Category Archives: Insourcing/municipalization

Lexserv to Temporarily Shut Down While City Takes Over Service

Source: WTVQ, May 8, 2017

A temporary shutdown of the LEXserv online and phone bill payment system has been scheduled as Lexington’s Division of Revenue takes over the service from Greater Cincinnati Water Works. Beginning May 15, the city will manage all LEXserv customer service and billing services, eliminating the need for outsourcing. Officials say some of the many benefits include:

  • City will save taxpayer dollars by moving system in-house;
  • Customer service will be handled by LFUCG staff in Lexington, creating jobs;
  • Payments will be mailed to a Lexington address for processing;
  • New web portal for customers to make payments, review billing. …

JSU Police canceling Calhoun County 911 dispatch service management

Source: Patrick McCreless, The Anniston Star, May 5, 2017

Jacksonville State University police are set to return to in-house dispatch services in July, less than a year after outsourcing those duties in the expectation of improved efficiency. JSU officials now say contracting out the emergency and non-emergency medical calls hasn’t made the dispatch service more efficient. The JSU police will instead use a combination of professional dispatchers and student workers to handle all emergency and non-emergency calls moving forward. JSU police Chief Shawn Giddy sent a letter to Calhoun County 911 Monday stating his department no longer wanted the organization to manage its dispatch services. …

Amherst TM takes action on elementary schools

Source: Scott Merzbach, Daily Hampshire Gazette, May 4, 2017

Town Meeting unanimously agreed to $15.5 million as the town’s share of a $31.3 million budget for the Amherst-Pelham Regional Schools and $22.5 million budget for the elementary schools. … The budgets also include money to bring the food service program back in-house, which Hazzard said will mean better tasting, less processed, more organic and locally sourced foods. …

Teamsters, city of Pekin agree on yard crew contract

Source: Sharon Woods Harris, Peoria Journal Star, April 28, 2017

An agreement between Teamsters Local 627 and the city of Pekin to bring yard work back in-house has been reached, which could mean a possible savings of more than $100,000 for the city. Pekin City Manager Tony Carson said the agreement only applies to yard workers, not all of the Teamsters in four bargaining units in the city. The yard workers’ contract will become a part of the Teamsters contract that is yet to be reached with all of the bargaining units. He said he cannot discuss the terms of the agreement until then. Pekin Mayor John McCabe said the return of an in-house yard crew is good news. “We talked about this last year and there’s been a lot of concern about the mowing and other work that’s been done over the last couple of years,” McCabe said. “A lot of people thought we should bring it back in-house because we seem to get better results.” … The city hired Golf Green in May 2013 and discontinued the in-house service.

Private prison official says bonuses were paid for cutting costs

Source: Rebecca Boone, Associated Press, February 17, 2017

A former regional manager for private prison company Corrections Corporation of America says top employees at a private prison in Idaho were given yearly bonuses if they cut costs on salary, wages and other operational expenses and met other company goals. CCA, which has since changed its name to CoreCivic, operated the Idaho Correctional Center under a $29 million annual contract with the state of Idaho until chronic understaffing, violence and other problems prompted Idaho Gov. C.L. “Butch” Otter to order the state to take over the facility in 2013. Kevin Myers was CCA’s managing director who oversaw the Idaho prison and several others. He testified Thursday in a federal lawsuit against the company brought by a group of inmates at the Idaho prison. The inmates contend CCA understaffed the prison to boost profits, causing dangerous conditions in which they were attacked.


Trial starts Monday in ‘ghost worker’ private prison lawsuit
Source: Rebecca Boone, Associated Press, February 12, 2017

A private prison company accused by inmates of dangerously understaffing an Idaho prison as part of a scheme to boost profits will have a chance to present its defense to jurors on Monday when a civil trial begins in Boise’s U.S. District Court. Eight inmates at the Idaho Correctional Center sued the Nashville, Tennessee-based private prison company Corrections Corporation of America in 2012, contending that poor management and chronic understaffing led to an attack in which they were jumped, stabbed and beaten by a prison gang. The inmates contend the company, now called CoreCivic, purposely understaffed the prison in a so-called “ghost worker scheme.” CoreCivic didn’t immediately respond to a request for comment but the company has vigorously disputed the claims in court filings. CoreCivic CEO Damon Hininger has been ordered to testify in the trial about comments made during quarterly conference calls with investors.

Private Prison Company CCA to Face Trial in Violence Lawsuit
Source: Associated Press, July 8, 2016

A federal judge says the Corrections Corporation of America will stand trial in December in a civil rights lawsuit over understaffing and violence at an Idaho prison. U.S. District Judge Edward Lodge made the ruling Thursday. Eight inmates at the Idaho Correctional Center sued the private prison company in 2012, contending that poor management and chronic understaffing led to an attack in which they were stabbed and beaten by a prison gang. CCA spokesman Steven Owen said the Idaho prison was appropriately staffed at the time of the attack and that he’s confident CCA will prevail at the trial. …

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The Perils of Privatization (Podcast)

Source: Building Local Power, Institute for Local Self-Reliance, January 12, 2017

In this episode, Chris Mitchell, the director of our Community Broadband Networks initiative, interviews David Morris, a co-founder of the Institute for Local Self-Reliance and the director of the Public Good initiative. The two discuss the climate surrounding privatization in our economy and how the incoming Trump administration will bolster these efforts nationwide. Morris delves deep into the history of public infrastructure including explanations of how our language around the subject has changed over the years, privatization in other countries, and hope for the future.

[Ed. Note: A full transcript of the audio is also available from the source.]

Bring it on home: How CUPE campaigns are keeping services public

Source: Canadian Union of Public Employees, November 21, 2016

Throughout BC, CUPE members have been key players in the effort to keep services public or bring them back in-house. Our members have led effective campaigns to ensure that residents are getting cost-effective, transparent and reliable services. This compilation of stories, first published in CUPE BC’s Public Employee magazine, highlights some recent contracting-in success stories.


What Happens When Privatization Doesn’t Work Out
Source: Katherine Barrett and Richard Greene, October 2016

Privatization is one of the hottest topics in state and local government. Google the word and you come up with around 12 million entries. But for all the articles and academic reports on the best approaches to outsourcing government services, there’s also a surprising amount of activity around insourcing. These days, roughly the same percentage of services that are newly being contracted out are being brought back into the government fold, according to Mildred Warner, a professor of city and regional planning at Cornell University. Her examination of data accumulated by the International City/County Management Association (ICMA) for the period from 2007 to 2012 showed that new outsourcing accounted for 11.1 percent of all services and new insourcing accounted for 10.4 percent of all services. … According to Warner’s analysis of ICMA data, the two main reasons governments reverse their privatized services are inferior service quality and a lack of anticipated cost savings. Additionally, improvements in the capacity of local governments to work with greater efficiency can make them the more appealing alternative. …

Back in House: Why Local Governments are bringing services home
Source: Keith Reynolds, Gaëtan Royer and Charley Beresford, Centre for Civic Governance, 2016


Back In House: Why Local Governments Are Bringing Services Home, a new report from the Columbia Institute, is about the emerging trend of remunicipalization. Services that were once outsourced are finding their way back home. Most often, they are coming home because in-house services cost less. The bottom-line premise of cost savings through outsourcing is not proving to be as advertised. Other reasons for insourcing include better quality control, flexibility, efficiency in operations, problems with contractors, increased staff capacity, better staff morale, and better support for vulnerable citizens. When services are brought back in house, local governments re-establish community control of public service delivery. The report examines the Canadian environment for local governments, shares 15 Canadian case studies about returning services, follows-up and reports back on two earlier studies promoting contracted out services, provides a scan of international findings, and shares some best practices and governance checkpoints for bringing services back in house. Many of the local governments examined employ CUPE members. As part of our ongoing work to promote the value of publicly-delivered services, CUPE helped fund the production of the Columbia Institute report Back in House

Read full report.

County leaders consider pros and cons of ambulance service switch

Source: Tiffany Neely, WBRC, October 13, 2016

Shelby County discussed some possible changes to its ambulance system at a public works committee meeting on Thursday. Plans were laid out for a future ambulance system run by the Shelby County Fire Department. The committee will soon decide whether to use that system or keep the current system, American Medical Response. … The debate comes after American Medical Response requested a few changes to their contract that could more than double costs for the county. That’s why the county is considering using fire department employees to man the ambulances as well. … Shelby County Fire Department proposed a plan with a total of almost $600,000 less than AMR, but they said there will be a 12 percent fire fee increase. Commissioners said they the proposal is looking like the winning option, but the decision is about more than cost—it’s about the safety of Shelby County citizens. … The final decision will come Monday. The switch could come as soon as January 2017, however, it would mean a $3 tax increase per month for county residents. …


Ambulance company AMR tells Shelby County it wants more money or will end contract
Source: Linda A. Moore and Donald Connolly, The Commercial Appeal, August 15, 2016

Ambulance provider American Medical Response has notified Shelby County government it is not making money under the current $1.7 million annual contract and given the county until Aug. 31 to pay more or end the agreement. Officials with Colorado-based AMR sent a letter to county fire Chief Alvin Benson last month detailing the proposed changes. It was not immediately clear how the proposed changes would affect fire fees or ambulance service for the areas that are part of the contract: unincorporated Shelby County and Arlington, Lakeland and Millington. … AMR has proposed three options: first, creating a hybridized service paying AMR an additional $2.2 million per year and requiring the Shelby County Fire Department to staff two ambulances and make calls; second, increasing the contract by $2.8 million per year; third, terminating the agreement after 120 days, allowing the county to bid the contract again. … He has also not ruled out the county providing ambulance service — buying the necessary equipment and hiring trained personnel. Adding to the dilemma, the demand comes more than a month after the county adopted the 2017 budget. …

Shelby County Considers Taking Over Ambulance Service
Source: Mike Matthews, Local Memphis, August 11, 2016

The company that runs ambulance service in much of Shelby County, American Medical Response (A-M-R) is telling folks they are losing money. They are asking for a big increase. So big, as Local 24 Watchdog Mike Matthews tells us, Shelby County officials are considering running the ambulance service themselves. … Here is one thing everybody is hearing. A-M-R officials say they are losing money running ambulance service in Shelby County. They want an increase in money; an increase that some say is about double of what they get now. … If the Shelby County officials were to give A-M-R the increase they want, they would probably have to raise fire fees. County residents pay fire fees for these types of services, and that increase would affect a lot of people who have A-M-R ambulance service. … Now, the future might mean Shelby County ends up running their service.  According to Kennedy, “Obviously we will be looking to see how much it costs for us to operate the service, as opposed to contracting it out. What kind of revenues we could get.” …

Editorial: ‘We are ready’ for the new New Orleans school system

Source: New Orleans Times-Picayune, September 7, 2016

It will take hard work to reunify New Orleans public schools by July 2018, but the Orleans Parish School Board took a major step last week. The board unanimously approved a transition plan Aug. 30 that lays out how charter schools from the state-operated Recovery School District will be blended into the city’s school system. The vote signifies the progress made in the 11 years since Hurricane Katrina and the levee breaches, when the Legislature took the vast majority of city schools away from the School Board to be run by the state. … Lawmakers approved the return of recovery schools to the OPSB earlier this summer. Senate Bill 432 safeguarded charter schools’ independence, forbidding the School Board from interfering in personnel, collective bargaining, contracts, curriculum and other matters. The legislation set up an advisory committee to come up with the transition plan. That group held multiple public meetings this summer to get New Orleanians to help refine the system’s guiding principles.


Editorial: Hold onto reforms as New Orleans schools move back to School Board control
Source: New Orleans Times-Picayune, May 15, 2016

New Orleanians who have chafed at having most city schools under the control of the state will be able to go to their elected School Board members with concerns again. But the new unified system won’t look like the pre-Katrina version, which was controlled by a massive central bureaucracy. … Once Gov. John Bel Edwards signs the bill, the committee has to come up with a plan to transfer services now being handled by RSD to the School Board. They are vital issues: enrollment, expulsion, truancy, a program for students in psychological crisis. The transition plan is due by Sept. 1, which is a quick turnaround. But the group will continue to meet over the next two years until reunification is complete. … Transitions like this aren’t easy. The RSD had a rough start in the first few years after Katrina as it took responsibility for dozens of schools. But over time, the state figured out how to provide important support to schools. … The legislation provides a good framework for that. But it will be up to the School Board, Mr. Henderson and his staff and individual school leaders to follow through. New Orleanians must hold them to it — and must commit themselves, as they have in the 10 years since Katrina, to ensuring every child has an excellent school to attend. The transformation of education in New Orleans can’t happen without the hard work of all of us.

Governor John Bel Edwards signs bill bringing New Orleans public schools under local control
Source: Jessica Williams, The Advocate, May 12, 2016

Gov. John Bel Edwards signed into law on Thursday a bill that will return public schools in New Orleans to local control, and officials named the members of a committee that will guide the transition as it plays out over the next few years. … The bill will start in motion a landmark transition for the city’s schools, most of which are now independent charter schools that fall under the state-run Recovery School District. Beginning in 2018, they will answer to the Orleans Parish School Board, the local body that lost control of a majority of city schools after Hurricane Katrina. …

New Orleans Plan: Charter Schools, With a Return to Local Control
Source: Kate Zernike, New York Times, May 9, 2016

Now comes another big moment in the New Orleans story: The governor is expected soon to sign legislation returning the city’s schools to the locally elected school board for the first time since Hurricane Katrina in 2005. Strikingly, that return is being driven by someone squarely in the pro-charter camp, the state superintendent, John White. He is a veteran of touchstone organizations behind the efforts to remake public schools — Teach for America and the Eli and Edythe Broad Foundation and its superintendent training program — as well as the hard-charging charter school efforts in New York City. … To Mr. White, the move to local control is not the retreat it may seem. He argues that it will make New Orleans a new model, radically redefining the role of central school boards just as many urban school districts are shifting increasingly large portions of their students to independently run but publicly funded charter schools. … This new model essentially splits the difference: The schools will keep the flexibility and autonomy, particularly over hiring and teaching, that have made charters most unlike traditional public schools. But the board becomes manager and regulator, making sure schools abide by policies meant to ensure equity and provide broad services, like managing the cost of particularly expensive special education students, that individual schools might not have the capacity or desire to do. …

Questions remain as New Orleans schools prepare to return to local control
Source: Andrew Vanacore, The Advocate, May 7, 2016

A bill now awaiting the signature of Gov. John Bel Edwards would unify the city’s school system under the Orleans Parish School Board by 2018, more than a decade after the state seized control of most New Orleans schools and began turning them over to charter groups, which are publicly funded but privately run. Right now, those schools answer to the state’s school board. By 2018 — or 2019, at the latest — oversight will fall to the OPSB. … In any case, the pairing of a locally elected board with scores of autonomous schools is something that hasn’t been attempted before on this scale. And the unification plan has generated a flurry of commentary from national education experts who have been watching New Orleans closely as a potential model for other struggling urban school systems. It is not just a question of whether OPSB members will try to impinge on how individual schools are run. The board will become the authorizer for all of the city’s charter schools, a role seen as critical in holding schools accountable for producing results and following the law. …

Bill Placing New Orleans Charter Schools Under Local Oversight Passes La. House
Source: Arianna Prothero, Education Week, May 6, 2016

A bill to return the majority of New Orleans’ charter schools to the oversight of the city’s elected school board has passed the Louisiana House of Representatives. Under the legislation, the schools will remain charters run by their own appointed boards, but the Orleans Parish School Board would have the authority to decide whether charter contracts are renewed or schools are shut down. … Today, Recovery School District oversees 52 charter schools while the Orleans Parish School Board oversees six district schools and 18 charters. The RSD would continue to run other charter schools in the state.  Both superintendents from the RSD and OPSB gave input on the bill, according to the Associated Press. A recent poll by Tulane University in New Orleans found that 38 percent of registered voters supported shifting oversight of the schools to the OPSB by 2018, 13 percent indicated the switch should happen even later, while 32 percent said they preferred the status quo. …

Returning New Orleans charter schools to local control a step closer to becoming reality
Source: Mark Ballard, The Advocate, April 27, 2016

… Despite their complaints, the House Education Committee voted 11-2 to advance legislation that would transfer control of 52 public schools — all charters — run by the state Recovery School District for the past decade to the Orleans Parish School Board by 2018, 2019 at the latest. Even with the move, charter schools would retain much of their autonomy. The legislation now heads to the full House. The state Senate already has approved the legislation without a single “no” vote. If endorsed by the House without any changes, the next step for Senate Bill 432 would be for the governor to sign it into law. …

Louisiana Senate Approves Bill to Return New Orleans’ Schools to Local Control
Source: Denisa R. Superville, Education Week, April 21, 2016 (Subscription Required)

A Louisiana Senate bill unanimously approved on Wednesday aims to return schools in the Recovery School District to the local school board by no later than 2019. The bill passed 36-0 and now has to be considered by the House of Representatives.   The measure came just a day after the Cowen Institute For Public Education Initiatives at Tulane University released its new poll of voter perceptions of public education in New Orleans  that showed 38 percent of respondents would like the schools under the Recovery School District to return to the Orleans Parish School Board by 2018. …

Survey: Most Michigan Schools Outsource Noninstructional Services

Source: Derek Daplin, Michigan Capital Confidential, August 25, 2016

Farmington Public Schools is expected to save $1.4 million this year after privatizing its custodial services for the first time. The district is one of several public school districts that have recently turned to privatizing noninstructional services, joining others that have used the practice for years. Farmington estimates the district will save $4.2 million over three years because of the move. The district reported its findings to the Mackinac Center for Public Policy for its “Michigan School Privatization Survey 2016.” … In recent years, public school districts in Michigan have increasingly contracted out at least one of three noninstructional services covered by the report — food, custodial, or transportation. Over 70 percent of districts in the state have contracted out for at least one the three services in the last year, a slight increase from 69.7 percent in 2015. A private vendor is now used in 379 of 541 districts in the state for at least one of the three services. In 2001, the first year the survey was conducted, only 31 percent of districts used private contracts for one or more of these services. … The survey was based on telephone interviews with districts, which were conducted between May 11 and June 30, 2016. The Mackinac Center submitted Freedom of Information Act requests to districts that asked for them, the study says. The Center has had a perfect response rate on the survey since 2005. The survey also probed for districts’ satisfaction with their private contractors. Nearly all districts, or 89 percent, said they were satisfied. Less than 3 percent were unsatisfied. … The districts that privatized custodial services this year include Farmington Public Schools, Clawson Public Schools and North Huron Schools. Districts with newly privatized food services are the Calumet-Laurium-Keweenaw School District, Carson City-Crystal Area Schools and Ellsworth Community Schools. Districts with newly privatized transportation services are East Grand Rapids Public Schools, Montrose Community Schools, and Mid Peninsula School District. …

Read full report.


Number of Michigan Schools Privatizing Services Grows to 70 Percent
Source: James M. Hohman and Jonathan Moy, Mackinac Center for Public Policy, August 17, 2015

There are more Michigan public schools contracting out food, custodial or transportation services than ever, according to the Mackinac Center’s latest survey of school districts. This year, 70.8 percent of school districts use private-sector vendors to clean buildings, get kids to school, or cook and serve school meals. This is up from 66.6 percent the previous year. … The biggest change has been in custodial services. Our 2003 survey found only 34 districts contracted out this service. In 2015, 283 of Michigan’s 542 districts contracted out these services. School food services are highly-regulated enterprises and the federal government subsidizes meals for many children. There are a few companies that have specialized in helping districts provide this service. In 2003, 27.3 percent of districts contracted out these services. This proportion increased to 42.8 percent in 2015. … There is a growing number of school districts that use private-sector contractors to bus students to and from schools. There were 18 districts that began new transportation contracts between the 2014 survey and the 2015 survey and now 144 of Michigan’s 542 districts (26.6 percent) contract out this service.

2014 Michigan School Privatization Survey
Source: James M. Hohman and Zachary Woodman, Mackinac Center for Public Policy, ISBN: 978-1-890624-37-8, 2014

From the summary:
The growth of school support service privatization has slowed. The 2014 survey shows that the percentage of school districts that contract out for food, custodial or transportation services increased just 0.4 percentage points, the smallest growth recorded since the survey began. Each service, however, increased and satisfaction with contracting remains high.

2014 Survey Results
Food Service
Custodial Services
Appendix A: Revisions to Previous Publications
Appendix B: Map of Survey Findings by School District