Update: Upcoming Privatization Issues. December 2, 2013


1) National: As a federal budget crisis looms in the New Year, a host of right wing pro-privatization organizations have written a letter to House Budget Committee chair Paul Ryan (R-WI) urging him to use the opportunity to force through privatization of numerous government assets and services. Groups signing the letter include Grover Norquist’s Americans for Tax Reform, the National Council for Public Private Partnerships, the Koch brothers’ Americans for Prosperity, the Reason Foundation, the anti-labor Center for Worker Freedom (Norquist), David Denholm of the anti-unionPublic Service Research Council, Morton Blackwell of The Weyrich Lunch, and others. The letter is addressed from the offices of the Business Coalition for Fair Competition, which recently hosted a candidate forum for San Diego privatization advocate Carl DeMaio.


2) National: Streetsblog’s Angie Schmitt looks at the risks that toll road “public private partnerships” pose to taxpayers. She points to research by Urbanophile’s Aaron Renn. Renn reports that “one of the theoretical benefits of privatizing a government asset or service through a lease or equivalent is that it hedges future risk by transferring it to the vendor. That obviously comes with a price tag, but that’s clearly because it has value. It provides predictability to the government. In practice, these contracts have proven to be so stacked in favor of the vendor that the taxpayer retains most of the risk”


3) National: Charles M. Smith, a former chief of the Field Support Contracting Division of the Army Field Support Command in Rock Island Arsenal, writes about how the crusade for privatization that began under the Reagan administration has adversely affected government performance. “So from Reagan, through Bush I, Bill Clinton and Bush II, contracting out was standard policy. For this reason, President Obama inherited a government, especially a Health and Human Services agency, with no internal IT expertise. When the Affordable Care Act required a quite complicated web site and interface with other parts of health care networks, it became time to write contracts.”


4) National: ALEC’s States & Nation Policy Summit takes place this week from Tuesday to Friday in Washington, DC. Its Education Task Force will consider a number of model bills.


5) National: Blogger Daniel Willingham discusses Pearson’s efforts to assess the efficacy of their education products. “I’m guessing that the folks at Pearson care about effectiveness to some extent because it affects how much things sell. But the bottom line is that what matters is the bottom line.”


6) National: Sebastian Thrun, the founder of Udacity, which develops many of the “massive open online courses” that have been criticized as a threat to public education, admits “we have a lousy product.”


7) National: Aardvark founder Max Ventilla raises capital to launch private elementary schools.


8) Florida: Questions are being asked about whether Palm Beach Mayor Jeri Muoio has the authority unilaterally to make decisions on outsourcing the city’s redevelopment efforts. “Mayor Muoio proposed the outsourcing in June. In August, the commission advertised for contractors. This month, the commission narrowed the contenders to CH2M HILL and Redevelopment Management Associates. A principal in that company is Kim Briesemeister, was under contract to serve as part-time CRA director until July. She resigned so her company could bid. We remain skeptical of this outsourcing. Mayor Muoio has refused to offer a financial comparison of which current CRA expenditures would be covered under a contract.” [Sub required]


9) Florida: Palm Beach Post editorial page editor Randy Schultz says “massive new prison privatization in Florida is dead for the moment, and it should stay dead.” [Sub required]


10) Georgia: Lawsuit over plans to privatize the Roswell court system and do away with election of the chief judge produces testy and personal exchanges in court. The Roswell city council is scheduled to vote on a charter change on December 6.


11) Illinois: Village of Oak Lawn is roiled by dismissal of 911 dispatchers asoutsourcing looms. “Village officials said that Tuesday’s board action to outsource was the result of a breakdown in negotiations over concessions with the union representing Oak Lawn’s Emergency Telecommunicators, Metropolitan Alliance of Police Local 351.”


12) Indiana: Lawyers representing Indiana ask an appeals court to refund money the state paid IBM for a failed welfare privatization project. They argue that “IBM officials painted a rosy picture of improved operations and reduced costs when they sold the state on the contract, but quickly changed their tune when problems started popping up. ‘Now, all of the sudden (they say), “We’re just the Geek Squad from Best Buy doing what you tell us to do.’”


13) Indiana: Indiana taxpayers may fork over $110 million in upfront costs for thecontroversial Illiana Expressway. The Northwestern Indiana Regional Planning Commission’s policy committee votes on the proposed project tomorrow. “Anticipating a crowd,” the committee has moved the meeting. The results of the vote will be passed on as a recommendation to the full commission. Streetsblog Chicago has taken a critical look at the project. Statements of Qualification are due December 19 and a shortlist will be issued in January.


14) Indiana: Indianapolis moves to privatize its parks. IndyParks has issued a request for proposals. Responses are due January 31. [Sub required]


15) Indiana: Doug Martin previews his forthcoming book on the school privatization battles in Indiana with a look at the role of Jeb Bush and “Tony Bennett—Indiana’s former superintendent of education and member of Bush’s Chiefs for Change school privatizing front group.”


16) Maryland: The Frederick County Commission will meet this Thursday to decide how to respond to a zoning board’s land use decision that would block the commission’s efforts to privatize the Montevue nursing home and rehabilitation center. The session will be closed.


17) Michigan: Request for Letters of Interest have been sent out by the DOT for a “public private partnership” to operate the Canton-Plymouth-Mettetal Airport in southeastern Michigan. Responses are due December 16. “Respondents are advised that parts of the information included in the response documents may be presented to other branches of State Government. Also, it is brought to the Respondents attention that MDOT is subject to the Freedom of Information Act with respect to any documents or other records provided to MDOT and, by law, are subject to disclosure to the public upon request. Therefore, Respondents should consider responses to this RFLOI to be public documents.” [RFLOI]


18) New Mexico: Bernalillo County Sheriff’s Office backs away from a plan to outsource courthouse security guard jobs. “Officials at the local branch of the American Federation of State, County and Municipal Employees said that privatizing courthouse security was just an effort by the sheriff’s office to “test the waters” to see which public agencies it could privatize, part of what AFSCME said was a larger effort to outsource union jobs. The union then threatened to file an injunction against the move, arguing that the proposal violated both the union’s agreement with the sheriff’s office and state law, which states that the job of so-called ‘courthouse security specialists,’ the title given to the deputies staffing the courthouse, could be given only to sworn officers.”


19) New York: Putative class action lawsuit says that tickets issued by LAZ Parking violate civil rights. “According to the class action lawsuit, LAZ Parking LLC routinely issued parking tickets without providing an option to request a hearing or plead not guilty to the alleged violation. LAZ manages 34 parking facilities for the MTA’s commuter rail line.”


20) New York: Three contractors are found guilty in New York City’s CityTime private consultants’ scandal. “Last year, the project’s main contractor, SAIC, was forced to repay the city $500 million as part of a deferred prosecution agreement. Meanwhile, a top SAIC official is poised to become the next Secretary of the Air Force.”


21) New York: Writing in the Binghamton University student newspaper, contributing columnist Molly McGrath opposes the privatization of Broome County Transit. “In Schuyler County, the privatization of the transit system led to increased fares, the cutting of essential bus routes and reliance on Tompkins County in order to continue service. Schuyler County was under contract with First Transit, a U.S. subsidiary of the United Kingdom-based FirstGroup. It only took two weeks under this contract for bus fares to rise 80 percent. Chemung County also agreed to a contract with First Transit, and its legislature was also forced to raise fares.”


22) New York/National: The Wall Street Journal reports on a Brooklyn charter school’s struggle to attract enrollment. “The school’s experience demonstrates that charter schools, which often say parents need more choices, can be stung when parents’ decisions don’t fall their way. It also bolsters opponents who say that, despite claims of long wait lists and tales of parents craving alternatives, there isn’t as much demand for charter schools as supporters say.”


23) Ohio: As Mayor John Cranley is sworn in as mayor of Cincinnati, he is expected to use his majority support on the city council to terminate the city’s proposed parking privatization plan. The council will meet today.


24) Ohio: Toledo Blade editorializes against the proposed privatization of Toledo Express and Toledo Executive airports. “The Treeces demand the ability to “sell, lease, transfer, [or] assign” property at or near Toledo Express, which is close to an Ohio Turnpike exit. In return, they offer to assume the airport’s operating losses and share any profits it makes with the city. The potential rewards don’t justify the real public risk.”


25) Ohio: Wadsworth planning commission approves “a request by the Restored Church of God to have most of Ambassador Drive declared a gated private roadway.” The city’s Safety Committee will discuss a draft policy governing private roads at its December meeting.


26) Pennsylvania: Springfield Township’s outsourcing of its ambulance service may cost residents more for medical emergencies. “‘I’d like the residents to be aware that this is a change that may affect them, specifically with respect to what charges they should expect to pay in the future should this proposal go through,’ said Kelly Sweeney, President of the Springfield Ambulance Corps.” A contract with Crozer-Keystone Health System is expected to begin January 1.


27) Texas: Collin County commission unanimously decides against privatizing its employee retirement system. “‘I think it’s fair to the taxpayers and fair to employees,’ said Bob Hughes, who presides over the county’s community supervision and corrections department.”


28) Texas: A PR battle has broken out pitting public schools against charter schools. “Backers of charter schools aren’t giving up; they’ve raised $30 million for an aggressive effort to bring big names in the charter world—among them, KIPP, Rocketship Education and Great Hearts Academies—to San Antonio. (…) Local public schools are fighting back: Fifteen districts in Bexar County, which includes San Antonio, are teaming up for a media blitz touting the benefits of traditional public schools. The ‘Go Public’ campaign, which will include TV and radio ads, boasts that public schools employ ‘awesome teachers,’ build ‘strong communities’ and offer academic rigor plus extracurricular activities not available in many charter schools. The campaign also talks up the diversity of traditional public schools, arguing that exposure to different cultures helps students prepare for the global economy.”


29) West Virginia: The division of corrections will open submitted bids this Thursday on housing inmates in out-of-state facilities. “While the request for bids for a contract to house up to 400 Corrections inmates currently housed in regional jails because of prison overcrowding went out in September, Corrections Corporation of America has been looking at West Virginia as a prospective ‘market’ for at least two years, according to transcripts from CCA’s Earnings Conference Call to investors last month.”


30) Revolving Door News: The Securities and Exchange Commission has delayed issuing a rule on its revolving door policy. The Project on Government Oversight comments that “for the ethics office to withdraw a rule after it had been adopted but before it could take effect appeared to be an unusual event.”


31) Think Tanks: Texas Prison Bid’ness adds Grassroots Leadership’s Cristina Parkerto its blogger lineup. “Cristina was most recently working with the Border Network for Human Rights and the Reform Immigration for Texas Alliance on projects that included documenting human rights abuses in border communities and fighting against Arizona-copycat legislation in Texas, among others.”


32) Think Tanks: Debate breaks out between school privatization advocates over whether students in voucher programs should be required to take standard tests.



Legislative Issues:


1) Georgia: State Senators hear testimony on the possible outsourcing of foster care. Changes in the juvenile justice system will go into effect in January, and other changes include “moving 27,000 children in foster care and adoption assistance to a Medicaid-managed health care program that’s administered by a private company contracted by the state.” The committee will meet again this month.


2) Kansas: Kansans for Liberty, a grouping of “political conservatives and tea party enthusiasts,” produces a manifesto calling for legislation to “authorize state-issued vouchers for private education.”

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