HIGHLIGHTS
JUMP: EDUCATION | INFRASTRUCTURE | PUBLIC SERVICES | THE REST
First, the Good News
1) National: Getting elected is the starting line, not the finish line, says the State Innovation Exchange (SiX) in an email. “One area where hard organizing work on the ground is yielding success is in passing state revenue measures for public benefits and services—i.e. tax hikes—which the right wing has demonized for decades while defunding them to redirect public revenues to corporate coffers fueling environmental destruction and share buybacks.”
Courtesy of SiX, here are some recent victories of note:
- Polling consistently shows that the public supports raising taxes on corporations and ultra-wealthy individuals, and state legislators and tax justice coalitions are working together across the country to build tax systems that ensure every working family has a fair shot to success:
- Revenue from Massachusetts’ Millionaires Tax – an effort rooted in the long-term, localized, power-building, and narrative shifting of the Raise Up Massachusetts coalition – reaches $1.8 billion, on pace to double state estimates.
- The Maryland House of Delegates passed worldwide combined reporting (WWCR), a key solution to corporate tax avoidance. The Florida House leveraged their amendment process to bring WWCR to a floor vote.
- Maine passed a new tax transparency law, poised to reveal how many corporations paid no state tax.
- California introduced an annual tax of 1% for residents whose net worth is in excess of $50 million and 1.5% in excess of $1 billion. California also introduced a bill that would tax Amazon, Meta, and Google for the data they collect from users, and direct that revenue as a tax credit for news organizations to employ full-time journalists.
- New Mexico successfully repealed nearly all tax deductions for capital gains and passed legislation to ensure that big corporations pay more of what they owe in corporate taxes
- Washington introduced a narrowly tailored property tax on extreme wealth derived from the ownership of stocks, bonds, and other financial intangible property.
- Since 2023, 19 states plus D.C. passed 23 new policies that improved, expanded, or created a Child Tax Credit (CTC) or Earned Income Tax Credit. Baby bonds too are gaining momentum, with programs in Connecticut and California.
- The IRS is rolling out its free tax-filing tool to 30 million Americans in 24 states.
Watch their Legislative Briefing on Tax Justice Trends in the States.
2) National: Here’s an overview of the key initiative issues on the ballot in the swing states
3) National/Pennsylvania: Girard Miller, the finance columnist for Governing, has a very useful overview of the issue of privatizing municipal utilities. “In coming years, there may come yet another impetus for privatization, as the federal Environmental Protection Agency has just issued a ruling to require all water supply systems to replace lead pipes with safer alternatives within 10 years. Think of Flint, Mich., as the backdrop for this edict. For some local water utilities, this could be the proverbial straw that breaks the camel’s back, unless the public finance community comes up with municipal-bond funding solutions that result in lower costs to water consumers than the private sector can deliver. Astute investors may also sense a potential hidden motive for local utility privateers: the growing demand for water and electricity to feed new data centers that operate all those artificial intelligence chips and servers that are today’s hottest topic on Wall Street. Already the stocks of larger private utility companies are surging. Could it be that private utility companies are catching on to something that local elected officials are overlooking — that their control of water and electricity is an underpriced asset?”
Miller proposes a special purpose municipal financing authority to recapitalize struggling municipal utilities, which certainly bears looking at as a way of escaping the privatization industry’s mantra that “desperate government is our best customer.” But he misses out on another key reason to keep municipoal utilities in public hands: it secures public control if the public is vigilant not simply for the purpose of realizing an asset value, but for realizing a democratic value..
4) National: Let’s hear it for Worth Rises, which knows the fight against private prison profiteers extends to the industry’s financial backers, is international in scope, and is assisted by laws mandating corporate transparency. “In a first,” they report, “UBS could be held accountable for passive investments in private prisons.”
Here’s the story from their email:
“Have you ever attempted to screen your retirement accounts for the prison industry just to learn that many of your investments were in index funds you could not control? Well, you’re not alone. An index fund is a collection of stocks that meet a particular criteria, and they are popular among investors because they facilitate diversification without the need for too much research. They are called passive investments because only fund managers, not investors, control what’s in them — and therein lies the problem. Well, we have some good news that gets us closer to removing some prison industry stocks from index funds. Earlier this year, we filed a complaint based on guidelines set by the Organization for Economic Co-operation and Development (OECD), to which 37 countries including the U.S. belong, against UBS for its passive investments in private prison operators CoreCivic and GEO Group, the nation’s largest private prisons, for human rights violations. After a preliminary investigation, the Swiss National Contact Point for Responsible Business Conduct (NCP), a governmental watchdog on business and human rights, has accepted our complaint. We now enter mediation with the bank to remedy their violations.
“This is major. It is one of the first occasions that the OECD guidelines have been applied to passive investments. And if successful through mediation or subsequent action by the NCP, this could lead to more scrutiny of passive investments, encourage fund managers to remove these stocks from their indices, and help all of us invest more ethically.”
5) Maine: A win for the poor, says Eve Ottenberg. “Roughly 20 million Americans live in trailer parks, and in recent years rents there, like everywhere, shot up. Since these tenants often cling to a lower rung of the socio-economic ladder, such rent hikes could easily spell destitution. That’s why Maine’s new law last year, giving trailer park residents the chance to purchase the land on which their mobile homes sit, is such a big deal. Because trailer tenants usually own their mobile home, but pay rent on their lot. So investors target these parks and then boost the rent. For those struggling with cheap homeownership, that stinks.”
6) National/Massachusetts: The Biden-Harris administration has announced that $4.2 billion of infrastructure improvement funding will be on its way to 44 projects across the country. “Boston’s transit agency will receive $472 million from the federal government to replace a century-old rail bridge. (…) Other projects that received awards include replacing a two-mile bridge in the Florida Keys, untangling a busy intersection in Arizona, electrifying port equipment in Miami, and replacing a highway bridge that collapsed in Providence, Rhode Island. The federal money, which comes as a result of the 2021 infrastructure funding law, comes from two grant programs that fund large projects, the so-called “Mega” grants for outsized projects that are too complex for most federal grant programs, and the INFRA program, which go to highway and multimodal projects that speed freight delivery and promote other economic benefits. The Department of Transportation received nearly 200 applications for funding through the two programs this year, said Transportation Secretary Pete Buttigieg.”
7) Massachusetts: Two property owners have lost their bid to privatize a road near Walden Pond that has been public since before the U.S. founding. “Earlier this week, an appeals court once again affirmed that the land is public—though a lawyer for the homeowners insists that he will still seek yet another appeal.”
8) New Jersey/National: Good news from More Perfect Union: “New Jersey could be the first state to ban landlords from using algorithms to set rents and reduce competition. A bill to ban price-fixing software has advanced out of committee. If the bill passes it could break the landlord cartels that are driving up the cost of housing.”
9) Think Tanks: Pew has five recommendations for how to rebuild trust in government:
- Showcase individual federal employees.
- Make the government more transparent and accountable to the public.
- Develop modern, customer-friendly services.
- Improve federal leadership.
- Reconnect with young people.
10) National/Think Tanks: The UCLA Institute for Democracy, Education and Access has issued a new report, The Costs of Conflict: The Fiscal Impact of Culturally Divisive Conflict on Public Schools in the United States, by John Rogers, Rachel White, Robert Shand, and Joseph Kahne. “Again and again, we heard stories of sizable expenses related to all this tumult—the money schools and school systems needed to spend on these issues, many told us, meant less money was available for other educational priorities. Some of these costs were straightforward—many districts said they were hiring increased security officers for board meetings and at district offices. Others reported needing additional staff to handle communications and legal expenses. And some costs, while sizable, seemed less obvious. Educational leaders spoke of increased staff turnover, sizable time spent responding to Freedom of Information Act (or public records act) requests, and time spent in endless meetings responding to unsubstantiated rumors and blatant misinformation. Across rural, suburban, and urban areas and in communities of all political persuasions, we heard that these costs could be sizable, and that they were meaningfully impacting the quality of education students received.”
11) National: Josh Cowen, a professor of education policy at Michigan State University and a senior fellow at the Education Law Center. says, “if Trump wins, count on continued culture wars, school vouchers and a fixation on ending the federal Department of Education.” Cowen writes, “Two of the first three paragraphs of Project 2025’s education plan call for universal school vouchers. In Trump’s official GOP party platform, universal vouchers are the second education agenda item, behind a call to end teacher tenure. Both items follow a general statement about making great schools. And yet, private school vouchers are not only eating up increasing shares of state budgets, some states are now directly funding new construction for private schools to receive those vouchers. These schools are free to discriminate on admissions and expulsion decisions across a variety of child characteristics. (…)
A new Trump presidency would usher in an era of isolation and separatism and a casting out of children who differ from their peers or from what Christian Nationalists believe America should look like beyond what we all share as human beings. As just one example: Voucher schemes, like those prioritized by Trump and his allies, have been used by the right to marginalize LGBTQ+ children and families by denying them access to what the right calls the “education freedom” and “opportunity” represented by such ‘scholarships.’”
12) National: Edward Blum, a key figure in the decades-long right-wing assault on diversity in American life, has a new target: scholarships for aspiring Illinois minority teachers. Somehow Education Week could not find anyone favoring the scholarships and considering them legally sound to comment on its story. [Sub required]. Blum also went after the Fearless Fund grant started by Black women, a program to help Black women business owners. Pushing back against such efforts on the corporate finance front, the NAACP has launched a $200 million fund of funds to transform the venture capital landscape.
13) Kentucky: Liam Amick, a Kentucky high school student, weighs in on Kentucky’s pro-voucher Amendment 2. “Supporters of Amendment 2 often bring up Kentucky’s 2023 $1 billion budget surplus, claiming that that money will be used to provide funding to public schools and said schools will lose no money. However, that surplus money already has a destination. According to House Appropriations and Revenue Chair Jason Petrie, the extra money has ‘provided the opportunity to invest more than $2.7 billion over the next two years to improve road, rail, river, air, and water infrastructure.’ Although Petrie claims they are also making “targeted investments in school facilities,” the bottom line is that significantly fewer tax dollars would go to public schools, leaving no replacement funding in their wake.”
14) Louisiana: Ethics charges have been settled for two former Baton Rouge charter officials, but a third official is still fighting. “Fontenot and Johnson are accused of violating a state law that states “no appointed member of any board or commission, member of his immediate family, or legal entity in which he has a substantial economic interest” can even pursue “a contract, subcontract, or other transaction which is under the supervision or jurisdiction of the agency of such appointed member.” The consent opinion dealing with Johnson that was approved Friday covers only her most recent contractual arrangement with GEO, from June 2020 to June 2023. During that time, the foundation paid her more than $130,000.”
15) Nebraska: The Custer County Chief reports that Nebraskans will be voting on whether to revoke state vouchers for private schools. “In one of the more hotly contested issues in recent years, voters will decide whether to repeal, or retain, a controversial law was passed earlier this year that allows the State Treasurer to administer a scholarship program to private and parochial K-12 schools that was funded with $10 million of state funds. Legislative Bill 1402 served to replace a law passed in 2023, the Opportunity Scholarship Act, that allowed taxpayers to devote up to half of their state income taxes to scholarships to private, K-12 schools with a cap of $25 million total. Public school supporters had gathered enough signatures to hold a vote to repeal the Opportunity Scholarship Act, but since the State Legislature replaced and repealed it, that petition drive was rendered moot, and a second signature drive was successful to force a referendum on the new bill. A “yes” vote for ballot issue No. 435, the Private Education Scholarship Partial Referendum, would repeal LB 1402, and stop state funding of private school scholarships. Advocates say state funds should be devoted to public – and not private – education, and that such programs in other states have expanded and become more expensive, straining state budgets and that there’s no proof private schools do a better job of educating students.”
16) Oklahoma: EPIC Charter Schools, which has been mired in scandal, has announced it will be laying off staff. “Superintendent Bart Banfield said the company was ‘experiencing some financial challenges due to student enrollment numbers not meeting our anticipated growth.’ Banfield went on to say that difficult decisions had to be made and that staff within the human resources department would be reaching out to ‘employees who are included in this position adjustment to explain the off-boarding process.’ A teacher with Epic Charter Schools, who wished to remain anonymous, described to KOCO 5 that having to wait for a phone call to know if they’ll remain in their position or not as nerve-racking. It’s unknown how many positions will be affected by the ‘reorganization.’”
17) National: Remember when, a few years ago, there was a massive scandal over private military housing, Congressional hearings and inquiries were launched amid much huffing and puffing by politicians, and the government then rumbled and rumbled then said they would, er, have to do privatization again but this time they would really, really, really tightly oversee the privatizers on things like mold and sickness?
Well, the Project on Government Oversight’s René Kladzyk is calling attention to some recently surfaced documents that shed even more light on the disastrous privatization of the military housing system and the shambolic efforts of the federal government to oversee the contracts.
“On the weekends, Aubrey Metzler lets out her frustration with military housing by screaming at strangers in the haunted house where she works, playing the part of ‘lunatic.’ The 23-year-old mother of two has good reason to feel a little unhinged. Metzler says her whole family has been sick ever since they moved into privatized military housing last spring on Fort Campbell, an Army base straddling the edge of Kentucky and Tennessee. Her 17-month-old son is so congested that he has trouble breathing. Her 2-year-old daughter often complains of headaches and stomach pain, and both kids can’t use the tub in the upstairs bathroom without breaking out in hives.
“Her husband, an Army Private First Class, has recently been hospitalized for cluster migraines. Metzler herself throws up ‘every single day,’ and describes the family’s housing challenges in a gravelly voice that’s punctuated by coughs and sniffles. On top of all that, the stress over housing has taken a toll on Aubrey and her husband’s mental health, she says, comparing her time working at the haunted house to ‘therapy.’ Metzler thinks the cause of her family’s health problems is mold, but she says it’s been an uphill battle getting taken seriously. Military family housing at Fort Campbell is run by Campbell Crossing LLC, a development of the global real estate conglomerate Lendlease. ‘Every time they tell me there’s no mold, I find mold. Every time without fail,’ Metzler says. A spokesperson from Lendlease said the company complies with Army guidance, and emphasized that the safety of military families is the company’s top priority.’”
18) National: Is Dodd Frank finally reaching the P3 advisory business? There seems to be mounting panic in the privatization industry over the prospect of federal regulation of their advisory practices in helping municipal and other governments with the ins and outs of privatizing or partially privatizing public assets and services. Note how the simple fact of regulation is equated with “risk.”
“The P3 advisory industry is waking up to a new source of regulatory risk,” explains PWF editor Michael Bennon, “based on remarks from a senior Securities and Exchange Commission (SEC) official in September. The crux of the new risk: according to the SEC, some P3 advisors may be ‘unregistered entities engaging in municipal advisory activity.’ The remarks were part of a presentation and panel at the Bond Buyer infrastructure conference in Philadelphia on 17 September. They were made by Dave Sanchez, Director of the SEC’s Office of Municipal Securities. The SEC published a copy of the remarks, available here.”
The comment by a federal official that seems to have most unnerved the P3 advisors is this one marking out financing advice in the course of the preparation of an RFP, which suspicious minds would not likely be too far off base imagining may happen from time to time in P3 dealmaking: “P3 Consultants should be aware that considering various financing alternatives and assisting with the sizing and structuring could constitute municipal advisory activity.” [Public Works Financing, September 2024; sub required].
19) National: Writing in Yale Climate Connections, Sarah Wesseler says the quiet part out loud: “Why widening highways doesn’t reduce traffic congestion.” Wesseler interviews expert Amy Lee on the subject. Casting doubt on the environmental benefits of expanding Lexus Lanes (with their accompanying “congestion pricing,” a significant cash cow for the infrastructure industry and their financiers) will surely be unwelcome news for their advocates; as would any argument for slowing down our global sport of paving everything over with highways and multimodal projects.
“It’s not for lack of funding,” says Lee, “that we don’t build, say, transit and bicycle infrastructure everywhere. In California alone, about $30 billion are slated to be spent on transportation in the next fiscal year – that is an astronomical amount of money. So we have the money; it’s just how we choose to spend it. And historically, and even today, a lot of it goes to highways and highway expansion. Transportation folks love to say, ‘Oh, but we can’t just shift money around, because it’s not one big pot from which every single project’s funding comes.’ And that’s true; there are lots of pots that have been created by legislation. If we wanted to change those policies, we could. I won’t discredit how hard it would be, though.”
20) National: Fortune reports that Trump’s Wall Street backers want to privatize Fannie Mae and Freddie Mac, the federal home loan agencies. “Democrats fear ending the conservatorship would cause mortgage prices to jump since Fannie Mae and Freddie Mac would need to raise fees to make up for the increased risks they would face without government support. The two firms guarantee roughly half of the $12 trillion U.S. home loan market and are a bedrock of the U.S. economy. Project 2025, a handbook for the next Republican administration, includes a key call for the conservatorship to end, though Trump has sought to distance himself from the 920-page document, which was drafted by longtime allies and former officials of his administration. ‘If his (Donald Trump’s) Project 2025 agenda is put into effect, it will add around $1,200 a year to the typical American mortgage,’ Democratic presidential nominee Kamala Harris said during an August rally in North Carolina, building off of a 2015 analysis by economists Jim Parrott and Mark Zandi.”
21) National: Veteran investigative journalist Russell Mokhiber interviewed Medicare Advantage critic Ana Malinow for his Corporate Crime Reporter. “Part of it is advertising. But the other part is that it is less expensive for seniors. Medicare is very expensive. And a lot of people just don’t have the choice and they choose the cheaper option. Why is it cheaper? Because the Medicare Advantage plans are being overpaid by the taxpayer. So yes, they can be a little bit more generous and they can be a little less expensive. And they drum up more business. And they get overpaid. That’s why they are so successful. And the reason they are so successful is not because of the ads, but because they are being overpaid by the federal government.”
22) National: The Committee for a Responsible Federal Budget says Trump’s plan for Social Security would be a disaster. “Trump’s proposals to eliminate taxation of Social Security benefits, end taxes on tips and overtime, impose tariffs, and expand deportations would all widen Social Security’s cash deficits. Under our central estimate, we find that President Trump’s agenda would:
- Increase Social Security’s ten-year cash shortfall by $2.3 trillion through FY 2035.
- Advance insolvency by three years, from FY 2034 to FY 2031 – hastening the next President’s insolvency timeline by one-third.
- Lead to a 33 percent across-the-board benefit cut in 2035, up from the 23 percent CBO projects under current law.
- Increase Social Security’s annual shortfall by roughly 50 percent in FY 2035, from 3.6 to 4 percent of payroll.
- Require the equivalent of reducing current law benefits by about one-third or increasing revenue by about one-half to restore 75-year solvency.”
23) National: Seeking Alpha has published an analyst’s report saying that GEO Group, the private, for-profit prison ad immigration detention company, is experiencing “Financial Deterioration Amid Debt Reduction Focus.” It says, among other things, that “ultimately, the company’s financial performance has been deteriorating and shows no signs of abating. Both operating margin and FCF margin have declined considerably.”
24) International/Canada: The Canadian Union of Public Employees (CUPE) and the Ontario Health Coalition once again have rolled out a Trojan Horse at Blind River Hospital on Friday to dramatize the dangers of privatization. “‘Private for-profit clinics and hospitals are up to two to three times more expensive than public hospitals. The Ford government is taking our public tax funding for health care away from our local hospitals to give it to more costly for-profit clinics,’ said Natalie Mehra, the executive director of the Ontario Health Coalition. ‘Even worse, for-profit clinics threaten public Medicare and cause hardship for patients, charging the elderly on pensions thousands of dollars unlawfully for needed surgeries and manipulating them to pay for unnecessary add-ons.’ The two organizations are instead demanding that the government make investments in public hospitals to improve staffing and capacity, which already have the infrastructure to offer more services but are lacking funding.”
25) National: As we mull over the question of how the politics of government contracting can affect democratic choices, there is clarity on another front, as Ryan Grim explains:
“Musk himself loves public-private partnerships. He lives off of billions of dollars in government contracts through SpaceX, essentially replacing the functions of NASA, and Starlink. He enjoys billions more in government subsidies and tax credits for Tesla. (In Q2 2024, nearly 60 percent of Tesla’s revenue came from the sale of carbon credits.) With a second Trump administration and a new FCC chair, Musk could also be in line for billions more in federal broadband subsidies, which were denied to him by the Biden administration. This strategy, becoming a monopoly through public sector contracts, is endorsed by Peter Thiel himself in the book Zero to One—with Tesla highlighted as an example.”
Perhaps, having swallowed up NASA, Musk wants to go all the way and turn the U.S. into a big corporation, where citizens become at-will low wage employees. He’s even registered two new companies to fit such a galactic privatization scheme. “Established earlier this month, the mysterious entities were formed in the billionaire’s home state of Texas using an address shared with his family office; they are United States of America Inc., and Group America LLC. Neither has been previously reported.”
PHOTO: From a Bike to the Polls Event