Category Archives: Horror.Stories

Secrecy inside child welfare system can kill: ‘God help the children of Kansas’

Source: Laura Bauer, Kansas City Star, November 12, 2017

… An agency charged with protecting kids instead focused on protecting itself. An agency where a former high-level DCF supervisor told The Star she was instructed not to document anything after a child’s death and to shred notes after meetings so attorneys and reporters couldn’t get them through open records requests. An agency where even lawmakers insist DCF officials are intentionally misleading them and providing information the Legislature can’t trust. In the end, Kansas children continue to die without a public review of what contact state social workers had with the families — whether they did enough and whether policies and procedures were followed. …

In a months-long investigation into the secrecy that permeates Kansas government and how it harms residents, The Star found a pervasive effort inside DCF to hide behind privacy laws and internal procedures to keep the public from knowing how it operates. Those practices are particularly acute in cases where children are seriously injured or killed by parents and guardians who were known to the agency. For the past year, DCF has refused to answer questions on topics ranging from open records and the death of specific children to runaways in foster care. During the course of The Star’s reporting on widespread problems within the agency, DCF Secretary Phyllis Gilmore announced her retirement effective Dec. 1. …

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For Kansas foster care task force, report of missing children latest concern
Source: Madeline Fox, Wyandotte Daily, October 12, 2017

The news that about 70 children are missing from the Kansas foster care system is the latest in a string of concerns for lawmakers and child welfare advocates. Concern for the safety of children, heavy caseloads for social workers and a lack of coordination in the system prompted lawmakers earlier this year to form the Child Welfare Task Force, which heard about the missing children during a meeting Tuesday in Topeka. The foster care system, overseen by the Kansas Department for Children and Families, was privatized 20 years ago after it failed court-ordered reviews. Care is now overseen by two contractors: St. Francis Community Services in western Kansas, and KVC Health Systems in eastern Kansas. …

More than 70 foster children missing in Kansas
Source: Jonathan Shorman and Hunter Woodall, Wichita Eagle, October 10, 2017
 
More than 70 foster children are missing in Kansas, the companies running the state’s foster care system said Tuesday.  Lawmakers were concerned that Kansas Department for Children and Families Secretary Phyllis Gilmore appeared unaware that three sisters have been missing from a northeast Kansas foster home since Aug. 26.  Sen. Laura Kelly, D-Topeka, told a child welfare task force meeting that when she raised the missing children with DCF on Tuesday, the agency knew nothing. … KVC Kansas, one of the foster care contractors, said it has 38 missing children. The other company, Saint Francis Community Services, said 36 are missing in its system.  Chad Anderson, chief clinical officer at KVC Kansas, one of the contractors, told a child welfare task force that the number of missing represented about 1 percent of the foster care population and is in line with the national average.  Still, he acknowledged the contractor could do a better job. …

Kansas Lawmakers Advancing Bill for Oversight of Foster Care
Source: Associated Press, May 12, 2017

 
Kansas lawmakers have advanced a bill that would increase their oversight of the state’s privatized foster care system and the contractors running it.  The House gave first-round approval to the measure Friday on a voice vote. Members planned to take another vote to determine whether the proposal goes to the Senate.  The bill would create an 18-member task force to collect data from the state Department for Children and Families on the foster care system and its contractors and to make recommendations for improvement. …

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Kansas House Committee Approves Foster Care Task Force
Source: Allison Kite, Associated Press, May 9, 2017
 
A House committee on Tuesday passed a bill that would allow Kansas lawmakers to more closely oversee the state’s privatized foster care system and the contractors that run it amid questions about how the state monitors the program.  The bill passed by the House Children and Seniors Committee would create an 18-member foster care task force to study the system.  The task force would collect data from the Kansas Department for Children and Families on the foster care system and its contractors and make recommendations for improvement. …

Audit finds problems in privatized foster care system, faults DCF for lax oversight
Source: Peter Hancock, Lawrence Journal World, April 28, 2017
 
The private nonprofit agencies that manage Kansas’ foster care system do not have the capacity in many parts of the state to handle the volume of cases they deal with, and the Kansas Department for Children and Families often does not conduct adequate oversight of those contractors.  Those are the findings of a Legislative Post Audit report on the foster care program that was delivered to lawmakers Friday.  However, auditors also said there would be enormous costs for the state if it decided to take back control and operation of the program itself. The report was the third and final part of a comprehensive audit that lawmakers ordered following two deaths in 2014 of children who were in the foster care system. …

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Are Private Prisons Using Forced Labor?

Source: Josh Eidelson, Bloomberg Business Week, November 8, 2017 

On Nov. 15 the 10th Circuit Court of Appeals in Denver will hear arguments in a case that could change the future of the $5 billion private prison industry. Judges will decide whether a district court was correct in February when it certified a class action on behalf of around 60,000 current and former detainees who are suing Geo Group Inc., one of the largest U.S. private prison companies, for allegedly violating federal anti-trafficking laws by coercing them to work for free under threat of solitary confinement. The case was first filed in 2014 by a group of immigrants who had been detained at an Immigration and Customs Enforcement facility run by Geo in Aurora, Colo. Their key claim rests on the assertion that Geo violated the Trafficking Victims Protection Act, a law designed to stop human trafficking—a scourge many associate with sexual exploitation by gangs, not with government contractors’ treatment of detained immigrants. Their lawsuit argues that Geo violated the law’s prohibition on using threats to obtain labor. …

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How a Private Prison Company Used Detained Immigrants for Free Labor
Source: Madison Pauly, Mother Jones, April 3, 2017

… The GEO Group, the private prison company that operates Aurora, allegedly forced more than 50,000 immigrants like Ortiz to work without pay or for $1 a day since 2004, according to a lawsuit that nine detainees brought against the company in 2014. On February 27, a federal judge ruled that their case could proceed as a class action, breathing new life into a suit that exposes the extent to which the for-profit company relied on cheap or unpaid detainee labor to minimize costs at the Aurora facility. … GEO incarcerates more immigrants (and receives more public money to do so) than any other detention center operator, according to an analysis by the anti-detention group CIVIC. And its business detaining immigrants for ICE is only expected to grow “with this increased and expanded approach to border security,” CEO George Zoley said in a February earnings call. …

Thousands of ICE detainees claim they were forced into labor, a violation of anti-slavery laws
Source: Kristine Phillips, Washington Post, March 5, 2017

Tens of thousands of immigrants detained by U.S. Immigration and Customs Enforcement were forced to work for $1 day, or for nothing at all — a violation of federal anti-slavery laws — a lawsuit claims.  The lawsuit, filed in 2014 against one of the largest private prison companies in the country, reached class-action status this week after a federal judge’s ruling. That means the case could involve as many as 60,000 immigrants who have been detained.  It’s the first time a class-action lawsuit accusing a private U.S. prison company of forced labor has been allowed to move forward. … At the heart of the dispute is the Denver Contract Detention Facility, a 1,500-bed center in Aurora, Colo., owned and operated by GEO Group under a contract with ICE. The Florida-based corporation runs facilities to house immigrants who are awaiting their turn in court. … The lawsuit, filed against GEO Group on behalf of nine immigrants, initially sought more than $5 million in damages. Attorneys expect the damages to grow substantially given the case’s new class-action status. … The original nine plaintiffs claim that detainees at the ICE facility are forced to work without pay — and that those who refuse to do so are threatened with solitary confinement. Specifically, the lawsuit claims, six detainees are selected at random every day and are forced to clean the facility’s housing units. The lawsuit claims that the practice violates the federal Trafficking Victims Protection Act, which prohibits modern-day slavery. … GEO Group also is accused of violating Colorado’s minimum wage laws by paying detainees $1 day instead of the state’s minimum wage of about $9 an hour. The company “unjustly enriched” itself through the cheap labor of detainees, the lawsuit says.

… The class-action ruling by Kane, a senior judge in the U.S. District Court in Colorado, came at a critical time, DiSalvo said, noting President Trump’s pledge to deport 2 million to 3 million undocumented immigrants. Advocates say private prison companies that have government contracts stand to benefit significantly from the president’s hard-line policy of detaining and deporting a massive number of immigrants. … Notably, the stocks of the two biggest private prison operators, Geo Group and CoreCivic (formerly known as Corrections Corporation of America), have surged since Trump’s election. The companies donated a total of $500,000 to Trump’s inaugural festivities, USA Today reported. Since Trump took office, his administration has reversed the Obama administration’s policy to end the country’s reliance on private prisons. … Under ICE’s Voluntary Work Program, detainees sign up to work and are paid $1 a day. … Jacqueline Stevens, who runs Northwestern University’s Deportation Research Clinic, said the program does not meet the criteria for what qualifies as volunteer work under labor laws. … Prison labor, Stevens added, has two purposes: to punish prisoners after they’ve been convicted of a crime and to rehabilitate them. Those don’t apply to immigrant detainees, she said. … In 2015, Kane, the federal judge, partially denied the motion to dismiss. Although he agreed with GEO Group that Colorado’s minimum wage law is inapplicable, he ruled that the other claims can stand. … Kane granted class-action status a few days after the Justice Department directed the Bureau of Prisons to, again, use private prisons, a significant shift from the Obama-era policy of significantly reducing — and ultimately ending — their use. …

Iowa Will Delay Plans to Add 3rd Company Back Into Medicaid

Source: Associated Press, November 7, 2017
 
An Iowa agency is delaying plans to add a third company back into the state’s privatized Medicaid program.  Iowa Department of Human Services Director Jerry Foxhoven says the agency will hire another company to offer Medicaid coverage in 2019. The agency originally said such a company would start next July.  Foxhoven says the agency will begin its search for a company soon, but the 2019 delay ensures adequate time.  Foxhoven provided the information Tuesday to a health care council. It comes one week after AmeriHealth Caritas announced it will drop Medicaid coverage in Iowa at the end of the month after failed contract negotiations with the state. Two other private insurance companies, Amerigroup and UnitedHealthcare, will continue Medicaid coverage. …

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DHS: Iowa Will Give $60M More to Companies for Medicaid
Source: Associated Press, November 2, 2017
 
An Iowa official says the state will spend an additional $60 million this budget year for private insurance companies to keep running the Medicaid program.  Iowa Department of Human Services spokesman Matt Highland said Thursday that additional costs announced this week as part of new state contracts with two companies will total $140.4 million. The state will pay $60.8 million of that. The federal government will pay about $80 million. …

Private insurance company to leave Iowa’s Medicaid program
Source: Barbara Rodriguez, Associated Press, October 31, 2017
 
An insurance company that helps run Iowa’s new privatized Medicaid program is withdrawing its participation after less than two years, state officials announced Tuesday, a move that highlights failed negotiations between the company and the state over future coverage expenses.  AmeriHealth Caritas will end its Medicaid coverage in Iowa at the end of November, the company confirmed in a press release. It offered no details on why a new contract with the state, through the Iowa Department of Human Services, could not be reached. DHS officials also declined specifics and focused attention to new contracts with the remaining companies, Amerigroup and UnitedHealthcare. …

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Opinion: Maggots, food shortages and contraband — this week in Michigan prison scandals

Source: Nancy Kaffer, Detroit Free Press, November 6, 2017
 
Maggots in the prison food. Again.  You know, I’m starting to think that a state government can’t outsource a service for $11 million less than it paid for in-house work and expect to deliver a quality product.   In three separate recent incidents, inmates at the G. Robert Cotton Correctional Facility near Jackson, found moldy food, crunchy dirt in mashed potatoes, and maggots or other foreign substances in or near food, provided by outside contractor Trinity Services Group of Florida per incident reports obtained by a state worker through the Freedom of Information Act and reported in Monday’s Detroit Free Press. That’s on top of reported food shortages, inadequate staffing, unapproved substitutions, a change to the way the company gets paid (from number of prisoners eating to just the number of prisoners) and 176 Trinity workers barred from prison premises for transgressions like smuggling drugs, contraband or overfamiliarity with prisoners. …

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Michigan’s prison food contract: A motive to serve yucky meals?
Source: Paul Egan, Detroit Free Press, October 31, 2017
 
Michigan’s prison food contractor — already hit with millions of dollars in fines for performance issues and facing controversy over employees smuggling drugs and having sex with inmates — may now have a financial incentive to serve lousy food.  That’s because Florida-based Trinity Services Group merged last summer with another big out-of-state company that sells packaged food to Michigan prisoners who can afford to stay away from the chow hall and buy food to eat in their cells.  A few months after that merger, the state agreed to change its prison food contract and start paying Trinity based on the total number of prisoners incarcerated, instead of the number who show up for meals, which was the previous basis for payment.  That’s bad news for Michigan prisoners, because Florida-based Trinity Services Group no longer has an incentive — and in fact has a disincentive — to serve food that prisoners want to eat, critics say. …

Michigan prison food woes drag on
Source: Michael Gerstein, Detroit News, May 10, 2017
 
Food problems continue to plague Michigan prisons in 2017 after Gov. Rick Snyder replaced a previous private vendor over similar issues, state documents show.  Inmates at the Upper Peninsula Kinross Correctional Facility picked through “maggot infested potatoes” to find still-intact spuds for prison meals, according to documents the Lansing-based liberal advocacy group Progress Michigan obtained from the Michigan Department of Corrections through an open records request. … The report shows that the potatoes were discovered less than two months before a costly riot broke out amid prisoners’ complaints about food quality.  “We have had food issues or prisoner complaints at a variety of our prisons. Kinross doesn’t stand out to me as being particularly worse off than any other facilities that have food service there,” said Chris Gautz, a spokesman for the Department of Corrections. …

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Exclusive: Nursing Home Sought Help From Lobbyist Friend Of Governor

Source: Jim Defede, CBS Miami, November 3, 2017

State officials intended to permanently shut down the now infamous The Rehabilitation Center at Hollywood Hills in 2014, when a lobbyist with deep ties to Governor Rick Scott interceded on behalf of the man who wanted to take it over, CBS4 News has learned. The role of one of the Governor’s friends lobbying state officials on behalf of Dr. Jack Michel so Michel could obtain the license for the Hollywood Hills nursing home has not been previously reported. The nursing home is now drawing intense scrutiny following the deaths of more than a dozen residents after its air conditioning system lost power during Hurricane Irma. … In 2014, Michel wanted to buy the nursing home, whose owner at the time, Karen Kallen-Zury, had just been convicted of Medicare fraud and was sentenced to 25 years in prison. … Political leaders have questioned whether Michel should have been granted a license given the fact that Michel and two former business partners paid $15.4 million to the federal government to settle fraud claims. …

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Hollywood nursing home should never have been licensed, state senator says
Source: Bob Norman, Local 10 News, October 26, 2017

The U.S. Justice Department hit Michel with civil Medicare fraud charges in 2004, alleging he received $70,000 each month in kickbacks to funnel nursing home patients into Larkin Community Hospital in South Miami for medically unnecessary procedures. … Michel eventually purchased the Larkin hospital (beginning with what the feds alleged appeared to be sham transactions) and, according to the complaint, began paying to other doctors for more bogus Medicare referrals. … Farmer says the fraud described in the Michel complaint has become all too common. … Michel and his business partners — including Chicago Rabbi Morris Esformes and his son, Philip — paid $15.4 million to settle the fraud case while admitting no wrongdoing. Published reports show that the Esformeses have a long history of nursing home violations going back decades in Chicago and other cities, including one case in 2001 involving the deaths of four women during a heat wave in St. Louis. Criminal investigations netted no charges in that case, but the nursing home was hit with a $275,000 civil judgment in one suit while three others ended with undisclosed settlements. But after paying the $15.4 million settlement to the federal government, both Michel and the Esformeses simply continued in the business of running nursing homes and hospitals. …

Hurricane Irma: Hospital linked to nursing-home deaths was paid $48M to care for Florida prisoners
Source: Arek L Sarkissian, Naples Daily News, September 26, 2017

The owner of a Florida nursing home whose 11 residents died after Hurricane Irma has benefited for years from millions of dollars in government contracts despite repeatedly running afoul of state and federal regulators. Dr. Jack Michel, owner of Rehabilitation Center at Hollywood Hills, owns a Miami hospital that has received $48 million in taxpayer money since 2006 to treat state prisoners. The payments to Larkin Community Hospital started the same year Michel settled a federal fraud lawsuit that accused him of bilking taxpayers. They continued after the state barred one of his assisted-living homes from taking new patients. And state officials are giving no indication that the payments will stop now despite Florida Gov. Rick Scott’s comments that the owner is unfit to care for patients after deaths at his nursing home.

Larkin provides the prison hospital care under no-bid agreements that the Florida Department of Corrections approved, according to agency contract and finance records. The hospital has served as a subcontractor to the state’s prison health care vendors with approval from corrections officials. Eight elderly patients died Sept. 13 after Irma knocked out power at Michel’s nursing home and residents remained for several days without air conditioning. Three other patients died days later after being hospitalized with complications. …

Editorial: Improve foster care

Source: The Register-Guard, October 27, 2017

Oregon Democratic Sen. Ron Wyden and Utah Republican Sen. Orrin Hatch have teamed up in support of a bill to better protect children in foster care. This bill is both badly needed and long overdue. The Senate Finance committee launched an investigation in April 2015 into the increasing practice of states giving the responsibility for some of their most vulnerable children over to private, for-profit companies. … Governors in 33 states responded to the committee’s request for information about the consequences of privatizing foster care, as did one of the largest providers in the country, the MENTOR Network. The results of the two-year investigation were both unsettling and, sadly, unsurprising.

The Senate found there were flaws in data collection and oversight when it came to for-profit foster care, at both the state and federal levels. Procedures set up by states to monitor providers’ performance and outcomes weren’t followed. Children under the authority of the state who received services from private, for-profit agencies were abused, neglected and denied services. Profits were prioritized over children’s well-being. High staff turnover sometimes made it impossible to monitor how children were doing, and foster parents with questionable backgrounds were given licenses to care for children, who were inadequately monitored by the state. …

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Senate Finds 86 Children Died In Care Of Giant For-Profit Foster Care Firm, Citing BuzzFeed News
Source: Aram Roston and Jeremy Singer-Vine, Buzzfeed News, October 18, 2017

At least 86 children died in a 10-year period while in the custody of a giant for-profit foster care company, according to an investigation by the US Senate Committee on Finance. In only 13 of those deaths did the company, The Mentor Network, conduct an internal investigation, the committee found. The Senate committee said the company “falsely” claimed that its child death rate was in line with the fatality rates in the overall foster care system.

The Senate probe started in part because of a series by BuzzFeed News that profiled problems at the company, which was the largest for-profit foster care provider in the country. In one case a 2-year-old girl who was placed at a home run by Mentor was murdered by her foster mother. In another case, a series of boys were sexually abused by a Mentor foster father, whom Mentor paid as a foster parent for years despite a series of red flags. He had requested that he be sent boys who were “male, white, any age.” Though Mentor denied the claim, employees told BuzzFeed News that the pursuit of profits sometimes took priority over child welfare. (The company is owned by Civitas Solutions, Inc., which recorded $1.4 billion in revenue last year and trades on the New York Stock Exchange.)

… As a result of the committee’s investigation, the chairman, Orrin Hatch, and its ranking member, Ron Wyden, introduced legislation Monday to require states to disclose the contractors they use in privatized foster care, and to report to the federal government how those contractors perform. …

The Brief Life and Private Death of Alexandria Hill
Source: Brian Joseph, Mother Jones, February 26, 2015

When the government took her from her family, it outsourced her safety to a for-profit corporation. Nine months later she was dead…..

….What happened in Rockdale that night would be the subject of a weeklong trial in the fall of 2014, focusing on the care of Alexandria. But it also opened a window into the vast and opaque world of private foster care agencies—for-profit companies and nonprofit organizations that are increasingly taking on the role of monitoring the nation’s most vulnerable children. The agency involved in Small’s case was the Lone Star branch of the Mentor Network, a $1.2 billion company headquartered in Boston that specializes in finding caretakers, or “mentors,” for a range of populations, from adults with brain injuries to foster children. With 4,000 children in its care in 14 states, Mentor is one of the largest players in the business of private foster care, a fragmented industry of mostly local and regional providers that collect hundreds of millions in tax dollars annually while receiving little scrutiny from government authorities. Squeezed by high caseloads and tight budgets, state and local child welfare agencies are increasingly leaving the task of recruiting, screening, training, and monitoring foster parents to these private agencies. In many places, this arrangement has created a troubling reality in which the government can seize your children, but then outsource the duty of keeping them safe—and duck responsibility when something goes wrong…..

….Mentor and other private foster care agencies say they are committed to children’s well-being, and that nothing can prevent the occasional tragic incident. But in my investigation, I found evidence of widespread problems in the industry—failed monitoring, missed warning signs, and, in some cases, horrific abuse. In Los Angeles, a two-year-old girl was beaten to death by her foster mother, who was cleared by a private agency despite a criminal record and seven prior child abuse and neglect complaints filed against her. In Albuquerque, New Mexico, prosecutors alleged that foster parents screened by a private agency beat their foster son so badly that he suffered brain damage and went blind. (A grand jury refused to return an indictment in the case.) In Chattanooga, Tennessee, a foster father vetted by a private agency induced his 16-year-old foster daughter to have sex with him and a neighbor. In Riverview, Florida, a 10-year-old girl with autism drowned in a pond behind a foster home. The private agency that inspected the home had previously identified the pond as a safety hazard but had not required a fence. In Duluth, Minnesota, a private agency failed to discover that a foster mother’s adult son had moved back into her home. The son, who had a criminal record for burglary that would have disqualified him from being around foster children, went on to sexually abuse a 10-year-old foster girl. In Texas, at least nine children living in private agency homes died of abuse or neglect between 2011 and 2013…..

Florida lawmakers, officials call for reform of private schools that get state scholarships

Source: Beth Kassab, Leslie Postal and Annie Martin, Orlando Sentinel, October 25, 2017

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. …

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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. …

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Student Loan Industry Clashes With 25 States Over Probes

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. …

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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. …

DCFS vows change to program that saw surge of child deaths

Source: David Jackson and Gary Marx, Chicago Tribune, October 25, 2017
 
Following a Tribune report on deaths of children in a privatized child welfare program, a state Department of Children and Family Services official said Tuesday that the agency has started taking back some of those cases from contract agencies and will handle them in-house.  Nora Harms-Pavelski, the agency’s deputy director of child protection, also disclosed at a legislative hearing Tuesday that agency administrators are now getting immediate reports on any instance of mistreatment of a child in the “intact family services” program, among other reforms. …

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Child deaths spike after DCFS privatizes ‘intact family services’
Source: David Jackson and Gary Marx, Chicago Tribune, October 23, 2017
 
The state Department of Children and Family Services had conducted two abuse investigations into Verna Tobicoe’s Southeast Side home in the months before her death in May 2015. The agency also had hired a nonprofit group to make frequent visits and conduct safety checks on Verna and two siblings. … And then 44-pound Verna became part of a growing pattern of similar fatalities: She was one of 15 Illinois children to die of abuse or neglect from 2012 through last year in homes receiving “intact family services” from organizations hired by DCFS, a Tribune investigation found.  There was only one such child death under the intact family services program during the previous five years from 2007 through 2011, according to DCFS records released to the Tribune under the Freedom of Information Act. … The spike in deaths began in 2012 after DCFS completely privatized the program, putting the care of families in the hands of nonprofit groups but doing little to evaluate the quality of their work, give them guidance and resources, or hold them accountable when children were hurt or put at risk, the Tribune found. …

Senate Meal Supplier Not Banned From Contracts Over Pay Charge

Source: Ben Penn, Daily Labor Report, October 12, 2017 (Subscription required)

The Labor Department won’t ban a Senate cafeteria contractor from government business over charges it didn’t pay workers properly. The DOL settled the case with contractor Restaurant Associates by entering into a compliance agreement with the food service provider, a company spokesman told Bloomberg BNA. The settlement doesn’t include the harsher penalties that had been sought by the Obama administration. A DOL administrative law judge approved the settlement earlier this month, according to an order appearing on the agency website Oct. 12. The company and a DOL regional solicitor’s office agreed that instead of a debarment, Restaurant Associates would abstain from bidding on new federal service contracts for two years, the order states. …

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GAO: Architect of the Capitol’s Oversight of the Senate Food Service Contract
Source: William T. Woods, Government Accountability Office, GAO-17-481R: May 12, 2017

The Architect of the Capitol administers contracts to acquire goods and services for the U.S. Capitol complex. In 2015, questions arose regarding the wages for workers employed by the Senate’s food service contractor. We reviewed the AOC’s oversight of this contract and found that it had considered this contractor’s performance satisfactory in 2015, and extended its contract for another 7 years. However, after the wage issues were identified, the agency enhanced its oversight and required the contractor to provide data on wages paid to its employees.

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Feds Go After Concessions Company That Shorted Senate Workers $1 Million
Source: Dave Jamieson, Huffington Post, December 30, 2016

The Labor Department wants to bar a concessions company from receiving new federal contracts, after the company allegedly stiffed low-wage workers inside the U.S. Senate out of $1 million. In June, the department announced that Restaurant Associates, a subsidiary of the food service conglomerate Compass Group, would repay 674 Senate workers back wages after the company failed to pay employees the prevailing wage under federal law and didn’t compensate employees for all the hours they worked. Restaurant Associates has since paid back the workers. But the department went a step further on Thursday, filing a complaint requesting that the company be forbidden from receiving new contracts for a period of three years. The request will now go before an administrative law judge. If approved, it will only affect future contracts, not the current one at the Senate building, which runs through 2029, according to the Labor Department filing. … According to the Labor Department, Restaurant Associates misclassified workers by putting them in lower job categories, resulting in lower pay. The company said the misclassification was an honest mistake, resulting from “administrative technicalities related to [workers’] evolving day-to-day work responsibilities.” In a statement Friday, Restaurant Associates said it was “surprised and disappointed” that the Labor Department was seeking disbarment: “Restaurant Associates, which had no history of previous [prevailing wage] violations, fully cooperated in the investigation. The company immediately paid all back wages owed and made all changes to pay practices going forward as requested by DOL. … DOL’s decision is unprecedented in these circumstances.” …

US Capitol workers want their voices heard over wage theft
Source: Alba Morales, The Hill, September 20, 2016

Last month, the U.S. Department of Labor announced that U.S. Senate federal contract workers like me had been robbed of over $1 million dollars from our paychecks by our employer, Compass Group. DOL found that Compass had been paying us less than the legal rates for our jobs, had not being paying us proper overtime or even for all the hours we worked, and had not kept proper payroll records. Within weeks, some of my co-workers started receiving as much as $20,000 in back-pay awards. But I only received $240, with no explanation of how it was calculated. I’ve worked at the Senate for over a decade and I believe the company likely stole much more than a couple of hundred bucks from me. And I’m not alone. Over a dozen Senate contract workers received little or no compensation as wage theft victims. Worst of all, neither myself, nor any of these workers were contacted or interviewed by the Labor Department or the Architect of the Capitol, the agency that oversees the contract, as part of the investigation. … The truth is that this is a symptom of a bigger problem: Workers and our representatives have not been invited to participate in the investigation and settlement talks even though we exposed the illegal conduct and are directly impacted by the results. If this were a court case, the victims would have their say, but we are low-wage workers who can’t afford a private attorney. That’s why workers are sending a letter to the Architect of the Capitol and the Department of Labor to request that our voices are respected. For us, respect means a willingness to bring workers into the process. …

House and Senate Restaurants: Current Operations and Issues for Congress
Source: Sarah J. Eckman, Congressional Research Service, August 23, 2016

Those involved with restaurant administration in the House and Senate have often considered how management choices affect operating costs, services available, oversight, and other elements of the restaurant systems. For much of their histories, the House and Senate operated their own restaurants, but since 1994 in the House and since 2008 in the Senate, private vendors have run the restaurants. In August 2015, the House entered an agreement with Sodexo to operate the 17 facilities in the House restaurant system, subject to direction from the Chief Administrative Officer (CAO) and the Committee on House Administration. In December 2015, the Senate entered a new contract with Restaurant Associates to operate the 12 facilities in the Senate restaurant system, subject to direction from the Architect of the Capitol (AOC) and the Committee on Rules and Administration. … Food and price issues, along with other day-to-day operational issues, including personnel matters, are largely the responsibility of the restaurant contractors. Some Members and observers have raised concerns about the degree of accountability for the House and Senate restaurant contractors, believing that the restaurants’ administration reflects upon Congress and that the restaurants should set an example for other businesses to follow. Although the House and Senate are responsible for restaurant oversight, the delegation of restaurant operations to private contractors means the chambers have less control over employee wages and benefits, procurement, or other business decisions that affect the restaurant systems. …

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