By now, many of you have probably heard that the Public Lands Development Corporation hearings have generated community outrage on all islands. Hundreds of people turned out and testified (the majority in opposition) at all the hearings. There are a plethora of videos of hearings on every island (except Lana`i and Ni`ihau) on Youtube.com under ‘PLDC’.
To our knowledge, CAP was the only group that raised concerns about public-private partnerships. This morning’s Civil Beat story highlighted concerns about these deals. Below is an except from the Civil Beat story as well as excerpts from an article about privatization. Also below is the transcript and video from Dan Rather Reports about public-private partnerships that we highlighted in our testimony.
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Excerpt from Civil Beat story: Could Public Land Corp’s No-Bid Contract Policy Lead To Sweetheart Deals?, By Sophie Cocke 09/10/2012:
“One area of concern is the lack of a requirement for competitive bidding on PLDC projects.
Public-private partnerships are a growing national trend, with states increasingly teaming up with private companies to help shore up aging infrastructure, develop state projects more efficiently and provide greater access to capital, according to Richard Norment, executive director for The National Council for Public-Private Partnerships.
He said that the number of states passing laws establishing PPPs has doubled in the past seven or eight years, driven by state budget constraints and a pattern of deferred maintenance on public works projects. Currently, 34 states have such laws.
But ensuring that there are adequate controls to protect the public’s interest is important, and competitive bidding is standard, said Norment. He was surprised Hawaii’s PLDC doesn’t require competitive bids and said the public should be concerned about that.
The PLDC’s proposed administrative rules say bidding is an option, but not required. The PLDC can enter into direct negotiations with private developers.”
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“1. We spend lifetimes developing community assets, then give them away to a corporation for lifetimes to come.The infrastructure in our cities has been built up over many years with the sweat and planning of farsighted citizens. Yet the drop off in tax revenues has prompted careless decisions to balance budgets with big giveaways of public assets that should belong to our children and grandchildren…
2. Insanity is repeating the same mistake over and over and expecting different results. Numerous examples of failed or ineffective privatization schemes show us that hasty, unregulated initiatives simply don’t work…
3. Facts about privatization are hidden from the public. Experience shows that under certain conditions, with sufficient monitoring and competition and regulation, privatization can be effective. But too often vital information is kept from the public. The Illinois Public Interest Research Group noted that Chicago’s parking meter debacle might have been avoided if the city had followed common-sense principles rather than rushing a no-bid contract through the city council.
Studies by both the Congressional Research Service and the Pepperdine Law Review came to the same conclusion: any attempt at privatization must ensure a means of public accountability. Too often this need is ignored…
5. Privatization often creates an “incentive to fail.” Privatized services are structured for profit rather than for the general good. A by-product of the profit motive is that some people will lose out along the way, and parts of the societal structure will fail in order to benefit investors.
This is evident in the privatized prison system, which relies on a decreasing adherence to the law to ensure its own success. Corrections Corporation of America has offered to run the prison system in any state willing to guarantee that jails stay 90% full. ‘This is where it gets creepy,’ says Business Insider’s Joe Weisenthal, ‘because as an investor you’re pulling for scenarios where more people are put in jail.’ “
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Dan Rather Reports – Episode: Private Prisons