The League of Women Voters of Palm Beach County are involved in several studies.
Privatization Study Overview
Privatization is a movement to deregulate private industry and transfer many government services, assets and functions to the private sector. We, as citizens of the United States, have been experiencing the growing effects of the privatization movement since the 1980s. Privatization efforts have been tried (with varying degrees of success) on federal, state and local levels. Federal efforts include Social Security/Medicare, student loans, military services and interstate highways. On the state and local level, agencies responsible for social services, transportation, mental health & public health care, corrections, and education have all seen remarkable increases in privatization activities since 1988.
The pace of the movement to privatize has escalated since 2008. The current economic recession and the trend in government over the years to reduce taxes have increased government budget deficits. The current recession is resulting in business failures, high unemployment, and a loss of tax revenues for federal, state and local governments. These revenue losses have added to the drive to downsize government by privatizing functions, services and assets. As was discovered throughout the study, as Connie Prince points out in the education article below, "information is limited because most of the operations are proprietary in a private company leading to a lack of transparency." That factor causes a bit of an unbalance in the study materials toward the negative effects of privatization in general. Failures are usually publicized and glaring, while actual facts are still behind the closed books of the private companies.
- submitted by Bill Stinson
Over the past few decades, state legislatures throughout the country have enacted state laws addressing privatization activities. By the early 1990s, several state legislatures, seeking to realize the promised benefits of cost savings and efficiency gains, had designed and enacted comprehensive, systematic privatization programs for their states. A decade later, however, no consensus had developed as to the effectiveness of privatization (outsourcing or contracting out), due, in part, to the lack of empirical data as well as the complexity of the issue. Consequently, the topic of privatization re-emerged as a controversial management issue for state policymakers. In fact, based upon its national survey, the Council of State Governments concluded in a 2003 report that many state agency directors had no clear idea of how much money privatization had actually saved.
Across the 50 states, legislative approaches to privatization differ widely, and while some states have enacted laws that promote and facilitate privatization, others have enacted laws seeking to regulate and curtail such activity. Moreover, such legislative approaches differ in scope. Some states have enacted broad-based privatization laws that apply to all such activity within the state (general privatization laws), such as the Massachusetts Pacheco law that tends to restrict and regulate such activities. Other states have passed laws that relate only to one or more sectors (sector-specific privatization laws), such as the Tennessee private prison contracting act, which, according to some commentators, has led to the rise of the national private prison industry. Issue-specific privatization laws also have been enacted and typically reflect policy concerns regarding such matters as nondiscrimination or public employee job security with respect to the outsourcing of services by public agencies.
In Florida in the 2011 session, a bill was passed attached to the budget which would privatize prisons. Due to its rather unorthodox procedure, the bill was overturned judicially as being unconstitutional. In this session, two bills are being introduced to privatize prisons. One concern has been the lack of transparency. Also, some legislators are concerned that privatization laws are being proposed without research as to any savings to the state. The Florida rules committee introduced a bill during the session which says that privatization of services can be kept secret until contracts are signed.
- submitted by Beverly Sidenstick
There are two proposals in the legislature which may help us to decide whether certain functions of water management should be privatized.
The first example is muddied because we have many quasi-governmental organizations involved. The Tampa Bay Water Authority (TBA) is one. It includes Pinellas and Hillsborough Co. and many of the cities in both counties. They took over the well fields and sewage treatment facilities and are governed by a board selected by the various governments involved. They get funds from selling their services and by grants from the Water Management District (WMD). They have introduced a bill in the Legislature to give them the right to sell "reuse water" from their sewage treatment plant to private users (HB 639).
These consist at the moment of residents in these counties on lines built for lawn watering by the WMD. They have extra water and want to sell it on the market. It is currently being released into Tampa bay to satisfy minimum flow requirements, set by the District to preserve the sea life in the bay. It is a nursery for the Gulf. Many fish lay their eggs here and the young fish grow until they can survive in the saltier, predator-filled gulf.
In Charlotte Harbor where the Caloosahatchee performs much the same service, its fresh water flow was cut off (for a different reason) and many shellfish and game fish disappeared from its waters. The river became filled with blue green algae and the fish that were left are unfit for human consumption. In fact the water was so toxic swimming and some boating were prohibited.
Should this water continue to be used to protect the environment? Should the WMD have to pay for it? Where would they get their money? Their budget was just cut by 25% by the Governor.
The second example is a bill introduced as HB 1103. It would change the definition of Mean high sea level to a much lower level. This would in effect give the beaches which are now owned by the state ,and also many wetlands and submerged waters, to the adjacent landowners. Public access to many beaches would be removed and many wetlands, now protected by the state, would be up for development.
DCF as a Case Study,
- submitted by Lillian Lima
Privatization: The Florida Department of Children and Families as a Case Study It has been over a decade ago that Florida began turning its child welfare program over to private contractors instead of state workers. And according to AP/WPEC-CBS12.COM (CBS, channel 12), despite spending a half billion dollars a year, the Department of Children and Families does not have a standardized system for evaluating in most areas of its 20 child welfare contractors. This lack of standardization makes it impossible to prove that the 40,000 children in the system are being helped. Nor can the state show with confidence which contractors are performing well, adequately or poorly.
- submitted by Nancy Futch The rapid expansion of prison privatization as a solution to reduce prison overcrowding, the capitol expense of building new prisons, and the cost of prison operations is worthy of investigation.
Advocates of privatizing correctional services state that private prisons can achieve savings over public prisons by purchasing in bulk, eliminating overtime and employee benefits, and reducing the red tape.
Opponents of privatizing prison services argue that a true and accurate comparison between public and private costs and services is difficult and complex, and does not provide a compelling argument for privatizing prison services. Lack of oversight and accountability, political posturing to affect public policy which increases incarcerations, preying on the voiceless (juveniles, mentally ill, immigrants), and increasing profits by cost-cutting measures that affect the welfare of prisoners and staff while neglecting rehabilitation and lowering recidivism are areas of concern. It is well documented that the only clear incentive to privatize prisons is to cut costs. Government contracting out the supervision, housing, and caring for those it imprisons to a for-profit industry that grossed 5 billion dollars in 2011 is cause for intense scrutiny.
- submitted by Connie Prince
Our Polk County school district is among the top 40 largest in the nation. We are the 8th largest district in Florida. There are 160 campuses that include 24 charter schools. With a general fund budget of 732.5 million dollars, for-profit education management organizations will continue to be interested in privatization of our schools. The LWV privatization of education study was compiled in 2007. The information is limited because most of the operations are proprietary in a private company leading to a lack of transparency. The conclusion reached at that time was that there was still no evidence that a private company can operate a public school more efficiently or with a better outcome than more traditional schools. However, with the financial hardships the school districts are facing, there will be a need for more public-private partnerships. These may include food, transportation, planned curriculum and facilities. Walter G. Ambrey, a school administrator for Baltimore City Schools, shared several lessons learned in what he called a fairly good experience. One was to establish performance objectives with accountability measurements in place. Another, negotiate terms for severance and renegotiation upfront. He suggested a Chief Financial Officer representing the school district to monitor progress and funding. Last, but perhaps what we need to consider first, is the importance of having the support of the entire school community and teacher's union before proceeding with caution.
Strategies for Best Practice
- submitted by Joan Verrett
Privatizing a government service is a complex undertaking that requires a major commitment of resources. It involves careful definition of the goals to be achieved, and assurance that all efficiencies have been implemented with the existing service model. For services such as utilities, transportation or parks it needs to be clear who owns and maintains the public facilities, infrastructure and assets. For provision of human services involving children, sensitive or vulnerable clients, it must be assured that this information is protected. Evaluation of the service "market place" must occur to assure a competitive bidding environment expert contract negotiation and a thorough understanding of the potential impacts to service customers. Most importantly, the process requires transparency, oversight and ongoing communication with stakeholders to understand their concerns about privatization, because, in the end, the public bears the success or failure of privatization.
The Public Policy Debate
The purpose of this article is to provide a description of the evolution of the public policy known as "Privatization." Privatization is a movement to deregulate private industry and transfer many government services, assets and functions to the private sector.
Nora Leech, LWVUS Committee Member