Media Scans
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This Week’s Outsourcing Scan 9-08-2015

1) National: At a Labor Day celebration, President Obama signs an executive order requiring federal contractors to offer employees up to seven paid sick days a year. “Right now you have parents who have to choose between losing income or staying home with a sick child,’ Obama told a crowd of 765 supporters, including many labor officials, during the annual Greater Boston Labor Council breakfast sponsored by the AFL-CIO.” [Video

Before the event, the MBTA Boston Carmen’s Union, Local 589 “held a rally across from the Park Plaza Hotel and sought to blast Gov. Charlie Baker for proposing to privatize some bus routes. (…) The MBTA’s union received several shout-outs from the Labor Day breakfast’s podium, including from U.S. Sen. Elizabeth Warren, who said the members were ‘outside fighting for their jobs.’”

2) National: As debate continues on whether the Federal Reserve should raise interest rates, which would affect both public and private financing, questions loom over how this might affect infrastructure spending. “The Fed lowered rates in 2008 to stimulate economic activity. Low interest rates make short-term loans and capital costs less expensive and can stimulate economic growth. Once the rates go up, it could become more expensive to invest in the sizable infrastructure updates that the American Society of Civil Engineers says the country desperately needs.”

3) National: Associated Press reports taxpayers could be on the hook for as much as $3.2 billion for fraudulent claims by the for-profit education industry. Nearly 12,000 students have asked the federal government to discharge their Corinthian-linked student debt “because their school either closed or lied to them about job prospects.” Soaring student loan debt poses a threat to the nation’s economic future, according to Moody’s Analytics.

4) National: Kenneth Zeichner and Hilary G. Conklin debunk sloppy arguments about the alleged superiority of privately financed and run teacher preparation programs to college and university based teacher preparation. “We also discuss the role of philanthropy, the U.S. Education Department, and the media in uncritically reproducing these narratives, and the ways in which the narratives have helped to shape teacher education policy and practice.”

5) NationalVenture capital investment in education technology tops $1.6 billion in the first half of 2015. There are several new edtech funds, including “Reach Capital, a for-profit spinoff from NewSchools Venture Fund that is looking to make follow-on investments. It’s led by a trio of women who ran NewSchools’ Seed Fund, which supported 42 early-stage companies”; and “Zuckerberg Education Ventures, which participated in AltSchool’s $100 million Series B round.”

6) Arizona: As Teamsters 104 members continue their monthlong strike against Tucson’s Sun Tran system, President Andy Marshall blasts Tucson and Sun Tran officials for bringing in “replacement drivers.”

7) Arizona: The state is considering privately financing its ports-of-entry project (truck screening facilities). AzDOT “currently envisions a project in which the Developer will enter into a multiyear Public Private Partnership (“P3”) agreement with ADOT to plan, design and supply all labor and material to install, maintain, and support a system,” according to the Request for Information. AzDOT plans to issue a Request for Qualifications in the fourth quarter of this year and a final Request for Proposals in the first quarter of 2016.

8) Arkansas: Alternet’s Kali Holloway takes a detailed look at Arkansas’ school privatization battles. “Anyone with even a passing interest in public education knows how this story normally ends. (…) But this March, Arkansas proved the exception to the ubiquity of Walton rule. Following the introduction of House Bill 1733, which would have vastly expanded the potential for privatization of Arkansas’ public school districts, a collection of grassroots groups, urban and rural school advocates, educators, parents, and other passionate individuals committed to public education mobilized. Recognizing they were out-spent, the collective out-organized the Walton lobby, killing the bill before it even passed out of committee. The bill’s defeat was made all the more significant by the fact that it occurred in the Waltons’ own backyard.”

9) District of Columbia/NationalGoverning magazine looks at “how full-time paratransit employees end up on government assistance.” Todd Brogan, an ATU organizer, “said privatization also decreases the quality of service to paratransit clients, which is why the union opposes efforts to privatize the service in the few remaining systems, like Atlanta’s, where paratransit services are still provided by the city. ‘Privatized paratransit has never made paratransit better. It’s made it cheaper,’ he said.”

10) Florida: Martin and Indian River counties mount a new legal challenge to the All Aboard Florida private passenger train project. They “filed separate legal actions challenging conduit issuer Florida Development Finance Corp.’s Aug. 5 final approval of the bond issuance. The counties filed the legal actions—one requesting an administrative hearing and the other seeking a court review of the Aug. 5 vote—against the FDFC, a legislatively created nonprofit corporation authorized to issue private activity bonds.” In addition, “Indian River alleges that the FDFC board members failed to disclose ex parte communications that they had with a representative for All Aboard Florida, which may have had a prejudicial influence on the Aug. 5 vote, the county’s petition said.”

11) Florida: Five private companies are vying to provide financing for Broward County to expand its convention center and build an adjacent hotel. “The private partner likely will finance, build, and own the planned convention center hotel with up to 1,250 rooms. County commissioners, who are overseeing the project and making primary decisions, determined last week that five of six companies submitted qualifications to continue through the public-private partnership procurement process.” [Sub required]

12) HawaiiThe Star-Advertiser condemns the “appalling” lack of contractor oversight by the Hawaii Health Connector, a nonprofit established to implement the Affordable Care Act. “The trouble is, the bill ultimately could end up in the public’s lap. Paying Mansha for ‘questionable costs’ could draw down a federal demand to repay grant funds with money the state doesn’t have, [state auditor Jan Yamane] added.” [Sub required]

13) Hawaii: Maui County chooses the Guernsey consulting firm to review options for breaking away from Maui Electric Co. “The Oklahoma firm said in its bid application that it has worked with multiple electric utility/cooperative clients across the United States to review options for acquisition, consolidation, privatization and/or valuation.”

14) IllinoisStriking Barrington High School janitors win an increase, and will return to work today. “The Service Employees International Union, which supported the strike, said it had productive negotiations with RJB Properties, which employed the janitors. As a result of those talks, the janitors’ hourly wage will increase to $9.50, according to the statement. It had been reduced to $8.50 earlier this summer after Barrington School District 220 entered into a new contract with RJB. Last school year, the janitors’ wage was $9.77 an hour, and some of them went on strike the first day of school in protest of the cut.”

15) Illinois: The hunger strike against the Chicago Public Schools’ plans for reopening Dyett High School continues. “Activists argue that the ‘choice’ system of schools that many cities have embraced in fact creates discriminatory selection policies that disproportionately affect poor and black locals. ‘This does not reflect the vision of the community,’ the strikers said in a statement.”

16) Illinois/National: AFSCME Council 31 and First Student are awaiting an NLRB hearing on September 22 to determine whether McLean County Unit 5’s outsourcing of bus services during a contract negotiation will stand. “Either way, a decision could be months or years away.”

17) New York: The business-dominated New York City Citizens Budget Commission has issued a report calling for “public private partnerships” to upgrade NY subway stations and infrastructure. “The MTA’s 2014 agreement with One Vanderbilt developer SL Green for $210 million in subway improvements along with a 65-story office tower next Grand Central Terminal, involved exchanging exchange of privately financed station work for additional development rights.” [Sub required; CBC report]

18) Ohio: Plunderbund says that documents released last Thursday bolster claims that Ohio’s former schools chief “intentionally altered data about charter schools on a state report in order to improve the rankings of some large charter school sponsors. (…) The records show that other Ohio Department of Education staff warned Hansen that doing so might be illegal.”

19) Tennessee: The Corrections Corporation of America-run Silverdale Correctional Facility in Hamilton County accidentally releases a federal inmate.

20) Texas: Texas charter school chains are going big on issuing debt to expand, while the consequences of issuing unrated bonds without state guarantees are unclear. “Some newer Texas charter schools have started out big, creating entire districts and issuing bonds to finance construction or to buy high quality buildings. Among the largest are Harmony Public Schools, KIPP Inc., and Life School of Dallas, all with multiple campuses in the state. (…) One of the newest entrants in the Texas charter school movement decided not to wait for the PSF guarantee before issuing $111 million of unrated bonds to buy six campuses in three cities. The August deal was one of the largest for a Texas charter school operator to date.” [Sub required]

21) VirginiaA private contractor dumps cleaning chemicals at Chesterfield County schools. “I would have thought a company doing this would know we shouldn’t be dumping anything, especially at elementary schools,” said parent Rodney Martin. SSC Service Solutions “has committed to pay cleanup costs at the buildings covered by its contract with the school system, but that means taxpayers will have to foot the bill for the schools that are still staffed by CCPS custodians.”

22) WashingtonThe state supreme court rules 6-3 that charter schools are unconstitutional. The ruling takes effect 20 days from last Friday unless reconsidered by the court. “In sum, the Charter School Act violates article IX, section 2 because charter schools are not common schools despite the Act’s attempt to so designate them. The Act’s designated funding mechanisms fail, and these provisions are not severable from the remainder of the Charter School Act. The portions of l-1240 designating charter schools as common schools violate article IX, section 2 of the Washington Constitution and are invalid. For the same reason, the portions of l-1240 providing access to restricted common school funding are also invalid. These provisions are not severable and render the entire Act unconstitutional.” The charter school law that was struck down was narrowly passed in a 2012 referendum with financial support from Bill Gates.

23) Washington: Marc Powers, a Foss High School (Tacoma) athletic director, voices concern over the impact of charter schools on students’ access to sports programs. “I think one of the things I wanted to mention that I’m just concerned about a little bit is the direction that Tacoma is going in thinking about adding a third sort of de-facto Charter School. That’s on the agenda right now and the board of directors is looking at that right now with the public. It has impacted sports in all of our schools in a negative way. I went and crunched the numbers last year, and between School of the Arts, and SAMI (Science and Math Institute) we have 1,400 high school students at those two schools. And they don’t have high school sports programs. And they have a day that gets done at 3:30 sometimes or 4 and they can’t get to practice. They have all sorts of different scheduling issues with the comprehensive high schools. So you take 1,400 students out and you look at their participation numbers—some of them will go swim at Stadium or play volleyball at Foss, but it’s 4 to 4½ percent participation at those schools.”

24) West Virginia: Advocates for a Safe Water System, a group formed in the wake of January 2014 Elk River chemical spill, launches a campaign to create a publicly-owned water system in the Kanawha Valley and take over West Virginia American Water. “The group says information related to the Our Water campaign will be available at ourwaterwv.org as of September 8. The new website will include a link to a petition as well as other campaign information.” A news conference is scheduled for today.

25) International: In Poland, Macquarie Infrastructure portfolio company DCT Gdansk is accused of union busting. A spokesperson for the International Transport Workers’ Federation (ITWF) says “we see investors also having responsibility here and are calling on them to help resolve these issues. Macquarie’s Global Infrastructure Fund II (GIF II) is the majority owner of DCT Gdansk and is represented on its board, therefore we believe this is an important test of how responsible they are as an investor in infrastructure assets.” [Sub required]

26) Think TanksA new education policy think tank has opened, with offices in Palo Alto and Washington, DC. Among its issues, “school funding and management.” The Learning Policy Institute “has some $5 million in initial funding and support from The Atlantic Philanthropies, S.D. Bechtel, Jr. Foundation, the Ford Foundation, the Sandler Foundation, the Stuart Foundation, and also the William and Flora Hewlett Foundation.” It will be headed by Linda Darling-Hammond. [Board and Staff]

Legislative Issues

1) National: As Congress returns to session this week, action on transportation funding, proposals for which include public and private financing, is uncertain. With floor time likely clogged up by the Iran agreement debate, and a possible Oct. 1 government shutdown looming, passing the highway bill will be a challenge. “The negotiations over the appropriations endgame are expected to last weeks and might end up being tied to discussions over how to pay for a multi-year transportation bill.” Program authority expires October 29. [Bloomberg BNA, September 4, 2015; sub required]

2) National: Pointing to North Carolina, blogger KathyinBlacksburg warns Virginians and others not to let the privatization agenda pushed by ALEC run amok in their state legislatures. “Some things should never be privatized.” Says “please choose your legislators well, Virginia.”

3) National: The Federal Transit Administration “is seeking public input on a new initiative to speed up planning, approval and delivery of the agency’s capital investments and better support innovative financing methods. (…) In addition, [the Expedited Public Transportation Improvement Initiative] seeks to encourage enhanced financing methods and opportunities for public-private partnerships through methods such as ‘value capture’—a term for the increase in land value generated by public transportation investments. The FTA will conduct an online dialogue from Sept. 8 through Oct. 16, to gather input on the initiative.” [Bloomberg BNA, September 4, 2015; sub required]

4) National: As the National Parks Service approaches its 100th anniversary, the Obama administration proposes a funding increase, but is meeting Congressional resistance. Pete Dolack writes, however, that this is “an increase that would put nothing more than a small dent in the maintenance deficit. Unfortunately, this increase includes more money for a ‘private-public partnership’ challenge—more corporate money. But Congress shows no sign of agreeing even to this modest funding increase.”

5) National: The Geo Group paid $80,000 to Navigators Global LLC in the second quarter of 2015 to lobby for it on budget issues and “issues related to alternatives to detention within ICE.” Navigators Global’s lobbyists for Geo Group are Christopher Cox, a former GW Bush legislative assistant; and Josh Finestone, a former aide to Sen. Dean Heller (R-NV).

6) California: As lawmakers struggle this week to find a solution for the state’s transportation funding needs, Republican legislators target Caltrans and move to privatize engineering and architectural work on public projects. “[Orange County Sen. John] Moorlach has advocated a more austerity-based approach beginning with reform of the state Department of Transportation (Caltrans), and previously offered a bill that would have required the agencies to be doing 50% of its work with private architectural and engineering firms by 2023. [San Jose Democrat Sen. Jim] Beall’s committee shot that bill down last month.” [Sub required]

7) Illinois/National: Tim J. Schmidgall, Sr., business manager of Laborers’ Local 165 in Peoria, says Gov. Rauner’s attempt “to gut the Prevailing Wage Act” is a terrible idea. “A review of federal highway projects found that workers in high-wage states like Illinois built a mile of road in 32 percent less time than in low-wage states.”