Update: Upcoming Outsourcing Issues. May 19, 2014


1) National: Sen. Bernie Sanders (I-VT) warns that conservatives will use the current scandal over falsified wait times at the Veterans Administration to try and privatize the agency. But the Nonprofit Quarterly writes “just because the VA exists doesn’t mean that it has to exist; just because there are problems in the VA system doesn’t automatically justify a reversion to the Republican default position of turning to the private sector.” Sen. Sanders says the Koch brothers “want to privatize the Veterans Administration.”


2) National: Abigail Caplovitz Field looks at the shortcomings of privatization and “public private partnerships.” She writes, “it’s a topic I’ve given a lot of thought to, because in my role as Legislative Advocate for NJPIRG, I played a meaningful role in defeating then-New Jersey Governor, né Goldman Sachs Jon Corzine’s push to privatize New Jersey’s ‘three big roads’–the Turnpike, the Garden State Parkway, and the Atlantic City Expressway. he policy arguments we made then (2007)–and which USPIRG and others continue to make today–remain true, and provide a good, accessible framework for judging any privatization deal that may affect you.”


3) National: Capital and Main features video on Mass Open Online Courses, “Online Ed: Teaching Millions or Making Millions?” by The Campaign for the Future of a Higher Education.


4) National/Louisiana: Journey for Justice Alliance asks Attorney General Eric Holder and Education Secretary Arne Duncan to investigate “racially discriminatory school closings” in New Orleans linked to privatization. “The stated goal of Act 35 was to allow the RSD to ‘meet the educational needs of all students residing in the jurisdiction of the transferring school system.’ This did not happen. What did happen was the implementation of RSD’s real agenda to privatize public education by recklessly closing or converting all district-run schools.” [Letter]


5) Florida: St. Augustine Record editorial criticizes a lack of transparency in the development of reclaimed landfill. “The future of Riberia Point should be decided by a larger process than one community meeting. There’s so much more information that should grow from a civil process, rather than a website attempting to, in effect, privatize use of a larger public asset.”


6) Georgia: Plans to privatize the operations of Paulding County Airport provokes intense debate and divides the community. Primary elections will occur this week. “Residents fighting the plan are targeting the [county] commission and the airport authority that made the deal and kept it under wraps for 11 months. The commission has limited control over the authority; much of the airport fight depends on a federal environmental assessment and lawsuits underway. Still, anti-airport commercialization candidates including Republicans Crowe and Vernon Collett aim to step into county commissioner seats, where they could challenge funding for the commercialization work.” [Sub required]


7) Georgia: The state transportation board approves funding for the $210 million Interstate 285-Georgia 400 interchange, which will be developed as a “public private partnership.” The interchange is highly congested.


8) Indiana: The Michigan City school district may outsource its food, custodial and maintenance services. Bids were opened last Wednesday. The board will meet today in executive session to review them, and on Wednesday in public session to reveal the bids. The Indiana State Teachers Association opposes the privatization and has said pension obligations must be covered for outsourced workers. ISTA has also “cited other drawbacks, such as schools losing control over matters from disciplining workers to the cost of meals.”


9) Louisiana: Robert Mann takes a harsh look at Gov. Jindal’s record on privatization. “If Jindal and legislators really believe in privatization, why not offer a constitutional amendment to abolish the House and Senate and turn over their lawmaking powers to the lobbyists who already write many of the bills they pass?”


10) Michigan: Lansing school board votes to privatize its busing program to Dean Transportation and lay off up to 95 employees. ““I’m deeply disappointed in where we are today,” said Dan Hamilton of the American Federation of State, County and Municipal Employees, which represents bus drivers. He said he had concerns about the details of the change, including such things as whether the district’s food truck drivers also would be affected.”


11) Michigan: The Plymouth-Canton school district, facing  a budget crisis, is “almost certainly going to privatize custodial services.”


12) New Jersey: As school privatization critic Ras Baraka wins the election for Newark mayor, Diana Ravitch looks at the money in the race. “Baraka was opposed by a charter school supporter named Shavar Jeffries, who was bankrolled by out-of-state hedge fund managers, Democrats for Education Reform, and other Masters of the Universe.” Ravitch points to research by Darcie Cimarusti, who reports that “Wall Street Outspends Unions 8:1.”


13) New York: The Columbia County Board of Supervisors will meet tomorrow to consider selling the Pine Haven Nursing Home, “along with an alternative plan to construct a new $32 million county-owned facility to replace the existing 120-bed nursing home. (…) Some residents and labor unions contend selling county-run facilities to for-profit companies reduces access to affordable nursing home care. They argue privatization ignores government’s role in providing an important public health service, especially to low-income people.”


14) New York: Residents and employees sue to block the privatization of the county-owned Valley View Center for Nursing Care and Rehabilitation. “In a case that could block or slow the county’s dash to privatize the 360-bed facility, Goshen attorney Michael Sussman has sued on behalf of a group of Valley View residents and employees to invalidate the transfer, arguing that it violated both the county charter and state law.” Thirty Valley View residents joined the lawsuit.


15) New York: New York City retirement fund issues RFP seeking a consultant on infrastructure investment. Proposals are due June 5.


16) North Carolina: State Supreme Court lets school voucher program proceed, staying a lower court decision. The challenge to the lower court ruling was brought by parents represented by the right wing Institute for Justice.


17) Oregon: Liquor privatization supporters get green light to start collecting signatures for a ballot initiative. According to a poll, 64% of likely voters “agree the state’s current system for liquor sales ‘works just fine’ compared with 28 percent who disagree.”


18) Pennsylvania: Auditor General Eugene DePasquale issues a report sharply criticizing the quality of oversight of charter schools. “‘In fact,’ he said, ‘several participants in the public meetings compared the current situation to the wild, wild west.’ An independent statewide charter oversight board would provide needed clarity and direction, DePasquale said. The board could be funded, in part, from the money the Education Department now spends on its charter office. ‘With more than $1 billion being spent on charter schools every year,’ according to the report, ‘improved oversight is imperative.’” [Report on the need for accountability and transparency]


19) Pennsylvania: Philadelphia Inquirer editorial opposes amendment to the city charter that would mandate legislative review of certain city legal aid contracts. Mayor Nutter has proposed outsourcing work now given to court-appointed attorneys.


20) Pennsylvania: Following a public outpouring of support, the Tatamy Post Office will remain open. One alternative had been “contracting with a local business to create a village post office.” Last month “union representatives expressed concern” that a pilot program to provide postal services from Staples “would expand and that local post offices would be pressured to close.”


21) Rhode Island: The Department of Transportation’s new website offers more information, including bidding opportunities, links for contractors and consultants, draft plans for upcoming projects, and community updates.


22) South Carolina: Anderson County may look to outsource its maintenance operation at Anderson Regional Airport. “The folks in Anderson have not supported that (maintenance) shop like they should. We can fix it, but it needs to be fixed or we need to privatize it … it is a subsidy to help us sell more fuel, so a $10,000 loss is like breaking even because of the benefit to the airport,” says deputy administrator Holt Hopkins. [Sub required]


23) Texas: Petitions are turned in for a ballot initiative to establish home rule for the Dallas Independent School District, which critics fear will open the door “to try and privatize education.”


24) Utah/National: As concerns over fire dangers in western lands grow, a panel debates the issue of who should control federal lands. “But thanks to a spate of 19th century ‘giveaway’ laws, the government has long since handed millions of Western acres to private enterprise, countered Dan McCool, a University of Utah political scientist. Short-sighted policies of the past ensured forests were aggressively cut and rangelands overgrazed. Newer laws reflect a national interest in conservation and multiple use on these lands, he said.”


25) Virginia: Roanoke is to outsource its downtown parking enforcement to Atlanta-based Lancor. “Current full-time city parking department staff, including enforcement officers and one office staffer, have been offered positions with Park Roanoke. If they don’t want those jobs, the city will work with them to find a position elsewhere in city government.”


26) Washington: The state DOT’s new strategic plan includes provisions for greater “community engagement.” Includes more consent on decisions made by WSDOT, improved public understanding of expenditures and investments, and improved public access to information and decisionmaking.


27) Wisconsin: Milwaukee County Executive Chris Abele defends his effort to bid-out the county’s transit system. Asked whether or not the county should insource the system back to public operation, Abele claims he asked the Federal Transit Administration and others whether any other municipality had done that, but “we couldn’t find examples”


28) International: Privatization is cited as a major cause of last week’s Turkish mine explosion and fire that caused the deaths of at least 300 miners. “Critics say safety problems worsened after privatization of Turkey’s coal mines in 2002, and claim that since the private company SOMA Komur Isletmeleri bought the Soma mine in 2005, the company has regularly skimped on safety measures to boost profits.  (…) ‘Recent trade-union statistics show that there was a 40 percent increase in accidents in mines since privatization started,’ said Ozgur Gurbuz, a Turkish energy expert. ‘In order to win tenders, companies have to cut production costs, and there is only so much they can change. Ultimately, it is down to cutting wages and compromising safety.” The Turkish government recently said they would redouble their efforts to sell off public assets.


29) Revolving Door News: Ted Mitchell, one of the leaders of the education privatization movement, is confirmed by the Senate as undersecretary of the Department of Education. Stacey Childress, “who has helped direct the flow of many millions of dollars in funding from the Bill & Melinda Gates Foundation to school projects nationwide,” will replace Mitchell as chief executive officer of the NewSchools Venture Fund.


30) Public Finance Twittersphere: Twitter opponent of municipal bond analyst Cate Long, a frequent critic of “public private partnerships,” outs herself as a Kentucky public official.



Legislative Issues:


1) National: As the transportation bill advances in the Senate, the House is silent on where it stands on the funding measure. “[House Transportation chair Bill Shuster] is expected to survive [his] primary, but transportation advocates are worried that too much time has been lost to pass a large bill before the projected bankruptcy date for the Highway Trust Fund.”


2) National: The conference report for the Water Resources bill has been filed with the House. The bill establishes a Water Infrastructure Public Private Partnership Program and expands local roles in project implementation.


3) National: Bill seeks to expand funding for transit-oriented development, including “public private partnership” projects. “The Transit Oriented Development Infrastructure Financing Act would help provide low-cost financing in the form of loans or loan guarantees under the highly successful TIFIA program, which was expanded under MAP-21. Eligible borrowers, whether a state or local government or public-private partnership, would have to demonstrate a reliable, dedicated revenue source to repay the loan needed for public infrastructure.”


4) Illinois: State lawmaker says Northstar Lottery Group’s contract to operate the state lottery should be terminated. “State Rep. Jack Franks, D-Marengo, said the state’s contract with Northstar Lottery Group has cost taxpayers hundreds of millions in lost revenues due to the firm’s failure to meet revenue goals.” The issue has become a political hot potato.


5) Kansas: Gov. Brownback signs controversial legislation that “creates a tax break for corporations that donate to private school scholarship funds,” and “allows school districts to hire unlicensed teachers for science and math classes.”


6) Louisiana: Lawmakers back closure of the LSU-run public hospital in Pineville as part of Gov. Jindal’s health care privatization scheme. “Rep. Robert Johnson, D-Marksville, opposed the hospital closure, saying too many financing questions remain that could jeopardize care in later years. He said private hospitals need to generate a profit, and he said that will drive the state’s costs higher. Under questioning from Johnson, [Rep. Lance Harris, R-Alexandria] acknowledged he hadn’t read the privatization contract and couldn’t talk about the financing structure. ‘My understanding is there’s no cap in this contract. This is like a blank check contract,’ Johnson said.”


7) Pennsylvania: Distilled Spirits Council says that a renewed proposal for partial privatization of liquor sales would hurt craft distillers. “The state would see reduced tax collections and state store profits, as state store sales are substituted for private sector sales that would be far less profitable to Pennsylvania.”

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