May 5, 2015


Why Air Traffic Controllers Are Open to a Privatization Strategy. . . . In an ongoing effort by Republican members of Congress to de-federalize the FAA, Rep. John Mica (R-FL) has introduced legislation in the House to privatize some national air traffic control functions. . . NATCA is open to discussing a shake-up of the status quo—as long as the federal agency’s own needs are met first. And while willing to consider some changes to national air traffic control operations, the association isn’t advocating for full privatization. Rather, it’s using this proposed legislation to highlight the importance of funding a system in critical need of financial support. Associations Now

In Congress, income inequality fact of life for food servers. Many of the Capitol’s food servers, who make the meals, bus the tables and run the cash registers in the restaurants and carryouts that serve lawmakers, earn less than $11 an hour. Some make nothing at all when Congress is in recess.. . . All work for Restaurant Associates, a major New York-based contractor that handles food services for the House and Senate. In a statement, the contractor said it “takes pride in paying above-market competitive wages.” It would not comment on individual employees. . . . A few Democrats objected. “You cannot stand on the Senate floor and condemn the privatization of workers, and then turn around and privatize the workers here in the Senate and leave them out on their own,” Sen. Bob Menendez of New Jersey said at the time. . . . Capitol employees’ struggles are causing discomfort for lawmakers – including some running for president – as national debate churns over income inequality. In April, dozens of Capitol workers staged a one-day protest.

NC: Toll contract could hinder new free lanes on Interstate 77. The N.C. Department of Transportation’s contract with a private developer to build toll lanes on Interstate 77 includes a controversial noncompete clause that could hinder plans to build new free lanes on the highway for 50 years. . . . Some area officials were surprised that under the contract with I-77 Mobility Partners, the developer would likely collect damages if the state added two new general-purpose lanes from Exit 28 to Exit 36 at the lake. . . . According to the noncompete clause, if DOT wants to add new free lanes to I-77, including Lake Norman, it would have to pay I-77 Mobility Partners compensation for lost toll revenue. That could be millions of dollars a year. The clause allows the state to build new toll lanes on the highway, so long as I-77 Mobility Partners manages them and keeps the revenue. Charlotte Observer

KS: Lawmakers to hear about privatizing KPERS. Three committees of the Kansas Legislature will meet Wednesday to discuss the possibility of privatizing the state’s pension system. That idea has been circulating among legislators and Gov. Sam Brownback’s administration at least since last fall when budget director Shawn Sullivan and Secretary of Administration Jim Clark presented it as an option during an interim meeting of the Joint Committee on Pensions, Investments and Benefits. Lawrence Journal World (blog)           

MO: Proposed Missouri gasoline tax talk still alive. The measure also deals with the possibility of converting Interstate 70 into a toll road, an idea that has not been popular with voters or lawmakers. KMBC Kansas City

MA: Gov. Baker seeks to privatize some mental health services. . . .The plan seeks to save $4.7 million on the treatment of mental illness, but the Baker administration would have to convince the state auditor that privatizing emergency mental health services in southeastern Massachusetts would save money without diminishing services. . . . The House committee’s budget would facilitate the Baker administration’s privatization plans, according to the Department of Mental Health. But state Representative Carole Fiola, a Fall River Democrat, filed an amendment with a bipartisan group of lawmakers from across the state that would require the department to maintain state-operated emergency services in the southeast. Boston Globe ($)

SC: Sometimes, Public-Private Partnerships Can Go Too Far. In this case, a government agency was criticized for placing too much of its authority in the hands of a partner nonprofit that was much less accountable and transparent with how it spent the public’s money. South Carolina state auditors called out that state’s commerce department for setting up a nonprofit organization with the South Carolina Coastal Conservation League to appropriate $5 million to offset the destruction of wetlands at a site that is now a Boeing factory near Charleston. The Savannah Morning News reports that the auditors ruled that Commerce failed to provide adequate oversight for the nonprofit’s complex dealings. Saying that they “could not determine the benefit of creating a nonprofit entity to accomplish this particular purpose,” they advised the agency not to take similar action in the future. The audit report said that the nonprofit spent $5.3 million when “only $743,000 was needed. The Nonprofit Quarterly

HI: Maui hospitals’ path to privatization could be costly. Hawaii lawmakers have given their approval for the potential privatization of Maui state hospitals, a switch that could cost the state hundreds of millions of dollars, according to preliminary state estimates. Pacific Business

DC: Charter school founder, company agree to pay $3 million to settle lawsuit. Charter school founder Kent Amos and his management company have agreed to pay $3 million to settle a lawsuit that alleged he used the company to divert taxpayer funds from the school for his personal gain. . . Since 2004, the school paid more than $14 million to the company, according to court records. Management fees rose while costs declined, because the company employed fewer people and duties were shifting to school employees, records show. Amos profited most in recent years, according to court documents. He received about $1.15 million in income in 2012 from the management company, according to federal tax records. In 2013, he received $1.38 million, including $103,000 paid to his wife, who was also listed as an employee. In February, the D.C. Public Charter School Board voted unanimously to revoke the s chool’s charter effective July 1, citing a pattern of fiscal mismanagement. Washington Post

DE: Charter choices resegregate schools, advocates say. Charter schools shouldn’t be able to give enrollment preference to students who live within five miles of their campus because doing so is leading to resegregation, some lawmakers and advocates argue. . .. Rep. John Kowalko, D-Newark, says Newark Charter’s five-mile radius preference leads to de facto segregation because it is situated in a mostly white, more affluent area of town. Demand for seats in the school is so high — its test scores among the best in the state — that it routinely has lengthy wait-lists which, Kowalko argues, makes it all but impossible for a black, low-income student from Wilmington to get in. USA TODAY