Highlights

• Reports: vouchers, charters bleed the public schools
• Dem who pledged not to privatize community-owned utility wins Jacksonville mayor’s race
• Yes, in fact, people are still talking about privatizing Social Security

First the good news…

1) National: Two new reports, one from In the Public Interest and another from Public Funds Public Schools, make the case that privatizing American schools has a devastating impact on public education. Charter Schools and Fiscal Impact, a new brief from In the Public Interest, describes some of the most common causes and types of fiscal impact and offers suggestions for how local or state officials might address this concern. It also explains why funding public education is so important: “That system of universal, free public education benefits all of us, whether we have children of school age or not. It is imperative that parallel and less accountable structures such as charter schools be ‘good neighbors’ and similarly committed to ensuring that one system does not harm the other.’ The report concludes with a comprehensive list of charter fiscal impact studies.”

The Fiscal Consequences of Private School Vouchers examines the growth in voucher programs and spending in Arizona, Florida, Georgia, Indiana, Louisiana, Ohio, and Wisconsin in the decade following the Great Recession. Among its findings: At the same time funding for vouchers climbed significantly in these seven states, the portion of state GDP allocated to K-12 public education decreased, even though public school enrollment grew over the same period in five of the seven states. “These developments underscore the importance of documenting and understanding the increasing levels of public funding diverted to private education through voucher programs. The seven states highlighted here provide crucial lessons about the likely patterns of voucher expansion—and the accompanying dramatic increases in voucher spending—that may continue if such privatization is not significantly curbed.”

2) National: From education historian Jack Schneider. “If every private school family in the U.S. received a voucher equivalent to avg. per-pupil funding, it would pull roughly $90 billion out of the public education system each year. These are families *not presently enrolled in public schools* and who *least need a massive handout*”

3) National: Following up on its investigative reporting on the use of algorithms to deny healthcare that patients need it (see Privatization Report, March 20, 2023, item 1), Stat News is out with a follow-up report covering Senate hearings during which lawmakers directly warned companies that do this that they will be held accountable. “Congress is ramping up its oversight, too. Lawmakers in both parties have asked UnitedHealth Group, Humana, and CVS Health’s Aetna for internal documents that “will show how decisions are made to grant or deny access to care, including how they are using [artificial intelligence],” said Sen. Richard Blumenthal, the top Democrat on a subcommittee with the power to investigate government affairs, during the hearing. ‘I want to put these companies on notice,’ said Blumenthal (D-Conn.). ‘If you deny life-saving coverage to seniors, we are watching. We will expose you. We will demand better. We will pass legislation if necessary. But action will be forthcoming.’”

Writing in The Washington Post, Elisabeth Rosenthal of the Kaiser Family Foundation, says “denials of health-insurance claims are rising—and getting weirder.” The reason is money, and the solution is at hand. “The government has the power and duty to end the fire hose of reckless denials that are harming patients financially and medically. Thirteen years after passage of the ACA, perhaps it is time for the mandated investigation and enforcement to begin.”

4) National: The Equal Employment Opportunity Commission has released new technical assistance offering “guidance on how to prevent discrimination via software, artificial intelligence and automated systems in the workplace.” Assessing Adverse Impact in Software, Algorithms, and Artificial Intelligence Used in Employment Selection Procedures Under Title VII of the Civil Rights Act of 1964, “is focused on preventing discrimination against job seekers and workers. The document explains the application of key established aspects of Title VII of the Civil Rights Act (Title VII) to an employer’s use of automated systems, including those that incorporate artificial intelligence (AI). The EEOC is the primary federal agency responsible for enforcing Title VII, which prohibits discrimination based on race, color, national origin, religion, or sex (including pregnancy, sexual orientation, and gender identity). Employers increasingly use automated systems, including those with AI, to help them with a wide range of employment matters, such as selecting new employees, monitoring performance, and determining pay or promotions. Without proper safeguards, their use may run the risk of violating existing civil rights laws.”

5) Colorado: People in Colorado prisons and youth detention facilities will soon be able to make free phone calls. “When the law begins operating in full effect in 2025, the policy will also bring major relief to Colorado families who collectively pay $7.7 million a year for prison phone calls, according to Colorado Department of Corrections data given to leaders of Worth Rises, an advocacy group that helped draft the legislation along with families of people who are incarcerated, ProgressNow Colorado and Stand For Children Colorado, an organization working to advance educational equity and racial justice.”

6) Florida: “So basically, the GOP candidate for mayor of Jacksonville ran on the DeSantis platform in Florida and lost,” says Jennifer Berkshire. But she ran for mayor on a bipartisan basis, warning people across the political spectrum about Jacksonville’s and Florida’s disastrous record on privatization, which she called a “five alarm fire.” “Passage of these bills will bankrupt our city and pave the way for JEA [Northeast Florida’s not-for-profit, community-owned utility] privatization. Thank you @matt_carlucci for supporting home rule while our city’s leaders are silent. If they care about Jacksonville and its future, now is the time to speak out.”

Meanwhile, some key facts about the scandal over privatizing Jacksonville’s utility have emerged, Nate Monroe reports in the Florida Times-Union. “It’s not clear if any other potential bidders got such an intimate private tip off about the coming opportunity to acquire one of the largest public utilities in the United States. (…) The secret nature of that meeting caught notice of federal investigators as they looked into Zahn’s tenure at JEA. They also showed interest in Baker, a political consultant who ran both of Curry’s campaigns for mayor as well as the unsuccessful mayoral campaign of Daniel Davis, who was defeated by Democrat Donna Deegan in Tuesday’s runoff election. Both candidates pledged JEA would not be sold on their watch, a promise that some critics said seemed tenuous given Davis’ ties to Baker.”

7) Florida: “The people of Callaway spoke and their elected officials listened. Trash collection will not be privatized,” Mypanhandle.com reports. “The privatization was proposed by City Manager Eddie Cook, who argued it would cut costs for residents, be more effective, and be better for the longevity of roadways. The residents, however, made it clear they do not agree. ‘It was a unanimous decision that we have killed this issue,’ Callaway Mayor Pamn Henderson said. ‘The citizens can keep who they want to pick up their garbage and the city is out.’ Henderson said so long as she is in office privatizing trash collection will not be considered again.”

8) Minnesota: The state House of Representatives has passed a budget bill with numerous provisions to support the efforts of prisoners to reintegrate into society, including a provision that that would make voice communication free across all state prisons. “Prison telecom is a billion-dollar industry dominated by just a few private-equity-backed corporations that make hundreds of millions each year exploiting family ties. For years in Minnesota, the state has compounded the predatory rates the industry charged by adding and collecting a 40 percent commission on call revenues that amounts to $1.4 million annually. The passing of the Public Safety and Judiciary budget bill begins to put an end to that practice.”

9) Mississippi: “What? Progress in Mississippi? Seriously?” asks Jim Hightower. [Audio, about two minutes]

10) Think Tanks: The Congressional Research Service has produced a very good primer for a general audience explaining the legal concept of Chevron Deference—a.k.a relying on science and expertise to make sound governmental regulatory decisions—the target of all the extremists, from the Federalist Society to Steve Bannon’s podcast, who want to destroy the “administrative state”—i.e. open the floodgates to poisoning your food and water, letting the pharmaceutical companies run even wilder, and gutting the EPA and NEPA. The Supreme Court will be ruling on an important case dealing with the concept.

Education

11) National: The Hechinger Report has shined a light on the abysmal conditions facing school support workers, an often neglected issue with so many crises besetting American public education. “Claire Considine, a teacher’s aide at Naperville North High School in a suburb about 35 miles west of Chicago, had lost count of the hardships that she and other school support staff had been through since she was hired in 2019: the trauma and disruption of Covid-19, chaotic online instruction, mask and vaccine debates, and rising behavioral and mental health issues among students. Now, facing staffing shortages, the district of more than 16,000 students dumped extra work on those who remained. As part of her job, Considine worked closely with students with disabilities, often helping medically-fragile children ride the bus or go to the bathroom. She did this all for $14.25 an hour, bringing home an average of $650 every two weeks. She struggled to afford gas for her car.” [Sub required]

12) National: Will artificial intelligence be used to spy on teachers (and kids?) in the classroom? According to Education Week, it already is. [Sub required]

13) Montana: Right wing Republican Governor Greg Gianforte has signed two charter school bills, and public education supporters have vowed to sue. “A lawsuit against the bills is expected from the Montana Quality Education Coalition. In a press release Friday, the group—which includes the Montana School Board Association, Montana Federation of Public Employees, School Administrators of Montana, Montana Rural Education Association, Montana Association of School Business Officials, and 98 school districts—said its board had voted to hire a lawyer and file lawsuits challenging both policies. ‘MQEC and our partners have defended Montanans’ Article X constitutional right to free, quality public schools for over 20 years,’ said MQEC Executive Director Doug Reisig in an emailed press release. ‘Legislators from both parties recognized HB 562 and HB 393 as both unconstitutional and terrible policy. We’ll bring the necessary lawsuits to clean up these constitutional mistakes.’”

14) Missouri: Sonali Kolhatkar reports that Missouri Republicans have sought to defund the public libraries because they dared to oppose their crusade to ban books. The effort was beaten back. “But the threat still remains after Missouri’s Republican State Secretary Jay Ashcroft pushed through an administrative rule that threatens funding if libraries violate the book ban. He did so in an explicitly undemocratic manner, saying, ‘I have to figure out how to do this, because by rule I can get it done much more quickly than if I wait on the legislature.’ ‘Defund the Library’ could be the GOP’s new slogan, succinctly encompassing a free-market agenda to destroy public funding of institutions that enlighten and educate, all under the disingenuous banner of ‘protecting children.’”

15) Oklahoma: The Tahlequah Daily Press reports that a decision on public funding of private Catholic schools is likely this summer. “The board in April rejected the proposed St. Isidore of Seville Catholic Virtual School in what is being watched as a national test case for public funding of religious education. (…) The archdiocese had a hand in writing the bill, authored by Sen. Julie Daniels, R-Bartlesville. It would insert into state statute the sentence: ‘It shall be deemed a substantial burden to exclude any person or entity from participation in or receipt of governmental funds, benefits, programs, or exemptions based solely on the religious character or affiliation of the person or entity.’ Another bill school supporters are watching is Senate Bill 516, which would eliminate the Statewide Virtual Charter School Board and replace it with a new, larger board that could oversee and authorize brick-and-mortar charter schools as well as virtual ones.”

“It’s hard to think of a clearer violation of the religious freedom of Oklahoma taxpayers and public-school families than the state establishing the nation’s first religious public charter school,” said Rachel Laser, president and CEO of Americans United. “This would be a sea change for American democracy. We will say it again: We urge the board to reject any application for a virtual charter school that includes a religious curriculum or engages in religion-based discrimination

16) North Carolina: Kris Nordstrom, a senior policy analyst with the North Carolina Justice Center’s Education & Law Project, says the state senate budget would have a catastrophic impact on education. “The Senate budget proposal would provide schools a year-over-year decrease in funding, worsen an already record teacher shortage, and expand extreme voucher schemes…steps that, if enacted, would put our inclusive public school system in serious peril. The Senate budget would kneecap our already-underfunded schools with a 2 percent cut in year-over-year funding at a time when the state has billions in overfunded state reserves and—in this Senate proposal—would leave another $2.1 billion unspent. (…) Despite having ample revenue, they’ve ignored the part about funding the 1.5 million students in our inclusive public school system. Ultimately, it’s those children who will pay the cost of the Senate’s misguided values, toiling in underfunded schools in order to finance voucher schemes and tax cuts that disproportionately benefit the wealthy.”

17) South Carolina: Horry County is to outsource the provision of substitute teachers to its schools. “HCS Chief of Human Resources Mary Anderson said the current fill rate for substitutes hovers around the 70% mark. Using an outside company to handle filling those needs could bring that rate up to 90% or better, district officials said. Regardless of which option is chosen, district officials said they need to increase their daily rate of pay for substitutes. (…) Outsourcing would include some cost markups, such as 30% for teachers, aides and support staff, and possibly up to 50% for nursing substitutes. Anderson said there would be some savings for the district, since the substitutes would technically be employees of the outsourcing company there would be no cost for retirement or Social Security. There would also be no costs for vetting substitutes with background checks or associated software costs for those needs since they would become the responsibility of the outside company.”

18) Wisconsin: The Department of Public Instruction has discontinued a portal it used to make available to parents who wished to file reports on how their disabled children were discriminated against by private schools. “The calls Juhnke receives from voucher families often contain the same story. A family has enrolled a child with disabilities in a private school. Administrators have begun pressuring the student to leave or have kicked them out, something public schools cannot do. The parents are shocked. They’re sure the schools can’t do that. Many times, Juhnke has to tell them: Yes, they can. You went into this school choice program thinking that you were the one, as the parents, who have the choice, she said. Really, on the other end, the school holds more choice cards than you do, and you’re coming out on the wrong side of that. (…) The agency was ending its formal complaint procedure, the letter said, to avoid giving complainants false hope that DPI has the ability to address their concerns.”

Infrastructure

19) National: New federal money is flowing into rural areas to support electrical cooperatives. “The programs are intended to allow those rural areas to take advantage of an industry-wide trend to invest in clean energy production. ‘There’s a favorable wind blowing here,’ he said. ‘This allows rural communities to put up a sail.’ The programs are meant to put rural electric cooperatives on equal footing with larger privately owned companies that have already put major funding into clean energy deployment, Vilsack said. The programs represent the largest single funding effort for rural electrification since President Franklin Roosevelt signed the Rural Electrification Act in 1936, a USDA press release said.”

20) National: The Biden administration’s Interior Secretary Deb Haaland is on the receiving end of sharp criticism for her management of energy resources on federal lands and waters. “Progressives denounced the [Cook Inlet] auction from the outset, saying it would damage a fragile watershed with vulnerable wildlife and violate President Joe Biden’s campaign promise to halt offshore leasing. Three environmental groups sued the federal government over the sale, and the litigation is still pending. (…) Critics on the left have since accused Haaland, who championed environmental justice as a congresswoman, of selling out to the oil and gas industry. Opponents on the right meanwhile insist that she is sneakily plotting to block oil and gas production on federal lands altogether.”

21) New Jersey: Brian Lipman, Director of Division of Rate Counsel, warns a Senate panel against weakening rules that inhibit inappropriately profiteering from utility customers. “Significantly, we look at revenue to ensure the utility is not overearning,” says Lipman. “Essentially, we figure out how much the utility really needs. That will not happen under this bill. A utility will be able to come in and show one, very specific set of expenses and then recover those expenses at an accelerated rate. If at the same time revenues go up with utility—that is just a bonus for them. There is no way to determine if they need the capital at that time, we are just forced to pay it to them. This is not good fiscal policy and could very quickly lead to higher rates to fund higher profits for these utilities.”

22) Pennsylvania: Residents of Towamencin, a Philadelphia suburb, are continuing their battle against privatization of their public infrastructure. “Selling the township’s water, wastewater, and stormwater public utilities to private entities will be illegal once the charter takes effect on July 1. Jenn Foster, a resident who served on the Government Study Commission and fought with Towamencin NOPE for the charter to pass, says the group is ‘thrilled’ with the outcome of the election. ‘This is an incredible moment not just for Towamencin, but for other communities in Pennsylvania who feel unheard by their elected officials.’”

23) Pennsylvania: Pittsburgh is preparing to sell water and sewer bonds amid economic and interest rate uncertainties. The deal is planned the week of June 4. “‘This series is just our traditional fixed-rate, municipal bond revenue issue and whatever revenue bond issuance to pay down our capital line of credit, said [Edward Barca, director of finance for the authority]. In pursuing its rolling capital plan, the Authority has leaned on around $800 million made available by a revolving fund managed by Pennsylvania’s Department of Environmental Protection in addition to $185.6 million of low interest loans through the federal Water Infrastructure Finance and Innovation Act, which are expected cover front-end costs of for five years out. The first $52.5 million WIFIA loan closes this month, according to the investor presentation.” [Sub required]

24) International: The Ontario Health Coalition is conducting a citizen-run referendum on the privatization of Ontario’s public hospitals. “There is another option. Virtually every community hospital in Ontario has operating rooms that are closed down in evenings, on weekends, for weeks or months each year or even permanently. We have the operating rooms. Our public hospitals simply do not have the funding and support to staff them. Ontario is dead last in Canada in funding our public hospitals. We have the lowest funding of any province in the country and the fewest nurses per patient anywhere in Canada. Even if our government funded our hospitals to the average of the rest of Canada, we would clear the backlogs and wait lists for surgeries and diagnostic tests in our local public hospitals. We are organizing a citizen-led community opinion vote, like a public referendum at the end of May. We are asking Ontarians to vote whether or not they want our local public hospitals’ services to be privatized to for-profit hospitals and clinics. The referendum will be held in community voting stations, at tables staffed by volunteers outside—or if appropriate inside—local businesses, coffee shops, busy stores, service clubs, places of worship, legions and as many places as possible, measuring public opinion on the plan to cut and privatize our local public hospitals’ services.” The coalition says the vote is this Friday and Saturday.

25) International: Here’s a great cartoon from the U.K. on the apology private water companies have made to the British public for years of price gouging, dumping filth into waterways, and profiteering at the expense of the public. [Here’s an explainer if you want more detail]

Public Services

26) National: Matt Cagle, an attorney with ACLU of Northern California says “face recognition easily automates the exclusion of people from public services, venues, and any location that decides to run a secretive “ban list” against people without their knowledge or consent.” Washington Post reporter Doug MacMillan says “Scott County, Va. uses facial recognition to scan for people on the public housing “ban list.” When they see a match, they call the cops. At least 6 housing authorities are using facial recognition to assist police investigations, manage building access and enforce ban lists.”

27) National: Here they come. The vendors marketing artificial intelligence applications for government. Question: do the people making decisions on these purchases really understand the technology?

28) National: Maximus, the enormous government services contractor, has been awarded a ceiling $2.6 billion contract with the IRS for the “modernization and transformation of the agency’s technology infrastructure. This work will bring together more than 400 IRS systems while reducing operations and maintenance costs.”

29) National: GEO Group, the private prison and immigration detention corporation, has filed an investor presentation with the SEC. Here’s the link.

30) National: CalPERS, the biggest U.S. public pension plan, is reportedly signaling that it will invest significantly in private equity, which has been widely criticized for driving privatization, undermining public services, and eroding the public sector jobs that underpin them. It is unclear whether such a move into private equity even makes market sense at this time. As the Financial Times reports, “the sector is now facing much higher debt financing costs, a deteriorating global economic outlook and concerns about the potential for “stale” valuations lagging those of public markets. Last year the chief investment officer at Danish pension fund ATP compared the private equity industry to a pyramid scheme.” [Sub required]. Private equity has faced accusations of unduly influencing decision-makers at public pension funds, and is facing political and labor resistance.

Everything Else

31) National: If you were wondering whether calls to privatize Social Security have gone away—they haven’t.

32) National: Artificial intelligence is upending the world of government contracting, and could be putting privatization of public sector jobs on steroids. With contractors scrambling to pitch deals to propagate AI throughout government bureaucracies at all levels, how is artificial intelligence going to be used by the federal government? Last Tuesday the House Homeland Security & Governmental Affairs Committee held a hearing (different from the Senate hearing with Sam Altman) on the subject, and included witnesses from the American Civil Liberties Union of Idaho Foundation, U.S. Government Accountability Office. Watch the video [About two hours].

33) International: In an important decision in the U.K., a court has ruled that the government has every right to undo the privatisation of military housing. “Under the controversial £1.7bn sale and leaseback agreement concluded in 1996, the government signed over 57,434 properties to Annington, now controlled by Terra Firma, Hand’s private equity business. The Ministry of Defence then leased back the properties and shoulders the maintenance bill. The deal, which was signed the year before the then-Conservative government lost power to Labour, has been widely criticised. The National Audit Office estimated in 2018 that over the first 21 years of the contract the taxpayer was between £2.2bn and £4.2bn worse off from the transaction, which was overseen by Michael Portillo, who was defence secretary at the time. In late 2021 the MoD used property law to take back ownership of eight properties in the portfolio as test cases. Annington went to the High Court, arguing the actions were unlawful.” [Sub required]. Are sale-leaseback arrangements in the U.S. being subjected to this kind of cost accounting and insourcing?