July 24, 2014

Top Story

Public-Private Partnerships in Correctional Health Care

PPPs offer better cost control, improved performance, increased accountability and reduced taxpayer risk

Lauren Galik, Leonard Gilroy

Over the past several decades, state prison populations have skyrocketed, and so too have corrections expenditures. In an attempt to control costs while maintaining high levels of service, a number of states have begun to form public-private partnerships (PPPs) in correctional health care by contracting out some or all of their prison health services. This paper gives a brief overview of what the current state correctional health care market looks like, and explores the various options states have pursued to provide their inmates with health care while incarcerated.


Punishing Landowners Won't Save Endangered Species

Massive penalties turn imperiled species into unwanted financial liabilties

Brian Seasholes

The apparent sighting of a single ocean-going steelhead trout in the recently restored Malibu Lagoon is a rare, but welcome, piece of good news for the Endangered Species Act. Unfortunately, the steelhead trout's potentially positive outlook in Malibu is the exception, rather than the rule.


Overprotecting Public Employee Pensions: The Contract Clause and the California Rule

Abandoning the California rule would give governments flexibility to deal with changing circumstances

Alexander Volokh

The Contract Clause, which prohibits states from making laws impairing the obligation of contracts, is commonly used to challenge state and local public pension reform efforts. Courts in California, and in other states following California’s example, follow a particularly strict rule: they hold not only that public employees are entitled to the pension they’ve accrued by their work so far, but also that they’re entitled to keep earning a pension (as long they continue in their job) according to rules that are at least as generous. Thus, in states where the California rule applies, one can’t constitutionally increase employee contribution rates or reduce cost-of-living allowances. There’s nothing legally invalid about the California rule. But the rule is unsound as a policy matter.


Why I Am Leaving California

High taxes and stringent regulations make California undesirable for many people

Adrian Moore

Simply put, California: I just can't take it anymore. All the taxing, spending and regulating hasn't led to a better quality of life. Maybe someday the state will once again value freedom and the entrepreneurial spirit. I hope so. But in the meantime, my family and I, like so many other successful Californians, are outta here.


Did the Supreme Court Just Signal Mandatory Union Dues Will Become a Thing of the Past for Public Sector Employees?

A possible future overruling of the decision that allowed compulsory dues to public-employee unions for non-political purposes

Alexander Volokh

The bare holding of the U.S. Supreme Court's opinion in Harris v. Quinn is fairly narrow. But the opinion may be more important than its bare holding, to the extent that it portends a possible future overruling of Abood v. Detroit Board of Education, the 1977 decision that allowed compulsory dues to public-employee unions for non-political purposes.


Phoenix Pension Reform Initiative Eliminates Taxpayer Risk, Saves Hundreds of Millions

Anthony Randazzo

The City of Phoenix Employee Retirement System is facing a $1.5 billion dollar unfunded liability and is operating with unrealistic actuarial assumptions that underestimate future taxpayer costs. Further, the 2013 reform initiative requires future employees to contribute unsustainably high percentages of their salaries to retirement savings, making retention very challenging. This report analyzes a proposed reform to the system that would address these challenges and finds it would reduce taxpayer liabilities, eliminate retention risk, save taxpayers $394.7 million by conservative measures, and possibly reduce taxpayer costs as much as $1.6 billion over the next 25 years.


California Teachers’ Tenure and Seniority Protections Struck Down

Judge’s decision badly reasoned, will probably be overturned on appeal

Alexander Volokh

On June 10, 2014, in Vergara v. California, California trial judge Rolf Treu handed down a decision invalidating a number of California educational statutes under the state constitution’s Equal Protection Clause. The statutes relate to teacher tenure and seniority, and the basic theory is that these statutes are unconstitutional because they made it too hard to get rid of incompetent teachers in public school classrooms. While teacher tenure and seniority have come under a great deal of criticism, Judge Treu’s opinion is badly reasoned and will probably be overturned on appeal.


Privatization & Government Reform Newsletter #8

June 2014 edition: Local privatization, federal privatization, criminal justice, bag bans, pension reform, and more

Leonard Gilroy

In this issue:

  • LOCAL GOV: What's New in Local Government Privatization
  • FEDERAL GOV: Reviewing the Past Year in Federal Privatization
  • PRISONS: The Latest in Criminal Justice, Private Corrections
  • PENSIONS: Rebutting Pension Reform Critics
  • REGULATION: Grocery Bag Bans—Are They Green?
  • PRIVATIZATION: Is Privatization a “Race to the Bottom?”
  • News & Notes
  • Quotable Quotes



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