “also will investigate the U.S. Department of Transportation’s decision to slow walk funding for transit projects that received bipartisan support from a Republican-controlled Congress earlier this year.”

5) National: Criminal justice reform legislation will be a top item in Congress during its lame duck session. “A GOP aide told The Hillearlier this month that the senators involved in talks were ‘close to a deal,’ while two Senate aides stressed that there was not finalized legislative text yet. A spokesman for Grassley, asked on Friday if text had been finalized, said talks remained ongoing. The tentative agreement, according to a copy of draft legislation viewed by The Hill, would pair a House-passed prison reform bill with some sentencing reforms, including reducing lifetime mandatory minimum sentences after two prior felony drug convictions to at least 25 years; reducing minimum sentences after one prior conviction from 20 to 15 years; and making the Fair Sentencing Act retroactive. It also would expand an existing safety valve for mandatory minimum sentencing, but would not apply retroactively, according to the draft seen by The Hill.”

The ACLU has supported a sentencing reform bill (the Sentencing Reform and Corrections Act of 2017), and it will be interesting to see how much of it makes its way into the new legislation. Trump’s son-in-law and senior adviser Jared Kushner, who is pushing criminal justice reform within the White House, was interviewed by Van Jones on CNN on Saturday about where the process stands(at 18:27).

6) Kentucky: A battle is looming in the state legislature over charter school funding. “Despite consistent opposition from the state’s public school teachers and their allies, the Kentucky Department of Education will push the state legislature during its upcoming session to pay for charter schools. (…) [Kentucky Department of Education Commissioner Wayne Lewis’] pledge to push for money comes as the role of charter schools in Kentucky remains hotly debated. When thousands of teachers stormed the state Capitol this year in protest, many held signs stating their opposition to charters. The controversy also carried into the 2018 elections, with candidates across the state pledging not to support the schools. Though Kentucky passed a charter school law in 2017, no charter schools have opened in the state. That’s because lawmakers have yet to approve a permanent funding mechanism for them.”