Headlines
1. FL: Some privatization fails the ‘cheaper, better’ test
2. GAO report: Fighting fire with the wrong sector?
3. Outsourcing faulted in taxpayer-funded call center layoffs
4. PA: Consultant reaps state windfall
5. Ariz: Editorial: State’s transit woes won’t be resolved by toll roads
6. Wall St. analyst: $50 million from privatizing Vermont lottery too high
7. WV: Can public-private concept save roads?
8. Ex-inmate crusades against judge nominee
9. Cash crunch boosts government service firms
10. Penn: Analysis — Lawmaker adds incentives for state store selloff
11. UT: Privatization a possibility for recreation centers?
12. Opinion: Should mass transit be privatized in U.S.?
News Summaries
1. FL: Some privatization fails the ‘cheaper, better’ test
The Tallahassee Democrat reviews privatization under Florida Gov. Jeb Bush and how his successor has made some changes to Bush’s approach. "The Department of Veterans Affairs, for instance, wants to take over some staffing at three nursing homes that were opened with private nursing-assistant and kitchen employees during the administration of Gov. Jeb Bush. This is the latest example of something that looked good at the time, but apparently didn’t work out precisely as planned."
2. Fighting fire with the wrong sector?
The Government Accountability Office faulted outsourcing projects at the Forest Service in a report released last week, prompting renewed calls for more scrutiny of the Bush administration’s effort to contract out federal jobs, a plan known as competitive sourcing, according to the Washington Post. The Forest Service does not have a realistic long-term plan for determining which agency jobs should be given to the private sector and does not have reliable data to back up claims of cost savings, the GAO said. In addition, outsourcing substantial numbers of Forest Service jobs to the private sector could, over time, reduce the agency’s ability to fight fires in the wilderness and to respond to emergencies such as Hurricane Katrina.
3. Outsourcing faulted in call center layoffs: Operators: Internet-based relays are to be sent through the Philippines
Layoff notices were distributed starting Friday to employees of a relay call center for the deaf that is scaling back operations. GoAmerica Inc. announced last week it is making the cuts because it blocked international calls, resulting in a drop in the center’s call volume. The service is for domestic use only, and employees said many of those international calls originated from Nigeria, where scammers would use the system to try to defraud U.S. businesses and residents. The taxpayer-funded service is used by the deaf, speech-impaired and those who are hard of hearing to relay phone conversations. At least a half-dozen employees said that while fraud had been a serious problem for years and made up a significant percentage of their calls, it’s not the only reason call volume has dropped. They also blame outsourcing to the Philippines, according to an article in the Modesto Bee.
4. PA: Consultant reaps state windfall
With the amount of money Deloitte Consulting has been paid by the state in recent years, some might consider it deserving to be a state agency in its own right.
During the last five years, state records show Deloitte Consulting, which opened an office in Susquehanna Twp. three years ago, has been paid nearly $414 million. With the contracts Deloitte still holds, the company is on track to approach or exceed the half-billion mark soon, according to a report in The Patriot-News. The international firm, with U.S. headquarters in New York City, provides audit, tax, consulting and financial advisory services. Most of its contracts with the state have been primarily for services related to information technology. Some current and former state workers question how this one company has gotten so much of the state’s business and whether it has anything to do with the ties to Deloitte held by four people in high-level positions in the Rendell administration. They also question whether any of this has clouded state officials’ judgment in being good stewards of tax dollars.
5. Ariz: Editorial: State’s transit woes won’t be resolved by toll roads
Arizona’s Tuscon Citizen has an editorial advising the state to go slow in toll roads. "Arizona is running on fumes financially, and its transportation system is especially needy.. We will need at least $60 billion in road, highway and rail fixes in the next 20 years as the state fills up with people. Some 10 million of us are projected to be living in the Tucson-Phoenix corridor by 2040. Given those stresses, it’s not surprising that state lawmakers this week took up measures to bolster revenue by bringing toll roads to the state.We urge them to go slowly. Making Arizona navigable is a huge, complex issue. Toll roads are a piece of the puzzle, but as one Maricopa County transportation official told The Arizona Republic, they "won’t solve the crisis."
6. Wall St. analyst: $50 million from privatizing Vermont lottery too high
An official with a leading Wall Street investment House says the $50 million Vermont Gov. Jim Douglas hopes to reap from privatizing the state lottery is too high, according to a report in the Burlington Free Press. J.P. Morgan Managing Director Jeffrey Hyman told the House Ways and Means Committee Wednesday that given the current state of securities markets, he doubts Vermont could get the $50 million up-front payment for allowing private investors to lease its lottery for 40 years. Douglas has built that amount into his budget proposal for this year, saying he wants to use half the money for school construction and the other half for property tax relief.
7. WV: Can public-private concept save roads?
The Register-Herald Reporter reports on a proposed Public-Private Transportation Act to build and maintain state roads. "West Virginia officials were approached by the Federal Highway Administration with a suggestion to consider the public-private concept since it has proved to be successful in other states."
8. Ex-inmate crusades against judge nominee
A private prison company executive nominated to become a federal judge has run into a determined opponent — a former inmate, reports the AP. President Bush in June nominated Gustavus A. Puryear IV, chief lawyer with Corrections Corporation of America, to become a U.S. district judge in Nashville. That led Alex Friedmann, who spent six years at the company’s prison in Clifton, Tenn., to investigate Puryear’s qualifications. He looked up every case where Puryear was listed on the docket as counsel. The prisoner-turned-inmate advocate found only five instances where Puryear was the attorney of record. By his count and Puryear’s, the judicial nominee has been involved in only two federal court trials during his career. Convinced that the well-connected Puryear was unqualified to be a federal judge and might face a conflict of interest overseeing litigation involving his former employer, Friedmann began a public relations campaign against the nomination that led all the way to the Senate.
9. Cash crunch boosts government service firms
The weakening U.S. economy has unleashed layoffs, reduced profits and sucked value from the stock market, but some companies, such as those that run prisons and consult for government, can benefit from harsh economic times, according to a report in Reuters. When state and local budgets see shortfalls, cash-strapped governments hire companies like management consultant Maximus Inc, social services provider Providence Service Corp and prison company Corrections Corp of America, according to analysts.
10. Penn: Analysis — Lawmaker adds incentives for state store selloff
The latest attempt to privatize Pennsylvania’s state-owned liquor stores faces the same formidable coalition as earlier tries and the added hurdle that stores now are widely viewed as more customer-friendly, reports the Pittsburgh Tribune-Review. "Most Pennsylvanians seem satisfied with the way the state store system is now. There isn’t a hue and cry for privatization," said Al Neri, editor of The Insider, a statewide political newsletter.
11. UT: Privatization a possibility for recreation centers?
Publicly owned recreation centers within Salt Lake County take notice: If a private company can do the work better, you might get shut down. The Utah House reversed course on Friday and approved a bill that would force Salt Lake County and all cities within the county to create an inventory of all "competitive activities" that are not so-called core governmental activities. In essence, public recreation centers are not quite on the chopping block yet. The bill just requires a listing so government officials can see whether public dollars would be better spent by allowing a private company to do the work. But Salt Lake County Mayor Peter Corroon fears the inventory is the first step toward a push for privatization that will eventually shut down recreation centers and golf courses, reports the Desert Morning News.
12. Opinion: Should mass transit be privatized in U.S.?
Wayne Madsen writes in the Columbus Dispatch: The privatization mania sweeping the nation has shown us that taking taxpayer-funded assets and turning them over to corporations is as close to vulture capitalism as one can get."
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