The U.S. Department of Education’s (ED) mission is to promote student achievement and preparation for global competitiveness by fostering educational excellence and ensuring equal access. ED supports initiatives to help expand opportunities and improve education for students from early childhood to adulthood, particularly approaches that are based on evidence of potential or actual success. Pay for Success (PFS) can be used to support evidence-based approaches by leveraging private investment to address societal problems and challenges while typically using government funds to pay only when measurable, positive outcomes are attained. This tool kit is an introductory guide for state and local governments and other stakeholders interested in exploring the possibility of a PFS project for education or related societal issues. It provides information to support stakeholders in determining if PFS is a viable financing strategy for them; it lays out steps usually involved in conducting a feasibility study and highlights critical questions and important safeguards to consider in using PFS. The Appendix includes tools that may be useful for PFS projects, including definitions of terms used throughout the document. …
Source: Roberta Rampton, Reuters, November 2, 2017
U.S. President Donald Trump on Thursday agreed to expand the use of disaster aid to help rebuild Puerto Rico’s power grid and other infrastructure wrecked by Hurricane Maria, the White House said. In a unique agreement recognizing both the massive devastation on the island and its dire financial problems, aid from the Federal Emergency Management Agency (FEMA) for infrastructure projects will be released in a faster, more flexible way than is typical after disasters, a senior White House official told Reuters. The plan, agreed to with Puerto Rico Governor Ricardo Rossello, will also provide for third-party advisers to estimate how much money is requires for big-ticket projects, and how it is spent – a provision aimed at protecting taxpayer dollars in what is expected to be a massive, long-term effort to rebuild the island. …
Puerto Rico Lays Out Energy Future With Tesla, Privatization
Source: Jonathan Levin, Bloomberg, October 22, 2017
A Puerto Rican official who has been in talks with Tesla Inc. said the island is serious about transforming its energy infrastructure after it was leveled by Category 4 Hurricane Maria, despite questions about how such an overhaul would be funded. Speaking in a telephone interview Sunday, Department of Economic Development and Commerce Secretary Manuel Laboy said Puerto Rico’s government understands its skeptics: The island’s finances are shot and its electricity system is in tatters. But he said the U.S. territory has a historic opportunity to use federal funds to modernize an aging and weak power grid. At the core of the argument is the government’s belief that funding related to the Federal Emergency Management Agency, or FEMA, can be used to build a new system, not just repair the old one, so that it won’t be susceptible to collapse when the next storm hits. Laboy said Governor Ricardo Rossello’s government is prepared to make its case. …
Puerto Rico taps public private partnerships to boost economy
Source: Robert Slavin, Bond Buyer, October 19 2017
…The island government said Monday that it’s working on six public private partnership projects that would lead to $300 million to $400 million of investment in projects ranging from a hydroelectric dam to student housing. Puerto Rico will seek requests for qualifications for three of the projects and it is already working with companies on the other three. If the projects go forward, they would boost an economy that has been struggling with long-term economic decline compounded by the impacts of two major hurricanes in the last two months….
Elon Musk Is Not the Hero Puerto Rico Needs
Source: Kate Aronoff, In These Times, October 11, 2017
… According to a tweet from the governor late last week, the two are now in talks about bringing renewable energy from Musk’s Tesla and SolarCity operations to the island, whose long-embattled public utility—the Puerto Rico Electric Power Authority (PREPA)—was decimated by Hurricane Maria. … On the one hand, the talks can be seen as a positive development: More than 80 percent of the island remains without power, and the storm could be a once-in-a-lifetime opportunity for Puerto Rico to get back online and become a leader in the transition away from fossil fuels. But the budding friendship between Rossello and Musk is also taking place in the context of a massive attempt to privatize Puerto Rico’s electric utility. Musk’s companies could deliver tangible improvements to Puerto Rico’s grid, but they could also prime the pump for a corporate takeover of the United States’ largest public power provider, putting decisions like who gets power and how much it costs into the hands of corporate shareholders. …
Puerto Rico Faces Restart on Financial Plan After Maria
Source: Heather Gillers and Andrew Scurria, Wall Street Journal, September 26, 2017
It took months to put together a financial overhaul plan for Puerto Rico. Now officials may have to start over following Hurricane Maria. The federal board supervising Puerto Rico’s bankruptcy plans to meet Friday and is likely to discuss possible changes to a commonwealth fiscal plan it approved in March, according to a person familiar with the matter. The conversations could affect the severity of write downs on Puerto Rico’s $73 billion in debt.
… Reconstructing Puerto Rico’s power grid may prove particularly costly because of financial difficulties at its struggling electric utility. … Congress is starting to debate how best to rebuild Prepa. Setting up a reliable power system will require expensive modernization using federal dollars. Prepa is a flashpoint in Puerto Rico’s financial crisis because power rates are a drag on family incomes and company budgets. The oversight board has said it wants to privatize power generation to lower costs and transition Prepa to a regulated utility model. Creditors are skeptical of privatization, concerned that by selling off assets Prepa would lose the revenue streams backing its debt. But raising power rates to repay creditors is politically toxic in Puerto Rico, where the cost of importing fuel from oil tankers has driven power prices higher than in any U.S. state but Hawaii. …
Puerto Rico’s bondholders worried after Hurricane Maria turns out lights
Source: Francine McKenna, MarketWatch, September 21, 2017
If Puerto Rico is without power for months after Hurricane Maria, as authorities now warn, many investors in the $9 billion of Puerto Rico’s outstanding electric utility bonds risk never seeing their money. … The plight of Prepa bondholders—Prepa is Puerto Rico’s main supplier of electricity—was grim even before Irma. … Prepa’s bonds, $9 billion worth, are revenue bonds whose funding stream is based on collecting customer fees. Even before Hurricane Maria knocked power out for good, bondholders were worried that Prepa would deliberately force some plants offline, jeopardizing the collateral, creating justification for a privatization plan that could leave current bondholders high and dry. Proponents argue that a brand new electric authority, free of debt, would be a huge boon to the Puerto Rican economy. …
Hurricane Irma Unleashes the Forces of Privatization in Puerto Rico
Source: Kate Aronoff, Angel Manuel Soto, and Averie Timm, The Intercept, September 12, 2017
For struggling governments around the world, privatizing utilities has come to be seen as a kind of get-rich-quick scheme, offering an upfront infusion of cash to underfunded municipalities. Given Prepa’s size and that of its debt — $9 billion — it has been a long-standing target for privatizers, even before Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act last year to help rein in Puerto Rico’s mounting debt crisis. The blackout following Irma just added fuel to the fire. Days before Irma hit, Rosselló emphasized that privatization is firmly on the table, telling the New York Times that Irma “can become an opportunity or another liability.” …
Irma Grazes Puerto Rico but Lays Bare an Infrastructure Problem
Source: Luis Ferré-Sadurní, New York Times, September 10, 2017
As government workers cleared roads obstructed by uprooted trees and repaired toppled electricity lines, residents of Puerto Rico felt some relief that the eye wall of Hurricane Irma had skirted the island on its recent rampage through the Caribbean. But while the commonwealth had largely been spared the 185-mile-an-hour gusts that had flattened its smaller island neighbors, hundreds of residents still lost their homes, at least three people died and almost 70 percent of households were plunged into darkness. The storm knocked out Puerto Rico’s fragile power grid, exposing the island’s decrepit infrastructure and raising questions about its future viability amid a worsening economic crisis.
… How a commonwealth going through a decade-long recession will be able to pay for much-needed upgrades is the key question. One option is to turn to the private sector, local economists say. Private investments, Mr. Rosselló said, could be accelerated under a provision of a contentious new law called Promesa, which placed the island’s finances under the oversight of a federal board. The provision could expedite and facilitate the process for private investment in electric, highway and water projects. … But the idea of privatizing public utilities is a divisive one on the island. The electrical workers’ union fears that the government purposely let Prepa deteriorate over time to justify privatizing it. …
Puerto Rico wasn’t ready for Hurricane Irma. We couldn’t possibly be.
Source: Carla Minet, Washington Post, September 7, 2017
On the surface, Puerto Rico was as ready as it could be for Hurricane Irma. Government agencies and Gov. Ricardo Rosselló have been taking a proactive, hands-on approach. President Trump has declared a state of emergency, which will generate emergency funds from the federal government. Refugees from the northeastern corner of the island, where Irma’s Category 5 winds already reached Wednesday afternoon, were arriving in shelters. … But Irma — a storm the likes of which we haven’t seen here in decades — is heading for an island whose resources to truly prepare for an emergency are already in grave doubt. … Now Irma may be used as a new rationale for the strategy of privatizing the public service by the Fiscal Control Board, whose members have publicly declared support for selling off the utility. The agency announced that 44 percent of the population — 692,350 clients — were already without electricity service by Wednesday afternoon. …
Government labor strife is latest test for fractured Puerto Rico
Source: Nick Brown, Reuters, August 30, 2017
Puerto Rico’s already frail economy faces a fresh test this week, as the bankrupt U.S. territory’s financial overseers try to force a defiant governor to furlough public workers, the single biggest block of employees on the island. An escalating power struggle between the democratically elected Governor Ricardo Rossello and the federally appointed oversight panel culminated on Monday when the board sued Rossello, saying he had no authority to reject pension cuts and furloughs ordered by the board. The measures are set to begin Sept 1. A competing lawsuit from the American Federation of State, County and Municipal Employees (AFSCME), which represents 12,000 Puerto Rican workers, argues the exact opposite – that the measures violate the U.S. Constitution, and should be halted. At least six unions are staging protests on Wednesday to oppose the austerity, featuring a midday march to the board’s San Juan offices. … Noting a Rossello initiative to privatize some public assets, Eiler said “the unions’ cooperation is imperative” for public-private partnerships. …
Hedge Fund Sues to Have Puerto Rico’s Bankruptcy Case Thrown Out
Source: Mary Williams Walsh, New York Times, August 7, 2017
A hedge fund sued on Monday to have Puerto Rico’s bankruptcy case thrown out, arguing that the federal oversight board guiding the island’s financial affairs was unconstitutionally established. In a lawsuit filed in United States District Court in San Juan, the hedge fund, Aurelius Capital, cited the “appointments clause” of the United States Constitution, which calls for all principal officers of the federal government to be appointed by the president, and then confirmed by the Senate. That did not happen when the seven members of the Financial Oversight and Management Board for Puerto Rico were selected, Aurelius said in its motion to dismiss the bankruptcy-like proceedings. …
Puerto Rico Teachers’ Union-AFT Join Forces Amid Debt Woes
Source: Jaclyn Diaz, Daily Labor Report, August 4, 2017 (subscription required)
The economic devastation in Puerto Rico has pushed the American Federation of Teachers to lend a hand to the island’s educators. Asociación de Maestros de Puerto Rico will continue to represent the 40,000 plus Puerto Rican educators. It signed a three-year affiliation agreement with the 1.6 million-member AFT to help it combat the island’s economic challenges, the two unions announced Aug. 3. … AFT and AMPR will work together to fight austerity measures and privatization on the island, Randi Weingarten, AFT president, told Bloomberg BNA Aug. 4. AFT will lend resources to help AMPR train teachers for the future and to bring in legal assistance to fight the fiscal plan adopted by the Puerto Rican government, she said. …
Is Congress’ plan to save Puerto Rico working?
Source: Edwin Melendez, San Francisco Chronicle, July 31, 2017
A year ago, Congress cobbled together a plan to try to save Puerto Rico from its US$123 billion debt and pension crisis without costing American taxpayers a penny. The law, signed by former President Barack Obama on June 30, 2016, effectively steered Puerto Rico into bankruptcy-like proceedings in federal court to prevent a massive default, while saddling the commmonwealth with an oversight board to ensure it put its fiscal house in order. Though the vote was bipartisan, critics called it a “Band-Aid” that would do little to solve Puerto Rico’s core problems: unsustainable debt that has kept the country mired in recession for almost a dozen years. …
For Sale: Puerto Rico
Source: Heather Gillers, Wall Street Journal, June 26, 2017
Puerto Rico has no cash and can’t borrow money anymore. So it is looking to sell itself off in parts. The troubled U.S. territory is preparing to seek bids in coming months from private companies willing to operate or improve seaports, regional airports, water meters, student housing, traffic-fine collections, parking spaces and a passenger ferry, according to a government presentation reviewed by The Wall Street Journal.
The Bankers Behind Puerto Rico’s Debt Crisis
Source: Michelle Chen, The Nation, June 8, 2017
Puerto Rico’s economic crisis has now washed the burden of its colonial legacy onto Washington’s doorstep. Congress has been trying to contain the island’s ballooning debt under the hardline austerity program of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). But since the program is governed by a control board run by the same financiers responsible for driving the debt crisis in the first place, the island continues to sink into poverty while its creditors feast on the spoils. To underscore how Puerto Rico’s revolving door of big finance and politics is underwriting the debt crisis, a report by the AFL-CIO and the community-labor coalition Committee for Better Banks (CBB) traces the career of the head of PROMESA, Carlos M. García, from his role as a head banker of Santander to his current political post overseeing the privatization and pillage of Puerto Rico’s anemic public assets.
Puerto Rico strikes second restructuring deal with bondholders
Source: Hazel Bradford, Pensions & Investments, May 15, 2017
Puerto Rico reached a restructuring agreement with bondholders invested in the commonwealth’s Government Development Bank, officials announced Monday in San Juan. … Puerto Rico’s Federal Affairs Administration said in that statement that GDB creditors “have agreed to substantial discounts to the principal,” but did not provide further details on the agreement, which calls for bondholders to exchange claims for one of three tranches of bonds issued by a new municipal entity. The new bonds will have varying principal amounts, interest rates, collateral priority, and other payment terms. It is the second agreement reached with bondholders and Gov. Ricardo Rosello, following one announced April 6 with holders of bonds issued by the Puerto Rico Electric Power Authority. The PREPA agreement restructures $9 billion in debt by offering them 85 cents on the dollar, and giving PREPA more time to begin making payments. …
Puerto Rico board extends budget deadline by two weeks
Source: Robert Slavin, Bond Buyer, May 9, 2017 (Subscription Required)
The Puerto Rico Oversight Board extended the deadline for Puerto Rico Gov. Ricardo Rosselló to submit a fiscal year 2018 budget by two weeks. Board chairman José Carrión III told Rosselló that the board had originally set May 8 as the deadline for either the board approving the governor’s budget or notifying the governor of violations and providing a description of corrective actions. “We have received a working draft of the proposed budget and are reviewing the submission and its completeness,” Carrión wrote Monday. “The board will provide the governor an additional 14 days to amend and improve the submission before it approves it or identifies violations.” …
Puerto Rico unveils energy PPPs amid economic turmoil
Source: David Casallas, BNamericas, May 5, 2017
Puerto Rico’s embattled government released a list of priority project proposals for this year, among them energy sector initiatives that would be carried out through public-private partnerships (PPP). The projects envision natural gas use at power utility AEE’s residual fuel oil fired-plants Costa Sur (990MW) and Palo Seco (602MW) which would cost US$150mn-265mn and US$200mn-360mn, respectively. Information from the Puerto Rico Public-Private Partnerships Authority also reveals that AEE seeks partners to develop renewable energy projects, including photovoltaic and wind, for between US$100mn and US$700mn. …
Puerto Rico Declares a Form of Bankruptcy
Source: Mary Williams Walsh, New York Times, May 3, 2017
With its creditors at its heels and its coffers depleted, Puerto Rico sought what is essentially bankruptcy relief in federal court on Wednesday, the first time in history that an American state or territory had taken the extraordinary measure. The action sent Puerto Rico, whose approximately $123 billion in debt and pension obligations far exceeds the $18 billion bankruptcy filed by Detroit in 2013, to uncharted ground. While the court proceedings could eventually make the island solvent for the first time in decades, the more immediate repercussions will likely be grim: Government workers will forgo pension money, public health and infrastructure projects will go wanting, and the “brain drain” the island has been suffering as professionals move to the mainland could intensify. …
Puerto Rico faces bank closure, privatizations
Source: Danica Coto, Associated Press, April 28, 2017
Puerto Ricans will be facing a water rate increase, privatization of government operations and the closure of a bank that once oversaw the island’s debt transactions, officials said Friday as they worked on measures to offset an economic crisis. Some of the changes were outlined in new fiscal plans presented to a federal control board overseeing the island’s finances. The plans for four heavily indebted Puerto Rico agencies will be amended in upcoming weeks, although officials noted that the water rate increase will start in January and that the Government Development Bank will be liquidated within a decade. The board recently approved an overall fiscal plan for the central government that contains several austerity measures. …
Puerto Rico pushes to privatize operation of public services
Source: Danica Coto, Associated Press, April 20, 2017
Puerto Rico is ready to sign dozens of new deals to privatize the operation of public services as government funds dwindle amid a decade-long recession, the island’s governor told some 800 investors attending a two-day financial summit Thursday. Gov. Ricardo Rossello said public-private partnerships could create up to 100,000 new jobs and generate some $5 billion in the next three years for a U.S. territory mired in economic crisis and its government facing a $70 billion public debt load that it is struggling to restructure.
AFSCME Pres. Lee Saunders on Puerto Rico Fiscal Plan
Source: AFSCME Press Release, March 13, 2017
AFSCME Pres. Lee Saunders issued the following statement on the oversight board’s approval of a fiscal plan for Puerto Rico: “The plan approved by the Oversight Board will have devastating consequences for the people of Puerto Rico, especially its most vulnerable citizens. The plan adopts an austerity approach that will slash services, cut pensions and create yet more economic hardship for Puerto Ricans. The winners are wealthy investors who stand to gain from the mass privatization of the services that remain. These actions are the foreseeable result of an anti-democratic law adopted by the last Congress. The people of Puerto Rico have been forgotten; we call on the federal government to act quickly to restore services and pensions.”
Board to Puerto Rico: Cut Pension System, Impose Furloughs
Source: Danica Coto, Associated Press, March 13, 2017
A federal control board on Monday said Puerto Rico’s government needs to cut its public pension system by 10 percent, furlough tens of thousands of its workers and eliminate Christmas bonuses if it cannot generate other types of savings amid a nearly decade-long recession. The seven-member board created by Congress last year to oversee the U.S. territory’s finances voted unanimously to add those measures to a 10-year fiscal plan presented by the island’s governor that the panel approved Monday. The measures will be implemented if the government fails to find other ways to cut spending and increase revenue. Board members said the spending cuts will be necessary so the government will have enough funds to pay for essential services such as education, health and public safety. … The plan drafted by the government and approved by the board also will cap some Medicaid benefits, effectively raise property taxes and scrap some infrastructure projects while possibly turning ferries, ports and parking lots over to private companies. It will freeze salaries until 2020, seeks to privatize the generation of power and increase motor vehicle license fees by 10 percent. …
Puerto Rico governor wants fewer austerity measures
Source: Danica Coto, Associated Press, March 1, 2017
Puerto Rico’s governor submitted an austerity plan made public on Wednesday that would cut deeply into the U.S. territory’s budget while avoiding some of the most painful measures recommended by a federal control board that is overseeing the island’s effort to confront a debt crisis that has led to repeated defaults. Gov. Ricardo Rossello’s plan would cap some Medicaid benefits, effectively raise property taxes and collect a tax on internet purchases. It would also scrap some infrastructure projects and could turn ferries, ports and parking lots over to private companies. But it would fall short of the board’s recommendation of a 30 percent cut in payroll costs and 10 percent reduction in the government pension system, which is on track to run out of money next year. …
With school choice efforts stalled in Washington, the billionaire Koch brothers’ network is engaged in state-by-state battles with teachers’ unions, politicians and parent groups to push for public funding of private and charter schools. One of the newest campaigns is the Libre Initiative, a grassroots drive targeting Hispanic families in 11 states so far, under the umbrella of the Charles and David Koch-funded Americans for Prosperity, a powerful conservative and libertarian advocacy group. … The group has had some initial success — for instance, helping to thwart a moratorium on charter school expansion in New Mexico. But it’s also created bitter divisions in the Latino community and led to accusations the Kochs are trying to undermine public education — and even in some cases, to subvert the Democratic process.
… Despite such criticism, the group is hunkering down for the long haul in states it views as ripe for change even as it eyes new states for expansion. Lima says it’s on track to make contact with more than 100,000 Hispanic households this year on school choice. Besides Nevada and New Mexico, Libre is organizing in Arizona, Colorado, Virginia, Florida, North Carolina, Ohio, Pennsylvania, Texas and Wisconsin. Its recent efforts, with other Koch-backed groups, include:
- A planned “six-figure” spend in Nevada on “deep canvassing” in Hispanic neighborhoods to build support for educational savings accounts, which enable families to use state tax dollars to pay for private school. …
- A lawsuit brought by Americans for Prosperity, among others, aimed at stopping a 2018 Arizona referendum asking voters whether they want to keep a school choice law passed earlier this year. …
- A “six-figure” Libre and Americans for Prosperity campaign in Colorado this summer to promote charter schools and education savings accounts and another ahead of a Nov. 7 school board race by the Americans for Prosperity Foundation to push choice-friendly issues.
- A seven-figure investment In Virginia’s gubernatorial race by Americans for Prosperity that includes a video criticizing Virginia Lt. Gov. Ralph Northam, a Democrat, for his opposition to education savings accounts.
- Mailings in Spanish and English supporting a Florida law that encourages charter schools in communities with low-performing schools. After Gov. Rick Scott, a Republican, signed it into law, the state Democratic Party said he’d “declared war on our public schools.” …
A task force has recommended how to shrink the state’s pension-fund deficit by $5 billion, and two of the suggestions – including privatizing the state’s public universities – got a cold reception from Gov. Kate Brown. Brown thanked the seven members of her task force for their research and commitment to identify ways for Oregon to keep its promise to retirees. She had convened the task force to identify opportunities to pay up to a quarter of the Public Employee Retirement System, or PERS, unfunded liability. That deficit has ballooned to at least $25.3 billion. … Governor Brown has also expressed to staff serious concerns about the task force’s proposals to privatize public universities and sell SAIF.
Source: Maria Danilova, Associated Press, October 30, 2017
The Education Department is considering only partially forgiving federal loans for students defrauded by for-profit colleges, according to department officials, abandoning the Obama administration’s policy of erasing that debt. Under President Barack Obama, tens of thousands of students deceived by now-defunct for-profit schools had over $550 million in such loans canceled. But President Donald Trump’s education secretary, Betsy DeVos, is working on a plan that could grant such students just partial relief, according to department officials. The department may look at the average earnings of students in similar programs and schools to determine how much debt to wipe away. …
States Sue Over Scrapping of Obama-Era Rules on For-Profit Colleges
Source: Douglas Belkin, Wall Street Journal, Oct. 17, 2017
A coalition of Democratic attorneys general from 18 states and the District of Columbia filed a lawsuit Tuesday against the U.S. Education Department and Secretary Betsy DeVos for not enforcing an Obama-era rule intended to protect students and taxpayers from predatory for-profit schools. In June, Mrs. DeVos suspended the so-called “gainful employment” rules before they took effect. If enacted they would have cut off federal funding for schools where students leave with high debt and end up in jobs with low salaries. The suit, filed in the U.S. District Court in Washington, D.C., calls Mrs. DeVos’s suspension of those rules “unlawful” and accuses her of trying to “run out the clock” through a series of delays until she can implement new regulation…..
Trump and DeVos fuel a for-profit college comeback
Source: Michael Stratford, Politico, August 31, 2017
For-profit colleges are winning their battle to dismantle Obama-era restrictions as Education Secretary Betsy DeVos rolls back regulations, grants reprieves to schools at risk of losing their federal funding and stocks her agency with industry insiders. More than seven months into the Trump administration, DeVos has: Moved to gut two major Obama-era regulations reviled by the industry that would have cut off funding to low-performing programs and made it easier for defrauded students to wipe out their loans; Appointed a former for-profit college official, Julian Schmoke Jr., to lead the team charged with policing fraud in higher education — one of a slew of industry insiders installed in key positions. …. Stopped approving new student-fraud claims brought against for-profit schools. The Education Department has a backlog of more than 65,000 applications from students seeking to have their loans forgiven on the grounds they were defrauded, some of which date to the previous administration. …
Source: Jeffrey Solocheck, Tampa Bay Times, November 1, 2017
The chairwoman of the State Board of Education, charged with supervising Florida’s system of free public education, has proposed amending the state Constitution to permit funding of some private schooling. Marva Johnson, a Gov. Rick Scott appointee to the state board and the Florida Constitution Revision Commission, filed a proposal Tuesday to exempt education from the state’s constitutional ban on using public funds for religious organizations. She further recommended that state money go to private schools, including religious ones, to support students whose individual learning needs are not “completely met and accommodated” at their zoned public schools. … The proposal is a long way from becoming reality. The commission would have to approve it, as would 60 percent of Florida voters. But if the Constitution were amended as Johnson has proposed, it would set up a major shift, paving the way for state-funded school vouchers, something the Florida Supreme Court ruled a decade ago violate the Constitution. …
Lawmakers, local elected officials and policy experts are calling for reform after an Orlando Sentinel investigation revealed that private schools take nearly $1 billion in state scholarships but have little oversight. The Sentinel series detailed how private schools can submit falsified fire inspections and hire teachers with criminal backgrounds — sometimes without Florida Department of Education officials noticing for years. Sen. David Simmons, a Republican member of the education committee, said he is considering legislation to enact reforms. …
State revokes Melbourne private school’s scholarships
Source: Beth Kassab and Leslie Postal, Orlando Sentinel, October 24, 2017
A private school in Melbourne with ties to two other schools already sanctioned by the state will be revoked from Florida’s scholarship programs, the Florida Department of Education said Tuesday. Yakol Christian opened in August with fewer than 20 students, all of them on one of the state’s three scholarship programs that pay nearly $1 billion in private school tuition for children from low-income families or those with a wide range of disabilities. The Orlando Sentinel reported last week that the church that shares the same name and storefront space as the school has ties to a pastor who ran two earlier schools and was charged earlier this year with lewd or lascivious molestation after a 15-year-old student said he improperly touched her. Samuel Vidal, 41, denies the allegations through his attorney and no trial date has been set. …
After student alleges abuse, principal shutters one private school, opens another.
Source: Annie Martin, Leslie Postal and Beth Kassab, October 18, 2017
After Palm Bay Police began investigating principal Samuel Vidal Jr., who was accused last year of lifting the shirt of a 15-year-old student and putting his mouth on her breast, Vidal shut down his private Christian school. But the police investigation didn’t stop Vidal, 41, from winning approval from the Florida Department of Education to open a new private school in Palm Bay and collect nearly $200,000 in state-backed scholarships. And even after Vidal was charged with felony lewd or lascivious molestation, prompting the state to pull scholarships from the second school, it approved yet another school this year with ties to Vidal. The case illustrates just how easy it can be for operators to open private schools with little scrutiny and to benefit from public scholarships in Florida, which runs one of the largest school choice programs in the country. …
Source: Erik Larson and Shahien Nasiripour, Bloomberg, October 24, 2017
The U.S. student loan industry is trying to dodge state investigations into allegedly abusive practices by claiming they’re preempted by federal law, a bipartisan group of attorneys general claimed. At least two national industry groups asked the Department of Education this year to issue formal guidance barring probes by states, arguing they duplicate federal efforts and needlessly expand regulations, according to copies of the letters obtained by Bloomberg News. Half the nation is balking. Twenty-five states including Texas, New York, Kansas and California on Tuesday urged Education Secretary Betsy DeVos to reject the requests, arguing that state probes have been effective in returning tens of millions of dollars to borrowers in recent years. …
Loans ‘Designed to Fail’: States Say Navient Preyed on Students
Source: Stacy Cowley and Jessica Silver-Greenberg, New York Times, April 9, 2017
In recent months, the student loan giant Navient, which was spun off from Sallie Mae in 2014 and retained nearly all of the company’s loan portfolio, has come under fire for aggressive and sloppy loan collection practices, which led to a set of government lawsuits filed in January. But those accusations have overshadowed broader claims, detailed in two state lawsuits filed by the attorneys general in Illinois and Washington, that Sallie Mae engaged in predatory lending, extending billions of dollars in private loans to students like Ms. Hardin that never should have been made in the first place. …
Navient Lawsuit Shatters GOP Privatization Myth
Source: David Dayen, The American Prospect, January 19, 2017
The Trump era is likely to usher in rapid privatization of public goods and services. … Behind these plans to sell off the public sector lies a philosophy that private enterprise can perform government roles more cheaply and efficiently. Perhaps nothing shatters this myth more than a lawsuit filed Wednesday against Navient, a company that administers payments on student loans. The Consumer Financial Protection Bureau (CFPB) and state attorneys general in Illinois and Washington state accuse Navient of “systematically and illegally failing borrowers at every stage of repayment,” using “shortcuts and deception” to rip off students. … Navient committed these alleged violations in part while fulfilling a federal contract for work that could indisputably have been performed by the public sector. … According to the complaint, Navient failed to correctly allocate borrower payments across multiple loans, sometimes ringing up late fees and defaults even when the borrower made the payment. The company steered borrowers into forbearance plans (a temporary break from payments) that increased interest due, rather than other repayment options. The CFPB estimates that $4 billion in unnecessary interest charges piled up on borrower accounts from 2010-2015 because of this. … The CFPB added that Navient gave student borrowers incorrect information for how to maintain eligibility for income-based repayment plans, which only take a sliver of a borrowers’ income every month. … But the Navient lawsuit doesn’t just reinforce why we need the CFPB. It shreds the argument for privatization, particularly of functions the government is perfectly capable of doing on its own. We could easily route student loan payments right to Uncle Sam. But instead, we push them through a predatory actor that needs to commit harm to make it worthwhile. …
Source: Eric Lipton, New York Times, October 27, 2017
For years, Betsy DeVos traveled the country — and opened her checkbook — as she worked as a conservative advocate to promote the expansion of voucher programs that allow parents to use taxpayer funds to send their children to private and religious schools. A detailed look at the first six months of Ms. DeVos’s tenure as the secretary of education — based on a 326-page calendar tracking her daily meetings — demonstrates that she continues to focus on those programs as well as on charter schools. Her calendar is sprinkled with meetings with religious leaders, leading national advocates of vouchers and charter schools, and players involved in challenging state laws that limit the distribution of government funds to support religious or alternative schools. …
DeVos prioritizes grants for school choice programs. But it won’t help all students.
Source: Elham Khatami, ThinkProgress, October 12, 2017
Secretary of Education Betsy DeVos unveiled a document Thursday outlining her policy priorities, and while it comes as no surprise that she intends to steer more grant funding to school choice programs, it’s unlikely that the programs will be effective. School choice, or programs that provide alternatives to traditional public schools, has been at the center of DeVos’ national education policy since she was appointed to the Trump administration. Indeed, President Trump’s proposed 2017-2018 budget from earlier this year calls for $1.4 billion to support investments in school choice, including an additional $167 million for the Charter Schools Program and $250 million for a school voucher proposal geared toward private schools — all while proposing $9.2 billion in cuts from other federal education programs. …
Betsy DeVos’ 6-month report card: More undoing than doing
Source: Associated Press, August 10, 2017
Since the inauguration of Donald Trump, the news cycle has been dominated by stories of White House controversy: a travel ban, North Korea, health care and more. Meanwhile, Secretary of Education Betsy DeVos has been busy fulfilling her conservative agenda that seeks to broaden school choice and market-based schooling in pre-K through higher education. As a researcher of education policy and politics, I’ve been following Secretary DeVos’ first six months in office. Here’s a quick look at what’s she’s done – and what’s been left in limbo. …
Source: Sharon (Yu Chun) Zhen, Daily Bruin, October 24, 2017
UCLA labor- and immigration-justice groups held a town hall meeting Monday night to urge UCLA to create more insourced positions for contract valet workers at the Ronald Reagan UCLA Medical Center. … Victoria Salgado, a union organizer at the American Federation of State, County and Municipal Employees Local 3299, the UC’s largest union, said many workers are concerned for their job security because they received unclear notifications in July and September about their employment dates. … Owen Li, a senior researcher for AFSCME Local 3299, said the UC has been increasing executive pay while cutting benefits for workers. “The University of California literally wastes billions of dollars on hedge funds, management bloats and on these crazy executive perks,” he said. The UC has 67 percent more overall staff than in 1993, and the number of senior managers has increased by 327 percent since 1993, Li added. Li said most of the jobs UCLA is offering to current valet workers are part-time jobs, which he he thinks do not offer enough pay to live on. …
Valet workers transferred from UCLA fear insourcing, loss of benefits
Source: Sharon (Yu Chun) Zhen, Daily Bruin, October 8, 2017
Edwin Cifuentes, a contracted valet worker at the Ronald Reagan UCLA Medical Center, said many valet workers who are being transferred away from UCLA are worried their new jobs will not offer them the same wages or benefits UCLA provided. … In August, UCLA ended its contract with ABM, a facility management company that employed valet workers like Cifuentes at the Ronald Reagan UCLA Medical Center. Although ABM had employed about 80 valet workers at the hospital, the university created about 35 in-house positions and has also hired part-time student workers. Workers UCLA did not rehire are set to leave by Oct. 30, said Victoria Salgado, union organizer at American Federation of State, County and Municipal Employees Local 3299, the UC’s largest union. … Throughout the summer, ABM workers have protested the insourcing alongside AFSCME, including at the medical center in July and at the inaugural UC public law conference in September. John de los Angeles, communications director for AFSCME, said when workers interviewed for the inhouse positions at UCLA, UCLA management discouraged workers from participating in union activities. In return, AFSCME issued a cease and desist letter in July. …
UC employees, students protest in support of contracted valet workers
Source: Sharon (Yu Chun) Zhen, Daily Bruin, July 31, 2017
About 500 University of California workers and students protested the Ronald Reagan UCLA Medical Center’s treatment of contracted valet service workers outside the medical center Friday. Valet service workers, who help park visitor and guest vehicles at the medical center, are contracted through ABM, a facility management company. Beginning in August, however, the hospital will lay off many valet workers because it will no longer be contracting out valet services, said hospital spokesperson Tami Dennis. Instead, it will offer in-sourced full-time, part-time and student positions. … John de los Angeles, communications director of American Federation of State, County and Municipal Employees 3299, the UC’s largest union, said the medical center would only offer 30 positions for the in-sourced program, even though the program currently employs 80 workers. Several students and workers said they think the hospital will carry out the layoffs because the contract workers received a pay raise. …