Here’s our weekly analysis of privatization in the news and in communities nationwide. Not a subscriber? Sign up.
This week’s highlights
- Baruch professor Andrea Gabor has written about “Big Philanthropy’s bid to privatize education.”
- There are “no easy solutions” for cleaning up PG&E’s role in the California wildfire crisis.
- Baltimore, having rejected privatization, is one step closer to income-based water billing.
1) National/Puerto Rico: The Schott Foundation for Public Education just convened organizers from across the country “to highlight the popular struggles in Puerto Rico against austerity, privatization, and the larger neocolonial project the island has been subjected to.” The convening was titled “The Fight for Public Education in Puerto Rico: 3 Lessons for the Field & Philanthropy.” Members of Schott grantee partner Journey for Justice Alliance “have visited the island to support and learn from the struggles there, including co-organizing a conference this past summer.” Presenters included Zakiyah Ansari,Advocacy Director & New York City Director, Alliance for Quality Education; Jitu Brown,National Organizer, Journey for Justice Alliance; Jorge Díaz Ortiz,Executive & Artistic Director, Agitarte; Mercedes Martinez, President, Federación de Maestros de Puerto Rico (Teachers Federation of Puerto Rico); and Marianna Islam(moderator), Director of Programs and Advocacy, Schott Foundation for Public Education. Watch the webinar, about an hour.
2) National/Louisiana: This month’s Harper’s has a must-read account by Baruch professor Andrea Gabor of “Big Philanthropy’s bid to privatize education.” She writes, “when the voucher concept failed to catch on nationwide, education reformers on both sides of the aisle embraced charter schools as the next best way to loosen the government’s (and the unions’) grip on K–12 education. Since about 2000, the model’s chief proponents and funders have been three big philanthropies: the Bill and Melinda Gates Foundation, the Eli and Edythe Broad Foundation, and the Walton Family Foundation.”
3) Alabama: A former principal of LEAD Academy, Nicole Ivey, has filed a lawsuit for fraud and breach of contract containing serious allegations: “The administration at LEAD Academy tried to prevent students with learning disabilities from enrolling. LEAD board president Charlotte Meadows and another board member controlled a private bank account. Meadows used the school to run her campaign for the Alabama House and directed school funds to her campaign manager and her niece. Teachers and other employees at the school haven’t been paid money they were promised, and LEAD officials attempted to alter contracts several weeks, even months, after the employees began working.” The Alabama Political Reporter says the allegations “were largely confirmed by current and former LEAD teachers, who spoke to APR in recent days, and who presented even more issues that they’ve encountered at Montgomery’s first charter school.”
4) California: AFSCME Local 3299 says 25,000 University of California Service and Patient Care Technical workers will strike on November 13 over new charges of illegal outsourcing. “By secretly working to expand outsourcing of service and patient care jobs, the University of California is unilaterally imposing lower wages, more inequality, and more risk of employer abuse against its most vulnerable workers—mostly women and people of color,” said AFSCME 3299 ULP Committee Member and UC Irvine Hospital Unit Service Coordinator Monica De Leon. “This is not just morally bankrupt, unfair and unsafe for the students and patients who depend on the work we do—it is illegal. And we will not rest until this lawlessness stops.”
5) California: Los Altos School District has hosted a multilingual meeting on charter school facilities. “Los Altos School District officials added the meeting in an effort to encourage more non-English-speaking families to participate in the ongoing public engagement process around charter school facilities. The meeting followed the same format as the previous two charrettes the district hosted, but the written materials were translated into Japanese, Mandarin, Russian and Spanish, and translators were available for all four languages. The meeting was led by Noé Noyola from MIG, a company the district hired to oversee the public engagement process.”
6) California: San Diego Cooperative Charter School “Is in Meltdown Mode,” Voice of San Diego reports. “The co-op school has two locations, one in Mountain View and another much bigger campus in Linda Vista. Leadership turmoil and reports of persistent safety concerns on the Mountain View campus led families to unenroll their children in droves since the end of last school year. The campus has lost more than a third of its students and now money problems are rippling out through the entire organization. School leaders held an emergency meeting Wednesday, which was attended by dozens of frustrated parents who shouted down board members throughout the evening.”
7) District of Columbia: In the Public Interest has launched a regular email roundup of news and analysis about the effort to privatize education in the nation’s capital and the families, students, and teachers fighting back. Sign up here.
8) District of Columbia: DC Prep wants to build a charter school in Southeast, but the neighborhood says no. “The conflict pitted educators against homeowners, charter school heads against its board, and Ward 8 residents against Ward 8 residents. It’s the latest example of how the District’s lack of comprehensive planning for where to build new schools can create disarray. ‘As a neighbor living 25 feet away from this proposed building, there was zero outreach from this school,’ Stephanie Bell told the Public Charter School Board. ‘The only reason that I know about it is because surveyors trespassed on my property while doing a survey for DC Prep.’ ‘The behavior we see today from DC Prep indicates to me that this relationship is beyond repair and they will never be a partner to this neighborhood,’ said another Ward 8 resident who lives near the proposed site, Sarah Woodruff.”
9) Illinois: Chicago high school teacher and CTU union bargaining member Jackson Potter says the teachers’ strike was “a definitive shift in the entire landscape, not just in Chicago, but throughout the U.S., away from privatization, school closures, charter schools, and the kind of Koch Brother-funding of private schools instead of public schools, a threat we’ve been fending off for the last 30 years.” Pro-charter advocates seem to agree. Chicago Business laments the deal’s “hard caps on charter school expansion and enrollment growth,” and the Heartland Institute’s Chris Talgo calls it “a death blow to charter schools in the Windy City.”
AFT President Randi Weingarten says“ @CTULocal1’s contract would not have happened w/o the support of community & the unity of our members. Thank you, Chicago 4 your patience & support in our fight 4 the schools our kids deserve. Thank you to every1 nationally 4 your solidarity.”
Service Employees International Union (SEIU) Local 73, which represents 7,500 school workers, notes that the newly ratified contract “includes the following specific benefits and changes for each job category: Custodians. 18-27% wage increases now through the 2020-2021 school year with additional wage negotiations then; Holding Sodexo and Aramark accountable: custodians can provide quick response to unsanitary conditions without going through private contractors; When CPS finally decides to have custodians report to school principals, members can bargain over the effects of that change.”
10) Massachusetts: Students have walked out of Boston Collegiate Charter School to protest policies they see as racist. “Among the issues that students said they were protesting: discriminatory dress code policies, teacher diversity disparities, and the school’s inaction and lack of progress in response to racist attacks on students and the lack of inclusive culture for students of color. The students made several demands to improve the racial climate at the school, which included revising the dress code to allow students to wear cultural head wraps, purchasing more textbooks that reflect the students’ diverse backgrounds, hiring more teachers of color, creating more courses that are culturally relevant to students, and forming a ‘task force that will lead the charge and keep the school accountable for their actions.’”
11) Pennsylvania: According to a study by William Hartman and Timothy J. Shrom, “unless structural changes are made by the Legislature in the way schools in the state are funded, the state educational system will continue to be divided into have and have-not districts.” The two scholars have published a policy brief based on their findings entitled “A Tale of Haves and Have-Nots: The Financial Future of Pennsylvania School Districts.”
Among their findings is that “charter school costs will place an increasing burden on school district taxpayers as the state does not support these mandated district costs.” Their breakdown (p. 3): “The largest type of expenditures are Salaries (35%) followed by Charter School Tuition (19%), Net Other Expenditures (17%), Net PSERS (16%), and Health Care and Other (13%) respectively.” They also find that (p. 3) “the projected five year state funding subsidies for [Basic Education Funding] and [Special Education Funding] are equivalent to the projected charter school required payments alone. This leaves no net state funding remaining to support other mandatory expenditure categories or any other district operating expenditures.”
12) Pennsylvania: Rep. Curt Sonney (R-Erie), who chairs the House Education Committee, plans on holding a hearing by the end of the year on a bill aimed at changing the structure of the state’s charter school system. “In House Bill 1897, state Rep. Curt Sonney, R-Erie, has proposed legislation that would require all Pennsylvania school districts to offer a full-time cyber education program. Sonney’s legislation, first introduced Oct. 7, has been met with criticism from school choice advocates—a reality he acknowledged in a recent interview with The Center Square – but the goal, he said, is to make the charter school system accountable to local communities. (…) Groups that have opposed HB1897 include the National Coalition for Public School Options, an organization advocating for a range of public education choices, including charter, online and magnet schools.”
13) National/California: The California wildfires have sparked an intense debate over how to restructure the bankrupt PG&E utility, whose faulty equipment and mismanagement allegedly led to death and destruction across the state and poses a continuing risk. [For more background see the excellent new episode of Frontline, “Fire in Paradise”] The role of the climate crisis is centrally involved, as it is in the continuing woes of Puerto Rico’s electrical utility, which was devastated by Hurricane Maria. Infrastructure resiliency is now a matter of vital public interest at the state and national levels.
Calls for PG&E to be taken into the public sector, in the midst of complex litigation and with a an end of June bankruptcy resolution deadline looming, are growing. Jill Richardson of the Organic Consumers Association says “the public interest, not private profit, should be priority No. 1. If there’s a silver lining to this mess with PG&E, it’s that more people will demand that.” Writing in The Nation, Ben Ehrenreich says “as the flames spread with devastating regularity, it is no longer at all radical to suggest that utilities should be owned by and accountable to the communities that they serve. In California and everywhere else, it has become a matter of life and death.”
Rep. Ro Khanna (D-CA) says “the for-profit motive does not work. The public utility is a much better option because you’re not having to worry about maximizing shareholder returns and you will make the safety investments that are necessary.” Also, listen to Thom Hartman’s interview with Greg Palast on bringing PG&E under public control. [Video, about 9 minutes] The Los Angeles Times has called for “remunicipalization” and even statewide public ownership to be given serious consideration. “We’ve reached a point where public ownership of PG&E shouldn’t just be on the table, it should be actively explored by state and local officials.”
But as The Atlantic’s Robinson Meyer points out, there are no easy solutions. Donald Cohen, executive director of In the Public Interest, says “whatever solution is chosen, transparency and public control of the decision-making process on what happens to PG&E, and control over California’s utility future, is essential.”
14) National: Dr. David Swindell, director of the Center for Urban Innovation at Arizona State University, has highlighted some of the issues surrounding public subsidies and/or financing of sports facilities. “The world’s fixation on sports of all kinds currently confronts a significant fiscal challenge for states and localities,” he writes. “Sports subsidies sold on the grounds of economic development are false promises. Sports subsidies sold on civic pride and community identity are another matter, but one with which economists wrestle.” Beyond finance and development issues, Jonny Coleman and Jacob Woocher point to the detrimental impact such projects may have in an article in The Nation, “How Staples Center Kicked LA Gentrification Into Overdrive: It was hailed as a turning point for a depressed downtown, but its construction helped start a wildfire of displacement.”
15) National: Sarah Lazare, the intrepid web editor of In These Times, is “looking for videos, pamphlets and slideshows from early-2000s weird corporate seminars and workshops touting the merits of private-public partnerships. Its kind of a deadzone for online videos so any leads would be appreciated.”
16) National: Squire Patton Boggs, a large law and lobbying firm, has just beefed up its “public-private partnership” practice by hiring G. Scott Rafshoon, law.com reports. “Rafshoon, 55, focuses his P3 practice on social infrastructure transactions, representing developers and sponsors in privatizations of housing and other concessions by military bases, public universities and other government entities at the federal and state levels.” This year Squire Patton Boggs has lobbied for Transurban USA on “TIFIA and Private Activity Bond, (PABs) legislative recommendations,” and “Issues related to Public Private Partnerships, infrastructure, tolling and TIFIAS, including public-private partnership and innovative financing.”
17) California: The Bond Buyer reports that “California Republicans want to reverse Senate Bill 100, a 2018 law that requires the state to hit 100% renewable electric resources by 2045, claiming it forces companies to focus on complying with the mandate when they should be spending money hardening equipment to prevent fires. State Sen. Jim Nielsen, R-Tehama, and Assemblyman James Gallagher, R-Yuba City, say the $2.4 billion PG&E is spending on renewables could go toward fire-proofing equipment.”
18) Florida: JEA, Jacksonville’s public utility, has set out a timeline for its intended privatization process in a 302-page filing it just posted on the Municipal Securities Rulemaking Board’s EMMA filing system (p. 69). The JEA board expects to make a proposal to the City Council in March. It says “No Decision Will Be Made on Strategic Path for JEA Until Mid-2020.” City Council member Matt Carlucci, who owns an insurance agency, is opposed to privatizing the electric and water systems. “Local control to me is really priceless,” he told The Bond Buyer.
The JEA privatization proposal is hugely controversial, for reasons Florida Times-Union columnist Nate Monroe regularly explains. “There is almost no one who stands to benefit more or more directly from the sale of JEA to a private buyer than the utility’s chief executive officer, Aaron Zahn—who could walk away from such a transaction with a $520,000-plus bonus,” Monroe writes. “JEA’s spin that this payout is not an incentive to sell the agency—and therefore Zahn is not hopelessly conflicted from leading the effort—is egregious even by the new heights of baloney the utility sets nearly every day. People in this country tear each other apart over Black Friday deals. What would they do for a half-million-dollar cash bounty? The median household income in Jacksonville is just over $50,000.”
An interesting question was posed to American Water’s President and CEO Susan Story by Shahriar Pourreza of Guggenheim its earnings call last week. “Susan, can you just touch a little bit on sort of some of the publicly available data in the media that we’re seeing around JEA and sort of your interest there? Maybe just high level structure of your bid because it does have an electric business, so curious if your bidding for the entire system or just the water portion of it and just how you’re sort of thinking about that process because it’s actually turning out to be a little bit more competitive than we originally thought?”
Story’s answer: “So Shar, one thing that I will remind everybody is that JEA has publicly announced who would be in the next round of participation, and we’re very respectful of JEA and their process and so we can’t really comment any further on anything additional about JEA. And all I will say is that we’ve not made any changes to our previously communicated business model strategy.” His raises the question, is JEA going to be parceled out?
19) Maryland: Baltimore, having rejected privatization, is one step closer to income-based water billing. The City Council has advanced a bill that will drastically reform Baltimore’s water billing system. However, Morgan State University professor of public health and activist Dr. Lawrence Brown “says the water affordability legislation could have been stronger. ‘The Water for All program should be automatically applied for entire [low-income] neighborhoods. People shouldn’t have to sign up. But we definitely should be looking for ways to make taxes and the general fund and the spending we do in this city more equitable.’”
20) Missouri: The St. Louis airport privatization working group held a public meeting last week where they fielded questions on the process. “Most residents at the meeting expressed concern about the airport privatization process, questioning the lack of public engagement and transparency. One resident asked whether local billionaire Rex Sinquefield—who is funding the exploration process—is influencing the group’s decisions. According to the consulting agreement, the city would pay back Sinquefield’s organization Grow Missouri if the city signs a deal.” @GerryConnolly88 reports “the consultants were so uncomfortable with the public’s tough questions at the outreach meetings that videos were not uploaded until the chair of the working group demanded the posting of the videos.” The city has received 18 responses to its Request for Qualifications for potential private operators of St. Louis Lambert International Airport. But St. Louis Post-Dispatch columnist Tony Messenger writes that “from day one, the city’s lead consultant has had end goal in mind—privatize Lambert.”
21) Nevada/California: California’s infrastructure bank is going to act as the conduit issuer for $3.5 billion in bond financing for Richard Branson’s Virgin Trains USA’s Victorville, California to Las Vegas rail line. “The $3.25 billion bond request IBank approved Wednesday is comprised of $850 million through the U. S. Department of Transportation and $2.4 billion in tax exempt, private activity bonds. IBank’s total figure includes the $600 million in PAB approvals expected from the California Debt Limit Allocation Committee chaired by Treasurer Fiona Ma. Last month, CDLAC approved the first $300 million in tax exempt, private activity bonds, with another $300 million to be considered next year. The bonding authority through California’s debt limit allocation would allow Virgin to market up to four times that amount, or $2.4 billion in tax exempt, PABs, according to Internal Revenue Service guidelines. (…) Virgin Trains USA was known as Brightline before a brand licensing deal with Richard Branson’s UK-based Virgin Group. It’s building a passenger train service between Miami and Orlando, and operating trains between Miami and West Palm Beach.” [Sub required]
22) New Jersey: Laura Flanders interviews Newark activists working to fix their city’s water through more robust democratization rather than privatization. “The people of Newark, New Jersey—the majority of whom are black and brown—are grappling with a lead contamination crisis that has drawn comparisons with Flint, Michigan. There, the state took control of the city’s water after municipal officials and a private management company failed to provide clean water. In Newark, local residents want to keep their water in public hands.” [Video, about 27 minutes]
23) North Carolina: Illustrating the challenges posed by years of underinvestment in public infrastructure, leaky sewers are plunging small towns into financial crisis. “The hydrological pressures on rural sewer systems are also not likely to relent. North Carolina is expected to see more severe downpours and higher overall precipitation as the planet warms, according to a federal climate change assessment. A separate analysis of 19 coastal wastewater treatment facilities in North Carolina identified significant vulnerabilities to increased rainfall and seasonally high groundwater tables, which can also infiltrate sewer pipes. Adding to the difficulty is that many of the state’s clay soils do not drain well.”
24) International: Cécilia Gondard of Eurodad gives us a heads-up that the draft Guide to Community Engagement for PPPs is open for public consultation to capture inputs and recommendations by all relevant stakeholders. “The guide is intended for the governments that prepare PPPs, the private partners that implement PPPs, and the investors and lenders of PPPs. It also intended to inform communities affected by a PPP about what they should expect. You can submit your input and feedback by December 31, 2019.”
Criminal Justice and Immigration
25) National/California: Lawmakers and immigrant advocates say federal officials “are rushing to secure new contracts for four private immigrant detention facilities in California before a state law takes effect on Jan. 1 phasing out the use of private, for-profit prisons.” State Assemblymember Rob Bonta (D), the author of the law, “pledged California would fight back against Homeland Security’s efforts to skirt AB 32, potentially setting the stage for yet another showdown between the state and federal governments over immigration.”
26) National: Rep. Bonnie Watson Coleman (D-NJ), a member of the Congressional Black Caucus, says “it’s time for members of the Congressional Black Caucus (CBC), the Congressional Hispanic Caucus (CHC) and the organizations associated with them to end all affiliations with the for-profit prison industry and immediately stop accepting donations from these entities.”
27) California: An assault and discrimination trial is set to begin today over a guard’s claims against the private, for-profit prison operator GEO Group. Attorney Raymond Babaian says “this is one of the most horrifying cases that I’ve ever seen of a company’s managers targeting and harassing a female employee. The racist remarks started on Day One… and quickly escalated…’”
28) California/National: A convention center group pressing a hotel room tax-hike measure in San Diego is disgorging a contribution made by GEO Group. “Laing’s disgorgement announcement came as GEO Group’s growing role in outsourcing of homeless services has begun to emerge as a bone of contention regarding the tax-hike measure, with accountability questions looming large.”
29) National: Writing in In These Times, In the Public Interest’s Jeremy Mohler proposes an expansive new mission for the U.S. Postal Service in the 21st century. “What would it take to return USPS to a pioneering force capable of addressing our country’s multiple crises? Why not leverage the nearly 250,000 letter carriers and over 30,000 post offices that blanket all 50 states for more than just mail delivery? Why not expand the workforce and presence of the American public’s most favored government agency? With mega companies like Amazon vying for the future of delivery, and conservatives increasingly calling for privatization, the U.S. Postal Service needs a makeover, not a dismantling. In an era of little faith in government, a reimagined postal service could demonstrate how public solutions can solve many of our collective problems, from climate change to a predatory financial industry. That’s exactly what the post office did in the country’s early days.”
30) National: A petition to Stop the Privatization of U.S. National Park Campgrounds is circulating on change.org. “In addition to privatization endangering wildlife, it will drive up the parks’ entrance fees which will inhibit working-class Americans from enjoying all that the parks have to offer. We need to tell the Department of the Interior that we care about our national parks and that we won’t see them ruined. President Franklin D. Roosevelt said it best: ‘There is nothing so American as our national parks… The fundamental idea behind the parks…is that the country belongs to the people, that it is in process of making for the enrichment of the lives of all of us.’ These are our parks, do not allow them to be ruined by corporate greed!”
31) District of Columbia/Virginia: Transdev, the private, for-profit contractor that operates a bus garage for WMATA in Virginia, has walked away from the bargaining table for the second time in ATU’s ten-day strike. WIN DC reports that “passengers were overwhelmingly on the side of the striking @ATULocal689 workers and against @wmata’s decision to privatize. Riders think giving public transit to private corporations is a bad idea.”
Odds and Ends
32) National: The Bond Buyer’s Paul Burton reports that as New York observed the seventh anniversary of Hurricane Sandy, “an analytics firm warned that climate change could pose the biggest threat to municipal credit for the next decade. ‘Climate change risks and preparedness may become the pension issue for the 2020s,’ Municipal Market Analytics said in a commentary. Assessment tools and analytic outcomes, MMA said, will propel negative rating actions and, eventually, wider spreads. Credits in areas most vulnerable to water, wind, and fire-related events are most at risk, according to MMA. Recent extreme weather cases have ranged from the raging wildfires in California to tornadoes, hurricanes and tropical storms in the Midwest and Southeast.” [Sub required]
33) National: Where does innovation come from? @OwenJones84 says “if you want to debunk the myth that innovation is driven by plucky entrepreneurs on their own, rather than being a collective effort often driven by the state, watch this lecture on the iPhone by the brilliant @MazzucatoM.” [Video, about 15 minutes; volume is set very low; try a different device if you can’t hear it well]
34) National: Bonnie Castillo, the executive director of National Nurses United, reports on What Algorithms Tell Us About Structural Racism in Health Care. “A research study on a commercial computer program used to allocate health care resources on predicted future health care costs provided a window on the ongoing pervasive impact of structural racism in our nation’s health care system. Moreover, the research published in Science magazine reinforced how structural racism persists throughout society, including disparities in income, housing and other social and economic factors, and the impact that has on disparities in health. (…) the researchers found the algorithm severely underestimates the health needs of the sickest African American patients, as the Washington Post noted, by basing its data on how much medical costs are expended on white patients compared to black patients with comparable chronic health conditions.”
35) Washington: Charles Tonderai Mudede, The Stranger’s film editor, looks at how the finance industry is looking to hook struggling rural Washingtonians into its profit stream by buying up their water rights and then soaking downstream consumers. “In truth, the resources of rural areas are being financialized in much the same way as the housing market in the city. A stream of water (like a stream of mortgage payments) becomes a revenue stream that can be converted into a security. And as the world warms, the more valuable this stream of water becomes. The farmers in the Columbia River basin need to watch Sleep Dealer. That science fictional economy is heading in their direction.”
Governing for the Common Good
36) National: Judges are beginning to integrate cutting edge research into their approaches to opioid addiction, the Rockefeller Institute of Government reports. “For all of the suggestions of what courts can and should do, the [National Center for State Courts] acknowledges that rural, frontier, and underserved communities face additional challenges, and it offers examples of ways to address those challenges including: Vermont’s Hub-and-Spoke model of addiction treatment; telehealth; Project ECHO, which links expert teams in an academic hub to local communities; the University of Wisconsin-Madison’s Addiction-Comprehensive Health Enhancement Support System (relapse prevention through a smartphone app); the Coconino Online Probation Education program in Flagstaff, AZ, which brings probation services and mentoring to clients who may not otherwise have easy access to transportation; and many others.”
37) New Jersey: The New Jersey Educational Facilities Authority is supporting library bonds.
“‘NJEFA is excited to begin working with TESU and the State Librarian on administering the Library Grant Program,’ Executive Director Eric D. Brophy said in a statement. ‘This program will provide tremendous value to libraries and residents across the state.’ The MOU, which was approved by the NJEFA at its Sept. 24 board meeting, establishes a framework for the Authority to provide support services for the library bonds. Some of the NJEFA’s guidance under the arrangement may include reviewing regulations and development of grant solicitation materials, developing disbursement procedures and requisition processing for grant funds as well as compliance review. The agency might also assist under the MOU with the preparation and coordination of required documentation such as grant agreements and tax certificates.” [Sub required]