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Weekly Privatization Report 12-11-2017

1) National: Donald Cohen of In the Public Interest asks “Why is a Private Prison Corporation Doing Business with the IRS?” He reports that “CoreCivic now owns what appear to be its first buildings that have nothing to do with incarceration. In September, the publicly traded corporation that owns and operates prisons, jails, immigration detention centers, and halfway houses bought properties in North Carolina and Georgia that are leased to the Internal Revenue Service (IRS) and Social Security Administration (SSA). (…) In other words, CoreCivic wants to be a landlord of all types of government buildings.”

2) National: Can’t make it to the National Critical Conversation on Public Education in DC this Wednesday? Watch itlivestreamed from 10-12 EST on Facebook. The focus? “Detailing the harm school privatization has inflicted on children & communities of color.” With Jitu Brown and Melissa Harris-Perry.

3) National/Texas: American Federation of Teachers President Randi Weingarten welcomes the results of theHouston school board elections. “Building on what they did in November, in the runoffs the people of Houston elected school board candidates committed to working with teachers and parents to invest in our public schools and make every school in Houston a school where parents want to send their kids, teachers want to teach, and kids are engaged. (…) These results are just the latest from elections across the country, from Douglas County, Colo., to Cincinnati, where voters are overwhelmingly choosing public education over privatization for their children and communities, and to invest in those schools, not efforts to defund and destabilize them.”

4) National: U.S. immigration arrests, which private prison companies have banked on to boost their bottom lines, have spiked under Trump. “ICE officers arrested far more suspected illegal immigrants in the months after President Donald Trump took office than in the same period last year. Between Jan. 20 and Sept. 30, the agency arrested nearly 111,000 people, a 42 percent increase over the prior year. (…) Between Jan. 20 and Sept. 30, [ICE deputy director Thomas Homan] said, 8 percent of the approximately 111,000 people arrested by ICE were ‘collateral arrests,’ or people who were not the original focus of the agency. He said most of those individuals were arrested in so-called ‘sanctuary cities,’ or jurisdictions that do not use local funds or resources to enforce federal immigration laws or that deny U.S. immigration officials access to local jails.”

5) NationalInternational Business Times looks into the “Post-Prison ‘Continuum’” strategy that the GEO Group is pursuing to diversify its money-making model beyond incarceration for profit. “Along with ‘faith-based services,’ ‘cognitive behavioral treatment programs’ and academic and job training programs, the Continuum of Care division includes substance abuse treatment, education and counseling, according to its website.” Donald Cohen, executive director of In the Public Interest, “argued that the existence of obligation to shareholders was a problematic element regardless. ‘They’re only making money if they’re controlling people,’ he said. ‘The incentive is to control as much as possible and spend as little as possible.’ (…) When you have private companies taking control, they say ‘cheaper, better, faster.’ There’s money that’s being taken from that system—executive salaries, shareholder returns, lobbying expenditures, campaign expenditures, maybe. That money should be in the system.’”

See also the Reveal News report, “They thought they were going to rehab. They ended up in chicken plants.” Amy Julia Harris and Shoshana Walter describe what they found. “There wasn’t much substance abuse treatment at [Christian Alcoholics & Addicts in Recovery]. It was mostly factory work for one of America’s top poultry companies. If McGahey got hurt or worked too slowly, his bosses threatened him with prison. And he worked for free. CAAIR pocketed the pay. ‘It was a slave camp,’ McGahey said. ‘I can’t believe the court sent me there.’ Soon, it would get worse.”

6) National/Washington: A federal judge has ruled that a lawsuit by Washington State on behalf of immigrant detainees to force GEO Group to pay minimum wages can proceed. “In a related case, Bryan also declined to dismiss a complaint by a former detainee named Chao Chen, who seeks class-action status — and back pay — on behalf of all Northwest Detention Center detainees who have performed work in the past three years. (…) The company also asserted that it does not have to pay minimum wage because the detainees aren’t required to work. But the judge said it was premature for him to determine if that was truly the case, considering that the detainees are in custody, paid just $1 per day, and helping to enrich a private corporation.”

7) National: Steven Singer of the Badass Teachers Association offers “Two Theories Why Facebook Keeps Blocking Me When I Write About School Privatization.” One theory, they are blocking him because they don’t like his anti-privatization posts. “[Campbell] Brown, a school privatization lobbyist and former NBC and CNN personality, heads Facebook’s News Partnership Team. The newly created position was part of Zuckerberg’s attempt to limit fake news on his social media platform while prioritizing information in the mainstream media. What exactly is fake news? Whatever Campbell Brown says it is. This is quite a lot of power to give one person, especially someone who has a reputation for partisanship. And she does. Not. Like. Me. Let’s just say we’ve gotten into a few Twitter skirmishes.”

8) National/Pennsylvania: The Pennsylvania Public Utility Commission has approved a 9.4% increase for customers of Pennsylvania American Water, less than the 16.4% increase the private water company initially requested. The next day, its parent company, American Water Works, declared a 41.5 cent dividend per share of common stock. But CEO Susan Story promises that “every dime” of the Trump/Ryan corporate tax cut will go straight to their customers.

9) California: Butte County District Attorney Mike Ramsey will be investigating possible criminal activity involving former administrators at Blue Oak Charter School in Chico. “For example, someone that claimed for a conference and there was no conference… That would be one type of situation,” said Ramsey.

10) California: With alternative news outlets under increasing pressure, controversy has erupted over the sale of the LA Weekly and firing of much of its staff. The publication has run a number of stories over the years on privatization, including one in October on a private company’s plan to pump water out of the Mojave desert.

11) Colorado: The CDOT is seeking consultant proposals for developing an Express Lanes Master Plan for the whole state. Responses are due December 18.

12) Delaware: A Newcastle charter school administrator is to be jailed for 18 months for embezzlement. “Moore embezzled $161,871 from the school by opening an unauthorized credit card, buying iPads and selling them for cash and skimming the school’s fundraising account, according to the U.S. Attorney’s Office. He used the money to pay for food, entertainment, travel expenses and jewelry. Moore’s annual salary was $111,000.”

13) Idaho: The Professional Standards Commission has “suspended Sage International School founder Don Keller’s administrator’s certificate.” Idahoednews.org reports “the sanctions against Keller mark at least the third time in recent months that the PSC has cracked down on prominent Idaho administrators for falsifying or submitting inaccurate data on official state reports.”

14) Illinois: Chicago public school students stage a walkout to protest the Chicago Public Schools proposal to put a charter school inside Hirsch Metropolitan High School. “Erica Clark, a member of Parents 4 Teachers, called the closures and underfunding of schools ‘a citywide attack on black and brown students.’ Parents 4 Teachers is an advocacy group allied with the Chicago Teachers Union that helped publicize Tuesday’s student walkout. Rashonda Stafford, a senior at the school, spoke to reporters over speakerphone on Clark’s cellphone. ‘We are trying to come outside and they aren’t letting us out,’ Stafford said. ‘The principal said he’ll get fired if we walk out.’”

15) Illinois: As school charterization proceeds, a battle is shaping up over CPS’ plan to close several South Side schools. Michelle Strater Gunderson, a 30 year teaching veteran who teaches first grade in the Chicago Public Schools, says the real objective is gentrification, driven by private real estate interests. “The Chicago Teachers Union (CTU) has been fighting for fair funding of schools for many years. The union’s underlying analysis is that the Chicago Public Schools purposefully defunded schools, claimed them as failures, and then proceeded to close them. The city is in fact ‘broke on purpose’ so that these neighborhoods can be taken over and gentrified. What are the values of our society when children’s lives are sacrificed to the real estate ‘gods of gentrification’? There will be readers who ask, why would a city government plan the demise of the high schools in an entire section of town? The answer is clear—real estate. Englewood sits in prime territory just south of Chicago’s Loop and with ready access to expressways and transportation. This is a real estate grab.”

16) Illinois: The Chicago Public School Teacher’s pension fund is suing the private operators of a defunct charter school for “allegedly failing to report the employment of some licensed teachers and failing to pay pension contributions on behalf of teachers.” An audit by Grant Thornton “showed more than $1.4 million in underreported wages and more than $130,000 in unpaid pension contributions between 2013 and 2016.” Jay C. Rehak, president of the pension fund’s board of trustees, said “this wasn’t just sloppy bookkeeping. This was fraud.”

17) Indiana/National: Diane Ravitch points us to a comprehensive article examining the shortcomings of the “Portfolio Model” of schools, which she calls “the Trojan horse of privatization. (…) How was Indianapolis snookered into privatizing its public schools en masse? [Matt] Barnum credits the work of the Mind Trust, a faux-liberal group that worked closely with the faux-liberal Stand for Children, which is a passthrough for the funding of corporations and corporate reformers.” Ravitch says “Stand for Children is an enemy of public schools and professional teachers. It is the conduit for privatization dollars. It has fielded candidates to run against supporters of public schools, in efforts to replace them with privatizers on school boards. It led efforts in Illinois and Massachusetts to curtail the power of unions and to reduce entry requirements for teachers.”

18) Indiana: Barnes & Thornburg’s Heather H. Willey alerts us to a disturbing ruling in the Indiana Court of Appeals—extending government immunity to organizers of charter schools. “The Indiana Tort Claims Act provides a series of immunities to government entities. For instance, the act protects governments from lawsuits stemming from the creation of a policy, the exercise of discretionary functions, injuries caused by temporary weather conditions, or the enforcement of laws. The act also requires a plaintiff to provide a detailed notice of a potential claim before bringing a lawsuit. Failure to comply with the notice requirement prevents a plaintiff from suing an entity shielded by the act. The Flanner House case concerned whether these protections extended to a nonprofit’s lawsuit against a charter school, the organizer, and the chartering government agencies. These claims alleged, among other things, that the organizer mismanaged the charter school.”

19) Louisiana: The Orleans Parish School Board (OPSB) is reconsidering “whether to allow high-performing schools to renew their charters for a full 10-year term.” The board “directly oversees around 40 schools this year, up from just 20 a year ago and expected to swell to 80 next year as the Recovery School District is finally dismantled. As part of that process, the OPSB is building up its Office of School Performance and reconsidering its polices around evaluating schools.”

20) Maryland: The University of Maryland College Park, “in partnership with real estate mogul Edward St. John,contracted with prison labor for the creation of their shiny new building.” Morna McDermott writes, “It might be  a ‘great day’ for Ed St John and U of M, but I doubt its a great day for the forced laborers who did the work.  The new center will ‘transform teaching and learning’ but it will not transform systemic oppression or racism. In fact, it benefits from the fruits of oppressive labor. This is not the only time that U of M, or other institutions of higher learning have used prison labor. That is a deep seated problem in itself that warrants our attention. As one news article states, ‘Maryland is just a symptom … of how the prison industrial complex affects African-Americans and poor people of color nationwide.’”

21) Maryland: Gov. Larry Hogan (R)’s proposed beltway widening project could require taxpayer funding and exorbitant tolls, says Greater Greater Washington. “While adding new tolled capacity is different than adding free lanes, the appeal of toll lanes depends on the adjacent free lanes being congested. For drivers unwilling or unable to pay, they will still be stuck in traffic jams with modest relief at best.” Hogan’s P3 plan has been called a “$9 billion Lexus-lane boondoggle.”

22) New York: CUNY Baruch Professor Andrea Gabor debunks the “breathless praise” for Eva Moskowitz’s charter schools as the New Yorker, The Atlantic and New York Magazine publish favorable pieces on Moskowitz. “It is we—that is American citizens—who should be terrified   because Success Academy is entirely in-sync with the Trump era. It is unapologetically anti-democratic, anti-union, segregated and relentlessly test-driven. (…) Success Academy is at the forefront of an anti-democratic movement to replace public schools with charters, while, at the same time, curtailing government oversight.”

23) New YorkThe Democrat & Chronicle reports a “related-party charter school deal generated healthy profit for [a] developer from public funds.” The article says “many Gulen-suspected schools across the country have entered into questionable real estate transactions with related parties, something critics label an attempt to siphon off the public money charter schools receive for their pupils. The importance for Monroe County residents, though, is the disbursal of hundreds of thousands of public dollars to a connected organization. Such transactions, while not illegal, point to an oversight weakness in charter schools, which rely more heavily on contracted space and services than traditional public schools.”

24) Ohio/Kentucky: DSA Cincinnati and Northern Kentucky is organizing to stop the Library Board from privatizing their library. Check out OurLibraryOurDecision.

25) Virginia/District of Columbia: As tolls for the new privately operated express lanes on I-66 hit $40 at one point last week, a debate on tolling erupted. “‘The bottom line is this is very different from what we briefed people it would be,’ said [Del. John J. Bell (D-Loudoun)], who has opposed tolling on 66. He said VDOT told him that as many as 76 commuters paid $40 at the peak of the morning rush hour on Tuesday, out of about 11,000 vehicles that went through the system during the morning rush. But, it is still unclear what the average toll is. Bell said the state plan presented to residents also was based on having a target speed of 45 mph in the corridor. This week the tolls were set to maintain an average speed of 55 mph. [Virginia Transportation Secretary Aubrey Lane] called the attacks on the program ‘political rhetoric’ based on ‘inaccurate data’ from lawmakers who have long opposed tolling. When asked if he would halt the tolls, he said ‘the answer is going to be no.’ He said the system is working as intended.”

Greater Greater Washington said “drivers who used to use I-66 outside the HOV restriction times, who now are reportedly sometimes seeing tolls in the $10-15 range, have more reason to be frustrated: Not only do they pay a new toll, but it may be double what officials had estimated.”

Public Works Financing dryly stated that the managed lanes “will serve high net worth commuters with high paying jobs,” and noted the upside of the deal for the private consortium that developed the ‘public private partnership.’ “The I-66 partnership gives Cintra and its partners the ability to earn unregulated returns from their investment in premium-service toll lanes on a chronically congested segment of I-66. Cintra’s parent, Ferrovial, expects to make a profit on its $2.23-billion design-build contract for building the lanes and other corridor improvements. And [I-66 Express Mobility Partners] was paid a relatively small development fee at financial close.” One of the Cintra team’s competitors predicted that VDOT/taxpayers “will have to buy down the I-66 tolls, as it did on Skanska’ Midtown Tunnel in Hampton Roads.” [Public Works Financing, November 2017; sub required]

26) International: The brutal war in Yemen is forcing people to pay more for public services, which Nasser al-Sakkaf, the assistant managing editor of the Yemen Times, calls “privatization by war.”  He reports that “hospitals, utilities, schools and other public sector operations can no longer afford to provide Yemenis with free or cheap services. (…) After more than two years of war, Yemen’s public sector is buckling. With budgets halted and employee salaries paid irregularly, hospitals, water and electricity providers, schools and other public-sector operations can no longer afford to provide Yemenis with free or cheap services as they did in the past.”

27) International: In Australia, Arup has agreed to pay $100 million in damages for “absurd” traffic forecasts “that bankrupted the project company seven months after the [Airport Link ] toll tunnels opened.” The company’s former lead traffic forecaster admitted in court that Arup’s forecasts were “totally and utterly absurd” and that some were “completely ridiculous.” In the U.S., FHWA’s Build America Bureau has requested proposals from consultants to come up with guidelines for assessing future traffic studies. [Public Works Financing, November 2017; sub required]

28) International: Unions and civil society activists rally to stop the privatization of hospitals in Multan and South Punjab, Pakistan. “Enraged paramedics and health workers in Multan stormed into public hospitals, expressing concern over privatization of public hospitals. They were of the view that the government plans to deprive the people of cheap medical treatment facilities. (…) ‘We will not allow privatization of public hospitals established with public money. The government is determined to privatize public hospitals instead of equipping them with facilities and removing lacunas,’ protesting paramedics said.”

29) Revolving Door News: CoreCivic, the private, for profit prison company, has appointed Harley G. Lappin, the former director of the Federal Bureau of Prisons, to its board of directors

30) Think Tanks: The conservative American Enterprise Institute has weighed in on the proposed elimination of Private Activity Bonds in GOP tax legislation because it will hurt charter schools. The piece contains an interesting statistic: “To date, the charter school sector has issued more than $15 billion in PABs.” The AEI board includesWilliam H. Walton, a founding member of Rockpoint Group a global real estate investment management firm.

Legislative Issues

1) National: Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, warns that the GOP 2018 budget resolution “calls for $500 billion in Medicare cuts, largely by adopting Speaker Ryan’s privatization scheme. To add insult to injury, unless Congress waives the PAYGO (or Pay-as-You-go) provision in federal budget law, the tax bill will trigger an immediate $25 billion cut to Medicare, which could negatively impact care for millions of seniors.” This would amount to a double whammy on recipients of health and disability benefits, who have already been hit hard by cutbacks in Republican tax legislation. See, e.g., the Center for American Progress’ Rebecca Vallas, Rebecca Cokley, and Eliza Schultz, “The Congressional Republican Tax Plan Is a Tax on Disability,” and an interview with Cokley on FAIR’s Counterspin (audio).

2) Kansas: When lawmakers return to session on January 8, one of the pieces of legislation on their agenda will be SB 101, the Larned and Osawatomie state hospital privatization prohibition amendments, now stuck in the Ways and Means Committee. Gov. Sam Brownback (R), a champion of radical austerity and privatization, is expected to step down soon and take up a diplomatic post for the Trump administration. Lawmakers are seeking clarity on where his privatization plans for prisons, hospitals and state healthcare will stand. Sen. Laura Kelly (D-Topeka) told the Lawrence Journal-World yesterday that “I’ve been pretty adamant that we should not commit the next administration—that we just don’t tie their hands fiscally by contracting for a new prison, by privatizing Osawatomie and contracting out for KanCare for another five years.” Perhaps we will be getting a more open debate, since the gag order Brownback imposed on hospital workers has been lifted.

 

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