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This Week’s Outsourcing Scan 4-18-2016

1) NationalAFGE National President J. David Cox Sr. denounces the Koch brothers’ political machine for trying to privatize the Veterans Administration. “Now, some Koch-backed politicians on Capitol Hill are trying to break that promise to our veterans and sell them out to private, for-profit VA providers. And unless we do something about it, they just might succeed. Let me explain. (…) The Koch Brothers’ fake veterans’ group, Concerned Veterans for America, and their mouthpieces in Congress launched a brutal smear campaign against the VA, painting it as a hapless bureaucracy that could never be fixed. The reality, of course, could not be further from the truth.”
 
2) National/TexasCriticism mounts against the state of Texas’ decision to designate private, for-profit immigration prisons as “as child care providers.” The designations were made to head off federal court action against the Obama administration’s placing of detained families in the Karnes County Residential Center and the South Texas Family Residential Center in Dilley. The Texas Observer’s Alexa Garcia-Ditta points out that the dysfunctional Texas’ Department of Family and Protective Services (DFPS) is already under attack for providing inadequate oversight of regular childcare services, and on top of that it will now be expected to oversee care in the detention centers.
 
3) NationalOn the private outsourcing front, workers are battling back against corporate efforts to outsource their jobs. The International Association of Machinists and Aerospace Workers, representing some 30,000 baggage handlers, gate agents and other groups, approved a new contract without outsourcing. “United said in the fall that it would not outsource more jobs in baggage handling or customer service until at least 2019.” Verizon workers, who are engaged in the largest national strike since 2011, are resisting a company attempt to gain “more power to shift and outsource work. (…) ‘It’s a lose-lose situation for the customer and for American workers, and that’s what we have to stop,’ says Lou Dalto, a 60-year-old Brooklyn-based customer-service representative. ‘Eventually, we’ll be reduced to nothing. It’ll all be outsourced work.’”
 
4) National: The National Association of Bond Lawyers is calling on the IRS to revise its proposed rules that would determine when entities are political subdivisions that can issue tax-exempt bonds. The IRS’ toughened-up proposed rules “would add two new additional requirements—that political subdivisions serve a government purpose ‘with no more than an incidental private benefit’ and that they be governmentally controlled.” [Sub required]
 
5) National: Government information management veteran Owen Ambur says “despite the differences on vivid display in this contentious political season, one point on which there should be broad, nonpartisan agreement is that critical, inherently governmental functions should be performed well and at the least practical cost to the taxpayers.” He recommends that government performance data be made “open, machine-readable and permanent.”
 
6) NationalCorrections Corporation of America announces it will report its first quarter 2016 financial results on May 4 and will hold a conference call at 11 am Eastern the next morning. Last week CCA announced it has acquired Boulder-based Correctional Management Inc. for $35 million.
 
7) National: Princeton Students for Prison Education and Reform submit a referendum calling for the university to disinvest from private prison companies, which will be voted on today. “These corporations include Corrections Corporation of America, The GEO Group, G4S and financial entities that exclusively contract correctional facilities like Global Tel Link, JPay, Securus and Corizon, according to the referendum.”
 
8) California: As part of a wide-ranging investigation of K-12 online charter schools, the San Jose Mercury News reports on whether they are “cashing in on failure.” They report that Silicon Valley-backed endeavors to expand online schools are “leading a dubious revolution. The growing network of online academies, operated by a Virginia company traded on Wall Street called K12 Inc., is failing key tests used to measure educational success. Fewer than half of the students who enroll in the online high schools earn diplomas, and almost none of them are qualified to attend the state’s public universities. An investigation of K12-run charter schools by this newspaper also reveals that teachers have been asked to inflate attendance and enrollment records used to determine taxpayer funding.”
 
9) California: Faced with “escalating water rates, debt, lawsuits, a costly groundwater recovery project and a looming need to replace aging water infrastructures,” San Juan Capistrano looks to outsource its water and sewer system. “[Council member] Perry suggested that the provider might be Santa Margarita, Moulton-Niguel or Irvine Ranch Water District, ‘or who knows? We won’t know that until the LAFCO study is complete,’ Perry said. ‘But we will have some control over who we pick and under what conditions do we pick them.’”
 
10) ColoradoCorrections Corporation of America extracts its “pound of flesh” from Colorado taxpayers as Gov. Hickenlooper’s last minute budget request for additional subsidies for CCAs Kit Carson Correctional facility passes. State senator Mike Johnston (D-Denver) “said the timing of the request—just as budget negotiations finished—amounted to ‘blackmail.’ ‘It’s not in the best interest of the state of Colorado,’ he said.” The Denver Post quotes Christie Donner, director of the Colorado Criminal Justice Reform Coalition: “They have a pattern of threatening to close prisons, to declare an emergency to get a bailout from taxpayers. This is Chapter 2 of the same crap.”
 
11) Florida: As AFSCME and AAUP hold a joint meeting to support AFSCME’s upcoming contract negotiations with Miami University, the university’s troubled past efforts to outsource are part of the mix. “‘Miami needs to start treating their staff as assets to this organization instead of costs,’ [Dustin Jones, the president of Miami’s AFSCME chapter and custodian at Clawson Hall] said in November. Miami has attempted to outsource the work done by the housing and dining staff to cut costs, but has not been able to find employees who could do the same quality of work for less money. ‘[The university] brought in [employees] from Marriott and Compass for rooming and dining to see if they can do the work cheaper, but they can’t, and they were surprised by what we do,’ Jones said. ‘The fact that we have such a strict attendance policy shows that they need us.’”
 
12) Florida: In an editorial, the Tampa Bay Times denounces Gov. Scott for his approach to Enterprise Florida, the economic development agency he wants to privatize. Scott’s approach has been focused on Florida as a low wage, lightly regulated state. “In his letter to the Enterprise Florida board, the governor still doesn’t seem to get it, calling for new ways to promote Florida on the cheap. The state needs a better grasp of what employers want in a modern workforce and to invest in those areas. It also needs to better target specific job sectors that are expected to grow in the coming decades.”
 
13) Florida: Shortly after beating Republican Gov. Rick Scott in a courtroom, the board chair of tax supported hospitals resigns. “[David] Di Pietro referred questions to attorney Brian Silber, who said that the resignation had nothing to do with the possibility that Scott might prevail in an appeal. Silber said Di Pietro quit because he achieved his goal of reinstatement. He accused Scott of plotting to privatize Broward’s public hospitals, similar to the Columbia/HCA empire Scott built two decades ago.”
 
14) Georgia: Ferrovial signs a deal with the state to use tax-exempt bank debt to finance an upgrade of I-285/SR 400. Gov. Deal says he will use the project as a model for other P3 deals. [Sub required]
 
15) Hawaii/NationalThe Marshall Project and Honolulu Civil Beat report on “The Prison Visit That Cost My Family $2,370,” an account of a Hawaii family member’s visit to Arizona’s Eloy prison. “After decades of tough-on-crime policies, Hawaii is one of four states that solve their prison crowding problem by shipping inmates out of state, usually to facilities run by for-profit companies such as Corrections Corporation of America and The GEO Group.” Meheula said “the visits are very important to the inmates. You’re sent so far away, and you literally feel like you’re neglected.”
 
16) IllinoisChicago teachers reject a proposed settlement and may go on strike after May 16. “The clock has started,” union President Karen Lewis said in a statement in which she blasted both the district and [Gov.] Rauner. “CPS has created this fiscal mess and refuses to go over hundreds of millions of dollars in existing revenue that is already out there. Our wacked-out governor isn’t helping,” Lewis said. “We have no choice (but) to prepare ourselves for a possible strike.”
 
17) IllinoisThe Chicago Public Schools want to privatize more facility jobs. “The Chicago Sun-Times reports that the district sent a letter to building engineers saying it would fully move to private management by summer 2018. That means more than 500 engineers could lose their jobs, and if hired back, would move into a separate union for private-sector workers.”
 
18) IowaThe early evidence on Gov. Branstad’s Medicaid privatization is not looking good, despite his claim that it has been “smooth.” “Gentry acknowledged managed care companies were working through ‘kinks’ in the initial days, but her patient is in no position to navigate them. He has schizophrenia. (…) The head of the Iowa Pharmacy Association said she has heard it is taking a week or more to obtain certain drugs for some people with mental illness.”
 
19) KentuckyGov. Bevin signs comprehensive ‘public private partnership’ legislation. “Partnerships authorized by the legislation include large transportation projects and management of utilities. The state will require public postings [of] hearings and legislative oversight for P3s to move forward and no project costing more than $25 million will be cleared unless first authorized by the state legislature. Furthermore, any shared transportation projects between Kentucky and Ohio would need to be approved by a separate law.” [Sub required; HB 309]
 
20) MarylandHundreds of staff and patients petition to stop the privatization of the Western Maryland Medical Center in Hagerstown. “We are in danger of privatization right now, so we are here to advocate for public service, state service, workers, patients,” said nurse Heather Hockman.
 
21) MichiganDetroit Free Press editorial page editor Stephen Henderson takes on Republican legislators for abandoning their own supposed principles by promoting the complete charterization of Detroit schools, despite the multiple failures of charter schools. “So let’s just call this discussion what it is: an argument for ideological affirmative action. It’s a push for advancement of the charter agenda based on belief that free-market principles are best for education, regardless of the stunning lack of merit in the outcomes of the charter experiment.”
 
22) Minnesota: Citizen activists appear to have won their battle to keep the Appleton prison closed despite heavy lobbying by private prison interests. “Over the past month, a protest temporarily shut down a legislative hearing on the bill, the state’s top prison commissioner called it ‘the antithesis of America’ and Gov. Mark Dayton vowed to veto if it passed. Last Friday, the bill missed a critical deadline in the state Senate, making even sponsor Sen. Lyle Koenen, DFL-Clara City, cautiously pessimistic that it would succeed this year.”
 
23) Missouri/National: The St. Louis Post-Dispatch reports that when a non-profit hospital system outsources its emergency services, “debt collectors follow.” The paper says, “since the end of 2014, a Las Vegas-based debt collection firm has filed more than a thousand lawsuits against St. Louis area residents, claiming that they still owed money for treatment performed years ago at SSM Health emergency rooms. The wave of lawsuits brought by CP Medical LLC, which even sued the pastor of a local Catholic church, has left many former SSM patients confused about their financial obligations and fearful of the legal consequences, which can include garnished wages and the seizure of money in bank accounts.”
 
24) New YorkThe bankruptcy of a private ambulance contractor has left the public in the lurch. “Mr. Miranda’s union—with support from, among others, Elizabeth Crowley, the chairwoman of the City Council’s fire and criminal justice committee, and the city comptroller, Scott M. Stringer—is arguing that the use of private ambulances is a false economy, and that the city should hire enough of its own workers. If it goes too far to call this a crisis, the episode disclosed a vulnerability that most members of the public did not realize existed.”
 
25) New YorkUnion and political leaders call on Mayor de Blasio and the FDNY to not re-privatize ambulance tours.
 
26) New YorkThe Bond Buyer extols new “creative proposals” on financing regional transit needs, including “a push for public-private partnerships.” [Sub required]
 
27) North Dakota: The Grand Forks Herald interviews gubernatorial candidate Doug Burgum and doesn’t understand his approach to public sector unions or like his answer on charter schools. “Sounds like a pitch by an executive who’d push for new-in-North Dakota innovations such as charter schools and merit pay for teachers. Both of those, by the way, have been high on the list of Microsoft co-founder Bill Gates’ K-12 reforms, which Gates has vigorously supported through the Bill and Melinda Gates Foundation. But in many cities and states where they’ve been tried, both of those reforms also have been vigorously opposed by the local and statewide teachers’ unions. Does Burgum think the same thing would happen here if he proposes, say, a charter-school law? Or would he imagine approaching or even partnering with the teachers’ union in an effort to ‘get to yes’?”
 
28) Ohio/NationalWarren County is to outsource job services for those with developmental disabilities. “The planned privatization of Production Services Unlimited (PSU), in response to a federal mandate, will affect about 150 adults with developmental disabilities currently developing work skills at the facility and 60 employees. (…) The changes were mandated in Ohio in 2014 by the Center for Medicare and Medicaid Services to end potential conflicts of interest between those providing employment services and other daytime services, as well as transportation, and overseeing care of those with developmental disabilities. Service providers around the country face the same mandates.”
 
29) Oklahoma: Interim prisons director Joe Allbaugh tells the North American Association of Wardens & Superintendents annual training conference that the Oklahoma system needs to fix overcrowding and its 30-year old software. “The Board of Corrections on Thursday approved his request to begin discussions about leasing beds with Corrections Corporation of America, which manages the empty North Fork Correctional Facility in Sayre and Diamondback Correctional Facility in Watonga. ‘I don’t want them to operate ’em. I think I can do it better and cheaply,’ Allbaugh told the audience. ‘I don’t really have anything against private prisons. I just philosophically believe that the state ought to be incarcerating their own folks who break the law and not paying a premium for the beds.’”
 
30) South CarolinaThe State reports that African-American students were suspended or expelled three times more often than white students at traditional public schools, and 3.8 times more often in charter schools.
 
31) VirginiaThe state concludes a ‘public private partnership’ agreement with Transurban for an I-395 Express Lanes extension and expansion project for 8 miles to the DC border. “As part of the agreement struck between VDOT and Transurban, the toll road operator will provide long-term transit investments through an annual payment to fund transit improvements on the entire I-95/I-395 Corridor, according to the latest VDOT statement. Virginia’s Department of Rail and Public Transportation has already launched a transit and transportation demand management study to identify priority transit projects that should be supported by these funds.” [Sub required]
 
32) Wisconsin: The legislature’s forced selling of vacant or surplus Milwaukee Public School buildings to competing operators “will hinder the district’s own reform efforts and its ability to serve returning students when private voucher and charter schools go belly-up,” according to the school system. The Bradley Foundation-backed Wisconsin Institute for Law & Liberty was threatening a lawsuit to enforce the legislature’s mandated sale.
 
33) Think TanksGovernment Executive looks “Inside the Fight to Reduce the Government’s Role in Veterans Health Care.”
 
Legislative Issues
 
1) National: As Democratic and Republican presidential and down-ticket candidates debate the possible privatization of social security, Motley Fool takes a stab at describing “What Would Social Security Private Accounts Look Like?” Apart from the obvious danger of a market crash destroying privatized social security portfolios, critics “note that Wall Street has been in favor of privatization and that privatization would probably greatly benefit Wall Street, driving more business its way and enabling it to charge more customers fees. Other critics worry that those who benefit the most from private accounts will be people who are financially savvy and effective managers of their money as well as those who earn higher incomes, as they’ll likely be able to invest more in the accounts. Left behind could be the masses earning lower incomes and those who don’t have a good understanding of investing and its various concepts, such as the risk-and-reward trade-off.”
 
2) California: Sen. Ricardo Lara, D-Bell Gardens, proposes legislation to get California out of the business of for-profit immigration detention. “Known as the Dignity Not Detention Act, Senate Bill 1289 proposes several notable reforms to California’s participation in this system. Most significantly, the bill proposes to prohibit city and county governments from contracting with private companies, like the GEO Group and Corrections Corporation of America, from operating immigration detention centers. These companies currently operate some of the largest detention centers in the state, including the Adelanto Detention Facility in San Bernardino County.” [SB 1289]

 

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