Tag Archives: Georgia

When Corrections Corporation of America built a private prison just outside Millen, officials hailed it as a boon to Jenkins County’s economy, then suffering from unemployment hovering near 20 percent. Two years after the 1,250-bed, medium- and minimum-security Jenkins Correctional Center received its first inmates, Jenkins County’s unemployment rate has improved to 14 percent. With virtually all boats rising post-recession, that May rate remained the second-highest among Georgia’s 159 counties. But the prison, which became operational in March 2012, has created 205 jobs ranging from custodial staff and regular corrections officers to full-time slots for a doctor, dentist and in-house education principal. In addition, after spending $57 million to build the facility, CCA now pays more than $450,000 annually in property taxes, a potential point of envy to counties that host prisons owned by the state of Georgia and operated by its Department of Corrections, which are tax-exempt. But what Mandy Underwood, the executive director of the Jenkins County Development Authority, sees as most important is the effect the prisons’ employees have when they spend their money. Millen’s first McDonald’s opened in May; a unique local restaurant, Honey’s Café, debuted after the prison opened; and Underwood observes that Millen’s other three or four restaurants are now packed at lunch….

Butts County school board approves $26.5 million budget /Custodial contract approved 3-1

Source: Beverly Harvey, Jackson Progress-Argus, July 1, 2014

The Butts County Board of Education last week unanimously approved a $26.5 million general fund budget for fiscal year 2015, but voted 3-1 to renew a janitorial services contract with a North Carolina company…. The dissenting vote for the janitorial services contract with Facilico was cast by District 5 board member Millard Daniel who, along with Marshall, voted against the initial contract with Facilico in 2013 when the school system’s custodial services were first privatized…. The one-year contract with Facilico was for $625,834, which is almost $27,000 more than the school system’s contract with the company approved in 2013 for $599,000….

Related:
Divided school board votes to privatize custodial work
Source: Michael Davis, Jackson Progress-Argus, May 23, 2013

The Butts County Board of Education voted Thursday to privatize the work done by 21 school system custodians. Under the terms of the deal struck with North Carolina-based Facilico, all school system custodians who wish to remain on the job would be hired by the company on a 90-day probationary basis. Butts County Schools will pay $599,000 under a one-year contract, which Superintendent Robert “Buddy” Costley said Thursday will be a savings of about $150,000 off the projected cost to keep the custodial work in-house next year. … He acknowledged that the custodians would take a cut in hourly pay and the number of days worked, but said the $10- to $12-per-hour rate the system negotiated with Facilico by looking for savings elsewhere is higher than the $8 to $9 the company initially proposed. Costley said Facilico currently works with one other school system in the region, Pike County Schools, and that employees would undergo background checks at least equivalent to, if not more stringent than, those conducted by Butts County Schools….

Financial advisor recommends against divesting TVA

Source: Robert Varela, Public Power Daily, June 9, 2014

An independent strategic review by an financial advisory firm, Lazard, Frères & Co. LLC, has recommended that the federal government not divest the Tennessee Valley Authority. TVA said it is pleased the report “supports TVA’s financial and operational plan.” The utility engaged Lazard to assist in analyzing financial data for the Obama administration’s strategic review of options for addressing TVA’s financial situation, including the possible divestiture of the utility. The Lazard report “concluded that the business model with TVA’s financial and operational plan is the best current option for the citizens of the [Tennessee] Valley and others,” TVA noted….The high level of complexity associated with a possible divestiture “would likely lead to a costly, multi-year process to execute any such strategy, during which time TVA would experience organizational disruption and which would result in an uncertain outcome,” the report said. The complex network of TVA stakeholders would add to the difficulty of divesting TVA “in a manner that creates value for all parties,” Lazard said. …TVA released the Lazard report on June 4 as part of a mandatory Form 8-K filing with the Securities and Exchange Commission. The 8-K document is available on the TVA website.
Related:
Study findings: TVA should not be sold; analysts reject Obama’s call to privatize utility
Source: Dave Flessner, Chattanooga Times Free Press, June 5, 2014

Selling TVA wouldn’t yield much for American taxpayers, but it could prove costly for Tennessee Valley residents and the region’s economy and environment, according to an outside financial review of America’s biggest government utility. In $1 million study prepared for White House budget planners, Lazard Freres & Co. said if TVA had to earn the financial returns of private utilities, electricity rates would jump by 13 percent. At the same time, dismantling its power and nonpower programs could hurt TVA’s recreation, economic development and environmental programs.

Unions fear a ‘New Deal’ sell-off
Source: Kevin Bogardus, The Hill, March 11, 2014

Labor unions are going on the attack against a proposal buried deep in President Obama’s budget that they charge is a move to privatize the Tennessee Valley Authority …. But while the utility is now self-financing, the government could pocket a hefty profit by selling its stake. Obama proposed studying that option in his last two budgets, angering a trio of major labor unions that have thousands of members at TVA facilities. …… In this year’s budget, the administration said it “continues to believe that reducing or eliminating the federal government’s role in programs such as the TVA, which have achieved their original objectives, can help mitigate risk to taxpayers.” That language was included over the strenuous objections of labor unions, which approved a resolution at the AFL-CIO convention in September urging Washington to reject all efforts to privatize the TVA.

TVA to meet with budget officials over privatization
Source: Eric Snyder, Nashville Business Journal, May 20, 2013

Executives with the Tennessee Valley Authority will meet with officials from President Obama’s administration this week to discuss privatization of the utility, WPLN 90.3 FM reports. It will be the first face-to-face meeting between the groups to discuss a possible sale of TVA since the idea was floated in Obama’s budget proposal earlier this year.

Shocker: Republicans Fight Obama Plan to Privatize the Hugely Popular, Cheap Energy Source of the TVA
Source:Gar Alperovitz, Thomas Hanna, AlterNet, May 19, 2013

US electricity giant rejects privatisation plan
Source: Ed Crooks and Stephanie Kirchgaessner, Financial Times, April 29, 2013
(subscription required)

The head of the Tennessee Valley Authority, the US government-owned electric company and a pillar of Franklin D. Roosevelt’s New Deal, has rejected an Obama administration plan to explore privatisation….But in an interview with the Financial Times, Bill Johnson, who took over as chief executive of the TVA in January, said the authority “isn’t broke” and could fund the investment it needed while staying in the public sector. His comments reflect an upsurge of support, led by typically pro-privatisation Republicans from Tennessee, for retaining government ownership of one of the largest electricity companies in the US…

Politics can obscure history’s reasons
Source: Edward Lotterman, Bismark Tribune, April 28, 2013

If you like irony, the kerfluffle about the Obama administration’s proposal to privatize the Tennessee Valley Authority provides plenty… Stalwart congressional Republicans like Richard Shelby of Alabama and Bob Corker and Lamar Alexander of Tennessee, who are all for small government, free enterprise, and lowering the national debt are decrying this move…

So why are GOP congressmen from the region now all opposed to its sale?

The simplest answer is that under private ownership, without an implicit federal guarantee of its debts and faced with the same requirements to pay state and federal taxes as any other private corporation, electricity rates would go up and TVA employment would go down. That would be politically unpopular. It is a case of “I’m against big government except when big government benefits me and my constituents.” Cynics may say that it also reflects the fact that the guiding principle for the GOP right now is “whatever Obama is for, we are against.”…

The Tennessee Valley Authority: Dammed if you don’t / Barack Obama mulls privatising America’s biggest public utility
Source: Economist, April 27th 2013

Eighty years ago Franklin Roosevelt signed a law creating America’s biggest public utility. The Tennessee Valley Authority (TVA) was charged with delivering cheap hydropower to the rural South, which it did by damming the Tennessee river (see map)…. Privatising the TVA would end the perception of an implicit federal debt guarantee. (A similar implicit guarantee for Fannie Mae and Freddie Mac, the federal mortgage-financiers, ended up costing taxpayers untold billions.) Divestiture would also free the TVA to raise more capital than the $30 billion debt cap allows—though, as the bond spike earlier this month hinted, it would probably pay steeper interest rates….

Role reversal: GOP attacks Obama plan to sell Tennessee Valley Authority, icon of New Deal
Source: Matthew Daly, Associated Press, April 16, 2013

Private probation: A juicy secret

Source: Economist, Democracy in America blog, April 22, 2014

….Since 2001 private companies have overseen misdemeanant probation, which includes not just minor crimes such as shoplifting, petty theft and public drunkenness, but also speeding tickets and other traffic violations.

Penalties for such crimes rarely exceed a few hundred dollars, but of course not everyone has a few hundred dollars. That’s where private-probation companies come in. I’ve written about these fees before, but here’s a quick refresher: if you get hit with a $200 ticket you can’t pay, then a private-probation company will let you pay it off in instalments, for a monthly fee. Then there may be additional fees for electronic monitoring, drug testing and classes—many of which are assigned not by a judge, but by the private company itself. When probationers cannot pay, courts issue warrants for their arrest and their probation terms are extended—a reprehensible practice known as “tolling”, which a judge declared illegal last year. These are folks who had trouble paying the initial fine; you have to imagine they’ll have trouble paying additional fines. It’s plausible to posit that these firms’ business models are based on assigning unpayable fees to people who lack the sophistication, time, will or whatever to contest them. One might even say these predatory firms treat the long arm of the law as sort of lever on a juicer into which poor people are fed and squeezed to produce an endless stream of fees.

How much do these companies make? How well do they supervise their charges? Do they in fact deliver on their promises of efficiency? Who knows! They may do the state’s business, but they are private companies, and hence not subject to sunshine or open-records laws…..
Related:
Deal vetoes private-probation, teacher benefits bills
Source: Walter C. Jones, Morris News Service, April 29, 2014

Legislation that would have broadened the powers of private probation companies fell subject to Gov. Nathan Deal’s veto pen on Tuesday. …. The bill would have allowed the companies that monitor people on probation for minor crimes the ability to ask judges to extend the sentences of those who don’t pay the cost of the monitoring. …. The bill would permit the details of the supervisory fees and the finances of these companies to remain confidential even though other aspects of state law make firms carrying out government functions subject to Georgia’s sunshine laws. …. Deal’s veto of HB 837 http://www.legis.ga.gov/Legislation/en-US/display/20132014/HB/837 comes a week after the Department of Audits & Accounts issued a report listing multiple weaknesses in the private probation monitoring system. …

Misdemeanor Probation Operations
Source: Georgia Department of Audits and Accounts Performance

Audit Division, Performance Audit Report No. 12-06, April 2014
Both courts and providers should improve management practices… Municipal and county governments manage misdemeanor probation services by establishing their own probation office or by contracting with a private probation provider. With the approval of the governing authority, the chief judge of each local court system enters into a contract (private providers) or a governmental agreement (public providers) that defines certain rules and procedures for operations and case management. Our review of misdemeanor probation operations in a sample of jurisdictions found that courts provided limited oversight of providers, with contracts that often lack the detail needed to guide provider actions and periodic reports from providers that tell little about their own or their probationers’ performance. We also found that providers frequently had inadequate case management policies and that some providers’ reporting and payment policies were likely to increase probationer non-compliance….

Georgia’s Debtors’ Prisons Belong in a Dickens Novel
Source: Andrew Cohen, Atlantic, January 21, 2014

In 2000, the state had the bright idea to privatize its probation services. The result has been unjust, unconstitutional, and entirely predictable. …

Connections matter in private probation industry
Source: Rhonda Cook, Atlanta Journal-Constitution, January 18, 2014

Many private probation companies in Georgia are controlled by former law enforcement officials, and they’re leveraging their connections into lucrative contracts….

Spotlight falls on private probation companies over fees, supervision
Source: Rhonda Cook, Atlanta Journal-Constitution, January 18, 2014

In 2000, Georgia cleared the way for private companies to supervise low-level offenders, claiming it freed up overburdened state probation workers while costing taxpayers nothing….

What We Know – And Still Need to Learn – About the Impact of Vouchers on Students and Schools

Source: Joshua Cowen, Scholars Strategy Network, SSN Basic Facts, April 2014

After two decades of trial-runs, school voucher programs occupy a growing place across the U.S. educational landscape. In Arizona, the District of Columbia, Florida, Georgia, Indiana, Louisiana, Ohio, Utah and Wisconsin, public funding supports private school attendance by students with varied needs and limited family resources. At least ten states offset private tuition with refunds or credits offered through their tax codes. As such programs proliferate, it is important to take stock of what researchers have found so far about the impact of vouchers on student achievement and school performance….

School system expects big savings on cleaning contract

Source: Colton Campbell, Times-Georgian, March 21, 2014

Carroll County Schools will continue to be cleaned by a contracted service for another year, the board of education voted this week. A contract extension with Southern Management cleaning service was on the table for a BOE vote, with the board voting 5-1 to extend the contract by one year, despite vocal objections by one board member, who went so far as to email board members the day of the vote to say he’d be voting no. …. Cater said he became concern with the company’s quality of service after a teacher emailed him photos of a pile of “dirt, old food, hair, etc.” that she had to clean up on a Sunday afternoon. ….
Related:
Custodial plan saves system $430K so far
Source: Colton Campbell, Times-Georgian, February 13, 2014

…Despite the savings, at least one board member and some principals are not satisfied with the service provided by Southern Management, which the system contracted last year for $2.76 million. … Annualizing that number, Fulford projects the system saving $860,000 in the service. Adding in the projected savings of $90,000 on worker’s compensation and general liability premiums, he predicts the school system will save $950,000 by contracting Southern Management. …. In the comments, principals complain of “lots of turnover and lack of training,” saying that they are “working toward satisfaction” with the company, which is more like a cleaning service than a custodial staff, Goldberg said. …. “Yes, the floors are better now that I’ve said something to them, but they’re still nowhere near as clean as they were when we had our custodial staff,” he said. “I’ve heard it put to me this way — you can either have a steak or a Happy Meal, so it’s apparently about money versus quality.” ….

Custodian outsourcing to save county schools $1 million
Source: Colton Campbell, Times-Georgian, March 22, 2013

Custodial positions in Carroll County Schools will be outsourced to a private company. The Board of Education, in a narrow 4-3 vote Thursday night, accepted the proposal of Southern Management, a regionally focused school facility maintenance company, which will save the school system more than $1 million in its fiscal year 2014 budget. All custodians currently on staff at one of the system’s schools will have the opportunity to be hired by Southern Management, provided they pass the pre-screening and background check. The decision to privatize the service will also come with a pay cut for most custodians. James Fulford, chief financial officer for the system, said the average day custodian gets paid around $11.50 an hour in the current, school-run system. Once hired by Southern Management, a day custodian will be paid $9 an hour….

Case Study: Ousting the Outsourcing Misconception

Source: SAFEbuilt, March 2014

There are many myths about the complex subject of privatization. This feature article highlights the common misconceptions of privatization, and the potential benefits, as they relate to the “new normal” environment for local government.

Using the analogy of a lemonade stand, SAFEbuilt, a private provider of community development services, helps to squeeze out truth from fiction.
Related:
City of Troy, Michigan
Kiawah Island, South Carolina
Centennial, Colorado
City of Roswell, Georgia
Powder Springs, Georgia
Bay Village, Ohio
Leesburg, Virginia

Documents Show Privatized Bus System Costs More Than City Operation

Source: George Eskola, WJBF, March 13, 2014

….. Augusta Commissioners privatized the bus system three years ago, with the promise it would save $400,000 a year. The city changed private companies in July, hiring McDonald Transit, but some Commissioners feel it’s the wrong route to take. ” …. Comparing the last six months the city ran the bus system, in 2011, to the last six months under the current company, the private company’s operation was about $500,000 more expensive than the city’s operation. …. Officials with McDonald Transit take issues with some of the numbers, saying they’ve added service the city did not provide, and their costs of operating the system are $15 an hour less than when the city was in charge. ….

Thrown in jail for being poor: the booming for-profit probation industry

Source: Lauren Gambino, The Guardian, March 3, 2014

….More than 1,000 low-level courts across the US rely on the so-called “offender-funded” probation model, signing contracts with for-profit companies that oversee probation requirements like monitoring, drug tests and fine collection. The decades-old, for-profit probation industry is deeply rooted in the south, and especially in Georgia, but courts in states as far-flung as Michigan, Montana and Washington have also embraced aspects of privatized probation…..

….Throwing those nonviolent criminals in jail – especially when there are so many of them – gets expensive for cash-strapped states. Misdemeanor cases fill up jail cells with minor offenders who present no threat to society, but a great cost to the government: at a price to states and counties of around $50 per day per prisoner. In comparison, putting a nonviolent offender on probation costs, according to one estimate, only about $1.25 a day.

It costs even less when the states and counties hire private companies to monitor those on probation. Sentinel Offender Services and Judicial Corrections Services are the two big players in the industry, although there are a smattering of smaller companies.

Those companies make offenders pay for their own probation by charging them fees. It saves the states and counties a lot of money. It also makes the companies a lot of money: Human Rights Watch estimated that private probation companies in Georgia alone rake in nearly $40m in fees a year.

While states save and companies profit, the offenders pay a lot. There is no cap on the amount of fees a private company can charge minor offenders, and the longer the probation period, the higher the fees.

In some cases, the probation fees can add up to twice as much – or more – than the court-ordered fines…..

AFSCME Privatization Update

Information from AFSCME's research librarians on the latest activities, problems, and issues in the contracting out of public services