Category Archives: Nevada legislature

The Big Catch: Pay Us and We’ll Do The Right Thing

Banker Sorry A small group of ultra-wealthy individuals are getting alarmed by the widening income gap in America. [NYT]  Their cries hit some major news outlets and were analyzed in others. [Salon] [NationalMemo] And, as we might expect there’s a catch:  Corporate Welfare.

“There is a way to start. Government can provide tax incentives to business to pay more to employees making $80,000 or less. The program would exist for three to five years and then be evaluated for effectiveness.

The benefits would be huge. People would have more money to spend, and many would no longer need government help. That would mean a reduction in entitlements.” Peter Georgescu, CEO Young & Rubicam

Yes, you and many others read this correctly – CEO’s like Ken Langone (Home Depot founder) and Georgescu and Paul Tudor Jones are worried about the possibilities of either peasants with pitch forks or declining sales.  And, no, there is nothing new here. Nothing that ventures too far from the business model calling for tax breaks, cuts, incentives, etc. for corporations to locate in beautiful downtown West Buffalo Fart. 

If the suggestion weren’t so demonstrably callous it would be ludicrous and risible.  First, there’s nothing preventing companies from doing this without benefit of yet more tax cuts for the already wealthy corporations – or, is there.  Welcome back to the world of Shareholder Value!

Wal-Mart recently announced plans to increase company-wide minimum wage to $9 per hour, and to increase pay to $10 per hour for many employees by February.  And, then it bowed to the First Law of Staffing:

The company has also increased store staffing at peak hours so shoppers move quickly through checkout lines and see stocked shelves, said executives during the company’s quarterly earnings call earlier in August. [MarketWatch]

The old First Law is that you have enough employees if you can satisfy customer demand and maintain acceptable levels of client or customer service.  This should have been good news all around – except it wasn’t.

Those efforts contributed to a 15% drop in second-quarter net income compared with a year earlier, said executives. [MarketWatch]

What did Wall Street do?  The Street didn’t like that drop and punished Wal-Mart accordingly.

walmart stock

That’s right… it didn’t matter to investors if there were happier employees at the giant retailer; it didn’t matter that customers didn’t have to wait in the cashier’s line so long.  It mattered that the second quarter net income report was down on a YOY basis.

This is one of the more egregious contemporary examples of the Shareholder Value Monster trampling on any corporate plans to do what businesses should do best – meet customer demand with an acceptable level of customer/client service.

As long as the Financialists continue to steer the corporate ships details like customer service and employee retention – which used to inform management policy – will take a back seat to the quarterly earnings reports. So, Wal-Mart caved to the financial side and announced to its +/- 4,600 store managers that it would return to “pre-determined” staffing levels (back to the old levels), and cut employee hours to trim expenses.

CEO’s, of such organizations like Wal-Mart, are now trapped in a device of their own creation. If they attempt to offer higher wages (or improve the quality of customer service), both of which have long term benefits;  they are punished by the Shareholder Value oriented short term investors and their stock prices drop. If the stock prices drop so does executive compensation.  Should the stock prices drop too far in the estimation of investors the CEO can be gliding off on his or her Golden Parachute into the corporate sunset.

Thus, it isn’t surprising that the CEOs are anxious to have some taxpayer assistance “doing the right thing” (increasing wages) in the long term because the short-sightedness of the Shareholder Value Theory of Management has translated into a situation in which long term benefits are sacrificed on the altar of short term profitability.

The paycheck pinch: One of the CEO’s angling for government (read: taxpayer) assistance in decreasing the widening income gap is Ken Langone (Home Depot founder). Sales and revenue for Home Depot in 2011 was $68 billion, increasing to $83.1 billion in 2015. 2011 gross income was reported as $21.69 billion, increasing to $27.3 billion in 2015. Its current domestic income tax liability is $3.26 billion, it has a deferred domestic tax liability of $116 million. [Marketwatch]  And, Mr. Langone agrees that corporations should be given tax breaks in order to pay more to the employees of concerns like Home Depot.

There are some 20 Home Depot stores in Nevada, most in the Las Vegas area, some in Reno/Sparks, and a couple in what is understood as rural Nevada, Elko and Pahrump.  There are plenty earning less than $80,000 per year in these operations.  The wages for a sales associate range from $8.67 to $13.95; cashiers earn from $7.93 to $10.83; department supervisors earn between $12.01 to $18.91; and, retail sales associations can make from $8.68 to $17.16.  (See Payscale.com as information updates)

These salaries have tax implications in Nevada as a result of 2015 legislation:

The Modified Business Tax (MBT) is currently imposed on businesses other than financial institutions in the amount of 1.17 percent of wages paid above an exemption level of $85,000 per quarter. Financial institutions pay a higher rate of 2 percent. The MBT rate had been scheduled to decline to 0.63 percent for nonfinancial institutions beginning July 1, 2015. The MBT base has been narrowed significantly since the tax’s introduction in 2003, with exemption level increases in 2011 and 2013.

After significant debate over whether to expand the MBT or adopt a new gross receipts tax, the final plan includes elements of both options. The MBT will increase from 1.17 percent to 1.475 percent for most businesses, effective July 1, 2015. Mining companies will join financial institutions in paying the higher 2 percent tax rate. The MBT base is broadened by reducing the exemption to $50,000 per quarter, increasing the estimated number of MBT taxpayers to 18,607, up from the 13,492 paying the tax at present.[2] An earlier proposal to remove the MBT exemption for employer-provided health care costs was dropped.

After the first year, taxpayers may deduct up to 50 percent of their Commerce Tax payments over the previous four quarters from their MBT liability. Moreover, should total revenue from all business taxes exceed projections by more than four percent, the MBT rate will be adjusted downward, though to a rate no lower than 1.17 percent. [TaxFoundation]

Note the last paragraph, even with a compromise between larger and smaller corporations in Nevada, there’s still a bit of a tax break allowed on the Commerce Tax depending on the “previous four quarters.”  We’re probably not looking at any massive tax breaks in the 2015 legislation, but we need to add these to the $88 million in breaks given to Apple [MJ]  and the state’s generosity to Tesla in the form of $1.25 billion. [RGJ] In the latter deal the understanding was that Tesla would pay an average of $25/hr.

Not to put too fine a point to it, but corporations are quite used to having government entities, be they Apple in Nevada and North Carolina, Tesla in Nevada, or the bargaining in the 2015 Nevada legislature over how to maintain tax revenues, engage in tax-payer subsidies for corporate operations.  Thus, it’s not the least bit surprising the CEOs would ask for tax-payer subsidization for payroll increases.

It would be a reasonable conjecture to conclude that Home Depot and other Big Box firms like Wal-Mart might be willing to adopt staffing policies which increase employee wages and provide for better customer service –IF and ONLY IF there are further tax breaks associated with those policies which will please the short-term oriented Shareholder Value financialists who pull on the purse strings.

Hanging the Wash? Consider what the CEOs are proposing – it’s all good: “The benefits would be huge. People would have more money to spend, and many would no longer need government help. That would mean a reduction in entitlements.”  But wait, there’s some loaded language herein.  Programs like SNAP, and subsidized housing, or similar assistance to low wage earners are NOT entitlements. These are situational support programs for people in need.  Social Security/Medicare, into which people have paid for decades are entitlements – you get what you paid for.

Loaded language aside,  What happens when the corporations raise wages, projected to reduce the number of people receiving social assistance, but the revenues for that social assistance are reduced by the tax breaks given to the corporations in order to support those very same wage increases? The tax payers are on the hook either way – they either pay for the social assistance programs which subsidize low wages,  or they subsidize the tax breaks to corporations to reduce the need for the social programs?  It’s a win-win for the corporations, and a lose-lose for the average American.

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Filed under Economy, Nevada economy, Nevada legislature, Nevada politics, nevada taxation, Politics

When Parrots Make Policy: Ron Knecht and the Great Trickle Down Hoax

parrot

Ron Knecht is the Nevada state controller.  He is a true believer in the Trickle Down Hoax and associated subsets of this egregious rationale for corporate welfare.  Not sure about the validity of this assertion? Read Knecht’s own words.   Mr. Knecht is most upset about the spending approved by the last session of the Legislature, sufficiently upset to grace Nevada editorial pages with his latest diatribe.

The first proposition in Knecht’s screed is that we are under-reporting the level of Tax Burdens on Nevada citizens.  His second major point is that “substantial empirical research shows that the numbers that determine the impact of government on economic growth and the public interest are total government spending amounts, not only those from particular accounts or sources. Research cited in our Controller’s Monthly Report #1 (at controller.nv.gov) shows that total public-sector spending, including state and local levels, has been too big a fraction of our economy for over 55 years.” [EDFP]

There are two problems with this paean to Koch Corporation Economic Theory. 

Problem One:  The assertion assumes that all government spending has a negative relationship to economic stability or growth.   Gross Domestic Product Formula

For an individual who has an academic background in mining economics, it’s remarkable that he’s possibly forgotten the good old, often cited, GDP formula in which “G” for government is part of the formula by which we measure the economy of both the states and the nation. Nor can we assume all governmental expenditures are counterproductive.  If, for example, the Federal government  decided to close Nellis AFB, what would be the impact on the Nevada economy?   Here’s the answer: (pdf)

As of 2012 there were 32,771 included in the base employment figures. 8,186 active duty military, 20,231 dependents, 289 reserves, civilian employees totaling 868.  There were 563 “non appropriated funds” civilian employees, and 2,055 on-site contract civilians; 579 “other civilians” were employed at the base.  The estimated dollar value of the jobs created at Nellis AFB was $229.7 million.  Expenditures at Nellis (federal and state) totaled $5,071.4 million.

Problem Two: Since the argument that all government spending is necessarily excessive is untenable, Mr. Knecht falls back on a subjective observation: “total public-sector spending, including state and local levels, has been too big a fraction of our economy for over 55 years.”   We’re left with at least two questions about this assertion. First, how big is “too big?”  Secondly, what’s magical about speaking of the last 55 years (since 1960)?

There is no way to objectively answer the initial question, the percentage of state and local spending relative to the GDP ranges from 5.9% in 1948 to 11.4% in 2014.  We could be dramatic and declare that this represents a 93% increase in state and local spending from their own sources over a 67 year period, but then we have to remember we’re speaking of 67 years, and the annual increase is an unimpressive 1.38%.

The percentage of state and local governments from their own sources as a percentage of GDP was 8.4% in 1960.  This would yield a 36% increase over the last 55 year period, an annual increase of 0.6545.   Even if we extend the numbers as globally as does Knecht in his discussion of expenditures and include federal, state, and local outlays, the total expenditure as a percentage of GDP was 25.7 in 1960 and 31.7 in 2014, an increase of 23% over the 55 year period, or  0.4181 annually. [OMB download Table 14.3]

State Local Expenditures GDP There’s nothing particularly dramatic about the state and local expenditures chart, and even less about the total outlays of the federal, state, and local expenditures.

Fed State Local Spending percentage of GDP The annual increases simply do not support the level of histrionics associated with the clamor from right wing politicians for decreased government spending.  Further, there is no reason not to take the numbers back as far as they go – to 1948.  There’s nothing magical about the last 55 years, certainly nothing in the actual numbers, which supports the assertion that we’ve experienced some form of grotesque increase in the level of spending as a percentage of GDP.

Problem Three:  Hyperbole doesn’t equate to substantiation. Knecht continues:

“This continued metastasis of government has slowed economic growth significantly over the last half century, directly damaging the public interest and producing an ever grimmer (not better) future for our communities and children. And Nevada politicians and special interests have played a substantial role in this uncaring destruction, especially those who supported this year’s taxing and spending blowout.

What are the true facts? First, state spending’s (sic) already excessive burden on our lives and wellbeing has increased 10 percent faster in the last decade than the incomes of Nevada families and businesses. (Due to changes in reporting categories, there is no pre-2004 total spending data comparable to figures since then; otherwise, we would use it. Hence, meaningful comparisons to earlier years such as 1992 are not possible.)” [EDFP]

These paragraphs don’t represent an economic argument, they are an ideological one.   Again, there’s an un-anchored assertion, that without the increase in government spending there would have been greater overall economic growth.   Since there’s no empirical data available because we can’t undo the government spending in the last 50 to 67 years, we’re left with an assumption – that all the revenue collected and spent by various levels of government would automatically have been re-invested in productive economic activity.   

The experience of 2007-2008 should have given us an example of what can go wrong when money isn’t transferred in ways described by classical economic theory.  Money didn’t necessarily move from investors into plant expansion and greater employment – too much went to feed the Wall Street Casino, into increasingly sophisticated financial products which had more interest in Bubble Manufacturing than in creating financial stability.  Perhaps in some utopian, and essentially academic, system money not spent on taxes would have been put into research, development, manufacturing, and sales efforts – but in the very real world of modern finance that’s not how the system works.  Mutations such as the management theory of shareholder value, and the rise of the Financialists, insured that the old illusions don’t make a solid foundation for current realistic economic discussions.

Additionally, as noted with the Nellis AFB example, not all government spending is universally considered economically counter productive.  Nor can it be effectively argued that government spending doesn’t enhance economic stability and promote growth.   Investments in infrastructure, such as the national highway system, can lead to decreases in production costs, and increases in output, yielding a net rate of return above that of private capital as shown during the forty year period from 1950 to 1989. [Rand pdf]

Knecht also attempts to create a cause and effect relationship between “excessively burdensome” taxation/spending and stagnant wages.  Welcome to the land of Post hoc ergo propter hoc.   Controller Knecht’s diatribe manages to ignore the effects of “gains in labor productivity, the division of earned income between labor and capital profits, and the allocation of labor compensation among wages and nonwage benefits.” [Brookings]  Nor does he cite the trends related to full employment, declining union density, the misclassification of employees, and the race to the bottom in labor standards. [EPI]  Knecht’s also omitting a new notion, “downward nominal wage rigidity,” in which workers in a buyers market are fearful of losing all employment so will settle for lower wages. [RCM]  [Economist]  Even the hard-right Federalist Society, of which Knecht is a member, cites “reduced labor demand,” “increased labor supply,” (and gratuitously tosses in the Affordable Care Act) as causal factors in wage stagnation.  In short, his simplistic, post hoc ergo propter hoc argument misses the point from the left, the center, and the right.  He might as well argue that wages have grown slowly since the beginning of the general economic recovery,  mid 2009, because Serena Williams won the Wimbledon Tournament on July 4, 2009.

Problem Four: Here’s another leap of logic which borders on the inexplicable.  Knecht’s syllogism appears to be: (1) Nevada has a median state and local tax burden; (2) Local governments are subsidiaries of the state; (3) Therefore, the state is responsible for negotiation results between local governments and local public employees.

“In fact, Nevada’s total state and local tax burden – that’s what matters, not headcounts – has risen to the midpoint: 25th or 26th in the U.S., depending on how measured. Because local governments are subsidiaries of the state and governed by it, legislators and governors bear significant responsibility for local spending too – especially the excesses caused by state laws allowing public-employee unions to drive local spending ever higher.”

There’s almost nowhere to begin with this other than to assume Knecht believes that local employee contracts are to blame for “excesses” in local spending.  Again, we’re in subjective territory.  How much is too much?  How much, for example, is too much to pay a police officer or sheriff’s deputy for being willing to engage with some of the most dangerous people in the state?  For being targets for radical right wing lunatics while the officers are trying to catch a bit of lunch in a pizza establishment?  How much is too much for a firefighter – how many people are willing to run into instead of out of a burning building? 

How much is too much to pay a county social worker?  The average caseload for a Child Protective Services investigator in Clark County is 18. The average case load for those responsible for supervising foster care is 13.  Or, to put it another way social workers are responsible for about 25 children per worker. [LVRJ]  The recommended standards are 12-15 children per social worker in foster family care, 12 active cases per month for initial assessment and investigation for every social worker; 17 active ongoing family cases per social worker with no more than one new case assigned for every six open cases.  The standard for a combined assessment and investigation in ongoing cases is 10 ongoing and 4 active cases per social worker. [CWLA]  

While hard cap number ratios may not reflect the flexibility needed to handle all local cases, recruiting and retaining trained professionals who are responsible for assessment, service planning, implementing and monitoring services, advocacy for children or adults who need basic services, interdisciplinary  and inter-organizational collaboration, record keeping,  and practice evaluation and improvements. [SWorg pdf] And, all this for about $45,000 to $66,000 per year.

Of course, there’s always that pesky teacher’s union – driving up the costs of public education – since there’s no way to run a school without teachers.  The current Clark County salary schedule begins at a non-too-impressive $34,637 and terminates for an “ASC + PhD” on step 15 at $72,331.  The median household wage in Nevada is $53,042.   In the private sector a doctorate in economics will get a person about $98,200 early in his or her career; a doctorate in statistics will get a person about $99,900 in the early years, increasing to approximately $128,000 in the later years.  [Payscale]

Aside from declaiming, without context, that salary negotiations are a significant driver of “excessive” local spending, Knecht also ignores another picky detail – population. In 1960 there were approximately 291,000 residents of the state of Nevada, 285,278 to be more exact.  By 2010 there were 2,839,000 residents.  There was an 895% increase in the population of the state in last 50 years.  This is the point at which “headcounts” do matter, it obviously takes more people to deliver services to 2.8 million persons than it does to provide them to 291,000.

NV Population 1960 2010

And now comes Controller Knecht’s finale, discounting efforts made by legislators to address spending issues in a rational manner:

“…as if hearing every detail of the budget means that politicians make the right decisions. Legislators can’t really know the value of each spending proposal when they hear almost exclusively from proponents, most of them paid for by our tax dollars to advocate for their interest, not for voters, taxpayers and the public interest. They certainly can’t determine its net social value unless they get equally extensive testimony in the same hearings on the damage done by the taxes needed to fund each item – and they never do that.”

There are a couple of features which require untangling in this paragraph. First, a person can be an advocate for social workers and also be a voter, a tax payer, and a person concerned with the public interest.  An advocate for highway funding is also a voter, a taxpayer, and concerned with the public interest.  There is no way to compartmentalize people, their advocacy, and their public spirit.   In Mr. Knecht’s taxonomy anyone who advocates for better police, fire, education, and social services, or highways, health inspections, public mental health services, parks, wildlife, and libraries – is not advocating “for the public interest.”  As if the public interest lies solely in diminishing these services in the name of “smaller government.”  This isn’t an economic argument – it is completely, totally, an ideological statement; and, it’s judgmental to boot.  So also is the term “net social value.”

“Net social value” is one of those buzzwords associated with radical right wing economics of austerity, and unfortunately it comes without any real meaning. [Guardian] It’s related to the economic term “social return on investment,” which is only slightly more precise.  “Social Return on Investment is an analytic tool for measuring and accounting for a much broader concept of value, taking into account social, economic and environmental factors.” [NewEcon]   Knecht’s context seems to place the “net social value” proposal closer to the Cost Benefit Analysis methodology and not quite so analogous to the SROI calculations.  Analysis in these terms can get very mushy very quickly.

For example, in purely economic terms (and ones Controller Knecht may find troubling) one of the best SROI or “net social value” or just old fashioned economic stimulus spending is the SNAP program.  A USDA Study designed to test whether or not SNAP benefits improved the economy found that an increase of $1 billion created about $1.79 billion in economic activity (GDP.) Or, that every $5 in new SNAP benefits generates about $9 in economic activity. [USDA]

If we expand the terms to include socially beneficial activities the measurement becomes more difficult to manage. How, for example, do we measure the quantitative benefits of public libraries?  Several states have made the attempt and most have returned results which might be at variance with Mr. Knecht’s ideological preferences.  South Carolina reported that for every $1 spent on public libraries contributed $2.86 in value to the state’s economy.  Florida studied 17 public libraries and demonstrated about $6.40 in economic benefit for every $1 in their budgets. [ALA]

Mr. Knecht assumes that “net social value” cannot be determined unless there  is equal weight given to the opponents of government spending for government services.  This, in turn, assumes that the arguments of the opponents are of equal quality and veracity as those of the proponents.  The evident extrapolation of Mr. Knecht’s argument is that any advocacy of government spending on government services must be self-serving, and therefore cannot be in the public interest. However, what are we to make of a hypothetical argument advanced by public health nurses that the state invest more in the inspection and regulation of out patient surgical centers? Simply because some such centers do not care to be inspected and regulated are we to assume that there would be a “negative net social value” to the increased number of inspections? What are legislators to do?  Knecht advises “focus?”

“Above all, they can’t make the right decisions if they substitute laboring over program details for focusing on the premier fact that government is already so big – even while still growing – that it has slowed economic growth to a long-term crawl and thus damaged our communities and children’s futures. If they really cared, they’d address and fix that first.”

Repeat the drum roll: Larger government = slow economic growth. As we’ve seen earlier in this post, that argument doesn’t stand under even cursory scrutiny.  This is a highly subjective point of view, and informed more by ideology than by economics.   If our legislators “really cared” they’d go over those program details, looking for ways to streamline services without compromising the basics, and in doing so would address issues in education, public safety, public health, and the quality of life in Nevada – without resorting to ideological blinders.  We could use more wise owls, and fewer parrots?

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Filed under Nevada budget, Nevada child welfare, Nevada economy, nevada education, Nevada legislature, Nevada politics

Quick Bucks and Long Term Losses: The Benzer Debacle and Nevada HOAs and COAs

Chicken Roosting Leon Benzer is worried about his family’s future, perhaps he might have given some thought to those prospects before launching his “sprawling conspiracy” in Nevada?  Another bunch of chickens comes home to roost:

“His sprawling conspiracy left a trail of ruin in its wake, including HOAs with substandard repair work, defrauded mortgage companies, defeated HOA homeowners with diminished property values and dozens of Benzer’s family members, friends and employees ensnared in his web of criminality,” prosecutors wrote. “Indeed Benzer by himself caused a (more than) 40-person crime wave in the Las Vegas Valley between 2005 and 2009, perpetrating crimes including mortgage fraud, election fraud, threats of violence and intimidation, abuse of the judicial process, tax fraud and obstruction of justice.” [LVRJ]

The conspiracy was a tangle with a simple objective: “The goal was to gain control of HOA boards through election rigging, obtain construction-defect litigation contracts for Quon and, ultimately, construction repair work to Benzer’s company, Silver Lining Construction.” [LVRJ

The result for Benzer was a 15 1/2 year sentence from a Federal District judge, plus 5 years supervised release, and $13.4 million in restitution. [LVRJ]   Mr. Benzer also played fast and loose with NRS 116.31105-7.  In Nevada, HOAs must have executive boards of at least three members, and the board members must be owners of units within the HOA.  So, from August 2003 until February 2009 Benzer and his associates:

  • Identified HOAs which could bring construction defect cases
  • Engaged real estate agents who would identify units available for purchase in the targeted HOAs
  • Enlisted straw purchasers for the identified units who would carry out Benzer’s scheme to get construction defect litigation contracts
  • Secured financing for the straw purchasers
  • Insured the straw purchase members were elected to executive boards of the HOAs (fraudulently)
  • Worked with the fraudulently elected straw purchase executive board members to manipulate property management, claims of construction defects, and to secure contracts for Mr. Benzer’s company. [DOJ Benzer]

Civic Duty

What would make HOAs such an inviting target for this kind of felonious manipulation?  First and perhaps foremost, the HOAs have an advantage in that multiple buildings or units can be conveniently lumped together, unlike having to deal with multiple individual owners.  The very nature of community interests can be twisted into an advantage for the unscrupulous.  So, if the sidewalks are 4.5 ft wide instead of the required 5 ft. then it’s obviously easier to get a large contract to improve pedestrian walkway easements on private property, or to encroach on landscaping, or whatever needs to be done to meet the local building codes and standards.

Secondly, we might want to consider the owners’ interests.  One of the HOA/COA advantages is that one can have some lawn or exterior landscaping without having to do the maintenance.  Just the thing for older residents who don’t have an interest in shoving the lawn mower around every weekend.  Or, perhaps, just the thing for younger residents who aren’t ready to invest in the lawn mower, week whacker, and other appliances of landscape management.  Or, can’t afford to hire landscapers themselves? The same applies to maintaining communal items – roofing (in connected buildings/units) or parking areas, walkways and other communal areas.  The advantage is that the individual owner isn’t responsible for the roof, or the parking, or the sidewalks – the disadvantage is that the HOA, being responsible is also a prime target for the likes of Mr. Benzer and his merry gang.

Third, and nearly always the case in relatively small operations, is the problem of finding people to participate in the management of an HOA/COA. This would seem a small issue if only three people are required for Board membership, but this doesn’t mean the problem goes away.  There are those who own HOA/COA properties who are not residents – they may be those who once resided in the community but have moved on, while still maintaining ownership of the unit.  They may have never resided in the community, but maintain the property as a rental.  It would seem that an HOA or COA with a high percentage of absentee owners could be an inviting prospect for the Benzer style take-over scam.

From the psychological speculation side of the issue, those people who moved into an area managed by an Executive Board and the property management firm because they didn’t want to bother with ‘community issues,’ may not be the type to get actively involved in the management and executive decisions related to the property or properties. The “Let George Do It” perspective is a powerful force in modern life.

Therefore, we might be left holding the banner for the old saw: 10% of the people will do 100% of the work.  How often the executive board work gets done is specified in the by-laws – by law the Board must meet “least once every quarter, and not less than once every 100 days and must be held at a time other than during standard business hours at least twice annually.” [NRS]  Let’s speculate that the more often a board meets the more oversight it does of property management, and that the board which meets only four times per year (two of which must be in the evening) has pretty much let the managers take over the subject.   Here, too, is an opening for the unscrupulous.

Legislative Duty

Given the extensive nature of Mr. Benzer’s highly questionable operations, it would seem the Board Scam would have drawn some legislative attention. It didn’t in the early days, the 2003 session of the State Legislature didn’t pass any legislation regarding Chapter 116.  In the 2005 session, the legislature enacted SB 325 which address management and fiscal issues.  In 2007, AB 396 required: “a member of an executive board who stands to profit personally from a matter before the board to disclose and abstain from voting on the matter.” Governor Jim Gibbons vetoed the measure.  His objections were, (1) the act might increase assessments; (2) there could be “dramatic changes to common areas,” and (3) it was a late bill and the legislature should have given it more consideration.  [DB 5/2009]  It would be November 2007 before Scott Canepa, a construction defect lawyer, brought information to the federal investigation into Benzer’s scheme. [LVRJ]

The next session in 2009 , did give the entire Chapter (116) much more consideration: SB 68; SB 182; SB 183; SB 253; SB 261; SB 351; AB 129; AB 350; and AB 361 were enacted. [NVleg] The provisions in AB 350 helped fill a void in management ethics, boards were admonished as follows:  “and shall act on an informed basis, in good faith and in the honest belief that their actions are in the best interest of the association.”   To its credit, when the details of the Benzer Scam-A-Rama unfolded the Nevada Legislature did act to curtail this kind of behavior.  And, perhaps had former Governor Jim Gibbons not been so allergic to the expression “solar energy,” AB 396 might have helped alleviate some of the damage back in 2007. 

Oversight and Information

The Nevada Legislature did what legislatures generally do best – enact legislation to criminalize crimes already committed. The prevention of any replication of Mr. Benzer’s operations is laudable.  However, before castigating the Legislature it should be noted that it’s impossible to legislate away problems before the information is available.

Members of HOAs and COAs, and member of the general public, might want to know  the status of an HOA or COA with particular attention to those factors which might render it a potential target for disreputable and downright criminal elements.  What oversight is in place for examining the activities of Executive Boards?  For examples, are there HOAs or COAs which have a relatively high percentage of absentee owners?  Let’s speculate that the higher the number of absentee owners the greater the chance for illicit behavior such as those straw buyers.  What kinds and to what extent is financial and management information available to owners and prospective buyers, and can we make improvements in the amount of information and access to it?

Caveat Emptor

There are some things owners and potential buyers can do to protect themselves.  The first might be to read the provisions on NRS 116.  It’s long; it’s wonky, and it’s in legal-ese, but it does define terms and set forth the fundamentals of HOA/COA operations.  If there’s no appetite to read the entire thing, then a person would be well advised to read  sections NRS 116.3075 through NRS 116.31107 on “meetings and voting.”

The second would be to ask questions such as: How many owners are absentee? What’s the percentage of proxy ballots? Again, the assumption is that the further removed the direct oversight, the greater the potential for problems.  Or, when and where are ballots counted in Executive Board elections?  What are the provisions for “spoiled” ballots or other ballots which might be rejected? And, what are the grounds for rejections?

What are the terms and term limits of executive board members?  Too long and there may be problems with “old boy” connections; too short and there’s the loss of “institutional memory.”  What percentage of the board members are residents?  What is the process by which property management firms are hired?  What is the process by which contracts are let for maintenance, construction, and rehabilitation?

NRS 116.31175 requires the availability of “books, records, and other papers of the association” for review “at the business office of the association or a designated business location not to exceed 60 miles from the physical location of the common interest community…”

las vegas 60 mile radius As the map indicates, that’s a fair portion of Clark County, and an owner or potential buyer might well want to know where, and how accessible, is that location with those “books, records, and other papers.”

Mr. Benzer will be a guest of the Federal government for the next 15 and one half years, with supervision for an additional five, however that doesn’t mean that there won’t be others who will apply their intelligence to those endeavors which will enhance their wealth without worrying about pesky ethics issues.  In the mean time it seems advisable to have some Legislative attention paid to:

  • How well protected are current HOA and COA owners in Nevada from potential scam artists similar to the Benzer group?
  • How well informed are potential HOA and COA buyers in Nevada, and are there steps we can take to better protect their interests as consumers?
  • Are there further steps which might be taken to insure that banks and other mortgage lenders don’t become involved in straw buyer, and similar schemes?

In order to prevent future Scam-A-Ramas of this ilk may require a combination of Caveat Emptor and Quis Custodiet Ipsos Custodes?

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Cliven Bundy: How Can We Miss You If You Won’t Go Away?

Bundy Riders

Let’s Talk Nevada covered the adventures of Senator Rand Paul (R-KY) in Mesquite, NV complete with pictures, and an interesting exchange:

“Cliven Bundy’s son, Ryan, stated there is no place in the U.S. Constitution that allows the federal government to hold land and he asked Paul what he would do to correct that problem. Paul agreed that public land should belong to the states and local governments, but that private ownership is best.”

Tricky Answer: The notion that the federal government may not own land, (pretty well covered by Article IV, section 3, clause 2 if we want to get specific about it, put to one side for the moment) – Notice that Senator Paul really didn’t answer the question.  What Bundy 2.0 wanted was reassurance that his outlandish right wing theory was correct, but what he got was pure corporate libertarian-speak. The candidate didn’t say he would actually do anything about the reversion of public domain lands, to the state, to the locality, or to any other public entity. He merely recited the corporate mantra that private ownership is always best.  If Bundy 2.0 was listening carefully, the response could easily mean that corporate interests would be able to purchase land and then charge users (ranchers) for the use of the property.   If for-profit entities were in charge, does Bundy 2.0 believe they would be under any compulsion to perform  land management activities other than that which would enhance the corporate bottom line?  Re-seeding? Noxious weed control? Grazing management? Would Bundy be able to evade paying for land use under corporate control, as his father has tried to avoid paying grazing fees?  And, if a higher bidder came along – would Bundy be looking for grazing property elsewhere?

But wait, there’s more:  There was more than a question from the audience.  Politico reports:

“The encounter came after Bundy attended an event for the Kentucky senator’s presidential campaign at the Eureka Casino in Mesquite, Nevada. When the larger group dispersed, Bundy said, he was escorted by Paul’s aides to a back room where he and the Republican 2016 contender spoke for approximately 45 minutes. (“There were no scheduled meetings at Senator Paul’s stop in Mesquite. He spoke to many people who came to this public event, none for 45 minutes and none planned,” Paul spokesman Sergio Gor said.)”

Cliven Bundy seems to have picked up the point about state ownership, “The state already owns the land…”

“The Nevada rancher said that he had expected only to have an opportunity to shake hands with Paul and make small-talk. He was surprised when campaign aides found a private room and allowed Bundy, his wife and son to speak with the candidate for the better part of an hour.

According to Bundy, the two mainly discussed federal land oversight and states’ rights, in addition to education policy — a theme Paul brought up in his speech.

“I don’t think he really understood how land rights really work in the western United States,” Bundy said. “I was happy to be able to sort of teach him.” [Politico]

How nice of Mr. Bundy to be so “educational?”  He doesn’t claim ownership, he claims “rights.”  Bundy 1.0 apparently understands that private ownership means private responsibilities – for fire prevention and fighting, grazing management, re-seeding, and maintenance – and he doesn’t want to pay for these.  He’d like the state to do it and let him put his livestock on the ground for free. Because? Freedom. Freedom as in Free loader.

Reprise:  Little wonder the Rand Campaign staff was anxious to tell us that the session between the Bundys and the candidate wasn’t “scheduled.” The candidate has already had to back away from Mr. Bundy once before:

“I want to tell you one more thing I know about the Negro,” Bundy told supporters shortly after the standoff, according to video footage captured by an onlooker. He recounted a time he drove past public-housing in Las Vegas “and in front of that government house the door was usually open and the older people and the kids — and there is always at least a half a dozen people sitting on the porch — they didn’t have nothing to do.

“And because they were basically on government subsidy, so now what do they do? They abort their young children, they put their young men in jail, because they never learned how to pick cotton. And I’ve often wondered, are they better off as slaves, picking cotton and having a family life and doing things, or are they better off under government subsidy? They didn’t get no more freedom.” [Politico]

Thus much for any outreach to African American voters? So, are the Bundys “in tune with” the Paul Campaign? [MSNBC]

And even more:  Last June two Las Vegas Police officers were gunned down by anti-government extremists.  Officers Alyn Beck and Igor Soldo were assassinated and the motivation was reasonably clear:

“…a “Don’t Tread on Me” flag and a Nazi swastika the couple placed on one of the police officers they ambushed Sunday at a pizza restaurant. They pinned onto the other officer’s body a note saying something to the effect of “this is the beginning of the revolution,” Second Assistant Sheriff Kevin McMahill told reporters.” [CNN]

Later reports said the Millers were too much even for the Bundyland bunch, not necessarily because of their views, but because of Jerad Miller’s criminal past.

“Jerad Miller was eager to support Bundy, who was confronted by federal officials after years of refusing to pay grazing fees. On April 9, he wrote on Facebook:

“I will be supporting Clive Bundy and his family from Federal Government slaughter. This is the next Waco! His ranch is under seige right now! The federal gov is stealing his cattle! Arresting his family and beating on them! We must do something. I will be doing something.”

I was out there but they told me and my wife to leave because I am a felon. They don’t seem to understand that they are all felons now for intimidating law enforcement with deadly weapons. So don’t tell you that they need people. We sold everything we had to buy supplies and quit our jobs to be there 24/7. How dare you ask for help and shun us dedicated patriots.” [MJ]

And here comes another Rand Paul connection:

“Jerad Miller’s Facebook “likes” include the NRA, American Patriot Media Network, Support the 2nd Amendment, The Patriot Party, Rand Paul 2016, Ron Paul, the Washington Examiner, Legalize Weed, Draft Judge Andrew Napolitano, the Heritage Foundation, FreedomWorks, American Crossroads, and Allen West.” [MJ]

Granted, any campaign gets its share of whackies. However, the Millers were making connections which the Paul campaign isn’t avoiding: Guns + Ultra Libertarianism + Candidates who espouse the connections between guns and ultra-libertarian views.  And, if one Paul campaign in Nevada could create chaos, there were some people imagining what a second one could do to the state’s clout in national elections.  (AB 302, SB 421, 2015)

The Ron Paul Campaign, which made the 2008 Republican state caucus such an interesting debacle for all to watch unfold, could be the prologue to a 2016 version of chaos created by Rand Paul’s version?  Efforts to convert Nevada’s caucuses into primary elections failed in the latest session of the Legislature. [Ralston]

In Nevada it’s hard to find room to wield a fly swatter without slapping at least one Tea Party enthusiast.  However, with that enthusiasm comes some perilous ground:  Association with dead beat rancher and resident racist Cliven Bundy; Association with the circumstances that left two police officers murdered in a Las Vegas pizza parlor; and, Association with one of the most controversial (but entertaining for Democrats) presidential season caucuses the Republicans have ever convened.  However, there are 496 days until the next presidential election so the GOP could find ways to skirt the impact of the Paul campaign in the Silver State.

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Filed under conservatism, elections, Nativism, Nevada legislature, Nevada news, Nevada politics, public lands, Republicans, Rural Nevada

Cluck, Cluck, AB 394 comes home to roost?

Chickens Roosting

A quick review:  Nine Republican members* of the Nevada Assembly introduced AB 394 in the last session, the bill would create a process for breaking up the Clark County School District into smaller, separate, districts because – “…Reconfiguring the structure of the Clark County School District into local school precincts will offer an educational system that is responsive to the needs and concerns of the residents of that school district;..”   (*Gardner, Fiore, Jones, Silberkraus, Hickey, Dickman, O’Neill, Seaman, and Trowbridge)

The bill passed in the Assembly on a 35-5 vote, and the Senate on a 13 to 7 vote, with one excused.  It was signed into law by Governor Sandoval on June 11, 2015.

The Numbers Game

For a party, the members of  which take umbrage at any suggestion they aren’t the party of fiscal responsibility, fiduciary trust, and conservative financial values, AB 394 demonstrates a level of financial naïveté that could easily be categorized as sophomoric. 

There is a inkling in AB 394, during its preliminary discussion of rural district consolidation in which there’s a hint that the Assembled Wisdom understood the principle of Economies of Scale.  However, the venerated Assemblage turned right around in the same bill and pretended these didn’t exist for the one district in the state actually large enough to benefit from those economies of scale.  For the uninitiated, here are some of the babes pitched out with the bath water in the interest of creating “responsive” little districts:

(1) The larger the operation (business) the more individual employees are able to specialize in various tasks creating technical expertise which in turn creates greater efficiency.  For example, a larger school district might be able to finance a specific office that focuses on testing and the administration of examinations.  In a smaller district these tasks might be assigned to a ‘curriculum director’ whose office is also responsible for the development of course content, the in-service training of teachers in that content, and the mapping of the curricular content throughout the district.  In the business domain, larger firms can separate tasks in the offices or on the shop floors that allows specialists to develop proficiencies in technical or production tasks.  

(2) Bulk purchasing.  Think of the difference in pricing between supermarket chain stores and the local corner bodega.  Volume, plus reduction in packaging and transportation costs, mean lower per unit expenses. There are approximately 24,286 first graders in the Clark County School District.  There are approximately 4,869 first graders  in the Washoe County School District.  [CCSD and Washoe SD]  Which has the better capacity to buy in bulk?  Which can negotiate for more discounts?

(3) Spreading overhead expenses.   Republicans, often supportive of mergers and acquisitions, note that the mergers of private sector firms allow for the rationalization of operation centers. or to put in more simply – it’s better (more efficient) to have one main office than two.   Again, the schizoid nature of AB 394 says that the rationalization of overhead expenses is fine for the rural districts, but CCSD is “just too big?”  By this logic, Goldman Sachs, Chevron, and JP Morgan Chase would have been broken up long ago.

(4) Let’s get to one economies of scale factors that’s extremely important for a large metropolitan population, the concept of Risk Bearing Capacity.  Again, the larger the enterprise the higher its risk bearing capacity.  The most common example of this factor is in the pharmaceutical industry wherein large corporate firms are able to finance (borrow for) research because profit lines in popular products provide investors with the assurance that the debts incurred can be paid off at the agreed interest rate.  Now, take a look at the Debt Service reported in the CCSD financials:

CCSD debt service

What we’re looking at above are all the bonds issued by the Clark County School District on which the district is paying off principal and interest.  Nor it is too difficult in a rapidly expanding population to have to issue bonds for school construction or renovation.  Schools aren’t  cheap to build and equip.  Constructing an elementary school for about 600 youngsters, at $190 per square foot will cost about $14,800,000.  A middle school for just over 900 students costs $215.14 per square foot, with a total cost of approximately $30,000,000.  High schools are even more expensive.  The total cost: $54,900,000 (1600 students) [NCEFAt this point one of the largest AB 394 egg layers  comes back to her nest.

“Moody’s Investors Services hasn’t downgraded the Clark County School District’s construction bond rating — yet.

But the credit rating firm late Monday issued a report warning a bill Nevada Gov. Brian Sandoval recently signed that could lead to the breakup of the nation’s fifth-largest public school system “poses uncertainty” and “a credit negative” to the district’s ability to repay debt.”  [LVRJ]

Investors who buy bonds (lend public & private institutions money) want their money back + interest.  The greater the risk the higher the interest rate on the bonds.   The ratings agencies, no saints themselves as we witnessed during the financial sector collapse of 2007-2008, are in the business of telling investors how much risk is involved – the lower the rating the higher the risk, therefore the higher the interest rate demanded for the loan.

The Clark County School District currently has an A1 rating from Moody’s.  The outlook was “stable” as of February 17, 2015.   What has “de-stabilized” this projection is – AB 394 – which creates “uncertainty.” Without spending the usual $150 Moody’s charges for smaller reports, let’s guess the nature of that “uncertainty.”   The Clark County School District’s report on its financials assures bond holders:

“Maintenance of the current property tax rate will be sufficient through fiscal 2015 to retire the existing bonded debt since the District issued previous bonds based upon the factors of growth in assessed valuation in addition to increases in student population. The Capital Improvement Program provided authority to issue general obligation bonds until June 2008 and will be repaid from a fixed tax rate of 55.34 cents per $100 of net taxable property. [CCSD pdf

Translation: The Clark County School District – as it is currently functioning – has the financial capacity to retire (pay off) existing debt, and the ability to repay Capital Improvement bonds from its property tax base. A property tax base of the present 8,012 square miles comprising Clark County, which according to the Nevada Department of Taxation has a final assessed value (property) of $69,258,468,466.  A number large enough to assure investors in CCSD bonds that they’ll get their money plus interest, since the ad valorem revenue is calculated at $495,059,633 for the county.   We can use the old reliable Red Book to determine what the Clark County School district can expect from its share of the property tax revenue: $819,903, 015 from a total 2014-15 assessed valuation of $62,904,942,089.

By now it should be getting obvious why Moody’s is getting nervous.  Under the terms of AB 394, there must be a plan in place to chop up the school district by the 2018-2019 school year.  Thus, we’d have an advisory committee and a technical advisory committee contracting with a consultant for the grand purpose of carving up the district – but how?

If the notion is to create “neighborhood schools” then would we amalgamate current high school attendance zones? [map]  However, a quick look at the obvious north/south or east/west divisions compared to the assessed valuations of the areas involved quickly demonstrates that not all school districts would be “created equally.”

Perhaps the “Performance Zones” could be used as a basis?  Where do we put the rural schools, from Moapa Valley to Laughlin?  Again, how does the dissolution of the district help any of these financially?  

Unfortunately for those who would be new map makers, Clark County, like so many other major metropolitan areas is comprised of various zones – residential, industrial, and commercial.  As long as the financial foundation of a school district is based on property taxation, then we have to live with the fact that while upscale residential property comes with high tax bills, there isn’t all that much of it.    A district carved out of a major commercial zone with a rather smaller number of residential properties in that zone might have resources in abundance compared to an area of high residential properties – and therefore higher numbers of students, but a lower total assessed valuation.  Geography can often be a real pain in the derrière and in this instance it’s going to be.

At the risk of petulantly pounding the dais – there appear to be only 12 members of the Assembled Wisdom in the last session who understood the gravity of separating school districts within a diversified metropolitan area, one with an overall assessed valuation currently capable of keeping investors optimistic about bonding capacity and bond retirement.  The remaining 48 – not so much – maybe one more round of Econ. 101 is in order?

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Filed under Economy, education, Nevada economy, nevada education, Nevada legislature, Nevada politics, nevada taxation, Politics, Rural Nevada, Sandoval

Kirner Update and Charter School Follies in the Nevada Legislature

Kirner There’s a difference between stale bread and stale politics; stale bread is useful.

“Well, this: Assembly Member Randy Kirner (R-Reno) is trying hard (perhaps too hard?) to be a “play-a”. He flippantly confirmed to Riley Snyder what we’ve been reporting about him killing Senator David Parks’ (D-Paradise) sexual orientation conversion therapy ban (SB 353). He then claimed he was “worried about litigation costs”, despite the Senate removing the law suit portion of the bill. The truth came out in private later, when he told a visiting constituent he just doesn’t like Senator Parks (and he’s just too obsessed with raiding PERS & busting unions to allow LGBTQ lives to be saved).” [LTN] (emphasis added)

The first indication of threadbare banality is Assemblyman Kirner’s worry about “litigation costs” in regard to SB 353.  This is the second to last resort into which a member of the GOP will dock when a bill or policy is presented that might protect potential victims of discrimination or abuse. (The last resort is “God Says…”)

Our second clue revealing  Assemblyman Kirner’s platitudinous and unoriginal offerings is his adherence to ALEC’s talking points about public employee retirement programs and labor organizations.  It’s fairly easy to spot a Talking Point Politician – when he or she is faced with current facts and social needs, our undaunted culture warrior reverts to hackneyed and uninspired reiterations of someone else’s phrases.  “I’m worried about the costs of litigation,” applied to everything from civil rights law to equal pay for female employees. “I’m concerned about the effect this will have on the free market,” applied to everything from environmental standards to the appointment of consumer protection advocates.   This isn’t politicking, it’s sloganeering.  Real players bring something to the table for discussion – something besides personal animosities and stale talking points.

Industrial education isn’t the same thing as industrialized educationSB 509 is still alive and in the Assembly Education committee. There’s a phrase in the bill which should catch our attention, here’s the LCB analysis:

“Existing law requires an application to form a charter school to be submitted by a committee to form a charter school. (NRS 386.520, 386.525) Sections 21 and 22 of this bill authorize a charter management organization to apply to form a charter school. Section 2 of this bill defines the term “charter management organization” to mean a nonprofit organization that operates multiple charter schools. Section 21 also revises the required contents of an application to form a charter school. Sections 21 and 36 of this bill authorize a charter management organization to request a waiver of requirements concerning the composition of a governing body. Section 22 revises the manner in which a sponsor is authorized to solicit and review applications to form a charter school.” 

Let’s differentiate between EMO’s  (Educational Management Organizations) which are for-profit educational enterprises and CMO’s which are non-profits.  While there is this crucial difference, they share some corporate interests.  One of those interests is the promotion of schools – not school districts.  This becomes an important point when we’re discussing overall school administration because when comparing “successes” schools and school districts are very different creatures.

For example, KIPP (a CMO) operates individual schools in urban areas. However, KIPP doesn’t run school districts. Recently a KIPP school in New Jersey was touted for it’s high performance in Newark, but when a bit of expertise was injected from Rutgers University scholars the results were less than stellar:

“The bottom line is that KIPP schools performance on comparable measures of student growth, controlling for demography, resources, etc., are relatively average (marginally above average). Many district schools, including ones in Newark, far outperform them.” [SchoolFinance]

In other words, anecdotal evidence of high performance (without running a model of demographics across the district to see deviations)  doesn’t mean a particular charter school operation is necessarily “successful” or that its operating plan is better than that which might be achieved by a local district itself.

A few years ago, another CMO, Rocketship was supposed to be achieving “astronomical” results, and was all the rage. [WaPo]  Rocketship used an “industrial model” with lots of computers and an equally large contingent of inexperienced teachers.  Rocketship moved into San Jose, California, but a year later the San Jose Mercury News was headlining, “Rocketship we have a problem.”  It seems that corporations like Rocketship DO have to follow local zoning regulations.  More issues arose with the charter non-profit, and by May, 2014 the Alum Rock CA Board of Education rejected a Rocketship charter, saying (1) it had not made Adequate Yearly Progress, there was no assurance made to investors that the schools would make AYP in the future, students spent a large portion of their day with no licensed teacher (a violation of state law), the CMO offered misleading figures on student-teacher ratios by not including Learning Lab Students in the calculations (creating a 1:37 ratio), and while Alum Rock School District spends about 6% on overhead costs, the Rocketship school was required to set aside 15% for its corporate headquarters.  The final point in the rejection was that for all the Wonders of Technology described in the Rocketship process, the students were actually encouraged to be passive rather than active users of the technology.

A third CMO, Green Dot Schools, has had a similar rocky history.  After much initial ballyhoo, Locke High School in Watts, CA was subdivided into segments under the management of Green Dot. Two years later the segments were themselves closed – for lack of “success” – the result?

“In fact, Animo Locke II, Animo Locke III, and Animo Locke Tech all failed the 2012 WASC accreditation. forcing Green Dot to merge all of the campuses, operationally, into the one school to receive accreditation. Animo Watts will continue to operate independent of the schools located at the main Locke campus.” [Ravitch

Eli Broad and other Silicon Valley ‘reformers’ were challenged by the LA Times:

“Charters claim that their schools score far better than traditional public schools serving similar students. That’s not true. The students at Locke or any of the other at-risk high schools in LAUSD are not “similar students” when compared to those who have left the public schools and moved to the charters. What Broad, Green Dot and the others do not reveal is the scores of those charter students when they were in regular public schools. It’s our belief that those students were already outscoring their fellow students in the traditional schools before they moved into charters. Low-scoring students do not enroll in Broad’s charters. His charters have skimmed off the education-oriented kids who otherwise would be raising test scores for traditional public schools.”

Cracks were showing in 2010, when it was reported that by Parent Revolution’s own definitions 14 out of 15 Green Dot Schools weren’t reaching their promised levels of success, [examiner] and to add substance to the LA Times critique, Green Dot Schools were targeting schools for takeover which were already exceeding Green Dot results. [SeattleEd] (More at MJ 4/1/2011]

By 2013 the Green Dot experiment in Los Angeles was plagued by high teacher turnover, inadequate administration, and unstable evaluation policies.  Meanwhile, a Tacoma, WA middle school is being taken over by Green Dot Schools, but parents are advised that “space is limited.”  [TNTRib]  — not an admonition which can be pronounced by public schools.  The Seattle Times reported that most seats were already taken by April 29, 2015 — ‘lotteries were held for 6 of 8 charter schools.”  There are no “enrollment lotteries” for public schools.

It would indeed be interesting, if JUST ONCE some legislative body decided to put the kind of care, attention, concern, (and potential funding) in the hands of its public school districts as it does into the hands of privatizing and elite exclusionist interests.

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Filed under education, nevada education, Nevada legislature, Nevada politics, privatization, Union busting

Battle Born and Still Squabbling: The Waning Days of the 78th Assembled Wisdom

Nevada Flag

Battle Born and still fighting.  Day 116 and the the squabble over revenue plans and priorities continues in the Assembled Wisdom.  See Let’s Talk Nevada for daily details.  The Latin Chamber of Commerce has lined up with the Governor’s proposal. [Slash Politics]  This makes some sense because those business interests which are opposing the Governor’s plan would actually pay very little under it. [Ralston] No, it doesn’t come as any surprise that those who are opposed to the plan don’t bear most of the burden, while supporters would pay a bit more than their share.

This morning’s agenda for Assembly Ways and Means includes SB 491, “Provides for the award of a grant to a nonprofit organization for use in Fiscal Year 2015-2016 and Fiscal Year 2016-2017 for the recruitment of persons to establish and operate high quality charter schools to serve families with the greatest needs..” 

Also on the agenda, AB 480, which would allow mortgage wholesalers from outside the state to act as mortgage brokers.  AB 481 would strike the limitations on the Consumer Affairs Commissioner and B& I Director to provide investigative assistance to the Attorney General in cases involving deceptive trade practices.

The Assembly Taxation Committee will take on SJR 13, the Settelmeyer, Gustavson, Goicoechea proposal to restrict property taxes — “no new taxes, and even less of the old ones” —  “This resolution proposes to amend the Nevada Constitution to limit the amount of certain property taxes which may be cumulatively levied per year on real property to 1 percent of the base value of the property. “ How does this fit with revenue plans and local government interests? It doesn’t.  The beast got out of the Senate on a 12-7 vote.  The city of Reno estimates it will cost about $8 million in lost revenue.

The Assembly Committee on Education will be looking at SB 509 which pertains to charter schools.  From the LCB analysis:

“Existing law requires an application to form a charter school to be submitted by a committee to form a charter school. (NRS 386.520, 386.525) Sections 21 and 22 of this bill authorize a charter management organization to apply to form a charter school. Section 2 of this bill defines the term “charter management organization” to mean a nonprofit organization that operates multiple charter schools. Section 21 also revises the required contents of an application to form a charter school. Sections 21 and 36 of this bill authorize a charter management organization to request a waiver of requirements concerning the composition of a governing body. Section 22 revises the manner in which a sponsor is authorized to solicit and review applications to form a charter school.”

“Existing law authorizes a sponsor to revoke a written charter or terminate a charter contract under certain conditions and requires a sponsor to take such action if the charter school demonstrates persistent underachievement. (NRS 386.535, 386.5351) Sections 5 and 27-29 of this bill: (1) authorize a sponsor to reconstitute the governing body of a charter school in such situations; and (2) revise the conditions under which such action is authorized or required.”

The Senate Education Committee will be looking at SB 92, which requires a teacher deemed minimally effective after the three year probationary period is reverted to probationary status.  And, then there’s the predictable assault on “seniority” as defined in master contract agreements:

“Existing law provides that when a reduction in the workforce is necessary, the board of trustees of a school district must not lay off a teacher or an administrator based solely on seniority. (NRS 288.151) Section 30 of this bill requires the board of trustees of a school district to consider certain factors when reducing the workforce. Section 30 also provides that, if two or more employees are similarly situated after the application of those factors, the decision by the board of trustees to lay off one or more of the employees may be based on seniority.”

Meanwhile, back at the Battle of the Budget……………..

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