A 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.
- Despite public institutions doing a better job of rolling out vaccines, a Maryland county leader says rollouts should be “privatized” going forward.
- Go figure: Turns out private prison company GEO Group donated money to the Virginia senators who killed a bill to end private prisons in the state.
- The Department of Defense is giving $1 billion to a private military housing contractor, even after years of privatization woes.
1) National: The Biden administration is scrambling to speed the flow of vaccines to the states and to provide the states with the resources they need to roll them out, and to find 20 million vaccine doses Trump reportedly failed to track. The reports coming in seem to be initially encouraging despite the critical shortage of vaccines. Last fall, top Trump administration officials actively lobbied Congress to deny state governments any extra funding for the Covid-19 vaccine rollout.
2) National: Last Tuesday President Biden issued an executive order on Reforming Our Incarceration System to Eliminate the Use of Privately Operated Criminal Detention Facilities. “To decrease incarceration levels, we must reduce profit-based incentives to incarcerate by phasing out the Federal Government’s reliance on privately operated criminal detention facilities. (…) However, privately operated criminal detention facilities consistently underperform Federal facilities with respect to correctional services, programs, and resources. We should ensure that time in prison prepares individuals for the next chapter of their lives. (…) Privately operated criminal detention facilities do not maintain the same levels of safety and security for people in the Federal criminal justice system or for correctional staff. We have a duty to provide these individuals with safe working and living condition.” Thus “the Attorney General shall not renew Department of Justice contracts with privately operated criminal detention facilities, as consistent with applicable law.”
The exact meaning of the order would require precise data on the dates of contract expirations going forward and some clarity on the ICE contracts.
Morgan Simon of Forbes delved into the fine print. “The core of the order is one sentence: ‘The Attorney General shall not renew Department of Justice contracts with privately operated criminal detention facilities, as consistent with applicable law.’ This statement has the power to eventually cut off as much as 23% and 22% of GEO Group and CoreCivic’s revenues respectively, by ending its contacts with the Bureau of Prisons and Marshals Service. But advocates are still focused on that other roughly 80%, and on the broader need to simply incarcerate less people, whether in public or private facilities.
“What the order didn’t touch — but may be clarified in additional statements moving forward — are two of the major areas private prisons companies have diversified into as the writing has been on the walls of the DOJ. Two other major sources of government contracts for these companies are immigrant detention, and post-incarceration ‘services’ like transition housing and electronic monitoring.”
3) National: After reviewing some of the disastrous projects promoted by vulture privatizers after the 2008 financial crisis, Jeremy Mohler of In the Public Interest offers some innovative solutions that municipal authorities and citizens should consider:
- Don’t cut spending, increase it
- Raise revenue from those who can afford to pay
- Keep it simple: Public safety, healthcare, housing, education, transportation.
4) National: Craig Farrand, a former managing editor of The News-Herald Newspapers, says “for-profit has no place in the delivery of public services.” Examining private prisons and charter schools, he says “problems stem in large part from the introduction of a profit motive into the role of government, which should never run a profit. It should just run efficiently. For all of us.”
5) National: In an initial riposte to the Trump-Bannon holy war against the “administrative state,” President Biden has issued an executive order to undo the damage to the public interest this has wrought across the government. “It is the policy of my Administration to use available tools to confront the urgent challenges facing the Nation, including the coronavirus disease 2019 (COVID-19) pandemic, economic recovery, racial justice, and climate change. To tackle these challenges effectively, executive departments and agencies (agencies) must be equipped with the flexibility to use robust regulatory action to address national priorities. This order revokes harmful policies and directives that threaten to frustrate the Federal Government’s ability to confront these problems, and empowers agencies to use appropriate regulatory tools to achieve these goals.”
6) National: In 1955, only one year after the historic Brown v. Board Supreme Court ruling that American schools should be desegregated (they never completely were), right wing guru Milton Friedman proposed school privatization. [Friedman, M. (1955). “The Role of Government in Public Education.” In Economics and the Public Interest, R.A. Solo, ed. University of Rutgers Press. New Brunswick.]
It was no coincidence. With a new wave of demands for quality public education sweeping the country, right wing state legislatures are now trying to head off a new era of progress. But as Jeremy Mohler of In the Public Interest writes, “school choice” is a dog whistle for resegregation. “No wonder so many right-wing politicians and pundits are gung-ho about vouchers and charter schools,” Mohler says. “As historian Steve Suitts has documented, “school choice” rhetoric and policies harken back to the racist segregationists of the mid-twentieth century. (…) In Iowa, they aren’t even hiding the resemblance. “Really it’s about parental choice,” said state Republican Rep. John Wills about the proposal. “Giving the parents a choice to allow their children to move to a different school or one that fits their child in a better way, and the schools right now are really prohibiting that.” That sounds right out of the 1950s, when southern state legislatures enacted hundreds of laws attempting to avoid school integration. Which included redirecting public dollars to benefit private schools.”
7) National: With Trump’s defeat in the November election, the school privatization industry is turning its attention to state legislatures in the wake of Betsy DeVos’ ouster from her position as U.S. education secretary. “Though DeVos’s efforts to re-route CARES Act money to private schools were thwarted in September by a federal judge, 19 states already fund private school choice through policies known as tax-credit scholarships. Now in 2021, over a quarter of those states are moving to expand their programs—and three new states, Missouri, Washington, and Nebraska, have introduced legislation to create programs of their own.”
Efforts to tear down the wall of separation between church and school are also proceeding. “Many state constitutions, including Nebraska’s, stipulate bans, known as ‘Blaine amendments,’ on allocating tax dollars for religious purposes. The laws derive from 19th-century efforts to bar Catholic families dissatisfied with Protestant-oriented public schools from obtaining a share of funding. Post-Espinoza, Bedrick explained, those rules no longer can deny religious schools, which make up roughly two-thirds of all private schools nationally, from participating in tax-credit scholarship programs. ‘Espinoza clarifies that school choice programs would be constitutional under a Blaine amendment,’ he explained.”
8) Alabama: The board of education has denied an application for a new aviation-focused charter school in Birmingham, voting 5-1 against the application. Local media did not report the board’s reasons for the lopsided rejection.
9) District of Columbia: Charter schools in the District are slow to reopen as traditional schools are set to reopen today. Charters educate more than 45% of the city’s public school students (KIPP DC and Friendship are the city’s two largest charter networks). “It’s unclear how many coronavirus cases have been connected to the charter schools. While the city posts the number of cases detected in traditional public schools, they do not do the same for charters. The charter board also does not collect this data, and the District’s health department said in a statement that it ‘does not release identifying information or details of case or cluster investigations.’”
10) Florida: Is Florida’s proposed new aggressive school voucher bill constitutional? “Ron Meyer, a prominent Florida education attorney, said the legislation appears to take Florida further down an unconstitutional path of funding religious education with state taxpayer funds.
‘What SB 48 purports to do in terms of using general revenue to pay for religious education puts the measure in peril,’ said Meyer, who won a landmark lawsuit against the state’s original voucher plan promoted by Jeb Bush. The bill sponsors ‘are selling it as streamlining five (programs) into two,’ Meyer said. ‘But it does so much more.’ The Florida Education Association has toyed with the idea of suing the state to stop the taxpayer-funded ‘Empowerment Scholarship.’ No suit has been filed, though the state was prepared to spend at least $250,000 to defend a potential challenge to the program. Meyer said the lack of a lawsuit shouldn’t embolden lawmakers to advance this expansion plan. ‘The constitutional issues are still front and center,’ he said.”
11) Florida: News Service of Florida reports that an appeal by a former charter-school management company CEO convicted of racketeering and fraud could hinge on whether a circuit judge improperly prevented a witness from testifying. “A three-judge panel of the 1st District Court of Appeal heard arguments Tuesday in an appeal by Marcus May, whose company Newpoint Education Partners operated 15 charter schools in six Florida counties. May was convicted in 2018 in Escambia County and sentenced to 20 years in prison after he was accused of fraudulent billing and engaging in kickbacks.”
12) Florida: The Citrus County School District is investigating the former leader of the Academy of Environmental Science, a local public charter school. “Even though Leonard resigned, the school district is required by law to send its investigative findings to the Florida Department of Education when an employee violates the principles of professional conduct for education in the state, Blair said. Blair said the investigation could also reveal other actions the school district might take.”
13) Idaho: The state’s charter schools have added thousands of new students this school year, despite pockets of steep decline and an overall drop in public K-12 enrollment. “Enrollment matters because it’s tied to how Idaho carves up about $2 billion in state K-12 funding for schools. The state has used an average-daily-attendance metric since 1994. The enrollment stakes are even higher for charters. Districts enjoy a safeguard in place for enrollment losses. A state policy keeps schools from losing more than 3 percent of their previous year’s funding, no matter how far their enrollments dropped from the year prior. Charters don’t qualify for that policy, so big enrollment drops fuel heavier financial hits.”
14) Iowa: Allison L. Beck, a member of the Davenport School Board, takes on Republican Governor Kim Reynolds’ school voucher plan. “When I moved to Iowa eight years ago, I didn’t worry about the schools my children would attend. Today, I fear they will collapse. The governor’s omnibus education bill is, quite frankly, a direct attempt to ‘defund’ public schools. It allows taxpayer money to be used to pay for private (and even religious) schooling. It opens the door to for-profit ‘educational’ companies to run amok in our state with little accountability for educational outcomes. And it limits local control—the ability of school boards to determine how best to preserve diversity in their own districts.”
15) Iowa: Last Tuesday the Iowa House Education Committee passed a bill that prevents schools with voluntary diversity plans from preventing open enrollment. “House Study Bill 64 would prevent districts from using voluntary diversity plans as a barrier to prevent higher-income families from enrolling their children in another school district. Five lower-income Iowa districts currently have voluntary diversity plans, including Des Moines. Des Moines Public Schools opposes the bill and has opposed previous attempts to end the plans. “The plans are designed to prevent large pockets of poverty from forming in urban cities as middle-class families seek to open enroll their students in neighboring districts,” district officials wrote in a 2019 blog post. Besides the potential budgetary implications for the urban districts, removing the plans would have a negative impact on the quality of education for all students. The higher the concentration of students in poverty, the more challenging it is for students to learn.”
Besides the Des Moines Public Schools, Democrats and groups like the NAACP are opposing the bill. “Iowa-Nebraska NAACP President Betty Andrews called the bill a ‘walk back’ in history. These bills could potentially finance a cycle where we’re actually stepping back into segregation where wealthier families can actually (flee) public schools,’ she said. Andrews said diversity plans are important for students of all races and socioeconomic backgrounds. ‘Having that opportunity and that’s not just an opportunity for white students, Black students or other students of color, it’s an opportunity for all people to learn how to work and live together,’ she said.”
16) New Hampshire: In a letter to the editor of the Concord Monitor, Mary Wilke denounces Gov. Chris Sununu (R)’s voucher plan. “He implies that voucher programs are really just a way of returning funds to their rightful owners (parents) to use as they see fit: It’s ‘not our money, [it’s] their money,’ he says (see “Retooling School,” Concord Monitor, Jan. 20). This characterization, commonly used by voucher supporters, is just plain wrong. Money used for public schools comes primarily from property-tax payers, a group that isn’t limited to parents, but includes businesses and people without school-aged children as well. We all contribute to the common enterprise of public education, which benefits the entire community. If someone hired private security guards, thinking they offered better protection than the protection provided by local police, she or he wouldn’t be entitled to a partial property tax rebate. Parents choosing to opt out of the public school system are no different.”
17) Pennsylvania: The West Chester Area School District board of directors has denied the application of a charter school. “‘The administration has spent many hours reviewing this application to determine if it has met the four standards in the charter school law. We have found it doesn’t meet any of the four standards,’ said Dr. Jim Scanlon, WCASD Superintendent. ‘The application doesn’t demonstrate sustainable support from the community or how it will support comprehensive learning experiences for students. The application also fails to provide any fiscal stability to operate, nor does it serve as a model for other public schools,’ continued Scanlon.”
18) Pennsylvania: The Pittsburgh Post-Gazette reports on the heavy costs that charter school expenses are placing on the city’s schools and on districts around the state. “Charter school costs are one of the largest expenditures for school districts in Pennsylvania. The Pittsburgh Public Schools, for example, will spend about $102 million in 2021 on charter school tuition. That accounts for about 15% of the district’s budget—the largest portion spent on anything but staff salaries and benefits. A majority of school leaders said they were concerned about staffing shortages because of health issues, quarantine procedures, online instruction and smaller class sizes. The report noted that almost 90% of respondents said they were worried about staffing, and nearly 85% indicated that finding substitutes was difficult, if not almost impossible.”
19) National: The road lobby has introduced a bill aimed to expand the use of private activity bonds. The Biden administration is expected to roll out their infrastructure plan this month, and there are lots of suggestions on what to include. The COVID-19 stimulus and relief package currently moving through Congress contains a number of infrastructure-related measures, and Congress is getting ready for legislative action on infrastructure.
20) National: Is the time ripe for affordable broadband? Harin Contractor and Christopher Ali say it is. “At the end of 2020, Congress passed the Consolidated Appropriations Act, a $1.4 trillion budget that included the largest public investment in broadband since the 2009 Recovery Act. Part of this $7 billion injection into broadband was the Emergency Broadband Benefit Program, a $3.2 billion program to be managed by the Federal Communications Commission (FCC) to subsidize broadband subscriptions by $50/month and $75/month on tribal lands for low-income households adversely impacted by the coronavirus. Currently, the FCC is trying to figure out how to operationalize this fund, and early in January 2021 released a Notice of Inquiry to ask for public comments. While we applaud the Benefit Program, the FCC must ensure the eligibility and enrollment requirements are streamlined and build a path to make the benefit permanent through Lifeline.”
21) National/Maryland: The Federal Railroad Administration has released a Draft Environmental Impact Statement (DEIS) and Draft Section 4(f) Evaluation for the high speed rail Baltimore-Washington Superconducting Maglev Project. Comment is open until April 22. Private financing will be part of the deal, which could cost between $13.8 billion and $16.8 billion.
22) Florida/National: Florida’s airports, hard hit by the COVID-19 pandemic, are holding on but are not out of the woods yet. “The [Orlando] authority’s bonds are rated Aa3 by with a stable outlook by Moody’s Investors Service, A-plus with a negative outlook by S&P Global Ratings, AA-minus with a negative outlook by Fitch Ratings, and AA with negative outlook by Kroll Bond Rating Agency, according to the Municipal Securities Rulemaking Board’s EMMA website.”
23) Maryland: State highway officials have stated their preference for a private toll lane expansion on the Beltway and I-270. The option “would add four new high-occupancy toll lanes—two in each direction—to both highways.” They will also explore some form of revenue enhancement to support the transit system. “The project’s draft environmental impact study released in July found that what’s known as ‘Alternative 9’ would be “the most likely to be financially self-sufficient,” based on estimated construction costs and toll revenue. Maryland officials have said the lanes’ construction will come at “no net cost” to taxpayers because private companies will build the lanes and finance them in exchange for keeping most of the toll revenue via a 50-year public-private partnership.”
24) Missouri: Cara Spencer, a fierce opponent of the privatization of St. Louis Lambert International Airport in 2019, is running for mayor of St. Louis. She “did not entirely rule it out as a part of a strategy for the airport going forward. Any plan, she said, has to recognize Lambert as part of regional transportation infrastructure like the port and the Mississippi River.” [Listen to the interview]
25) Think Tanks: The Milken Institute, chaired by convicted felon and financier Michael Milken (who was granted clemency by Donald Trump last year reportedly on the advice of Rudy Giuliani), has launched a new program on public finance and infrastructure. It will be headed by Lois Scott. Scott was a key proponent of private investment in Chicago’s public infrastructure in former Mayor Rahm Emanuel’s administration. Before joining the Emanuel administration, Scott headed a firm known for its privatization work, Scott Balice Strategies. PFM Group bought the company in 2011.
Criminal Justice and Immigration
26) National: #CagingCOVID is a campaign “to shine a light on mass incarceration in a time of a public health crisis, and apply pressure to use parole, clemency and decarceration at local and federal levels to stop the spread of the virus behind bars.” They have declared today “Freedom Day” and will be pressing their demands. “As a new administration enters the White House, we want to make clear, immediate demands to reduce and reverse the harm done by the past year of pandemic negligence in prisons and jails. Join us in a spirited motorcade rally through the Capitol on February 1st, Freedom Day, while we hand-deliver our petition to the Department of Justice to call for immediate action.”
27) National: Keith Malik Washington, the editor of the San Francisco Bay View, “may pursue legal action against the GEO Group and the Federal Bureau of Prisons after he apparently faced retaliation for communicating with a reporter about a COVID outbreak in the private halfway house where he is staying.” For a sample of Washington’s reporting, see his “Western District of Louisiana Ignores Humanity of Federal Prisoners at FCI Oakdale.”
28) National: CoreCivic has announced its fourth quarter 2020 earnings release and conference call dates. It will release its 2020 fourth quarter financial results after the market closes on Wednesday, February 10. A live broadcast of CoreCivic’s conference call will begin at 10:00 a.m. central time (11:00 a.m. eastern time) on Thursday, February 11, and is sure to include analyst questions on the Biden administration’s executive order barring contract renewals for private prisons. You may want to bone up on its operations by consulting the investor presentation CoreCivic made this month.
29) Alabama: Alabama’s state auditor, Jim Zeigler, warns that the state’s prison lease plan may be a 30-year mistake costing $2.6 billion. “That is why I am calling for an independent management audit of Alabama’s Department of Corrections. I invite my fellow state leaders to join me in this call for transparency. Is that too much to ask when our state currently allocates a whopping 25% of our general fund budget to th e prisons? That’s $624 million in 2020, folks! And you can bet your bottom dollar that percentage will keep rising. Next week, ADOC will present their proposed budget to the legislature in the budget review committee meeting. I implore our elected officials to thoroughly interrogate the spending practices and promises of the money-eating ADOC. Given that ADOC is so heavily funded and is about to be hit with an additional $88 million a year expense for 30 years, it seems prudent for legislators to have a chance to evaluate the underlying data that supposedly justifies the prison lease plan.”
30) Alabama: The Free Alabama Movement has launched a 30-Day Economic Blackout. “FAM’s 30-Day Blackout calls for a statewide work strike on all prison labor, which FAM contends amounts to slavery, and a boycott of prison service providers JPay, Access Corrections, Securus, ACI and Union Supply, companies that FAM states are profiting off families through exploitation, price gouging made possible through their monopoly contracts with the government.” FAM has issued a series of demands, including “Remove Article 1, sec. 32 of the Alabama Constitution of 1901, which allows for slavery and involuntary servitude as punishment for crime.” Shadowproof reports that “an ongoing boycott and strike inside Alabama’s prison system faced retaliation before it began.”
31) Virginia/National: The GEO Group donated money to the Virginia senators who killed a bill to end for-profit prisons in the state, Dean Mirshahi of WRIC reports. “On Jan. 15, the Virginia Senate Rehabilitation and Social Services Committee debated SB 1179, proposed by Sen. Adam Ebbin (D-Alexandria), that sought to end the for-profit prison management system in the commonwealth by stripping the authority of the director of Virginia’s Department of Corrections to enter into contracts with private prison operators. The only prison in Virginia not operated by the Department of Corrections is Lawrenceville Correctional Center, which has been run by GEO Group, Inc., a Florida-based private prison contractor, since 2003. GEO Group donated to 29 state lawmakers in 2020, $26,500 to 12 Democrats and $8,500 to 17 Republicans, according to analysis from the nonpartisan Virginia Public Access Project. 8News independently confirmed VPAP’s analysis by reviewing campaign finance reports filed with the state. The company contributed to the campaigns of nine members of the Senate Rehabilitation and Social Services Committee with donations ranging from $250 to $1,000. All of the senators who received donations from GEO Group rejected the measure from Ebbin.”
WRIC’s Kerri O’Brien reports that the GEO-operated Lawrenceville Correctional Center is routinely short-staffed and in breach of its contract with the state. “8News has learned The GEO Group, Inc, which operates the Lawrenceville Correctional Center Brunswick County, has been in breach of its contract with the state for years. Memos and invoices obtained by 8News reveal that month after month The GEO group has been fined thousands of dollars in damages for a lack of staffing at the correctional facility. The documents show both security and health positions have been left unmanned. A spokesperson for The Geo Group says the health positions are never truly left open. We’re told GEO works with a temp agency to get someone until a replacement is hired.”
32) Idaho: State officials are repossessing 10,000 doses of COVID-19 vaccine which had been shipped to a so-called public-private partnership with CVS and Walgreens but went unused. “‘We are working with (the U.S. Centers for Disease Control and Prevention) on reallocation of doses from the Pharmacy Partnership for Long-Term Care,’ said Idaho Health and Welfare spokesperson Niki Forbing-Orr. ‘We know we are getting over 10,000 doses back in our state allocation by Sunday.’”
33) Maryland: Despite public institutions doing a better job of rolling out their vaccine supplies, Anne Arundel County Executive Steuart Pittman says rollouts should be “privatized” going forward. “State data show that pharmacies have administered 55.6% of their doses, Pittman said; hospitals, 71.7%, and health departments about 79%, with Anne Arundel’s department leading that at 84.1%. ‘Privatization is an excellent move once supplies grow,’ Pittman said, but health departments are more efficient, and they work ‘with an equity lens.’”
34) Oklahoma: Despite the pandemic, Oklahoma is plowing ahead with its scheme to privatize its Medicaid service—and is doing so without legislative approval. “‘My legitimate prayer is that you and the governor will come to the house that you will work with us and not try to cram those down our throat,’ Rep Marcus McEntire, R-Duncan, told [OHCA CEO Kevin Corbett] in the House chamber. ‘I’m laying down the gauntlet and we don’t want to be obstructionist here, but we will if we have to be.’ (…) ‘Centene, their market cap is $35.33 billion. The CEO made $26 million in salary last year,’ McEntire said as he continued to list sizeable corporate profits. ‘To achieve profits like that, states are either overpaying or they’re just really damn good at their job and I don’t know which one it is.’”
35) National: The Bond Buyer reports that Municipal Bonds for America, which was formerly a coalition of both buy side interests and pubic sector issuers led by Bond Dealers of America, will now shift its lobbying activity strictly to the bond buyer side. “This year, Nicholas is hopeful about the outlook for hoped for muni legislation ranging from the reinstatement of tax-exempt advance refunding to increasing the cap on private activity bonds and incentivizing the use of public private partnerships.”
36) National: Remember the scandal over privatized military housing? Well the Defense Department thinks it has solved the problem by, you guessed it, giving $1 billion to a private military housing contractor. To what does the CEO of the company chalk up this supposed win-win? You guessed it again, privatization. “‘Thanks to the privatization and our innovative approach to financing, we’re able to expedite our improvement plans, allocating funds to projects based on those with the greatest needs and priorities without appropriations from Congress,’ said Denis Hickey, CEO of Lendlease Americas. Lendlease is an international property and investments group based in Sydney.”
Photo by Maryland GovPics.