Weekly privatization report: Oakland teachers still striking | Private prison corps see gold | and more

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

THIS WEEK’S HIGHLIGHTS

JUMP TOEducationInfrastructureCriminal justice & immigrationPublic servicesOther

EDUCATION

1) National/California: In the latest in a series of strikes across the country by educators and support staff, Oakland school employees walked off the job on Thursday. Ten charter schools were shut down by wildcat strikes. Key issues in the strike include the inability of teachers to live and work in the city because of high rents and low paythe ongoing privatization of public schools through charterization, and school closures to make room for charters. The Washington Post reports that “about 30 percent of the city’s 50,000 public school students go to charters—the highest proportion in the state. A study found that Oakland is losing about $57 million a year in revenue because children transferred to charters, even after researchers considered how much money the system was saving when it no longer had to educate those students.” The study is In the Public Interest’s The Cost of Charter Schools for Public School Districts.

Negotiations continued yesterday with no reported progress at press time. The Oakland Education Association says they are prepared to walk out again today. Serious issues remain, as OEA bargaining unit members explained last night in a 10 minute must-watch video.

Oakland teachers marched through West Oakland to the offices of GO Public Schools, a pro-charter nonprofit that is the major force behind the privatization of the Oakland public school system. OEA President Keith Brown explains how billionaires funded political action to impose publically-funded, privately operated charter schools on the city.

“Privatization is many things,” In the Public Interest’s Jeremy Mohler writes. “It’s a corporate cash grab. It’s a convenient way for politicians to dodge accountability. It’s smoke and mirrors to distract us from raising taxes on corporations and the wealthy. And it often doesn’t save money for taxpayers. But most of all, it sideswipes democracy, taking decision making power from people to put it in the hands of corporations.”

Eric Blanc, a former Bay Area teacher agrees. “At its heart, the Oakland strike, and the national teachers’ revolt, is a struggle for democracy—for a society in which the working-class majority, not the superrich, determines governmental policy. As Oakland union leader Keith Brown said just before [the strike began], ‘only the power of the people can defeat the power of the billionaires.’”

2) National/CaliforniaOakland charter school teachers are planning a sick-out today in solidarity with the public school teacher strike and in protest of poor and unaccountable treatment from charter school owners. They say “we charter school teachers face the brunt of privatization. As you know, we’re forced to work weekends, have huge workloads, bad benefits, no public pension, and we’re often paid less than even the lowest paid public school teachers. Enough!” Teachers at 10 charter schools organized wildcat walkouts to support the Oakland strike. Two of their leaders spoke at a rally to denounce privatization. [Video]

3) National/California: Steph Curry, Mahershala Ali, and MC Hammer and others made a video to support striking Oakland teachers. Here it is.

4) National: Writing in Salon, Derek W. Black, Bruce Baker and Preston Green III explain how charter schools are exploiting lucrative loopholes and practices that would be easy to close. “The biggest problem in charter school operations involves facility leases and land purchases,” they say. “The time has come for oversight that ensures public money is meeting its public purpose–serving students, not private interests. In our view, lawmakers should prohibit charter school owners and operators from leasing and purchasing property from their other companies. They should also require state officials to audit facility purchases and leases for irregularities.” 

5) National: Carol Burris of the Network for Public Education reminds us that “the week of March 25-29 is Public Schools Week. Let’s make 2019 The Year of the Public School.” See NPE’s toolkit.

6) National/Arizona: The Arizona Republic has won the Polk Education Reporting award for what the Tucson Weekly calls its “thorough, ground-breaking stories about charter school corruption and profiteering.” Reporters Craig Harris, Anne Ryman, Alden Woods and Justin Price shared the honor along with investigative editor Michael Squires.

7) Arizona: The Arizona Republic’s Laurie Roberts passes on the bad news from the Republican-controlled state legislature. Lawmakers “passed a bill through committee aimed at better regulating charter schools – one written largely by the charter school industry. The bill makes modest changes but does nothing to prevent insider deals that have allowed charter school owners to divert unlimited amounts of tax money away from students and into their own stock portfolios.” 

8) California: Charter schools would face closer oversight under fast track legislation. “At the urging of Gov. Gavin Newsom, a bill that will require charter schools to be more accountable and transparent is making its way swiftly through the legislature and may be the first of several bills seeking to tighten oversight of charter schools. Senate Bill 126 would require that California charter school boards comply with the same open meeting,conflict-of-interest and disclosure laws as district school boards, including holding public board meetings, opening records to the public upon request and ensuring board members don’t have a financial interest in contracts on which they vote.” It’s now in the Assembly and may be voted on this week.

9) Colorado: Jeff Bryant explains howthe Denver teachers’ strike was a rejection of education ‘reform.’ “Denver’s approach to school governance has been much-ballyhooed by politically centrist advocates like David Osborne of the Progressive Policy Institute, the Clinton-era ‘ideas shop’ that has been pushing the privatization of public services for more than thirty years.” But “to Nelson and his fellow teachers, for far too long, Denver has felt ‘like a lab for education reform, experimenting with a district that will rubber stamp anything presented to them by reform advocates.’ They want the experiments to end.” 

10) Colorado: A charter school operator is miffed that the state school board failed to overturn a rejection of its charter by the Boulder Valley School District. But the issue of local public control sealed its fate. “According to Shuler, [Superintendent Rob Anderson] told the board that Shuler’s group wouldn’t accept his conditions, despite never meeting to discuss them. Shuler said most of the recommendations were easily workable, but some were poison pills designed to kill the application, such as requiring the school’s board of directors to be local, to hold board meetings in the district, and to require employees work for the school, not the network, to name a few.”

11) District of ColumbiaA slavery skit at Elsie Whitlow Stokes Community Freedom Public Charter School in Northeast causes outrage. “She said a few weeks ago, her fifth-grade son came home upset after his classmates put on a skit. ‘Two of the African American boys portraying a scene of slavery being beaten by a white child,’ Ragland said.”

12) Massachusetts: Can it work in the other direction? Can a charter school make the transition to a public neighborhood school? New Bedford may be about to find out. But Jack Spillane of The Standard-Times and SouthCoastToday.com is skeptical.

13) Missouri: Three candidates for the post of president of the Board of Aldermen debated a number of issues, including airport privatization. “In this case, all three candidates support a public vote on any proposal that comes forward although a bill that would have made that possible died in committee. Nasheed and Green called the airport privatization study underway a conflict of interest because it is being funded by billionaire philanthropist Rex Sinquefield, a major political donor who would have to be repaid if the proposal was accepted by the city.” Despite protests, a bill requiring a public vote has been bottled up in an aldermanic committee. 

14) Missouri: Twenty years after the first charter school opened in the state, a private St. Louis school is being converted to a charter and will begin receiving public tax dollars. Charter schools operate under a separate board. “Using a sliding-scale based on income, Soulard receives an average of $4,500 a year in tuition from its 100 students in kindergarten through fifth grade. With federal, state and local funding, they’ll receive closer to $8,300 per student. (…) While charter school enrollment has grown to nearly 12,000 students in St. Louis, or 36 percent of the city’s public school student population, academic results have been mixed.”

15) New Mexico: The Santa Fe New Mexican calls for a moratorium on charter schools. “Under legislation now in the state House of Representatives, a moratorium on new charter schools would start June 14 and last until Jan. 1, 2022. It leaves the state with 96 charter schools and doesn’t limit enrollment or seek to close any. Currently, some 26,000 students are being educated in such schools. Here’s why this is a good idea right now.”

16) Tennessee: Nashville School Board member Will Pinkston says “a new ‘nonprofit’ group called ReThink Forward has said it wants to open a charter school in Nashville. Their ‘leadership’ includes a controversial former Indiana state school superintendent and a former executive of the controversial for-profit Charter Schools USA.” This is Tony Bennett, a controversial former member of Jeb Bush’s Chiefs for Change. For more see the results of In the Public Interest’s records request.

17) Tennessee: A new set of Memphis charter school guidelines would help decide if there are too many schools in a single neighborhood. “The charter school guidelines, called the Educational Priorities Document/Rubric in a proposed district policy on charter schools, would also prioritize what the district wants charter schools to focus on, such as early literacy. Board members would be able to systematically slow the growth of charter schools in Memphis, which has swelled to 54 since the state legislature approved their creation in 2002.”

18) Texas: Responsive Education Solutions, a charter operator that  currently runs over 70 charter schools in Texas, is looking at moving into Sherman and Denison. “Denison Independent School District Superintendent Henry Scott said he spoke with [state rep] Smith about charter schools and how they impact districts. ‘They need to be held more accountable,’ Scott said. ‘In many cases, they don’t have an elected board. They are freed from a lot of state requirements we have to abide by. Even though they are considered a public school, they still have capacity to pick and choose students much like a private school. A public school doesn’t have those choices.’”

19) Utah: Chris Jones and Nadia Pflaum of KJZZ examine the lucrative connection between charter schools and lawmakers in the state. “Some such lawmakers, past and present, merely oversee various charter schools by sitting on their boards — a volunteer position. But others have a more vested interest, operating charter-adjacent businesses (such as charter school management companies) that can rake in millions in taxpayer money. Their names will be familiar to anyone with even a casual ear to Utah politics. How they vote on legislation that benefits charter schools may — or may not — surprise you.” 

20) West Virginia/National: West Virginia teachers win a major victory over uncontrolled charter school expansion by striking and building public support. “Our students are not for sale,” said Katie Endicott, a rank-and-file teacher from Mingo County.  “West Virginia is not for sale. It’s infuriating that people would try to profit off us: privatization would give millions of dollars to elites and it would create even more haves and have not. We’ve seen the charter school system fail students all across the US and that’s why we risking our pay raise to defeat this bill. We want better funding, and better schools, for all students. All students are worthy.”

“Delegates killed the bill in less than 24 hours after teachers announced their strike,” WVNews reported. “The unions called off the strike shortly after, but threatened further action if provisions to allow charter schools or education savings accounts return.” Senate President Mitch Carmichael, R-Jackson, has said  that he might pursue the ideas in different pieces of legislation. Stay tuned.



INFRASTRUCTURE

21) National: The Trump Administration’s decision to strip funds from the California high-speed rail project “leads to a potentially dangerous politicized approach to financing infrastructure,” sources told the Bond Buyer. A public finance attorney told BB “I think it’s a scary precedent in terms of federal funding for transportation projects. It seems like this project is being used in the broader fight over border funding. There is a lot more happening here than just some big rail project in California.” [Sub required]

22) National/Florida: The Trump administration is poised to approve more Private Activity Bonds for a private railroad after stripping funds from the California high-speed rail project. “The Florida Development Finance Corp., a statewide conduit issuer, has scheduled a TEFRA hearing for March 1 in Tallahassee to approve $950 million of PABs under the Tax Equity and Fiscal Responsibility Act for Brightline, which will become Virgin Trains USA this year. (…) Brightline, which would not comment on the new financing, filed an application for the PABs with the U.S. Department of Transportation. The USDOT did not respond to calls or emails requesting confirmation of the award.” [Sub required]. British billionaire Richard Branson backs Virgin Trains USA which called off its IPO a couple of weeks ago amid reports that “the company may still tap private activity bonds to fund its Orlando rail line, similar to what it used for its South Florida rail project that now operates from Miami to West Palm Beach.” Are the two stories by any chance related? [Subs required]. The company “also plans to construct a rail system connecting Las Vegas and Southern California.”

23) National/Think tanks: Public pension funds are interested in investing in infrastructure, though their allocations to the asset class are small, according to a report. “Public-private partnerships have long been talked about as another way to fund infrastructure, and leaning less on the federal government for funds. Lipshitz noted that P3’s are, like public pension fund investment, another tool. “Again, neither of these things is going to replace the other, it’s just an additional tool in the tool kit,” he said. As for riskiness, Lipshitz said like anything, if done incorrectly, it could be risky.” [Sub required]

24) New EnglandA company is planning to bring private rail service to congested New England corridors. “Bono said the company’s plan is to bring privately operated rail service to New England ‘gateway cities’ where commuters currently suffer from congested highways and lack public transit options. Around 200,000 commuters in the region spend around 70 minutes to drive 50 miles twice a day, he said. BSRC hopes to provide a rail service that cuts commute times by as much as 40 percent for an average fare of $11.”

25) Indiana: An Indianapolis real estate mogul has pitched lawmakers on a public bond-financed second tier soccer stadium. “Moody’s noted in a 2016 report on stadium finance that public bonds guaranteed by a developer are still at risk of falling short of expectations. ‘A government’s credit quality can be weakened due to the reliance on demand-based and potentially volatile revenue streams, such as hotel, car rental and sales taxes, to repay any issued debt and fund game/event day related expenses, such as public safety and traffic control.’ Moody’s said. ‘If these revenue sources are insufficient, the government might have to make up the shortfall from other revenue sources. The government might also use its general revenues for these purposes, which can divert funds away from other essential government services.’” [Sub required]

26) Think tanks: The National Council for Public-Private Partnerships (NCPPP—formerly the Privatization Council), a corporate backed group advocating infrastructure privatization, has added a legal arm to its operations. It is “led by representatives from Nossaman LLP, Kaplan Kirsch Rockwell LLP, Ballard Spahr LLP,  Mayer Brown LLP and Hunton Andrews Kurth LLP.   The Legal Institute offers participants an opportunity to participate in discussions about pertinent and relevant legal issues and challenges that P3 legal experts are addressing in the sector.  Participants will have the opportunity to engage in interactive discussions of common obstacles public and private sector partners encounter during the various stages of P3 development.” Its first webinar will be on March 21 on the subject of “Third Party Risks in P3 Transactions.” NCPPP’s vice president for policy is Ben Brubeck of Associated Builders and Contractors. 



CRIMINAL JUSTICE AND IMMIGRATION

27) National/Pennsylvania: Despite protests, the Berks County family detention center, which is operated by the county for ICE, remains open. “Since the beginning, we have argued that the center does not follow the Flores Agreement, because there have been children that have been in there for more than 20 days, which is the agreement,” said John Michael Cotignola-Pickensis, an Advocacy Programs Coordinator for the PA Council of Churches. “There are children who have been in there for over a year. It’s obvious the Flores Settlement is not being followed at Berks, which is something we have brought up a lot, but is not a deal breaker for some reason.”

28) National/California: More than 70 legal service providers and advocacy groups are calling for more transparency of the GEO Group-run Mesa Verde ICE Detention Facility in Bakersfield that could potentially be on the brink of closing. “‘We are profoundly concerned about the fate of the people imprisoned in the Mesa Verde facility, and what the future holds for them,’ the group of over 70 advocates said in a collective press release. ‘The fact that we have not been provided any information about whether they face transfer, relocation, or release, leaves legal service providers unable to mobilize and coordinate the resources that may be necessary if this facility were to be closed.’”

29) National/Colorado: Rep. Jason Crow (D) has expressed “serious concerns and questions” about the safety and health of roughly 1,500 potential detainees at the GEO Group-run Immigration and Customs Enforcement facility in Aurora. “Crow’s letter asks the Department of Homeland Security to provide details on the number and type of disease outbreaks, and how many led to quarantines. He also requests 911 calls, medical staffing and the contacts between ICE and the contractor.”

30) National: The GEO Group has reported FY19 adjusted earnings guidance of $464-$476 million, a 5-7% year-over-year increase. CEO George Zoley told investors on GEO’s conference call that the recently approved federal budget authority “”may provide additional opportunities for our company this year. First is there are two active procurements we are participating in for the Federal Bureau of Prisons totaling close to 12,000 beds. While the timing of these procurements was impacted by the recent government shutdown, we still expect contracts to be awarded during this year, which could result in upside to our initial guidance.”

31) National: CoreCivic has reported 4th quarter 2018 total revenue of $482.2 million, up 9.4% from the prior year quarter. During this year, the company expects to spend “approximately $125.0 million to $130.0 million in prison construction and expansion costs, including primarily costs associated with the construction project in Lansing, Kansas and the expansion of the Otay Mesa Detention Center.” 

CEO Damon Hininger told investors “we are anticipating utilization of ICE’s facilities to remain consistent throughout 2019, however, the rate of border apprehensions in 2019 are well above 2018 levels. So ICE could have emerging needs as the year unfolds. We have capacity and flexibility to address any emerging needs from the agency should they arise. And let me state again as I have in the past that none of our immigration facilities previously or currently has unaccompanied minors. Our South Texas Family Residential Center which was opened at the express request of the Obama administration does house mothers with their children for three weeks or less to have the process of their asylum claim initiated.”

32) Arizona: The Arizona State Retirement System has raised its stake in the private, for-profit prison company CoreCivic

33) Massachusetts: Harvard University President Lawrence S. Bacow has rejected demands from students groups that the university divest any of its $39.2 billion endowment in prison companies and disclose the specific investments. “This is not the first time students have voiced support for divestment from companies tied to the prison industry. An Undergraduate Council ballot referendum last year urging for divestment from the “prison-industrial complex” garnered 77.2 percent of the vote.”

34) Puerto Rico: The Commonwealth has quietly abandoned its plans to send 3,200 inmates to CoreCivic’s Eloy, Arizona, prison. “The plan met with forceful criticism by civil rights advocates, who argued it would separate families, interfere with inmate rehabilitation and lead to forced transfers.” The Guardian reports that “the government is now attempting to negotiate a deal to transfer just 200 inmates to Mississippi, the Puerto Rico corrections under secretary, Ulrich Jiménez, said on Friday.”

35) TennesseeAn inmate has filed suit against CoreCivic’s Trousdale facility. “The man claims his cellmate repeatedly threatened to rape him and the prison staff did not do anything when he reported it.  The man says he was eventually raped. We asked CoreCivic for comments. They told us the man only made one report of sexual abuse and it was unsubstantiated.”



PUBLIC SERVICES

36) Alaska: Is the threat of privatization being used as a wedge in public service contract negotiations? As the state ferry system heads into contract negotiations with its unions this year, the Republican governor has just floated the idea of a massive and devastating cut to its state funding. “In a separate memo dated Feb. 12, Dunleavy directed MacKinnon to investigate possibilities for the future of the Alaska Marine Highway System, such as privatization or a public-private partnership. A report on those possibilities is due Aug. 1.”

37) Connecticut: State court recording monitors are resisting plans by the state judicial branch plan to outsource the production of court transcripts. “The court monitors and union representatives [AFSCME Local 749] also say that the integrity of the official court record is at risk if contractors who haven’t been in court listening to the proceedings, and are unfamiliar with the players and terminology, are producing transcripts.”



OTHER

38) New Hampshire: “The more people we have at a low minimum wage, the more taxes are going to be required from all of us to support public assistance programs that those people need to live on,” says Rep. Howard Moffett (D) as state lawmakers begin debate on the minimum wage. Draconian wage cuts are still happening on a daily basis. For example, @_ericblanc reports that “the entire workforce at the Sonic in Circleville, Ohio just quit en masse to protest their new management and workers least two other Sonics in the area did the same. Check out the lovely note the Circleville workers left.” @boredgeek reports that the new management “cut workers pay from min wage to $4.00 USD + tips. $4.00 USD. Plus tips. TIPS. AT A FAST FOOD JOINT.” As of December 7, 2018, Sonic Corp. operates as a subsidiary of ARG Holding Corporation. Sonic was the target of criticism recently when its drive-ins stayed open during the polar vortex. As for tips, the situation is bleak.

39) National: Lawmakers in 23 states have introduced legislation to mandate worker tracking software for contractors “down to the keystroke.” Route 50 reports that “on Thursday, NASCIO came out with a statement in opposition to the wave of legislation, saying the requirements in the bills pose ‘significant risks to citizen privacy and federal regulatory compliance concerns.’ ‘That data would be stored by the contractor’s contractor, which has the potential to have screenshots of numerous state systems—everything from DMV, to health and social services, to public safety, to labor and so on,’ Delaware CIO and NASCIO President James Collins told Route Fifty.“It’s creating this other repository of potentially sensitive data around the citizens of our state.” 

40) National: Stung by reports of disastrous conditions at privatized military housing facilities, the U.S. army’s private housing contractors have come up with a response. “The landlords agreed to add staffing and become more responsive to housing concerns by setting up online tracking systems for service requests. They also endorsed a military-proposed ‘tenant bill of rights’ that will allow families to withhold rent while preventing the private housing companies from charging fees when families receive poor service.” Reuters adds that “the fine print of the landlord reform plan—such as under which circumstances residents can withhold rent, and how the provisions will be enforced – has yet to be ironed out. It’s likely the Army and its private industry partners will have to renegotiate some aspects of their contracts.” 

41) National/New York: New York Times columnist David Leonhardt says New York did us all a favor by standing up to Amazon despite the criticism over lost jobs. “Yes, New York’s economy will be slightly worse off because of Amazon’s departure. But the city deserves our gratitude. Refusing to play an unfair game is sometimes better than winning it.” In the fourth quarter of last year alone, New York City’s economy grew by 3.9%, with private employment surging by 34,000.

42) Puerto RicoPrivate bondholders are seeking to take over the Puerto Rico pension system. “The bondholders ask [Judge Laura Taylor Swain] to stop an effort by the Puerto Rico Oversight Board to dismantle the ERS and transfer all of its assets, including its revenues and rights to collect revenues, to Puerto Rico’s central government. Further, the bondholders are asking Swain to appoint them to be the system’s trustees. As an alternative, they ask Swain to appoint an independent trustee, which the bondholders would approve. ‘This is strong stuff,’ said Puerto Rico attorney John Mudd. ‘I doubt the judge will allow it but it is a direct result of the First Circuit’s opinion on ERS.’” [Sub required]