Is Outsourcing Really Saving Taxpayer Money?

Source: Phil Williams, News Channel 5, July 27, 2016

An exclusive NewsChannel 5 investigation has uncovered new questions about a major Haslam administration plan that was supposed to save taxpayers’ money. But our investigation discovered that effort — to turn the state’s vehicle operations over to private companies — is costing millions of dollars more than lawmakers were told. … While state employees once handled most maintenance of state vehicles, the Haslam administration outsourced the work to a private company. A fleet of state vehicles were once kept on standby for state workers, but that job was outsourced to Enterprise’s WeCar program. The administration also sold off hundreds of state-owned trucks and cars, choosing instead to lease them — all supposedly to save money. But a careful analysis of state budget documents suggests the state’s motor vehicle management operations have consistently blown through the budget numbers given to state lawmakers, now costing taxpayers more than ever. In 2011-2012, the Haslam administration proposed a motor vehicle budget of $32.5 million dollars, but they overspent by more than $10 million. The next year, they were $11 million over budget. And in 2014, they overspent by $12 million. …


Tennessee outsourcing proposal inches forward
Source: Adam Tamburin, The Tennessean, July 1, 2016

The state is inching forward in its long-running review of a proposal to outsource facilities management on college campuses and other government-owned properties. Gov. Bill Haslam’s administration has expressed interest in the idea for some time. In April, the Haslam administration released a request for qualifications, or RFQ, to gauge interest from businesses that might participate in the proposed plan to outsource facilities management at a number of its properties — including colleges, prisons and state parks. The deadline passed Thursday, and the state will begin fielding presentations from the interested businesses later this month. … The state uses Chicago-based JLL to manage roughly 10 percent of its facilities. An internal report released in March suggested privatizing the management of residence halls, student centers and other properties across the state could save $36 million annually. Critics have said outsourcing would translate to subpar services, particularly for colleges, and slashed pay and benefits for employees. Haslam has said the savings are possible without layoffs or cuts to pay or benefits. …

Union members ask trustees to reject outsourcing at UT
Source: MJ Slaby, Knoxville News-Sentinel, June 22, 2016

For nearly a year, members of the United Campus Workers union, like McDaniel, and others have protested a plan by Gov. Bill Haslam that would allow outsourcing of maintenance and management of public buildings, including on college campuses. The state has repeatedly said each campus would be allowed to opt into or out of the plan, which has been met with scepticism by the union. But now, that decision to opt in or out may come at the same time the Knoxville campus has a new chancellor. Based on state timelines, campuses are expected to make decisions in early 2017, and UT President Joe DiPietro said Tuesday he hoped to have a new chancellor in spring 2017. …

Outsourcing Savings Estimates Strain ‘Credulity’
Source: Sam Stockard, Memphis Daily News, May 19, 2016

… The plan, if all departments participate, is projected to save $35.8 million by the second year of a contract for building operations and services – with the requirement state workers keep their jobs, with comparable pay and benefits as long as they perform. The contract would be available for all state properties, enabling colleges and universities, for example, to compare their costs to the contract in deciding whether to opt in, according to Cowles. … The Department of General Services started moving on the process in 2015, much to the chagrin of state employees, primarily United Campus Workers, who contend their jobs and pay will suffer. They rallied during the recent legislative session and then petitioned the governor again in late April. Several state lawmakers also raised questions about the office’s plan when it went before the Senate State and Local Government Committee in March. Some called it “corporate rhetoric,” while others said it “strains credulity.” … In early April, the state made a request for qualifications from potential facilities management service providers to determine whether they can do the job. … The state appears to be head over heels in love with Chicago-based JLL, saying it has saved the state $10 million since it took over facilities management a few years ago. Cowles points out in his presentation JLL is ranked the city’s best employer by the Nashville Business Journal. United Campus Workers is questioning why the office started looking for qualified vendors before the independent review is complete. It also is pointing out the state is continuing to change its tone throughout this situation, now softening its stance to say colleges could choose just to go with a landscaping portion of the contract or janitorial services, for example.

Campus workers present letter of concern to Haslam administration over privatization effort
Source: Richard Locker, Knoxville News Sentinel, April 26, 2016

… The governor’s facilities management outsourcing initiative is apparently the largest ever attempted by a state government. When a request for information was issued last summer to gauge interest from potential contractors, it proposed a contract covering the operation and maintenance of virtually all state-owned property, including office buildings, state parks, college and university campuses, prisons, armories and hospitals. In March, the outsourcing team issued a “business justification” for the plan estimating that it could save taxpayers $36 million a year if fully implemented, even while protecting current employees’ jobs — although their employment would be transferred to the contractor. Cowles acknowledged at the time that no firm cost comparison would be realized until a contract is bid and negotiated. Largely at the request of higher education officials, Haslam agreed to hire an outside consultant to evaluate his team’s estimates of savings and the state on March 17 started the process of selecting a contractor to perform that work.

Tennessee moves to review possible outsourcing partners
Source: Adam Tamburin, The Tennesean, April 11, 2016

The state took steps Monday to review possible options for outsourcing facilities management on college campuses and other government-owned properties. An internal review released last month by Gov. Bill Haslam’s administration suggested privatizing the management of residence halls, student centers and other properties across the state could save $36 million annually. On Monday the state released a request for qualifications, or RFQ, that will allow businesses to express interest in participating in the proposed outsourcing plan. … Critics have said outsourcing would translate to sub-par services, particularly for colleges, and slashed pay and benefits for employees. Haslam has said the savings are possible without layoffs or cuts to pay or benefits.

Critics question Haslam’s outsourcing plan
Source: Joel Ebert, The Tennessean, March 22, 2016

While proponents of the plan say the effort will result in taxpayers saving millions of dollars, Chris Dauphin, the organization’s communications director, questioned the $35.8 million in estimated savings. The figure was mentioned by Terry Cowles, director of customer-focused government, during a presentation to the Senate State and Local Government Committee in early March. On Tuesday, Dauphin told the same committee that the state can save money without having to outsource the facilities management on every state property. … Dauphin advocated for a more common-sense approach before warning that outsourcing could result in cost shifting down the line. He said a private company could decide to have annual rate increases, pointing to a contract between the Texas A&M University system and Compass Group USA, an outsourcing company, that resulted in students being forced into paying more for meal plans as a result of the privatization plan. Dauphin also explained that the 1,647 state workers at the university were forced to reapply for their jobs, with only 600 being rehired.
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Emergency dispatch consolidation plan advances

Source: Leon Lagerstam, QC Online, July 27, 2016

A decision to consolidate emergency dispatch centers into what’s called Public Safety Answering Points was approved Tuesday by a statewide 911 administrator. Administrator Cindy Barbera-Brelle emailed Rock Island County Emergency Telephone System Board chairman Steve Seiver that the county’s proposal has been accepted. … Agencies were required to submit a consolidation plan by the end of June and now have until June 30, 2017, to finish developing specific operational guidelines. Rock Island County was tasked with cutting its centers to three. Emergency telephone system board members decided to keep Rock Island and Rock Island County’s centers open, but close a Centre Station center handling Moline and East Moline calls, as well as Milan and Silvis. Moline, East Moline, and Milan decided to create a new dispatch center to be housed in Milan. Silvis has started negotiations with Rock Island’s department. …


RI County begins plans to merge police dispatch centers
Source: Leon Lagerstam, Dispatch Argus, July 10, 2016

A plan to consolidate local police dispatch centers was filed a day before its state-mandated deadline. The plan for what is officially known as Public Safety Answering Points — PSAPs– was needed by June 30. It was filed June 29, Rock Island County Emergency Telephone System Board chairman Steve Seiver said. … On June 29, 2015, Gov. Bruce Rauner signed a bill into law that required reducing the six Rock Island County emergency dispatching centers to three by June 30, 2017. … Milan, Moline and East Moline will consolidate and be housed at Milan. Where Silvis will go will be determined later by the newly consolidated PSAPs, according to information in the “Application for 9-1-1 Consolidation or Modified Plan.” Silvis city administrator Jim Grafton said city leaders were disappointed they didn’t get to see a copy of the proposed application before a city council meeting could have been convened. An emailed copy of it arrived in Silvis June 28. Revisions were suggested, but a council meeting couldn’t be called in time to approve it. … Dispatch centers employ about 54 full-time employees represented by the American Federation of State, County and Municipal Employees, as well as part-time employees and supervisors, according to reports. Staffing and budgetary requirements will be addressed this year ahead of an implementation stage. Ignoring or postponing a PSAP consolidation decision would have jeopardized future 9-1-1 surcharge funding, according to materials.

Audit blasts Kansas foster care system over missed visits, background checks

Source: Jonathan Shorman, Topeka Capital-Journal, July 27, 2016

Auditors released a scathing review of the state’s foster care system Wednesday, revealing that the Department for Children and Families doesn’t check the backgrounds of people in foster homes as often as needed, doesn’t ensure monthly in-person visits take place, and grants nearly all requests for exceptions to rules governing foster homes. … According to the audit, while case management staff are required to conduct monthly in-person visits with children in foster care, the visits don’t always occur. Auditors reviewed 194 cases during fiscal year 2015 and found that for 59 percent, they couldn’t determine whether a visit had occurred because of poor documentation. The report also said that for most cases reviewed, auditors couldn’t determine whether the foster care contractors had conducted their own visits. Gilmore acknowledged documentation had been poor but said that didn’t prove visits were missed. … A lack of monthly in-person visits was among allegations raised in a federal lawsuit against DCF and foster care contractor TFI Family Services over the 2013 death of 4-year-old Mekhi Boone. The mother of the Hiawatha boy charged that foster care workers hadn’t made required visits before the boy’s beating death at the hands of his father. …


Editorial: Audit Overdue
Source: Lawrence Journal-World, January 21, 2016

Amid various questions about how the Kansas Department for Children and Families is handling foster care and adoptions in the state, Kansas legislators last week took the prudent action of ordering an audit of those DCF services. … The audit will include two questions specifically aimed at the impact of foster care and adoption privatization on Kansas children and families involved with that system and whether privatization has “significantly affected the cost of those services to the state.” …

Lawmaker wants to nix current foster care program
Source: Jonathan Shorman, Garden City Telegram, December 20, 2015

A Republican lawmaker’s report calls for the end of Kansas’ current privatized foster care system — an idea coming as the 20th anniversary of the private system looms and the agency in charge faces mounting scrutiny. Rep. Mike Kiegerl, R-Olathe, wrote in a report entitled “When Children Die We Must Act” that his overall impression was the mid-90s privatization of foster care wasn’t a success. … According to the report, the state spends about $283 million every two years on foster care, excluding payments to foster parents. The report found a substantial duplication of work between contractors and DCF analogous to an extra level of hierarchy. The report called case worker turnover a serious problem and noted a 37 percent turnover rate for one contractor. Currently, the state contracts with KVC and St. Francis. The turnover creates extra work for DCF employees, disrupts judicial procedures and increases expenses, the document said. The report concluded the contractors must have healthy profit margins — which add to the cost per case — because a CEO of one of the contractors makes $650,000 per year. The document also said the work product of the contractors doesn’t appear to merit the expense.

Kansas social workers call for review of privatized child welfare system
Source: Peter Hancock, Lawrence Journal-World, December 13, 2015

Kansas lawmakers have tentatively agreed to authorize a wide-ranging audit of current practices within the Department for Children and Families, including its management of foster care services and whether the agency is routinely discriminating against gay and lesbian families when placing children in either temporary or permanent homes. But some who have worked within the system say the problems at DCF go beyond its current policies and practices. Although conditions have become noticeably worse in recent years, they say, the root of the problem dates back to a decision made nearly 20 years ago to privatize the state’s child welfare system. … In response, DCF announced last month that it has started hiring other kinds of professionals to perform the jobs of social workers, including people with advanced degrees in psychology, counseling, and marriage and family counseling. But both the agency and its contractors have also started hiring for positions that require no degree at all, “special investigators,” as they are called at DCF, and “family support workers,” as they’re called by KVC Behavioral Healthcare Kansas, the contractor for the eastern Kansas region, including Douglas County. They work under the supervision of licensed social workers and perform some of the tasks previously reserved for licensed workers, such as making home visits and interviewing people involved in abuse and neglect cases.

Kansas services are corroding on Gov. Sam Brownback’s watchSource: Barbara Shelly, Kansas City Star, December 10, 2015

Kansas’ child protection system is under fire on a number of fronts, so it came as no surprise when news services reported recently that Michael Myers, director of prevention and protection services, was leaving the Department for Children and Families. What struck me as curious was that he was there at all. Myers came to the agency in 2011 without the usual background in child protection, social work or state government. His job experience was in property development and construction management in Topeka. …

Kansas Legislators Call For Scrutiny Of Foster Care Contractors
Source: Andy Marso, KCUR, November 18, 2015

The Kansas Department for Children and Families announced major changes to its standards for substantiating child abuse Tuesday. But lawmakers want more reform of a privatized foster care system they say is failing to protect children. DCF Secretary Phyllis Gilmore announced that the agency will begin using a “preponderance of the evidence” as the standard for substantiating a child abuse claim rather than the more stringent “clear and convincing evidence.” … After Gilmore’s announcement, legislators suggested the foster care system still needs a deeper look. Democrats pushed for an audit of the system in July, but it narrowly failed when five Republicans voted it down. At Tuesday’s hearing, though, the majority party members expressed serious concerns as well. … The foster care system has been privatized since 1997, and DCF now works with two contractors, KVC Behavioral Healthcare of Olathe and St. Francis Community Services of Salina. A subcontractor, Topeka-based TFI, handled Kaddillak’s case, and DCF briefly halted new foster care placements with that agency after her death last year. In recent years the state has consistently set records for the number of Kansas children in foster care, topping 6,000 last year.

Legislative committee denies request for audit of foster care system
Source: Bryan Lowry, Wichita Eagle, July 29, 2015

A legislative committee on Wednesday voted down a request for an audit into Kansas’ foster care system. The request was brought by House Democrats in response to recent media coverage of cases where children have died either when placed in a foster care home or after being reunited with family members. Democrats requested that the audit begin in August so that data would be available by the start of the next legislative session. The Legislative Post Audit Committee voted down the request 5-4, splitting along party lines. A second vote to keep the proposal alive so it could possibly be revisited passed with bipartisan support. The cases that raised concern included the death of a 10-year-old boy in Wellington five days after the Department for Children and Families had been alerted to problems in the home. The boy’s mother has been charged with first degree murder. Rep. Jim Ward, D-Wichita, who brought forth the request along with Rep. Ed Trimmer, D-Winfield, argued that privatization of the foster care system in recent years had lessened state oversight and that an audit was needed to determine whether the DCF had ensured the safety of children in the system.

November ballot question: Lifting the charter school cap

Source: Frank Conte, New Boston Post, July 28, 2016

The most popular governor in the United States wasn’t going to let a mid-July downpour on the State House steps dampen the launch of ballot campaign to lift the state’s charter school cap. Spending down some of the political capital he’s accrued over the last two years, Governor Charlie Baker announced his support for a measure that will potentially increase annually the number of charter schools by 12. … If approved by the voters in November, the ballot question certified by the Massachusetts Attorney General will allow the state Board of Elementary and Secondary Education to approve up to 12 new charter schools each year. Should the board receive applications from more than that number, districts with student performance in the bottom 25 percent of state assessments and strong popular demand will be given preference. In reality, charter school advocates — given the economics and logistics — think only two or three new schools will be approved by the board each year. But teacher union resistance can be overwhelming, even if the changes are small. …


Senate President: Charter school bill all but dead
Source: Associated Press, June 20, 2016

Hopes for a bill aimed at heading off a proposed charter school ballot question appear all but dead on Beacon Hill. Democratic Senate President Stan Rosenberg told reporters Monday that discussions between the Massachusetts House and Senate on the bill have come to a “dead stop.” … The Senate in April approved a bill aimed at allowing more charters in districts serving at-risk students while largely maintaining the statewide charter school cap. The House hasn’t acted on the bill. The proposed ballot question would add up to a dozen new or expanded charters each year outside of existing state caps.

Gov Baker Proposes Bill To Allow More Charter Schools
Source: Paul Tuthill, WAMC, October 8, 2015

Massachusetts Governor Charlie Baker announced legislation Thursday to lift a cap on charter schools.  The bill  Baker plans to file would add up to 12 new or expanded charter schools a year with a preference in low performing school districts. His legislation is similar to a ballot measure proposed by a coalition of charter school advocates. Spokesperson Josiane Martinez said the group needs to collect 65,000 signatures to get the question on the 2016 ballot.

What’s at stake in Atlanta’s experiment in outsourcing public schools

Source: Molly Bloom, Atlanta Journal-Constitution, July 27, 2016

If everything goes as planned, the reopening of Thomasville Heights Elementary School this week will be the start of the most ambitious outsourcing of public education in Georgia. This winter, after calling out Thomasville as one of the worst schools in the state, Atlanta school Superintendent Meria Carstarphen hired Purpose Built Schools to run the school. Purpose Built is a nonprofit affiliated with Drew Charter School, a well-regarded east Atlanta charter school. … It’s also an attempt to avoid the state potentially taking over Thomasville. If voters approve Gov. Nathan Deal’s Opportunity School District plan this fall, the state could take over low-performing schools like Thomasville and close them, turn them over to charter school groups or run them itself. Carstarphen has said showing the state she’s making dramatic changes could help shield the school from takeover. Her plan is for Purpose Built to run a cluster of three schools in south Atlanta feeding into Carver High School, and eventually Carver itself. …


APS test about to begin: Can new team transform struggling school?
Source: Molly Bloom, Atlanta Journal-Constitution, July 25, 2016

By 2018, as many as 2,000 Atlanta students could attend public schools managed by Purpose Built. Another nonprofit, Kindezi, will manage a fifth school. The schools aren’t technically charter schools — Carstarphen has pledged they’ll accept all students in their attendance zones — but they’ll have much of the same flexibility in how they operate. … Most of the Thomasville’s new staff are veteran teachers from Atlanta, nearby districts or charter schools, including Drew. They include some of Thomasville’s old staff who won their jobs back. … Thomasville’s new model will borrow extensively from Drew Charter School, which opened 16 years ago in a former Atlanta Public Schools elementary school. Today, the state rates Drew’s elementary school higher than nearly 80 percent of schools in Georgia. Like Drew, Thomasville will focus on teaching through class projects. Students will get extra help through reading and math tutoring. And after-school programs followed by dinner will keep kids at school until at least 6 p.m. …

Iowa’s Medicaid switch won’t be deterred, Branstad maintains

Source: Rod Boshart, The Gazette, July 27, 2016

Gov. Terry Branstad fired back Wednesday at critics of the state’s decision to contract with three managed care organizations to oversee Iowa’s $5 billion Medicaid program for more than 560,000 recipients — a change that has played to mixed reviews since the April 1 implementation. Branstad said the approach has been praised by governors — both Democratic and Republican — in other states that have employed private managed care organizations (MCO) to modernize service delivery more efficiently and effectively while ferreting out fraud and abuse by checking claims to make sure they’re legitimate before they’re paid. … One day earlier, members of the Senate Human Services Committee heard concerns that service providers such as hospitals, nursing homes and mental health agencies, have experienced delays or problems since April 1 in getting reimbursed that are threatening their financial viability and have forced some layoffs. At the heart of Tuesday’s committee meeting was provider payments — MCOs and the state say the majority of claims are being paid cleanly and timely, while providers testified otherwise. … Of the more than 4.9 million claims submitted during the first three months, about 3.4 million were paid while 1.2 million were denied, 300,000 were suspended and 101,000 were rejected — meaning the claims were missing key pieces of information. State officials also pointed to data that showed the three MCOs were paying at least 95 percent of claims within 21 days. …


Christian Opportunity Center Facing Changes Due to Privatized Medicaid System
Source: KNIA, July 28, 2016

Several significant changes are impacting the way in which Christian Opportunity Center (COC) provides residential and vocational services for adults with disabilities. The biggest change according to the organization is the privatization of Medicaid, or managed care, which began in April. COC has contracts in place with all three MCOs, and Executive Director Rod Braun says the biggest challenge with managed care has been getting the organizations to understand who COC is and what they do. Braun says there are a large set of other changes they’ve had to adjust to separate from the Medicaid privatization, including the phase out of sheltered employment opportunities for the people they serve. COC provides residential and vocational support and services to more than 300 people with disabilities in Marion, Warren, Mahaska, Dallas, and Polk counties. …

Senate Human Resources Committee Meets After Issues with Medicaid Privatization Raised
Source: Stephanie Moore, WhoTv, July 26, 2016

Lawmakers came back to the statehouse for a rare summer hearing Tuesday. The Senate Human Resources Committee met after concerns were raised from an Iowa health provider survey. For hours, members of the committee heard from providers and caretakers about the problems they’re having with the Medicaid switch after claims providers have seen increased costs, reduced services and are not getting paid on time. … Starr said on top of the payment, the transition has also taken its therapists away from client care. … But the Iowa Department of Human Services says it’s only seen a 10-15 percent denial rate in claims which it says is similar to the previous program. …

Problems with Medicaid Privatization Called “Shocking”
Source: Joyce Russell, Iowa Public Radio, July 26, 2016

Dozens of health care providers and others crowded a committee room at the statehouse today.   Democrats in the Iowa Senate held a hearing on problems with Iowa’s new privately managed Medicaid program, which provides health care for the poor and disabled. … Hospitals and others say they’re borrowing money to cover expenses while they wait for reimbursement.   Others have laid off employees because of the shortfall. … Critics say some health care providers have laid off employees or even closed down services because of the delays. Program officials disagree with some of the complaints. … By one estimate, officials say as many as 25 percent of claims are being denied. …

Survey: Iowa Medicaid providers not getting paid on time, running into billing issues
Source: Chelsea Keenan, The Gazette, July 25, 2016

Hundreds of Medicaid providers have run into billing issues since the April 1 transition of the state’s $5 billion Medicaid program over to three out-of-state, private insurers, according to a survey released by Iowa Democratic legislators on Monday. The survey includes responses from more than 400 Iowa providers, including doctors, hospitals, clinics and not-for-profit agencies. Legislators used social media to solicit the responses over about a month’s time, during June and July. … According the survey, 90 percent of respondents have seen their administrative costs increase and nearly two-thirds have received lower reimbursement rates. Nearly eight in 10 providers who completed the survey said they are not getting paid on time and 28 percent of providers have been forced to take out loans to cover their expenses while waiting for payment. …
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As Baker assesses MBTA’s future, role of privatization considered

Source: Jule Pattison-Gordon, Bay State Banner, July 28, 2016

As officials struggle to turn the MBTA around, one bone of contention is the role that privatization should play. The administration of Governor Charlie Baker has been taking advantage of the MBTA’s exemption from the Pacheco law to explore greater levels of outsourcing. The Pacheco law aimed to prevent officials from privatizing public services without first making a case that the private company would provide higher or equal quality service for less expense than could be achieved in-house, and that the cost savings would not be reliant on cutting employee wages and benefits. Opponents labeled it as “anti-privatization.” Last week, Baker held a meeting with reporters in which he reflected on the past year at the MBTA and on the next steps going forward. While privatization of several departments is under consideration, Baker said, generally speaking, he has no preference between public and private providers, only on whichever will provide the best service quality and lower costs. …


Wait, did somebody cut sunroofs into the MBTA’s armored cars?
Source: Adam Vaccaro, Boston Globe, July 25, 2016

The labor union representing the T’s “money room” workers is accusing Gov. Charlie Baker of misrepresenting facts as the two sides continue to bicker over whether to contract out the MBTA’s cash-counting operations. Last week, while speaking to reporters about the last year at the T, Baker said sunroofs had been cut into two armored cars used to move money around. He didn’t offer much more in the way of detail, but suggested the issue was consistent with other problems MBTA management says it has found with security in the money room. … But the Boston Carmen’s Union, which represents the money room employees and thousands of others, pushed back hard against Baker’s claim about the armored cars, calling it “pure fiction.” … Privatization at the T has been a central issue for MBTA labor throughout Baker’s time in office. It has grown more tense as the agency moves closer to actually spinning divisions toward the private sector. In the spring and summer of 2015, as he sought reforms at the MBTA following the system’s struggles in last winter’s snow, the Republican governor successfully convinced the legislature to give the T more unilateral power to privatize services, scoring a three-year reprieve from a law requiring a multi-step audit before the state could contract out a service provided by public employees. T officials have been pushing to privatize the agency’s cash-counting division since before the recent audit was released. …

Private guard in MBTA money room caught napping on the job
Source: WCVB, July 13, 2016

Private guards are on the job, tasked with making sure millions of dollars of the MBTA’s money is safe, but 5 Investigates discovered a major lapse in the T’s money room security. Security at the T’s money room was handled by Transit Police in the past, but was privatized in June. On Wednesday, 5 Investigates obtained a photograph that showed one of the new security guards sound asleep when he was supposed to be guarding the money room’s front door in Charlestown. In the photo, obtained exclusively by 5 Investigates, the guard can be seen leaning back and taking a snooze while on the job. The photo was taken in the middle of the workday and showed the guard sound asleep with his hands tucked in his bulletproof vest. He’s part of the MBTA’s new plan to keep safe the building where they collect and count about $200 million a year. … In a statement, G4S told 5 Investigates “Inattentiveness to duty is not tolerated.” The company said it will “work to ensure that any necessary changes are fully implemented to help prevent a reoccurrence.” The MBTA said it moved swiftly to secure the facility and stands by its decision to outsource the money room.

MBTA takes first major step toward privatization
Source: Nicole Dungca, Boston Globe, June 30, 2016

The Massachusetts Bay Transportation Authority’s warehouse operations could be run by a private company by October, as T officials take a major step toward outsourcing a part of the agency. MBTA officials on Thursday released a request for proposals from outside firms for the operations of its warehouse, which T executives have blasted for being inefficient and dysfunctional. The move is already prompting fierce opposition — and a request for arbitration — from the agency’s largest labor union, whose members could lose jobs. James O’Brien, president of the Boston Carmen’s Union, pledged to appeal the move, under a federal process that — if successful — the union argues could eventually cost the T significant federal funding. … At the T, warehouse operations would be the first department to replace public workers with private ones since the Legislature lifted restrictions on outsourcing at the agency. …

MBTA union willing to cut new workers’ pay if management limits privatization
Source: Adam Vaccaro, Boston Globe, June 27, 2016

The largest labor union representing MBTA workers wants to make a deal. The 4,100-employee Boston Carmen’s Union says it’s willing to cut wages for new employees if it means the T will limit privatizing jobs done by members. Union officials presented the proposed deal at a Monday meeting of the T’s governing board, saying it would save $24 million for the agency over four years. The proposal would extend the Carmen’s current contract with the T two years, to 2020. Under the proposal, new full-time employees would see an 11 percent wage reduction over their first four years, and new part-time employees to see an eight percent reduction over their first six years. Additionally, wages would grow by 1.5 percent per year in 2019 and 2020, a lower rate than the usual 2.5 percent annual increase. In exchange, the union is asking the agency not to contract out services done by its members. It would allow one exception: the agency’s central warehouse, which employs 34 Carmen’s Union members and which the T has discussed recently as a potential service to privatize. …

Legislators blast plan to privatize T warehouse jobs
Source: Nicole Dungca, Boston Globe, June 13, 2016

Legislators and Massachusetts Bay Transportation Authority workers blasted potential plans to outsource jobs in the MBTA’s warehouse operations, as officials on Monday made their case for privatizing the department. Saying the warehouse operations system is “completely broken,” T officials are pushing to outsource about 38 jobs in a department that costs approximately $4.2 million annually. … Also Monday, MBTA officials revealed that they had quietly replaced Transit Police officers with private security agents at the “money room” where employees count cash fares — a move that sparked criticism from police union officials who said they had little notice and noted that the T had hired the security agency that employed the gunman in this weekend’s mass shooting in Orlando. … [Michael Keller] blamed the T’s system, noting that it runs the central warehouse only 40 hours a week, despite 24-hour maintenance. He also said the system encourages mechanics to take parts even when a stockperson isn’t there to track the inventory — which contributes to the system’s inaccuracies. …

Could outsourcing fix this T problem?
Source: Nicole Dungca, Boston Globe, June 12, 2016

T officials Monday plan to make the case for privatizing the sprawling warehouse department, which employs about 38 employees for approximately $4.2 million annually. Officials say it could lead to major improvements to the T’s maintenance operations and will represent one of the first efforts by Governor Charlie Baker’s administration to test the suspension of the so-called Pacheco law, which puts up hurdles for outsourcing state jobs. … The majority of the T’s inventory — about $38 million — is at two central warehouse locations in Everett and Charlestown. Maintenance workers usually call upon the warehouses when their own supplies — for things as simple as cables, brake rotors, and air filters — at their garages run out. T officials say that process, which can take up to 80 hours, should take about 12 by industry standards. That’s partly because the main warehouse is only open for eight hours a day, five days a week, compared with the maintenance department, which is working around the clock. … Officials say fixing the system internally could prove to be too expensive, especially as the agency looks for ways to balance its books. Polcari said the T would need to upgrade its warehouses and equipment, which could cost about $14.5 million. Officials hope the agency’s fiscal control board will sign off on a timeline that would allow the T to put out a request for proposals later this month, then select a bidder by the middle of August. …

The next big MBTA battle will be about privatization
Source: Adam Vaccaro,, June 7, 2016

In nearly a year since new management took control of the MBTA, the agency has taken several steps to achieve Gov. Charlie Baker’s directive that it get its financial house in order. … But it has yet to act on what proved to be Baker’s most contentious plan for the agency a year ago: To outsource parts of the agency to private companies. … In a conference call last week, MBTA Chief Administrator Brian Shortsleeve told reporters that privatization — or “flexible contracting,” as the T calls it — will be a focus of the agency in the coming weeks. He said the agency is examining “several initiatives we’re going to move quickly on to leverage flexible contracting” as part of a strategy to cut down on a budget deficit projected for $80 million next year, even after accounting for fare hikes and the end of late-night weekend service. …

MBTA Workers Speak Out Against Plans To Privatize Services
Source: ZENINJOR ENWEMEKA, WBUR, February 10, 2016

MBTA workers and union leaders spoke out Wednesday against a plan by T officials to privatize some services — which could affect about 250 jobs. … The Boston Carmen’s Union Local 589 said the plan will push hardworking people out of jobs. … The Boston Carmen’s Union said 165 cash handling and fare collection jobs would be jeopardized. This includes technicians who repair fare collection equipment and workers in the MBTA’s Charlestown office known as the “money room.” Workers in that facility count MBTA fares, Mass Pike tolls and parking meter deposits from the city of Cambridge. The union represents 77 of these jobs that would be eliminated and given to private companies under the plan.

MBTA to consider privatizing services involving 250 jobs
Source: Nicole Dungca, Boston Herald, February 10, 2016

Massachusetts Bay Transportation Authority officials on Wednesday will take up a plan backed by Governor Charlie Baker to privatize departments that maintain fare machines, count cash fares, and run marketing and retail operations, a step that could eliminate about 250 jobs in all, according to MBTA officials. … MBTA and administration officials say they believe outsourcing the services could help the T vastly improve its fare-collection system and save millions of dollars that could be invested in the system. No specific figures on savings have been made public. … It would be among the first attempts by Baker’s administration to outsource services since the Legislature agreed to temporarily suspend a state law — specifically for the MBTA — that put up hurdles to privatizing public-sector jobs. The MBTA has considered privatizing some bus routes, but promised no layoffs would accompany that move. … About 165 jobs dedicated to fare collection and cash handling could be targeted in the privatization effort, MBTA officials said. In addition, they will look to privatize marketing services and retail operations; management of warehouses and materials; management of employee leave; management of telecommunication; contracts; and employees who handle the dispatch system for Transit Police. They will also look for savings in cleaning and elevator maintenance crews, which are already outsourced to private companies.

Unions rally against plan to privatize T services
Source: Antonio Caban, Lowell Sun, September 23, 2015

Concerned that the Baker administration’s effort to privatize some MBTA services could cost workers their jobs, union members gathered in protest on Wednesday, vowing to continue to call attention to the issue. Wearing matching orange shirts, nearly 80 members of Boston Carmen’s Union 589 turned out for the protest near their Devonshire Street headquarters. Aimee Daluz, an MBTA customer service worker, was among those passing out flyers. … Baker, who is in the midst of plans to revamp operations at the T after disastrous service last winter, said he will not move forward with plans to privatize certain MBTA bus routes if it doesn’t generate savings and efficiencies.

Union leaders urge MBTA officials to reconsider bus privatization plan
Source: Adam Vaccaro,, September 14, 2015

Union heads called on MBTA officials Monday morning to pump the brakes on a plan that would allow some low-ridership bus routes to be operated by private companies. Russell Gittlen, the regional director of the International Association of Machinists and Aerospace Workers, and James O’Brien, who heads the local Carmen’s Union, each addressed the T’s Fiscal and Management Control Board about the plan, which union members have criticized vociferously since it came to light last month. … MBTA officials have tried to assuage that fear, saying affected drivers and buses would be moved to help deal with busier bus routes. But Glitten and O’Brien said they think the agency should take a different approach—rather than bringing in outside help to handle slow routes, they say, the T should take it a step further and consider reconfiguring its bus routes. …

MBTA union, taxi drivers hold protests
Source: Chris Villani, Boston Herald, September 8, 2015

A demonstration by hundreds of members of the Carmen’s Union yesterday — protesting a move toward MBTA privatization on some bus lines that was backed by Republican Gov. Charlie Baker as well as the Democratic Legislature — drew some high-profile support at the annual Greater Boston Labor Day Breakfast. … The Carmen’s Union was not alone in Lincoln Square. About 15-20 members of the Boston Taxi Drivers Association marched, holding signs saying ride-sharing services like Uber and Lyft are putting them out of business. Donna Blythe-Shaw, who represents the Boston taxi drivers, said she would like to see the same regulations applied to ride-sharing cars and taxis. Specifically, she said the union wants to make sure ride-sharing services can’t undercut meter fares, make sure that every car has a livery plate and that drivers are vetted the same way taxi cab drivers are vetted.

No layoffs in privatizing of bus lines, T officials say
Source: Nicole Dungca, Boston Globe, August 20, 2015

The MBTA’s top two officials said Thursday that no bus drivers would lose their jobs if the T privatizes certain bus routes, a day after the president of the agency’s largest union said outsourcing routes to private companies amounts to a “betrayal” by Governor Charlie Baker. … But Frank DePaola, the MBTA’s interim general manager, said on Thursday that bus drivers whose routes are affected by the plan would keep their jobs and be reassigned to other bus routes. O’Brien said that he still had concerns despite DePaola’s promise, delivered by phone, that the privatization plan would not result in job losses. … The 32 bus routes being discussed include late-night service lines, express routes, and some lines with lower ridership, according to the T. The routes would only represent about 2.5 percent of weekly ridership.

MBTA Looking To Privatize Bus Routes
Source: Andy Metzger, WBUR, August 21, 2015

All 93 buses and their 65 drivers that would be taken off of those 40 routes if service is privatized would be re-deployed to other areas of the system that need more service, MBTA Interim General Manager Frank DePaola told reporters Thursday. … If the privatization plan moves forward, MBTA officials said that while it would improve the efficiency of bus services, it would also likely increase the total costs to the MBTA because private carriers will likely require some public subsidy. It would also increase the amount of transit service and the number of jobs in the transit sector, as private operators supplement T service. Those facts did not sway O’Brien. … The MBTA has not yet determined what routes would be supplemented with the 93 buses and 65 operators that would be shifted away from routes covered by a private carrier.

The T wants to privatize some bus routes
Source: Adam Vaccaro,, August 20, 2015

One of the major reforms to the MBTA this summer was a three-year reprieve from a law that puts a high barrier toward contracting out services to the private sector. Six weeks after peeling away the anti-privatization law, The Boston Globe reports, the T is preparing to ask private organizations about operating about 30 bus routes. … The MBTA told in July that it had begun speaking “informally with a number of stakeholders and potential partners” about offering privatized late-night bus service, which has struggled financially. Bridj, a Boston startup that offers shuttle service from neighborhood to neighborhood through a smartphone app, is among the services to have participated in informal discussions with the T, MBTA spokesman Joe Pesaturo said at the time.

Gov. Baker ready to test outsourcing T work
Source: Matt Stout, Boston Herald, July 8, 2015

Gov. Charlie Baker said a budget measure to suspend the so-called Pacheco Law at the MBTA and open the beleaguered agency to more outsourced contracts isn’t an attempt at “privatizing the T” — but he wants to prove it works. … They included language lifting for three years the provisions of the Pacheco Law, which puts up high hurdles to bringing in private work, and creating a fiscal control board to oversee the transit agency, something Baker called the “most important” part of reforms. A separate MBTA reform bill remains in the House, but the suspension of the Pacheco Law — despite waves of protest from unions and some in the Senate — proved a victory for Baker….

Watchdog Finds Uneven Assessment of Army Contractors

Source: Neil Gordon, Project on Government Oversight, July 28, 2016

The U.S. Army is not consistently following the rules for evaluating contractor performance, according to a Department of Defense Inspector General (IG) report released on Monday. … The IG reviewed 56 PARs prepared by five Army components on contracts worth a total of $1.5 billion. The IG found 52 of the 56 PARs were incomplete or did not include sufficient written justifications for the performance ratings given. For example, officials rated some contractors as “exceptional” or “very good,” but the IG determined that the written narratives justified a lower “satisfactory” rating. Additionally, 21 of the 56 PARs were not prepared within the required timeframe of 120 days, and the average delay among all five components was 59 days. The average delay at the Army Corps of Engineers’ Engineering Support Center in Huntsville, Alabama was an astonishing 146 days. …

Senate Cafeteria Workers Will Receive $1 million in Backpay from Restaurant Associates

Related: Lauren Godles, On Labor, July 26, 2016

Today, the Department of Labor announced today that the Senate cafeteria workers who were illegally denied wages will receive $1 million dollars in backpay from Restaurant Associates (RA) and its subcontractor, Personnel Plus. The money will be split among 674 employees, though DOL did not specify how much particular individuals will receive. … In an official investigation, DOL’s Wage and Hour Division (WHD) concluded that RA misclassified the cafeteria workers, in violation of the Service Contract Act. RA was also found to have violated the FLSA. According to the Associated Press, the WHD is considering whether RA should be banned from future government contracts. …


Most Senate cafeteria workers were mistreated on wages, top Capitol official says
Source: Mike DeBonis, Washington Post, March 21, 2016

A majority of the roughly 90 blue-collar restaurant workers serving the U.S. Senate were improperly classified by their private employer, a top U.S. Capitol administrator told a congressional committee last week, putting them at risk of being underpaid and prompting a Labor Department inquiry into the matter. The workers employed by Restaurant Associates have sought higher wages for more than a year, and a December contract renegotiation appeared on its face to deliver better pay and benefits. But several workers said they were subsequently reclassified into new, lower-paying jobs, thus cheating them out of the raise they were expecting. … Ayers’s deputies then interviewed 86 of the cafeteria and restaurant employees. That inquiry determined that 35 employees were classified properly, said Laura Condeluci, a spokeswoman for Ayers; the other 51 were not. Restaurant Associates immediately reclassified 35 of the 51 misclassified workers and delivered back pay, leaving 16 in dispute, Ayers said. Half of those are being resolved through negotiations; the rest have been referred to the U.S. Department of Labor for resolution.

Senate Cooks Say Contractor Dodged Raises
Source: Rhonda Smith, Daily Labor Report, February 1, 2016 (Subscription Required)

The seven-year contract extension between Restaurant Associates and the AOC took effect Dec. 14. As a result, Restaurant Associates increased wage rates for about 80 percent of the 115 employees who work in Dirksen Senate Office Building eateries and in the Senate dining room. In the complaint, signed by attorney George W. Faraday, legal and policy director for Good Jobs Nation, the group said the minimum wage rates to which Compass Group employees at the Senate are legally entitled are established by the federal Service Contract Act for each occupational category. The letter notes that the new wage rates resulted in substantial wage increases for Compass workers classified in the lowest-paid SCA occupational categories, including cashiers, dishwashers and food-service workers. But the federal contractor downgraded various cooks to food-service worker positions, it added, which reduced their hourly wage rate. …

Senate Food Workers Allege ‘Raise Theft’
Source: Bridget Bowman, Roll Call, January 29, 2016

According to the complaint, congressional staff members were told at a Dec. 14 briefing that minimum wages for Level 1 cooks would be raised by $3.65, to $17.45 an hour, and Level 2 cooks would would receive a $5.70 increase to $19.50 an hour. But the complaint alleges several cooks were reclassified as a lower-tier “food service worker,” meaning their wages did not increase as expected. Under the new contract, food service workers’  minimum wage increased to $13.80 per hour. A labor organizer said so far they know of roughly a dozen workers who have had their classification downgraded, even though they still perform the duties of a cook.
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MANCI auction set for cattle, farm equipment

Source: Lou Whitmire, Mansfield News Journal, July 26, 2016

The beef cattle that graze outside the Mansfield Correctional Institution farm on Ohio 13 and related farm equipment will be sold at auction on Oct. 28 and 29. The Ohio Department of Rehabilitation and Corrections is seeking bids to secure an auctioneer to sell farm equipment and about 415 beef cattle at its Ohio Penal Industries Farm Facility, 1150 N. Main St. According to the state documents, beef farming equipment will be sold at auction on Oct. 28 from the state prison. ODRC’s estimated aggregate value of the farm equipment designated is $550,000 to $750,000. … In April, ODRC announced the state prison farm operated at Mansfield Correctional Institution was among 10 agricultural operations Ohio is shutting down in a move to raise millions of dollars to fund new rehabilitation and job-training programs for inmates through land sales. Earlier, Ohio Civil Service Employees Association officials said the move was announced “without much explanation, rationale or plan” in a conference call to the union. The Mansfield prison operated one of the state’s larger prison operations, with 1,485 acres of farmland, a beef herd of 350 cows and a beef finishing operation of 500 head, it was reported in April. Other affected prisons include Marion (995 acres), Pickaway (1,200 acres), Chillicothe (1,809 acres) and the Southeastern Correctional Complex (578 acres). The acreage figures include both state-owned land and land used through partnerships. …


Ohio seeks bids to sell prison farm beef cattle, farm equipment
Source: Chris Kick, Farm and Dairy, July 25, 2016

The Ohio Department of Rehabilitation and Correction is seeking bids for an auctioneer to sell 415 head of beef cattle and farming equipment, from the Mansfield prison farm. Known as the Mansfield Correctional Institution, it is one of about 10 locations the state announced it will close in an April 12 decision, that calls for the closure and sale of Ohio’s prison farms. Bids to sell the cattle and farm equipment will be opened July 29, according to documents provided by the Ohio Office of Procurement Services. The auction would take place Oct. 28-29, at the Mansfield prison farm. The herd consists of registered Angus cattle, including breeding stock, some which were shown at the Ohio Beef Expo in Columbus. … The corrections department, and Ohio Gov. John Kasich, are also the center of a Franklin County lawsuit by the state’s labor union, the Ohio Civil Service Employees Association, which alleges that state employees were not afforded their bargaining rights, and that selling the livestock will disrupt their jobs. The decision to sell the farms came at a time when the state was in the finishing stages of a $9 million renovation at two of the farms, which included new dairy and beef facilities, and a new dairy milking parlor. …

Ohio prison system buying milk after selling cows
Source: Chris Kick, Farm & Dairy, June 22, 2016

With its dairy cows now sold, the Ohio Department of Rehabilitation and Correction is buying about $2.6 million in milk to supply its prisons. An existing contract between the state and several Ohio dairy suppliers was expanded in late May to supply about 1.3 million gallons of milk to prison facilities. … The move from milking to buying comes after an April 12 decision by the corrections department to get out of the farming business, and sell most of the prison farm assets, including land and cattle. Selling the land will require legislative approval and is still pending. The department said it could better use the money within prison walls, to provide more meaningful rehabilitation for inmates seeking jobs after being released. The department also cited concerns that the farms were being used by inmates to bring contraband into the prisons.

Ohio prisons need $2.6 million in milk money after selling dairy cows
Source: Alan Johnson, Columbus Dispatch, June 15, 2016

After selling off its dairy herd, Ohio prisons will pay $2.6 million a year to buy milk for 50,000 inmates. An existing state contract with four Ohio dairies was expanded on May 31 to include milk for state prisons, according to records from the Ohio Department of Administrative Services, the business arm of state government. The state needs about 1.3 million gallons of milk annually for inmates. … In the meantime, the Ohio Department of Rehabilitation and Correction has sold about 1,000 dairy cows. Another approximately 2,000 beef cattle are scheduled to be sold this fall. The milk money is needed because of the April 12 decision by the prisons agency to get out of the farm business. The announcement came as a surprise, especially as the department was in the final stages of completing nearly $9 million in improvements to the prison farms. … Some have suggested other possible reasons for the quick turnaround, including potential buyers eager to snap up 7,000 or more acres of farmland at 10 sites across the state. …

Tentative interest in prison farm land surfaces
Source: Chris Balusik, Chillicothe Gazette, May 8, 2016

About 220 inmates work on the farms at the height of the farming season, and Mohr believes the millions of dollars that could be raised through the land sales could end up helping thousands more inmates through job training programs, rehabilitation efforts, transitional housing and rehabilitation services. The sales, expected to result in the end of prison farms by 2017, may face a stumbling block. The Ohio Civil Service Employees Association, a union with 56 members who work at the farms as farm coordinators and dairy operators, filed a temporary restraining order Thursday in the Franklin County Court of Common Pleas to stop the closure of the 10 prison farms. … Union president Christopher Mabe also doesn’t understand why a prison farm operation that was looking at expansion of facilities in London and Marion to boost meat and dairy production for the prison system is now looking to shut down. …

State to shutter 10 prison farms, sell off land
Source: James Ewinger, The Plain Dealer, April 12, 2016

The state is shutting down its century-old prison-farm system to save money and focus on new rehabilitation programs, according to the Associated Press. Christopher Mabe, president of the 30,000-member Ohio Civil Service Employees Association, said in a telephone interview Tuesday the move was political but said it was evident from conversations with state officials that they don’t quite know what they are going to do. The union represents 8,000 employees in the Ohio Department of Rehabilitation and Corrections, including more than 50 who work at the 10 prison farms, one of which is at Grafton in Lorain County. … The Columbus Dispatch reported that ODRC plans on eliminating all 10 farms covering 12,500 acres, with 2,300 beef cattle and 1,000 dairy cattle, by the end of the year. The state will continue farming this year but prepare to auction off livestock and stop farming by 2017, prisons director Gary Mohr told The Associated Press. … Prison officials said the state will keep open a 21,000-square-foot meat-processing plant at the Pickaway Correctional Institution in Orient, Ohio. The state may partner with a private company to get more business for the plant, according to the Dispatch. However, a milk-processing plant is expected to close.

State to close all 10 prison farms, sell land
Source: Alan Johnson, Columbus Dispatch, April 12, 2016

Mohr said the closings will affect about 70 staff members and 220 inmates during the peak season. They will be moved to different jobs inside the prisons, but no layoffs are planned. State prisons have been in the farming business a very long time, dating back to 1868 when the first farming operation was proposed for the old Ohio Penitentiary in Columbus. Prison officials said the reason for shutting down the century-old farm operations is not financial, although the state expects to harvest some revenue by selling 7,000 or more acres of farm land. … The Ohio Civil Services Employees Association, the union representing 30,000 state workers including prison employees, criticized the announcement as being done “without much explanation, rationale or plan.” The union said the closings will affect 56 union members who are farm coordinators.

Ohio shutting down prison farms, selling land
Source: Linda Martz, WKYC, April 12, 2016

State prison management told union officials that most farm production would be phased out by the end of 2016, including raising cattle and crops, as well as beverage and milk processing. The OCSEA said the farms have been in existence for over a hundred years “and have been, for the most part, self-sustaining.” In a press release, the union said the farm programs have also been centerpieces for inmate programming and skill-building, with inmates being taught how to operate heavy machinery, weld, drive large vehicles, repair equipment and use a variety of farm tools. … For years, powerful private food lobbyists, like the meat industry, have been lobbying the Ohio Statehouse in an effort to shut down the prison farms and take over the business, union officials said. … Aramark, Ohio’s private prison food vendor, which has been cited for food spoilage, has said it wants to ditch real milk for powdered milk that won’t spoil, the OCSEA said. Aramark has complained of a contract provision that requires it to purchase milk and beef from Ohio Prison Industries, union officials said.