Here’s our weekly analysis of privatization in the news and in communities nationwide. Not a subscriber? Sign up here.


1) National: Paul Cox, who helped found the Veterans Healthcare Policy Institute, reviews Suzanne Gordon’s new book, Wounds of War: How the VA Delivers Health, Healing, and Hope to the Nation’s Veterans. “As a long-time board member of the San Francisco based Swords to Plowshares Veterans Rights Organization, I am particularly glad that Gordon took the time to investigate how the VA engages in public-private partnerships with groups like Swords. Unlike predatory public-private partnerships—where private companies profit by raiding the public till—these partnerships with local non-profits (run for, and often by, veterans) actually pursue a common good. Gordon documents their successful efforts to reduce veteran homelessness and keep veterans out of jail.” See also VHPI’s report on outsourcing mental healthcare.

Pop quiz: So, who oversees responsible contracting at the VA? David Thomas, the deputy director in the VA office that verifies small businesses for government contracts, who “hung a painting of the first Ku Klux Klan grand wizard and Confederate general in his office but removed it after some employees circulated a petition to force him to take it down.” ABCreports that “a petition coordinated by the labor union representing VA was sent to members this week. It denounced the display of the painting in a government building and called for ‘appropriate action to be taken.’ ‘Hopefully this will one day be a thing of the past but until that happens we’ll be here to fight it,’ said Cheston McGuire, press secretary of the American Federation of Government Employees.”

2) National: Correct Care Solutions, the for-profit prison healthcare corporation owned by private equity funds, has been sued 1,395 times in federal courts over the last decade, according to a document published by Yahoo Newsas part of an investigation supported by the nonprofit Project on Government Oversight. Ken Silverstein writes, “while the two largest private prison companies, GEO Group and CoreCivic, are often at the center of debates over outsourcing imprisonment and immigrant detention, thousands of other companies like Correct Care Solutions are also involved in this multibillion-dollar industry. These companies are largely unknown to the public and even to some policymakers. Yet the health care companies, especially, can have life-and-death impacts.”

3) National: Protecting public land from privatization is on the ballot tomorrow in Utah, Michigan, and in every state via upcoming congressional votes by the people they elect.

4) National: As Trump supporters seem to be gearing up for another series of “Infrastructure Weeks” and a congressional push after the midterms, some of the dodgy ideas from the last failed infrastructure drive, such as “asset recycling,” are reappearing. But Douglas Lavin of the International Air Transport Association and Sharon Pinkerton of Airlines for America wrote in The Wall Street Journal to remind readers it doesn’t work. “For all the complaints about decaying airports, there is no broad U.S. airport funding crisis. (…) The fact is that asset recycling is not about finding more efficient ways to modernize and expand infrastructure. It’s about raising money for cash-starved treasuries by selling off public assets to private interests. Candidly, airport privatization hasn’t lived up to the promised benefits of greater efficiency and a better experience for air travelers. To date, economic regulation hasn’t been sufficient to effectively balance the interest of private owners to earn a profit with the public interest in having the airport serve as an engine of economic growth. Simply put, private investors get the profits while airlines and passengers pay the costs.” [Sub required]

5) National/New York: Susan Edelman of The New York Post reportsthat the NYC Department of Education is under investigation by federal and state officials for giving personal information about students to a marketing firm hired by charter schools. “The longtime marketing practice has now come under investigation by state and federal officials after a Manhattan mom complained it violates student privacy rights. ‘Each year my family receives a large number of pamphlets and flyers from charter schools, promoting and marketing their schools and urging me to apply,’ Johanna Garcia wrote to state and US officials.”

6) National: The Project on Government Oversight (POGO) reports that the Mercers, through Renaissance, have invested millions in for-profit prison corporations. “Renaissance Technologies—where Mercer was co-CEO until last fall and where he continues to be active—invested in corporations directly involved in the president’s immigration crackdown and the administration’s embrace of private
prisons. These include CoreCivic and GEO Group, the two biggest Department of Homeland Security contractors operating immigrant detention centers. In the last two years, Renaissance has purchased millions of dollars worth of shares in CoreCivic and GEO Group, which have seen their stock prices soar.”

7) National: Tax lawyers are concerned that a reorganization of Internal Revenue Service advisory committees “could dilute the input of tax-exempt bond practitioners, though the IRS says the move will streamline and improve communication about tax issues. The anxiety is arising out of the IRS’s Thursday announcement that the Advisory Committee on Tax Exempt and Government Entities (ACT), which has provided the IRS with recommendations on tax-exempt bonds for more than 15 years, will be absorbed into a restructured Internal Revenue Service Advisory Committee.”The National Association of Bond Lawyers “highlighted that risk in an alert sent to members.” [Sub required].

8) Alabama: The Montgomery Public Schools have issued a request for proposals to set up a charter school. The Montgomery Advertiserreports that “the district had submitted an application to become an authorizer prior to the intervention, but it was put on hold because MPS lacked the necessary capacity and financing to be approved, said Kristy Hatch, an education specialist with MPS, during a recent board work session. Before MPS can become an authorizer independent of the state’s control, the system will have to acquire the needed capacity—which includes personnel trained on charter schools and the application review process.”

9) Arizona: On the eve of a vote on whether or not to massively expand the state’s voucher program (Proposition 305), an Auditor General’s report finds that “Arizona parents have made fraudulent purchases and misspent more than $700,000 in public money allocated by the state’s school-voucher style program, and state officials have recouped almost none of that money,”

10) California: Rachel M. Cohen reports on “How the Charter School Wars Turned an Obscure Race Into California’s Second Most Expensive Election” in the Intercept. “More than $50 million has flown into the contest between two Democrats for a nonpartisan office with little statutory power. For perspective, this is more money raised than in any U.S. House race this cycle and most Senate races, not to mention every other race in California, save for the governor’s. The race, largely understood as a proxy war for the future of California charter schools, is the second attempt by the state’s charter school lobby to demonstrate its influence this election cycle. The candidates, Marshall Tuck and Tony Thurmond, both insist that the race is about far more than charters, which currently enroll 10 percent of the state’s 6.2 million public school students, though they admit that they hold different visions for the publicly funded, privately managed schools. That’s something their funders also acutely recognize.”

11) California: East Bay school board races have attracted a lot of campaign funding, with the charters issue front and center. “In West Contra Costa, real estate developer Ronald Nahas has contributed $120,000 to an independent expenditure committee supporting three candidates in that school board election. Nahas is a member of the Making Waves Academy charter foundation’s advisory board in Richmond. (…) In West Contra Costa, both the local teachers’ union and GO are supporting incumbent Valerie Cuevas, but the teachers’ union is also supporting Kronenberg and retired district teacher Consuelo Lara, while the GO group is supporting incumbent Block and Hernandez-Jarvis.”

12) Florida/National: Zaid Jilani has traced out the determined effort by the private, for-profit prison corporation GEO Group to block the election of Andrew Gillum (D) as Florida’s governor. “Gillum has stated clearly that he is opposed to the prison industry. Over the summer, he pledged not to take any money from private prison corporations and vowed to eliminate them from the state of Florida. ‘I believe private prisons ought to be illegal in the state of Florida. They should not exist,’ he said.”

13) Florida: Citizens of Loxahatchee Groves are ruing the day they turned over their whole town to a private, for-profit outsourcing company. “‘Poor road conditions, code enforcement issues, and significant cost increases to the residents,’ Ryan said. The list of complaints is long and many community members fear, if nothing changes, the town might have to dissolve. ‘It’s a do or die situation,” said Loxahatchee Groves resident Cathy Giliberti. Loxahatchee Groves became a town in 2006 and tried to do things differently. ‘Residents really wanted a government-light operation,’ Ryan said. (…) After contract negotiations fell apart, the Palm Beach County Sheriff’s Office declared it will no longer provide its services to the town. ‘This management company is bleeding out the town,’ Giliberti said. Underwood hired his son and wife. A violation of anti-nepotism rules? Nor for Underwood since his company is a private company, not a government entity.”

14) Georgia: The Atlanta school board “will consider renewing its authorization of several charter schools, including the KIPP Metro Atlanta cluster of schools, and extending their leases of district buildings. At the board’s meeting [today], members will be asked to approve a 40-year lease of the former Turner Middle School for continued use by KIPP Atlanta Collegiate and a five-year lease to allow KIPP Soul to move into the
former Blalock Elementary School.” Meanwhile, the Atlanta public school have picked the leader of one of the city’s oldest charter schools to head up the district’s charter office.

15) Illinois: Teachers voted last week to authorize a charter school strike. “And teachers at nine other Chicago charter networks are also in contract negotiations, and could similarly opt to take strikes votes in the coming months.” Illinois Network of Charter Schools President Andrew Broy admits that Chicago has become the epicenter of charter union organizing in the country.” Writing in Jacobin, Rachel T. Johnson says “contrary to most media reports, this would not be the first time charter teachers have gone on strike. In 2011, roughly two dozen teachers at Philadelphia’s Khepera charter school staged a wildcat sick-out, as former teachers union organizer Shaun Richman explained in 2016. But a strike of this kind would still be historic—the first time hundreds of charter educators across two major networks have walked off the job en masse.”

16) Illinois: The Corrections Accountability Project reports that new research finds Illinois Gov. Bruce Rauner (R) “has been profiting from the mass incarceration, immigration detention, and the exploitative bail bonds industry.”

17) Indiana: Ball State University and Muncie Community Schools are opposing a proposed charter school in Muncie. “The leadership of the new school board has inspired people from the community and throughout the nation to partner with MCS to provide an exceptional educational and innovative academic experience for the children of Muncie,” Jim Williams, president of the MCS school board, wrote. “A 7,200-square-foot retail/warehouse structure at 2708 N. Walnut St., the former home of the City Lights lighting store, is under consideration as a home for the academy.”

18) Iowa: Democratic gubernatorial candidate Fred Hubbell says “Polk County Jail leads a diversion program to reduce recidivism, but it’s been sharply affected by Medicaid privatization. After recent mental health facility closures, the number of inmates with mental health issues has increased to more than 60%. This can’t continue.”

19) Iowa: Rob Sand, the Democratic Candidate for Iowa State Auditor, says that if he gets elected State Auditor tomorrow, “MCOs will get subpoenas not raises.” Sand says his top priority will be to “investigate the privatization of Medicaid. Our state auditor sat through 48 alarm bells before finally starting an audit that likely won’t be released before the election.”

20) Louisiana: A principal has been suspended from a New Orleans charter school after questioning the board’s spending. “She claimed the drama was triggered after she questioned board spending, and she said she has been accused of defamation and libel. During Friday’s meeting, several people expressed their support for Wyatt. (…) Wyatt is the fifth principal in two years, and the school received warnings for questionable spending practices and other issues.”

21) Maryland: Food & Water Watch and AFT Maryland joined together to canvass in favor of passing a city charter amendment that would #BanWaterPrivatization and keep Baltimore’s water public. #BMoreYesForE

22) Michigan: A charter school is opening in a former funeral home in Saginaw.

23) Missouri/National: Uncle Sam may be picking up part of the tab for Missouri American Water’s proposed big new reservoir.

24) Nevada: The head of the state charter school authority has submitted his resignation. “The resignation comes after the authority had issues with the Interim Finance Committee, which administers a contingency fund set up to provide provisional money to state agencies when the Legislature is not in session. The committee took issue with the charter authority failing to conduct evaluative site visits, even though the 2017 Legislature approved four new positions for the agency. ‘It’s unconscionable that this has not moved along more expeditiously than it is, because there’s ramifications,’ state Sen. Joyce Woodhouse, D-Henderson, told an authority staff member at the committee’s meeting last week. ‘I’m assuming you are aware, and the board is aware, that there are ramifications if these evaluative site visits are not done.’”

25) New Jersey: After New Jersey American Water collected more from a rate increase than it was allowed, it has to return the money to ratepayers. “Customers paid more after New Jersey American Water temporarily hiked customers’ water and sewer bills in June to collect an additional $75 million in revenues, money the utility said would help cover the cost of system upgrades. But
in a settlement with the state Board of Public Utilities and the state Rate Counsel, the company agreed that its rate would be raised by a lower figure: $40 million. ‘Now they have to return everyone’s money,’ said Stefanie Brand, director of the state Division of Rate Counsel. ‘We lent them money for the last five months. We do get interest. I know a lot of consumers who don’t have the money to lend to American Water.”

26) New York: A town hall meeting between New York City Schools Chancellor Richard Carranza and Harlem parents “started off with a heated exchange and was dominated by parents’ fears of charter schools expanding in the neighborhood. Carranza answered screened questions on Monday night from parents of public school children in district five—which spans most of Central Harlem and portions of West and East Harlem—but before he could get to any answers he had some explaining to do. Community Education Council 5 President Dr. Sanayi Beckles-Canton accused Carranza and the DOE of disrespecting district parents by not inviting the CEC to a meeting earlier in the day with elected officials. ‘It is disrespectful to come into our community, meet with elected officials about issues about our kids and not include us.’”

27) New York/National: An instructive lesson on how austerity drives privatization can be found at the embattled New York City Housing Authority, whose interim chairman just announced they will be relying on Section 8 ‘public-private partnerships’ for their fiscal needs. “‘We’re going to RAD because that’s where the money is,’ Stanley Brezenoff told members of the City Council’s housing committee Tuesday. ‘The more RAD we can do, the better,’ Brezenoff said. ‘It is clear that public housing authorities must change the way we do business to survive and thrive. We must be realistic and assume the decades-long trend of federal disinvestment will continue.’” [Sub required]

28) New York/National: This coming Sunday at Riverside Church in New York City, Justice Aid is holding a public forum on Racism and the Criminalization of Poverty: 21st Century Debtors Prisons in the Age of Mass Incarceration. “Jeffery Robinson will discuss the true history of the economic oppression of African-Americans from slavery to the present as reflected in his dynamic, multi-media exploration Who We Are: A Chronicle of Racism in America. Next, there will be a panel discussion with our beneficiaries Alec Karakatsanis of Civil Rights Corps and Gina Clayton of Essie Justice Group; and Johnny Perez, Director of U.S. Prison Program for the National Religious Campaign Against Torture. The panelists will further explore Robinson’s themes and their focus on the systemic extortion of money from poor people by imprisonment and the dramatic repercussions for those left at home, particularly women. Performing artist Abena Koomsom-Davis will sing an anthem to Justice and poet and educator Randall Horton will recite poetry. Guests are invited to experience The Cell, a VR (virtual reality) installation set up in the Church. The forum is free and open to the community and will be live-streamed through @JusticeAid on Facebook. Follow the event at #JusticeAidForum.”

30) New York: The New York Postreports “supporters of charter schools wrote big checks to Gov. Cuomo in the home stretch of the race for governor, according to campaign filings released on Monday. Jim Walton and Carrie Penner—heirs to the Walmart fortune—each kicked in $25,000 over the last three weeks. Sonia Jones, wife of billionaire hedge fund investor and charter school philanthropist Paul Tudor Jones, added $40,000. The governor also received $15,000 from the Great Public Schools PAC created by Eva Moskowitz, CEO of Success Academy Charter Schools, and $15,100 from New Yorkers for Putting Students First, a pro-charter PAC. Charter school advocates are preparing for battle in Albany next year to try to lift the cap on how many charters are allowed to operate in New York City.”

31) Pennsylvania: A former business manager for a charter school is suing the school for wrongful discharge after she blew the whistle on its finances. “In a 48-page complaint filed through Penndel attorney Timothy Kolman, Warminster resident Sparango claims she was wrongfully discharged in 2017 for her “refusal to participate in ongoing criminal activity” related to her reporting of alleged financial infractions at The Center for Student Learning Charter School at Pennsbury. (…) The lawsuit names the school, CEO Charles Bonner, the school’s regular attorney Kevin McKenna and several other school officials and consultants. Sparango, who held her positions at the school for two years ending in 2017, claims in the suit that her ‘refusal to conspire with the defendants to falsify audits with fraudulent numbers resulted in her duties being removed from her to the point where she had no choice but to leave her employment, if she was not otherwise to be a participant in the ongoing conspiracy to violate Pennsylvania law.’”

32) Pennsylvania: WESA, Pittsburgh’s NPR station, reports that Aqua America, which recently announced it would purchase Peoples Gas for $4.3 billion, “has regularly backed dozens of Pennsylvania political candidates financially since 2005.” Aqua America has been pursuing privatization of the Pittsburgh Water and Sewer Authority, which citizens groups have been resisting. Aqua America will have its earnings call tomorrow at 11AM Eastern.

33) Tennessee: Twelve Nashville charter organizations are forming a coalition to collaborate with one another and “to help the organizations better communicate with Metro Nashville Public Schools, which contracts with the publicly funded, privately operated schools.” Randy Dowell, KIPP Nashville executive director, says “the collaborative is an idea that is 12 or 13 years in the making.”

34) Tennessee: The board of the Cottontown/Bellevue Historic District Neighborhood Association has formally voted to express its opposition to a charter school locating at a former car dealership site in North Columbia. “Among their worries were that a five-acre block near downtown would come off the property tax rolls to make way for a nonprofit school. Already only abut 40 percent of the properties in the city are on the property tax rolls. Neighbors also have expressed dire concern about the traffic that would come with a school that could one day have 1,300 students, plus faculty and staff. The school and engineering firm Kimley Horn currently are in negotiations about traffic plans.”

35) Virginia: Network for Public Education Action warns that “it has come to our attention that 2 candidates for School Board in the Alexandria race have received over $16,000 each from a billionaire funded PAC and a related non-profit organization connected to TFA that promotes corporate reform.”

36) Washington: The Washington Supreme Court ruling upholding lottery funding for charter schools has damaged the credit ratings of traditional school districts. But “at this point, while charter schools compete against traditional schools in the state, there are not enough of them to represent the same kind of hit to the budgets seen in California’s major metro areas.” [Sub required]

37) International: Twenty six years after it was introduced in Britain with a lot of “free market” and “private is better” ideological fanfare, the Conservative government has terminated Private Finance Initiative program. “The Chancellor’s announcement comes against a backdrop of the opposition Labour Party promising to bring all existing PFI contracts ‘back in-house,’ although Hammond insisted no operational projects will be cancelled.” [Sub required]

38) Think Tanks: Public Goods Post points readers to a new report that debunks the stale myth that the public sector is less efficient than the private sector. “The paper, “Economic Benefits of Public Services,” by David Hall and Tue Anh Nguyen, is a ‘meta-analysis’ of multiple studies that have compared direct government provision with privatized or outsourced provision.  Hall, of the University of Greenwich, and Nguyen, at Oxford University, have found no evidence that the private sector is more efficient in terms of cost or effectiveness of results.” The authors say “the evidence does not support the view that there is any systematic difference in efficiency between public and private sector companies, either in services which are subject to outsourcing, such as waste management, or in sectors privatised by sale, such as telecoms. If the private sector does not have this efficiency advantage, then there is nothing to offset the higher private cost of capital, and it is always likely to be better value to use the public sector.”

Legislative Issues

1) National: Chad Terhune of Kaiser Health Newsasks “As billions in tax dollars flow to private Medicaid plans, who’s minding the store?”

2) Oregon: State lawmakers promise to take on a significant driver of mass incarceration—the imprisoning of the mentally ill. “Oregon Public Broadcasting reported Thursday that about half of all inmates locked up in Oregon have mental health issues, and that’s partly because police officers have nowhere else to take them. Oregon Senate President Peter Courtney says a new committee is going to look at the problem and suggest monumental change. The committee will come up with policy recommendations for the 2019 legislative session.”

3) Washington: The Seattle Times sharply criticizes state lawmakers for evading the state’s transparency law when it comes to themselves. “”In truly tone-deaf fashion, Washington legislators keep clinging to the idea that they deserve special treatment when it comes to following the state’s Public Records Act. This disappointing attitude has permeated the first two meetings (today is the third) of the state’s Public Records Task Force, formed earlier this year after lawmakers cravenly attempted to exempt themselves from the voter-approved transparency law. More than 20,000 citizens called and emailed Gov. Jay Inslee to urge him to veto that legislation, which he did. (…) Never mind that other public officials, from local city council members to the state’s attorney general, are required to release the same records upon request. Or that a Thurston County judge ruled in January that lawmakers were breaking the law by not disclosing these documents in the first place.”

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