Your weekly rundown of news and analysis about the privatization of education, water, and other public goods—and about the people fighting back. Not a subscriber? Sign up.
- As the New York City mayoral race heats up, candidate Andrew Yang’s position on private religious schools and charter schools is attracting scrutiny. He is being backed by pro-charter school investor Daniel Loeb.
- Whatever the eventual size of an infrastructure bill, In the Public Interest is raising a red flag about the possible incorporation of the dubious concept of “asset recycling”.
- Immigration and Customs Enforcement (ICE) is closing two privately operated immigration detention centers that have been the subject of accusations of abuse.
1) National: A Senate committee has reached bipartisan agreement to reauthorize the main federal program that provides funding for highways, roads and bridges. “In addition to supplying bedrock federal dollars for roads, the legislation would provide new grant funding in a number of areas—including for electric vehicle infrastructure, efforts to make the nation’s infrastructure more “resilient” to extreme weather, climate change and natural disasters, and for projects in rural regions.”
2) National: How do we move forward to universal broadband availability? Kathryn de Wit of The Pew Charitable Trusts’ broadband access initiative suggests we focus on three issues: increasing speed minimums, improving accountability measures, and addressing affordability.
However, writing in The Nation, Victor Pickard and David Elliot Berman raise a critical question: how will the government confront the broadband industry’s entrenched market power? “Behemoths like Comcast and Verizon exert immense control over the Internet’s last-mile infrastructure. During the pandemic, these corporations have further tightened their grip, forcing hard-hit communities to plead with these giants for a modicum of reprieve from their exorbitant monthly subscription fees. (…) Therefore, it’s important that the bulk of Biden’s proposed $100 billion commitment goes to local governments and nonprofits to build publicly owned broadband networks and not to corporate ISPs. Government has showered big telecom companies with billions of dollars in subsidies over the past two decades to either upgrade or extend their existing infrastructure. Such efforts have consistently under-delivered for the public and over-delivered for the broadband industry. At minimum, we should mandate a return to Title II public interest protections, including reinstating net neutrality and limiting how much ISPs can charge their customers for Internet service before any corporate ISP receives public subsidies.”
3) National: Senate Democrats have introduced a bill to help states and cities modernize IT systems. “Governments should not outsource their mission. They need in-house technology experts to help with research, design, creation and procurement of digital services. Our new legislation cuts through bureaucracy to deliver upgrades for users, and gets a running start at the huge job of upgrading state and local systems,” Sen. Ron Wyden (D-OR) said in a statement.
4) National: The Bond Buyer reports that “the extensive consideration that municipal finance tools are getting as Congress considers infrastructure legislation is producing growing optimism among public finance and local government groups. (…) The Biden administration is scheduled to weigh in on May 28 with its detailed tax proposals as part of its 2022 budget. ‘My interpretation is that if they didn’t have a pay-for problem, then they would have bipartisan agreement,’ said Charles Samuels of Mintz Levin, counsel to the National Association of Health & Educational Facilities Finance Authorities. Brett Bolton, spokesman for the Bond Dealers of America and Municipal Bonds for America, said both groups remain optimistic Congress can take robust action on infrastructure. ‘We hope that Congress and the administration are able to work through the gridlock and find a pay-for solution,’ Bolton said. ‘We will continue to work with our partners on the Hill, in the administration and within the issuer community.’”
5) Pennsylvania: Gov. Tom Wolf (D) joined the fight for charter school reform at an event at Pottstown High School. Wolf was joined by Republican and Democratic legislators, school board members and school superintendents for a press conference. “Pottsgrove School Board member Bill Parker said ‘as a proud Republican, I stand with Gov. Wolf in support of this bill.’ He’s not alone. Ciresi said 400 of Pennsylvania’s 500 school districts have passed resolutions calling for charter school tuition reform. ‘This must pass this session, this budget cycle,’ said Ciresi. ‘This is the time to get this done.’”
Wolf’s plan is outlined in bills from state Sen. Lindsey Williams and state Rep. Joe Ciresi, though the bills have yet to be advanced out of their respective committees. The bills would save $395 million.
6) Think Tanks: Tomorrow Route Fifty will be hosting a “town hall” looking at state and local budgets in the Covid-era and beyond. Hear from @NASBO’s Executive Director @ShelbyKerns as she discusses what to expect in state budgets for the next fiscal year. Sign up.
7) Think Tanks: The Open Society Foundations have announced the 2021 recipients of the Leadership in Government Fellowship, “an initiative supporting accomplished, senior public servants from federal, state, and local governments, who have dedicated their careers to advancing economic, social, and racial justice.” Tom Perriello, executive director of Open Society-U.S., said “at a time when our political landscape is undergoing rapid and profound shifts, the innovations these former public servants are working on will help build a more just and equitable democracy. We are proud of the talent our fellowship program continues to produce and we look forward to their contributions in the years to come.”
8) National: Billions of federal dollars are heading to school districts. How should they spend the money? Route Fifty’s Marguerite Roza and Chad Aldeman look at the issues. “Over the past year, Congress has invested nearly $200 billion to support K–12 education. School district leaders now face tough decisions about how to maximize those investments. Will they hire more teachers, pay existing teachers more to lengthen the school year or something else? If history repeats itself, most of that money will go toward adding more staff. The question is whether hiring more staff now would be the best way to help students recover from a year’s worth of pandemic schooling. We think not.”
9) National/International: A major conflict has broken out over FirstGroup’s effort to sell off its North American school bus operator, First Student, to a Swedish private equity group. “FirstGroup has urged shareholders to vote in favor of the sale of two of its North American divisions amid an increasingly heated spat with its biggest investor. (…) Shareholders are due to vote on the deal at a general meeting of the company in London next Thursday (May 27).
Coast Capital, which owns nearly 14% of FirstGroup, has accused the company of bad timing with the sale – in the middle of a pandemic—and making ‘misleading claims’ about the ‘destructive planned disposal of crown jewel assets.’ FirstGroup hit back … rebutting what it called ‘inaccurate statements’ by New York-based Coast. Highlighting ‘numerous inaccuracies’ in Coast’s latest missive to the market, FirstGroup said the rebel shareholder’s figures for earnings to transaction value were skewed by factors including ‘materially different’ exchange rates.”
And now a second major investor in FirstGroup is opposing the sale, Bloomberg reports, “raising questions about the success of the deal with the London-listed transport firm’s two biggest investors now opposed to it.”
10) Florida: A battle over whether charter schools are entitled to a cut of tax dollars that Palm Beach County voters approved in 2018 for more-traditional public schools has gone to the Florida Supreme Court. “The Palm Beach County School Board on Thursday filed a notice of taking the issue to the Supreme Court after a divided 4th District Court of Appeals sided with charter schools in February. As is common, the notice does not detail the school board’s arguments.”
11) Illinois: The Chicago Teachers Union reports that “After three years of contract negotiations, Urban Prep Academy is offering teachers a measly 1 percent pay raise and the worst health insurance plan for union teachers in Chicago. This, along with other dodgy financial actions, have put the schools and its students at risk. Teachers are not taking it and discussing potential job actions before the end of the year. Stay tuned.”
And CTU has other big news on the charter school front: “CTU-ACTS will launch a charter school division-wide contract campaign on June 11, after school. We’re kicking off the campaign with a rally at Christopher House, 5235 W. Belden, to demand that private charter school employers put the public money they receive into the classrooms, instead of their boardrooms.”
12) Iowa: Gov. Kim Reynolds signed a new charter school bill last week which enables charter school groups looking to form new schools to bypass local school boards and turn directly to the state government for approval. “Democrats and public school advocates have criticized the new charter school formation method, saying that the schools would not be accountable to local school boards or taxpayers despite using taxpayer money. They raised concerns that for-profit education management organizations from other states could set up schools in Iowa.
The Iowa State Education Association echoed those points in a statement from President Mike Beranek Wednesday afternoon. ‘The new charter school law is an unfortunate experiment when we should be investing all of our education resources in the innovative and creative programs in our public schools,’ he said.”
13) New York: As the New York City mayoral race heats up, candidate Andrew Yang’s position on private religious schools and charter schools is attracting scrutiny. “A slew of influential Jewish leaders endorsed Mr. Yang, motivated by one overriding issue: ‘Yeshivas, yeshivas, yeshivas.’ The campaign material began appearing in Yiddish earlier than usual this year, declaring that the best defense that ultra-Orthodox Jews in New York City could have against a hostile world would be to elect Andrew Yang as mayor.”
Yang is being backed by pro-charter school investor Daniel Loeb. Others say his election would be “a disaster.” Yang “got rich running a test prep company, which perhaps shaped his view that private enterprises, like charter schools, are the best providers of education.”
14) Oklahoma: Time is running out for state lawmakers to come up with an effective response to the Epic charter school scandal. Legislation has been drawn up, but adjournment is at the end of next week. The bill is supposed to be voted on today. “HB 2966 would specifically require full disclosure of spending records for charters that contract with outside educational management organizations, or EMOs, as Epic does. ‘The most important part of this bill is the ability of a charter school board, sponsor or the State Department of Education to request financial documents from the EMO if they believe there are discrepancies and the EMO is not following their contract or the law. The EMO must comply,’ Dills said.”
15) Washington: A strike is looming for delivery truck drivers with the Seattle Public Schools. Teamsters Local 174 Secretary-Treasurer Rick Hicks says “enough is enough—it’s time for the Seattle School District to get serious about showing they appreciate the hardworking Teamsters who risk their health day after day to take care of Seattle schoolchildren,”
16) Wisconsin: Ruth Conniff has called out the Wisconsin Institute for Law and Liberty’s “sloppy” voucher school research. “Flanders’ analysis is sloppy and misrepresents simple math. But the central piece of misinformation he is peddling is important to understand. The ‘biggest falsehood presented in Coniff’s [sic] piece,’ he writes, is that the ‘majority of choice students [were] already in private school.’ The fact that Wisconsin taxpayers are footing the bill for private school tuition, mostly for families who never even had their kids in public school in the first place, is highly unpopular. And private school voucher advocates take pains to obscure that fact, arguing, falsely, that the Department of Public Instruction is somehow misleading the public about this. I’ve written about that debate previously.”
17) Wisconsin: A Milwaukee mother says her son’s elementary school is negligent after he was put on the wrong bus and went missing for three hours. “Reliford called police and filed a report. She said at 7:00 p.m., she got a call. Jeremiah had been located on a bus at the First Student bus company bus yard in West Milwaukee. (…) ‘After the route, the driver and the student returned to our location,’ A First Student statement said. ‘The student was never left unattended. He was in our team’s care the entire time as we worked to get him home safely. Our driver followed proper protocol.’”
18) National: With the Republicans having missed President Biden’s deadline last week to come up with a workable infrastructure proposal, and the two major parties still far apart on a deal, the question is whether Biden and the Democrats will move ahead and try to pass legislation on their own. The New York Times reports that “the reaction on Sunday by one of the Republicans most willing to cross party lines, Senator Susan Collins of Maine, illustrated the depth of the impasse on infrastructure, even after offers and counteroffers on both sides. While she said that “negotiations should continue” on a $1.7 trillion infrastructure counterproposal Mr. Biden made on Friday, her position had not moved: The White House bill was simply too big.”
19) National: Whatever the eventual size of an infrastructure bill, Jeremy Mohler of In the Public Interest is raising a red flag about the possible incorporation of a dubious concept. “‘Asset recycling’ is back. This time with flowery language to hide its very real and documented risks. During a Senate hearing Tuesday, Sen. Bill Cassidy (R-La.) praised the selling off of public goods like roads, water systems, and electric utilities. He described it as a ‘virtuous cycle,’ like a ‘soufflé rising.’ Called ‘asset recycling,’ Australia pioneered long-term leases of public assets like Port Darwin, now operated by Chinese investors, and a state-owned electrical grid that was leased out for 99 years. (…) But, a virtuous cycle, asset recycling is not. More like a soufflé collapsing into a soupy mess. As we explained during the Trump administration, asset recycling isn’t some new invention but simply privatization rebranded. It’s the textbook definition of snake oil, a ‘quack remedy or panacea.’” The Council on Competitiveness, a corporate p ressure group, is pushing for the scheme to be included.
20) National: Can bad sports infrastructure deals—so-called public private partnerships— damage public services? Seth Sandrosky looks at the case of the NBA’s Sacramento Kings. “Investing public dollars in private ventures is not risk-free. Consider the case of the NBA Sacramento Kings. The city of Sacramento borrowed $273 million to build the Golden 1 Center, where the Kings play. That deal required the city to take out a loan six years ago. Revenues from city parking service the borrowing, principal and interest. What could go wrong? In brief, the answer is the COVID-19 pandemic. Gov. Newsom’s shelter in place mandate to slow the spread of the novel coronavirus hammered the city’s service economy. Basketball fans stopped watching the Kings play in their publicly funded sports arena.”
21) National: How much would it cost to replace all of the lead water pipes in the U.S.? “A back-of-the-envelope calculation based on EPA’s estimate of average replacement cost per line ($4,700) and assumption of 6 to 10 million lead service lines across the country suggests the cost could range from $28 billion to $47 billion, putting (President) Biden’s $45 billion near the top of that range,” wrote the report’s authors, David Wessel, director of the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution, and research assistant Sophia Cambell.
And, beyond lead pipes, how can it all be financed? It isn’t going to be easy. “Water and sewer utilities would need to issue three to four times as much debt as they have been to fund the level of projects the Environmental Protection Agency says they need, according to Moody’s analysts. The EPA estimated in a 2018 report that $743 billion in water infrastructure improvements are needed to meet the country’s drinking water and wastewater needs. The majority of those costs will be borne by the utilities, Moody’s analysts said. ‘Historically the federal government had funded a great deal of the local infrastructure, but federal funding has been declining,’ said Eric Hoffmann, a Moody’s senior vice president and manager.” [Sub required]
22) West Virginia: The Kanawha County Commission on Friday sent a letter to the West Virginia House minority leader calling on the legislature to hold public hearings on proposed rate increases by utility companies. “The commission faulted [West Virginia American Water] for filing a rate increase request for an additional $40.8 million in annual revenue for water and wastewater operations combined, 26.1% more than the company’s current rates. The average monthly residential sewer bill would jump from $54.14 to $71.84, according to filings.”
23) International: Brazil’s right wing government, which is mired in scandal and corruption, is anticipating a bonanza from its fire sale of its public assets. [Sub required]
Criminal Justice and Immigration
24) National: The federal Immigration and Customs Enforcement agency is closing two privately operated immigration detention centers that have been the subject of accusations of abuse. “Homeland Security Secretary Alejandro Mayorkas directed ICE to terminate its contract with the Bristol County Sheriff’s Office and transfer migrant detainees out of the C. Carlos Carreiro Immigrant Detention Center in North Dartmouth, Mass. The order comes four months after the Massachusetts Attorney General found that the sheriff’s office used excessive force against detainees—such as flash bang grenades, pepper-ball launchers and canines—in a clash over coronavirus testing at the facility in May 2020. Mayorkas also directed ICE to prepare to discontinue its use of the Irwin County Detention Center in Ocilla, Ga, “as soon as possible.” NBC News reported last September that a gynecologist who worked at the facility was accused by multiple women of performing unnecessary procedures on them, including hysterectomies. (…) The Irwin County Detention Center, which houses ICE detainees as well as inmates for Irwin County and the U.S. Marshals Service, is privately contracted by LaSalle Corrections.”
ICE’s decision was catalyzed by the Government Accountability Project Client Dawn Wooten’s Whistleblower Disclosures, the organization said in a statement. “Dana Gold, Government Accountability Project Senior Counsel and lawyer for Ms. Wooten, stated: ‘Ms. Wooten’s brave decision to come forward about the abhorrent conditions at Irwin launched the OIG investigations that prompted Secretary Mayorkas to terminate ICE’s contract with LaSalle and end the misconduct that endangered immigrant detainees at ICDC. Her whistleblowing opened the door for women survivors to seek justice for the medical mistreatment they suffered and has ensured that immigrants will not suffer from any mistreatment in the future. Unfortunately, Ms. Wooten, a single mo ther of five children, continues to pay the price for her truth-telling, having suffered wrongful retaliation.’”
25) National: Route Fifty’s Kate Elizabeth Queram looks at the issue of local corrections spending, which has risen by $25 billion in last 40 years. “Mandated population decreases during the Covid-19 pandemic helped local jails in some jurisdictions find creative cost-cutting measures that could continue long after the threat of the virus has passed, local officials said last week during a webinar hosted by the National Association of Counties.”
26) National: The Financial Times has reported that “two years after JPMorgan Chase announced it would no longer finance the private prison industry in the US, the bank’s asset management arm has disclosed a position in a private prison bond sold last month. Funds tied to the bank have invested $25m or more in a bond issued by CoreCivic, which runs prisons and detention centers across the US. The funds each bought a piece of a recent $450m bond sold by the company in April.” [Sub required]
27) Alabama: Lawmakers may have to hold a special legislative session to deal with the crisis surrounding the state’s public-private prison construction scheme. “The lease plan faces a June 1 deadline for the companies to secure financing, after which the state or the companies can back out of the deal. House Speaker Mac McCutcheon said lawmakers are working on a Plan B in which lawmakers would consider a bond issue to build new state-owned prisons. McCutcheon said lawmakers have been supportive of the governor’s plan to lease prisons in which the buildings would be owned by private companies but run and staffed by the Alabama Department of Corrections. But he said it could be time to look at other options. ‘We’ll continue to be supportive of (the governor), but time is running out now. Those contracts were supposed to be finalized June 1,’ McCutcheon said.”
Meanwhile the U.S. Department of Justice in an amended complaint says the Alabama Department of Corrections and its leadership continue to fail to protect incarcerated men from physical and sexual violence and death, despite years of warnings from the federal government. “Carla Crowder, executive director of Alabama Appleseed Center for Law and Justice, said in a message to APR that nothing has changed. ‘Nothing. It’s been more than two years since the first DOJ report shamed this state in headlines across the country. Elected leaders promised to address the crisis. Obviously that has not happened. Instead, their nonchalance and inaction have allowed conditions to worsen and more people in state custody to die violent deaths or try to survive in shockingly inhumane conditions,’ Crowder said.”
28) California: Rebecca Plevin, the project editor for the Central Valley News Collaborative, asks whether the new California attorney general, Rob Bonta, will hold California immigrant detention centers accountable. “During a recent phone interview, I asked what he plans to do to ensure oversight of these facilities. ‘We will certainly be actively using the tools that the (Department of Justice) has at its disposal,’ Bonta told me. His role is to ‘enforce the law,’ he said, and pointed to several pieces of legislation—including some he had authored—that he could utilize to ‘help ensure accountability, oversight and appropriate attention to the health, safety and welfare of Californians in these detention centers.’ It’s true that as the head of the state’s Justice Department, Bonta is now responsible for interpreting and enforcing state laws, rather than crafting them. Still, his response was more measured than what I’d come to expect from one of the most—if not the most—strident legislators with a history of speaking out against private prisons and detention centers.”
29) Oklahoma: The Oklahoma Board of Corrections has unanimously approved two contracts that will keep the North Fork Correctional Facility in Sayre and Davis Correctional Facility in Holdenville open through July 2023. “CoreCivic, a Tennessee-based private corrections company, owns both of the prisons. The facilities combined house just under 4,200 prisoners or nearly 20% of Oklahoma’s total prison population. The Department of Corrections will pay CoreCivic at least $12 million annually to use the North Fork facility, which it has leased and staffed with state corrections officers since July 2016. The facility previously housed out-of-state prisoners from Wisconsin and California. Starting July 1, the corrections department will pay CoreCivic between $50 and $63 per day per prisoner to house up to 1,314 medium and 360 maximum security prisoners at Davis. The agency won’t have to pay for unused beds, according to the updated contract agreement, and Davis prisoners won’t be charged more than their counterparts at state facilities to make phone calls.”
30) Pennsylvania: Delaware County is seeking managers to oversee its juvenile detention center. “On March 12, Delaware County President Judge Kevin F. Kelly ordered the county’s Juvenile Detention Center in Lima closed after Delaware County Public Defender Chris Welsh and First Assistant Public Defender Lee Awbrey sent a letter claiming the juvenile justice system was broken and the kids were being abused, including punching the juveniles in the face, forcing one to drink out of a toilet and sexual assault. (…) As a temporary measure, the county has been working with Bucks, Montgomery and Chester counties to place juveniles as needed. Also, council approved a contract with GEO Group Inc. subsidiary Cornell Abraxas Group Inc. last month for use of the juvenile detention facility in Morgantown at a cost of $340 per day. GEO Group operates the county’s adult prison, the George W. Hill Correctional Facility, and county officials are in the process of deprivatizing that facility to return it to county control. County council members who approved the arrangement with Cornell Abraxas for juveniles emphasized that it was only a temporary solution until a more permanent one would be established.”
31) National: Suzanne Gordon asks whether President Biden will enable Trump’s efforts to privatize the Veterans’ Administration. “Now that Democrats are in charge, the critical question is this: Will the Biden administration implement a Trump initiative designed to weaken the VHA, or will it appoint proper commissioners and staff as well as provide accurate information to the commission, so it can genuinely address veterans’ complex health care and social needs, particularly during and after the COVID-19 pandemic in which millions of veterans have lost their health care and will turn to the VHA for help?”
32) Pennsylvania: In Pittsburgh, state Rep. Ed Gainey toppled two-term Mayor Bill Peduto in the Democratic primary and is an overwhelming favorite to become the Steel City’s first Black mayor. Gainey was endorsed by One PA. “Known as One Pittsburgh prior to a statewide expansion, the group has been involved in a number of progressive causes, including efforts to fend off privatization of the city’s water system and a bid to establish a “community schools” model in Pittsburgh that would prevent school closures. Such advocacy efforts have at times put the group at cross purposes with Peduto, who is seeking a third term as mayor. In 2018, the group unsuccessfully opposed city approval of an expansion to UPMC Mercy Hospital without a robust community benefits agreement. Peduto argued the city could not use its zoning powers to dictate such terms.”
33) Tennessee: The Hamblen County-Morristown Solid Waste Board is exploring the idea of privatization of the county’s landfill. “The board voted unanimously Friday to request proposals for any parties interested in running the day-to-day operations of the landfill. The landfill has been a public entity since the solid waste board was first formed in 1988. But, Tony Cox, Morristown city manager and chairman of the board, said that does not mean the landfill will automatically be privatized. ‘(There’s) no obligation to accept any proposal,’ Cox said. The bids are due on June 29 and will be opened at that time, Cox said. According to a request for proposals put out by the board, there are a total of 11 operational qualifications, six financial qualifications and three other qualifications that any potential vendors must meet in order to be considered.”
34) Washington: A group of 130 yard waste and recycling drivers with Republic Services, who are members of Teamsters Local Union 117, “voted unanimously to authorized a strike on Saturday over pay disparities between employees. The drivers’ contract with the company expires on May 31, according to the union. (…) ‘We drive the same trucks, do the same physically demanding work, yet have less in wages, healthcare, and retirement,’ said Margarito Gonzalez, a union member who has worked in the solid waste industry for 45 years. ‘Republic somehow found a way to pay its CEO $110 million over the last four years, yet we have to scratch and kick for pennies. The right thing for them to do is to make sure our pay is on par with our co-workers.’”
35) National: Thom Hartman reminds us that the same group of billionaire-funded operations to undermine popular trust in government over recent decades is still out there. “So how do you pull this off, when every one of these things hurts average Americans? Easy. Just embark on a 50-year-long campaign, through think tanks, right-wing media, and massive PR efforts to convince average Americans that government is the cause of, not the solution to, their problems. Convince working-class Americans that gutting government is a good thing that will ultimately help them in some mystical, magical way through the incredible “invisible hand” of the marketplace. Lewis Powell, a lawyer for Big Tobacco, launched the movement to do just this with his infamous memo in 1971, and billionaires have funded and promoted politicians who jump on board the “government is evil” bandwagon ever since.”
36) National/International: Writing in Foreign Policy, Walter Kerr, a consultant at Starling Strategy and a former U.S. diplomat, multilateral bank advisor, and technology entrepreneur, and Maya Guzdar, a consultant at Starling Strategy and student at Stanford University, criticize U.S. government contracting policy on foreign aid. “USAID spends so inefficiently because every year the agency needs to move more than $20 billion to projects worldwide. It has become dependent on funneling hundreds of millions, sometimes billions, of dollars to mammoth government contractors. In fiscal year 2017, for instance, 60 percent of agency funding went to just 25 organizations. To right the ship, USAID needs a procurement renaissance.” [Sub required]
By Gage Skidmore.