2018 was a busy year for me. I published more than 80 stories, across 19 different outlets. I took up a lot more investigative reporting (and discovered I quite like it). I also created this newsletter! I’m grateful for your readership, which has truly helped me make this challenging line of work possible.

In keeping with roundups I did in 2017, 2016, and 2015, I’m going to once again take the end of December to reflect on some of the work I’m most proud of from the year.
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1. The Intercept: “Minnesota Attorney General — Now Democratic Frontrunner for Governor — Relied On Government Employees For Campaign Work, They Say” and “It Was All True”: Minnesota Attorney General’s Former Deputy Speaks Out About Participation In Political Work

I spent the summer in Minneapolis, and while I was there published a story about Minnesota’s longtime attorney general, Lori Swanson, who former and current employees told me routinely promoted employees who worked on her political campaigns. The first piece came out on a Monday, and because it partly relied on anonymous sources, the local press and political establishment tried to sweep it under the rug. Swanson’s office also tried to spin it as an attempt by the owners of the Intercept to settle some old feud on behalf of a company Swanson sued years six years ago. But three days later I published a follow-up, one that forced the state and local media to finally take it seriously. I firmly believe that the second story, which featured Swanson’s top deputy of eight years recounting his experiences on the record, would never have been possible without the first.

2. Washingtonian: “Has The New America Foundation Lost Its Way?”

I published an investigative feature into a DC think tank grappling with a high-profile scandal that raised questions about the role of corporate funding in research and policymaking. I looked at how the organization responded to this scandal, as well as how it handled other, more thorny problems that emerged as it grew in size and scale.

3. Democracy Journal: “Is School A Waste of Time?”

I reviewed a trollish book published by a libertarian economist who tried to argue that education is a waste of time and money. I do not recommend the book, but I did use the opportunity to write down some of my broader thoughts on education, its value, and its relationship to the labor market.

4. Washington City Paper: “Turnaround Runaround”

I was very proud of this cover story investigation I did on the wholly unscrutinized world of charter school consulting. This particular company—TenSquare—raked in millions of dollars in DC taxpayer funds since 2012 for “school improvement” services. I looked at TenSquare’s limited level of oversight and transparency, and talked to charter school leaders about how they felt pressured to hire the company, lest they’d face consequences.

5. Washington Post: “Public school buildings are falling apart, and students are suffering for it”

It was an honor to write an op-ed for the Washington Post, especially on the importance of investing in quality school infrastructure.

6. City Lab: “How Should HUD Count Family Homelessness?”

This story looks closely at a debate among homelessness advocates regarding who should be considered homeless. HUD uses a much more narrow definition of homelessness than other federal agencies, and this has major implications not only for who gets aid and support, but also how to understand the statistics HUD publishes about their progress reducing homelessness.

7. The Intercept: “How Labor Is Thinking Ahead to a Post-Trump World”

This piece sought to answer the question of what labor leaders might push for if Democrats reclaim power in 2021, and why organized labor’s past efforts failed when Democrats had unified control in 1978 and 2009.

8. Washington Monthly: “The Libertarian Who Accidentally Helped Make The Case for Regulation”

This was a magazine story about what happened when a prominent libertarian economist set out to prove that federal regulations are strangling the economy. But no matter how he sliced and diced the data, he could find no evidence that federal regulation was bad for business.

9. The Atlantic: “The Teachers’ Movement Goes Virtual”

There was a ton of great coverage this year of the teacher protests that swept the nation. This story was about one teacher organizing effort that went under the radar: virtual charter school teachers in California, who organized a union and voted to go on strike.

10. The Nation: “Letting Non-Citizens Vote in the Trump Era”

On Election Day, for the first time, undocumented immigrants and permanent legal residents in San Francisco were able to vote for their local school board. I wrote about America’s surprisingly long history of non-citizen voting, and the cities now working to bring it back.

11. Talking Points Memo: “Democrats Need Voters’ Help To Fix Gerrymandering. Will They Get it?”

I reported a feature looking at the constellation of different advocacy groups—both nonpartisan and partisan—trying to making voting rights a more salient political issue. For a long time, things like voter suppression and gerrymandering have been wonky issues mostly left to lawyers and the courts. But in 2018 there was far greater recognition that defending democracy requires a more all-hands-on-deck strategy.

12. City Lab: “A Five-Decade Fight to Improve Housing Choices for the Poor”

This year was the 50th anniversary of the Fair Housing Act, and I wrote a few stories to commemorate the civil rights milestone. I especially loved doing this Q&A with Alex Polikoff, a lawyer in his 90s who is considered the grandfather of housing mobility.

13. The American Prospect “Can a Blue Wave in a Blue State Make Ben Jealous Maryland’s First African American Governor?”

Unfortunately the answer to this headline’s question was no, but I was proud of the magazine story I reported during Jealous’s campaign. (I also wrote “Why Ben Jealous Lost” for The Intercept the day after the election.)

14. Washington City Paper: “D.C.’s Master Facilities Plan Will Shape the City’s Balance Between Neighborhood Schools and Charters”

This cover story sought to illuminate an obscure planning process in D.C. that has big implications for the future of public education in the city.

15. The Intercept: “Nearly Every Member of the Progressive Caucus Still Takes Corporate PAC Money”

As a host of progressives running for office in 2018 swore off corporate PAC money on the campaign trail, I co-wrote a piece looking at the fast-changing movement to get money out of politics, and the mounting pressure on sitting incumbents to change how they raise money.

***
Thanks for reading! I’ll see you in 2019.

Originally published in The Intercept on December 26, 2018.

Two likely Democratic presidential contenders in 2020 have made quiet strides in recent years to bring into vogue a little-known policy that could reduce economic inequality — one that harnesses current law to expand workers’ ability to become owners in their place of employment.

Sens. Bernie Sanders, I-Vt., and Kirsten Gillibrand, D-N.Y., have worked to advance legislation on employee stock ownership plans, or ESOPs, which are retirement vehicles that allow a business owner to sell their company stock to a trust co-owned by the company’s employees. The company typically purchases the owner’s shares with a loan, divides the shares among the staff, and then repays the debt annually with pre-tax payments from the company’s profits. When a worker leaves or retires, the company buys back that worker’s stock at fair market value, giving them a slice of the company’s capital earnings.

A bipartisan group of legislators first took up ESOPs in Congress in 1974, but when that generation of lawmakers retired, their successors did not embrace employee ownership with the same enthusiasm. The focus on deficit reduction, coupled with a few bad employee ownership scandals in the ’80s, ’90s, and early 2000s, led many otherwise receptive politicians to steer clear. Federal incentives for employee ownership began to dwindle, beginning under George H.W. Bush and continuing through the next three presidential administrations.

Last year, however, Sanders took up the mantle. He introduced legislationto expand state centers that provide training and technical support for establishing cooperatives and ESOPs, modeled off the successful Vermont Employee Ownership Center in his home state. Gillibrand also signed onto that legislation, which never made it through Congress.

This past summer, for the first time in more than two decades, Congress passed a pro-ESOP piece of legislation. Introduced by Gillibrand in the Senate and Rep. Nydia Velazquez, D-N.Y., in the House, the Main Street Employee Ownership Act makes it easier for small businesses to establish ESOPs and co-ops. It was included in the defense bill that President Donald Trump signed in August. (Another likely 2020 presidential contender, Sen. Elizabeth Warren, D-Mass., introduced legislation this year for a different type of employee ownership. Known as co-determination, it would require companies with revenue over $1 billion to allow workers to elect at least 40 percent of their board of directors.)

Unlike conservatives, who have defended employee ownership on the grounds that it’s most certainly not socialism — indeed, it turns laborers into capitalists — liberals have taken to ESOPs because they strengthen worker power, boost worker income, and increase corporate transparency. Workers, the arguments goes, care as much about their employment as they do about corporate profitability, so they won’t advocate for a strategy that leaves them jobless, even if it is better for the short-term bottom line. “Simply put, when employees have an ownership stake in their company, they will not ship their own jobs to China to increase their profits; they will be more productive, and they will earn a better living,” Sanders said last year.

Some progressives have criticized ESOPs, with the argument that they are little more than tax breaks for corporations that don’t give workers real ownership of a company or a meaningful say in its management. ESOPs can also create tensions with traditional labor unions, as the latter seeks to organize workers, while ESOPs tend to blur the relationship between workers and owners.

Indeed, not many unionized ESOP companies exist. Some unions — like the International Brotherhood of Electrical Workers and Steelworkers — have been open to the idea. Others, “like the [United Automobile Workers], are inherently distrustful,” said Loren Rodgers, executive director of the National Center for Employee Ownership, a national nonprofit based in Oakland, California. “In the auto industry, the threat of strikes is really important, and it’s harder to get people to strike against something when that might hurt the value of the shares in their retirement account.”

MORE THAN 14 MILLION current and former private sector workers have participated in ESOPs, according to the National Center for Employee Ownership. They work in almost every industry, from supermarkets, like the chain Publix, to policy research, like the firm Mathematica. About 7,000 companies today have the retirement plans. Research released earlier this year estimated that the average worker in an ESOP had accumulated $134,000 in retirement wealth from their stake.

Joseph Blasi, an economic sociologist who directs the Institute for the Study of Employee Ownership and Profit Sharing at Rutgers University, has long championed ESOPs because he believes they benefit both workers and companies, and are a way to transfer wealth to the middle class. Blasi points to studies showing that workers at ESOP companies tend to earn 5-12 percent more in wages than those at traditionally owned companies, have retirement accounts that are 2.2 times larger, and are far less likely to be laid off during economic downturns.

Sobering statistics about growing wealth inequality — like that the top 10 percent of households owns 80 percent of the financial assets, and the top 1 percent owns more wealth than the bottom 95 percent combined — underscore the need for economists, activists, and policymakers to figure out ways to counteract these trends.

“I’ve been working on them for over 40 years and only now have ESOPs become cool,” said Blasi.

A PAPER PUBLISHED this summer by a young economics researcher in Denmark has reinvigorated interest in ESOPs, as his findings suggest that the financial benefits of the retirement vehicle may be even greater than previously understood.

Esben Baek, who grew first interested in employee ownership after living in San Francisco and discovering pizza and bakery co-ops, pivoted from his traditional labor economics research to begin studying ESOPs in 2016.

Baek’s University of Copenhagen master’s thesis makes use of a previously untapped data source: the 1997 National Longitudinal Survey of Youth. He found that ESOP participation boosted wages for U.S workers by nearly 13 percent, much more than the 8 percent figure ESOP researchers typically cite. Baek also found that male and female workers enjoyed near-equal economic gains under ESOPs, more so than other variables, like union membership or being married, on the panel survey. Baek is presenting his research at an ESOP conference in New Jersey next month.

Douglas Kruse, a Rutgers University economist who studies employee ownership, was “thrilled and surprised” to learn of Baek’s work, he said, as it helps address a persistent issue that has plagued the ESOP community.

There have been many ESOP studies over the years, looking at things like productivity, employment stability, satisfaction, and organizational commitment. While the research has generally shown positive results, some economists have remained skeptical, because if workers have to decrease their wages and benefits in exchange for owning a piece of the company, then ESOPs would generally be considered too risky of a bet for workers to make.

Yet the existing empirical studies have suggested that isn’t the case; when scholars like Kruse and Blasi looked at cross-sectional and administrative data, workers who owned shares in their company also tended to have higher wages and benefits compared to those in non-ESOP companies. ESOPs appeared almost too good to be true, drawing skepticism from other economists about the underlying data.

“What Esben has done, the reason his data is especially good, is because with cross-sectional studies, maybe the workers are somehow better or they have higher credentials, and that’s why you see them receiving higher pay,” Kruse explained. “But with this national longitudinal data set, you can compare workers before and after joining the ESOP companies, and when you do, you see the pay goes up, and it appears to go down when they leave the ESOP.”

Kruse suggests this may be driven by the economic principle known as “efficiency wages,” in which ESOP companies recognize that paying higher wages on top of the employee-owned stock is really the most effective way to get more committed workers and boost productivity. “If a company establishes an ESOP but then cuts worker pay, then workers could start to see that as a financial risk,” Kruse explained. “Whereas if they get the ESOP on top of regular pay and benefits, then it’s like, ‘Hey, this company is doing well for me,’ and really helps create that sense of ownership and community.” Both Kruse and Baek agree that further research is needed to help explain what’s going on.

ASIDE FROM BEING a way to address inequality, the impending “silver tsunami” — the wave of baby boomer retirements expected over the next decade — is another reason ESOPs are gaining traction. According to a 2017 study by the worker ownership group Project Equity, 2.3 million businesses are owned by baby boomers who are approaching retirement, and these companies employ almost 25 million Americans.

While many of these business owners will fold quietly and sell their companies to competitors or private equity firms, ESOPs offer owners another alternative: selling the company to its workers. Advocates say this can help to better ensure that jobs remain in the local community, while still allowing the retiring owner to cash out. According to Project Equity, one-third of business owners over age 50 report having a hard time finding a buyer for their company. As a result, many just quietly close up shop, often without even considering selling their company to the staff.

But if ESOPs really can yield such positive results — for workers, owners, and local economies — why do they remain so obscure?

Most people have heard of 401(k) plans, a different kind of retirement vehicle authorized in 1978. Unlike ESOPs, employees pay for 401(k) stock through pre-tax wage deductions.

J. Michael Keeling, president of the ESOP Association, said 401(k) plans have been far more common among small businesses that offer retirement plans, because they require less overhead to administer properly. “Most nations have something like social security and a mandated retirement program every employer has to contribute to,” said Keeling. “But in America, retirement programs are voluntary, so businesses usually go for the cheaper option.” (According to the National Institute on Retirement Security, about 45 percent of all U.S. households have zero retirement savings.)

Most people with ESOPs also have 401(k) plans, a recommended best practice to reduce financial risk. It’s not good for workers to have their retirement savings wrapped up in the fate of a single company, as the Enron disaster of 2001 showed. “There’s no question in my mind that if a worker has holdings in an ESOP, they should have a separate, diversified 401(k),” said Blasi from Rutgers University. “What we say, though, is that workers who have both accumulate more for retirement than workers with just one.”

One study, published in 2010 using Labor Department data, compared roughly 4,000 ESOP companies to all other non-ESOP companies with 401(k) plans. The researchers found the net assets per ESOP participant to be 20 percent higher.

“We’ve got a marketing problem,” said Rodgers from the National Center for Employee Ownership. Rodgers’s group was founded in 1981 and has spent most of its time conducting research and connecting worker-owned companies with one another. Since 2010, though, the organization has been trying to play a bigger role in getting the word out.

Rodgers has a few theories for why ESOPs aren’t more well-known. Some of it he chalks up to the incentives of the business adviser world: If you’re a broker, like an investment banker or personal wealth adviser, the fees you take home at the end of the day would be higher if you encourage your client to sell their company to a private equity firm or another corporation, rather than their employees, he said. Financial advisers also tend to advise owners on things they know how to do themselves, and ESOPs are highly regulated, complex structures. “If you, as a CPA, advise a business owner to sell to their employees, you’re probably advising them on something you personally don’t know how to do,” said Rodgers.

From the owner’s perspective, selling one’s company to an outside firm is generally going to be a more lucrative option, and often easier, than creating an ESOP, Rodgers explained. “It’s hard to say no to more money, and it certainly can look easier, because you just sell your business and walk away.”

Further complicating things are several past ESOP scandals that haunt the field. One such incident occurred when United Airlines went bankrupt in 2002, leaving its employees with ESOP stock in the lurch. In some other cases, owners who sold their company to their employees had their businesses assessed at way too high of a value, so that when they sold their shares to an ESOP, they made off like bandits and left the workers paying an outsized loan. But the Labor Department has been cracking down on that overvaluation issue, and since 2014 especially, ESOP advocates say, worker safeguards have grown to be far more defined.

A number of groups have been ramping up efforts to educate the public and the business community about employee ownership. This past spring, Rutgers University approved the establishment of the Institute for the Study of Employee Ownership and Profit Sharing, the world’s first research center of its kind. In 2016, the Pennsylvania Center for Employee Ownership, the nation’s first state center dedicated exclusively to promoting awareness of ESOPs and co-ops, was founded. Kevin McPhillips, the executive director, told The Intercept that he travels around talking to businesses and elected officials, trying to help get the ESOP and co-op message to owners who are beginning to plan for retirement. A few other state centers have long existed to provide technical assistance to worker-owned companies, like those in Vermont, Ohio, and Colorado.

It’s well past time for leaders to take the prospect of employee ownership more seriously, Blasi says. “It’s not a panacea, but neither is regulatory reform or raising the minimum wage.”

Originally published in Washington City Paper on December 19, 2018.
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There’s no sign on the small house on Minnesota Avenue SE—no way to know that this isn’t a home, but a kind of school, specifically meant for charter school students who are being transitioned between different parts of D.C.’s special education system. Tucked away in the Fairlawn neighborhood, the Future Family Enrichment Center has no website, no business license, and no known accreditation. That hasn’t stopped at least six D.C. charters from sending children there for interim instruction.

Federal law sharply regulates the teaching of students with disabilities. Teachers cannot subject special education students to repeated disciplinary action if their misbehavior is related to their disability. If teachers and parents determine that a special education student needs new arrangements, such as a transfer to a different school, the District must provide the student with access to a general education curriculum while those arrangements are being made. For some parents, that means homebound tutoring. D.C.’s traditional public school system also provides a dedicated school for this purpose, known as C.H.O.I.C.E. Academy. But some charters have looked to other options, including the Future Family Enrichment Center.

Now the Enrichment Center program is under scrutiny from city agencies. Advocates have expressed alarm over a number of features of the program, including the quality of services it provides and its lack of identifiable accreditation. Combined with its low profile, these characteristics have raised worries that, by placing students in the program, participating charters are keeping special education students “out of sight, out of mind.” Neither the Office of the State Superintendent of Education nor the Enrichment Center itself were able to confirm the exact number of charters using the Center’s services, meaning the actual figure may be higher than six.

Two weeks ago Maria Blaeuer, an attorney and program director with Advocates for Justice and Education, a DC nonprofit focused on helping parents of students with disabilities, contacted the DC Public Charter School Board with a range of concerns, which she described in an email.

Both OSSE and the PCSB have since launched investigations.

Blaeuer sent her email after learning about the experience a 5th grade student had at the Future Family Enrichment Center earlier this year. The student’s charter boarding school, Monument Academy, suspended him ten times between the start of the school year in mid-August and early October. All students in special education have what’s known as an Individualized Education Plan, or an IEP, which is a document outlining how schools will appropriately serve a child with special needs. Students also have legally required IEP teams, and this student’s team consisted of three Monument representatives, his mom, and a parent advocate from the nonprofit So Others Might Eat. Together, following the tenth suspension, they determined that the child needed an alternative school to meet his needs. After an IEP team makes this kind of decision, OSSE has up to 45 days to help identify a school—known as a “non-public placement.”

According to the mother, Loretta Jones, and the parent advocate, Jennifer Fox-Thomas, Monument told Jones they would continue to suspend her son if necessary while OSSE looked for a non-public placement. Fox-Thomas responded that such warnings are illegal, because after ten suspensions, if it’s determined that a student is being disciplined due to problems caused by their disability, a school must find alternative ways to address the child’s problems during the 45-day transition. Monument recommended sending the student to the Future Family Enrichment Center, a move described to Jones as a “lateral placement.” Monument CEO Emily Bloomfield tells City Paper that her school intended the phrase as a synonym for “interim alternative educational setting”—which is a permitted temporary solution under the federal Individuals With Disabilities Education Act.

“Because they told me they would keep suspending my son I felt as though I was forced into putting him in the lateral placement,” says Jones.

Bloomfield says that while state and federal law prevent her from commenting on specific cases directly, her school sees the facts and timeline of this situation differently.

The child began at Future Family Enrichment Center in mid-October, and Jones and Fox-Thomas describe growing increasingly concerned by the quality of instruction he was receiving. Jones says that when she first visited she found her son doing worksheets on a first and second grade level, and had to ask the program director, Sharon Holley-Ward, to provide him with more rigorous work.

Fox-Thomas says she made two visits to the program to check up on Jones’ son. “I spent ten years as a special educator and two years as a special education coordinator at a charter school, and I’ve never seen anything like this,” she says. “It was nothing but busy work.”

Fox-Thomas describes the child’s worksheets as ranging from a first-grade level to a seventh-grade level. “I think [Holley-Ward] just downloaded handouts and passed them out willy-nilly without any instructional plan. There was no consistency,” she says. “All these things were ungraded, there was no apparent teacher response, and I completely got the sense that this is what every student there was doing.” Fox-Thomas says she was told the Center relies  exclusively on Khan Academy web videos to deliver instruction.

Jones’ son finally began attending his non-public placement last week, though Fox-Thomas says it could have been sooner if Monument had handled some logistics more quickly. Fox-Thomas and Blaeuer prepared to file a complaint over this, and have a mediation with Monument scheduled for next month..

City Paper visited the Enrichment Center twice over the past two weeks. On the first visit, one student was there, and the director, Holley-Ward explained that she started her company less than a year ago after providing homebound tutoring services. Her goal, she said, was to provide a place for students who needed educational services to go, so they would not end up on the streets and potentially in jail.

“I’ve been a principal at a DC public school so what I do is when [charter schools] have a student who is suspended or expelled, while they wait to do a [nonpublic] placement, I provide them the academic services,” she said. “And that’s pretty much it.”

City Paper could not confirm what school, and what years, Holley-Ward worked as a DCPS principal. She is the founder of and pastor for Greater Faith Ministries, a church in Prince Frederick, Maryland. She lives in Port Republic, Maryland and also owns the Minnesota Avenue SE property, according to city records.

Holley-Ward says she keeps her program small, limiting it to no more than seven students at one time. It typically runs from nine in the morning to two in the afternoon, and she accepts all grade levels. She says her job is to make sure that schools stay compliant with IEPs, and that their website is under development.

“I don’t have ties or commitments with no schools, no charter, no nothing,” she said. “It’s just if they call me and they say ‘hey can you service a kid.’”

Holley-Ward shared her cell phone number and said to call back if this reporter had any more questions. Two days later, City Paper called back with some follow-up inquiries. Holley-Ward answered the phone and said to call back in two hours. She did not ultimately answer the follow-up call, and ignored other subsequent calls and text messages.

City Paper went back to the property on Monday to find out who exactly works there and what the qualifications of the staff are. Holley-Ward opened the door and at least four students stood behind her. She refused to answer questions, including about her credentials or those of her staff, and asked this reporter to get off her property.

Emily Bloomfield, the Monument CEO, says that while Monument officials had not visited the program, her charter had contracted with the Future Family Enrichment Center on the recommendation of their attorney, Lauren Baum, who knew of other schools that were satisfied with its services. “I think very highly of Lauren Baum,” says Bloomfield. “She’s someone who always points out what we should do to satisfy the spirit and letter of IDEA and what’s right for students.” City Paper learned of at least one other charter network—Cesar Chavez—that Baum has referred to the program.

Baum tells City Paper that she has also never visited the Future Family Enrichment Center, but heard about it from a charter colleague who had been pleased with the services rendered. “In my experience, schools are utilizing FFEC as an interim alternative educational setting in a way that is compliant with what the laws governing the education of students with disabilities allow,” Baum says.

Bloomfield explains to City Paper that Monument only uses interim alternative educational settings as a “last resort”, and that she believes the Enrichment Center provided “the services necessary for the student to make progress toward their IEP goals and continue to participate in the general education curriculum,” as required by federal law. Bloomfield refutes accusations that Monument has ignored or forgotten any child sent to the program, and says their special education coordinator checked in with Holley-Ward on at least a weekly basis to monitor student progress and ensure IEP goals were being met.

“Monument is not bypassing any rules through its use of FFEC,” Bloomfield says. “We chose this option because we were searching for a new alternative to homebound services.” Homebound services are another way to meet a student’s IEP goals if a child is suspended, expelled, or transitioning to a non-public placement. Tutors either come to the student’s home to provide instruction, or they meet in a public location like a library.

However, Bloomfield says that while a total of three Monument students have been sent to FFEC, her charter ceased its relationship with the program on Monday “in light of concerns recently shared about business licensing and related regulatory issues.”

***

Last week, following Blaeuer’s email, representatives from OSSE and the Public Charter School Board visited the Future Family Enrichment Center and began reaching out to charter schools to learn more about their experiences with the program.

The PCSB declined an interview with City Paper, citing their recently launched investigation. “We’ll have more to say after that is completed,” says spokesperson Tomeika Bowden.

“OSSE’s top priority is the safety and well-being of all students attending public schools across the District,” says OSSE spokesperson Fred Lewis. “The agency is investigating the Future Family Enrichment Center and working with [local education agencies] to ensure they are following the alternative placement process to best serve students.”

It is not clear at this time how much money FFEC is earning from charter schools for its services. City Paper filed a public records request to review any contracts submitted to the PCSB, but the results of that FOIA are not due until January. However, the most recently available nonprofit tax filing for Somerset Prep DC Public Charter School listed the school paying the Future Family Enrichment Center $114,660 for special education services. Somerset Prep did not return a request for comment on this story.

OSSE has claimed unfamiliarity with the Future Family Enrichment Center, but Baum, the charter school attorney, tells City Paper that an OSSE administrative hearing officer “recently determined that, pursuant to federal and local law, the program was an appropriate interim alternative education setting for a student.” OSSE says that the hearing was adjudicating just one student’s situation, and that the hearing officer works for the Office of Dispute Resolution and is not an OSSE employee. Yet OSSE’s website describes the dispute resolution office as an OSSE subdivision.

Baum says that it is her understanding that the Enrichment Center’s services are provided “by certified and/or highly qualified staff in accordance with each student’s IEP.”

Fox-Thomas, meanwhile, struggled to determine the level of qualifications for those working at the Center, and does not think Holley-Ward has a teaching certification. Her biography on her church website lists her as having a Bachelor’s in English from the University of Maryland, and Masters’ in Social Work and Divinity, both from Howard.

What the law in D.C. requires for students to receive their entitled special education services is somewhat contested.

Lauren Onkeles-Klein, the director of the Juvenile and Special Education Law Clinic at the UDC Law School, says that D.C. charter schools have more leeway with some local regulations regarding education, “but the federal rights for students with disabilities apply equally to students in all public schools—DCPS and charters.” Onkeles-Klein says federal law requires that “highly qualified instructors implement a student’s IEP with fidelity,” but notes that the requirements “get a little mushy” when it comes to these alternative placements. “Kids must continue to receive educational services and supports that allow them to access the general education curriculum while making progress toward their IEP goals, but the educational setting they are provided may not be structured like their school, or like a school at all,” she says.

OSSE takes a somewhat different view. In 2016 it issued guidance that says that special education teachers in charter schools only need have bachelor’s degrees. By contrast, all DCPS special education teachers must have some sort of certification or license to work with students with disabilities.

Loretta Jones, the parent, tells City Paper she was upset by her recent experience and feels her son fell further behind academically than he would have if he had been welcome to stay at Monument before transitioning to a non-public placement.

For other charter school families, a program like Holley-Ward’s can offer a valuable alternative to homebound tutoring services. Sometimes parents are uncomfortable inviting tutors into their homes, or the tutoring hours don’t quite work out with their work schedules. Students enrolled in the traditional public school system have more options, because they can attend C.H.O.I.C.E. Academy, a DCPS school for at-risk students in grades 6 through 12 who are in a long-term suspension or expulsion status.

Onkeles-Klein has had experiences with the Future Family Enrichment Center, and says she’s seen how parents of students who are suspended may appreciate having somewhere safe for their children to go during the day other than staying at home or out on the streets.

“We wish there were more interim and also long-term options that are being offered for parents and caregivers and advocates to consider when children present a danger to themselves or others,” says Bloomfield.

Blaeuer says she was encouraged when the Public Charter School Board launched an immediate investigation into the program following her email. “We know that charter schools, especially smaller [ones], often struggle to provide the full continuum of placements required by the law for students with disabilities,” she says. “We hope that OSSE and the PCSB will work with parents and the charter school community so that students with disabilities have the same access to school choice as their non-disabled peers.”

Originally published in The Intercept with Ryan Grim on December 19, 2018.
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No Labels, a group that works to elect centrist candidates from both parties, has been grappling internally with conflicts of interest tied to its use of political consulting firms linked to the group’s leadership, according to documents and email correspondence obtained by The Intercept.

It’s been a rough few weeks of public scrutiny for No Labels. A Daily Beastinvestigation published earlier this month revealed that despite the group’s professed interest in reducing partisanship, it had solicited money from wealthy, partisan donors, many of them from the world of finance, on both sides of the political spectrum, and had considered making Democratic leader Nancy Pelosi a “bogeyman.”

The group was also in the news because the No Labels-backed House Problem Solvers Caucus, comprised of 24 Democrats and 24 Republicans, was organizing to block Pelosi’s bid for speaker of the House unless she agreed to a series of their proposed legislative reforms. The Democratic chair of the Problem Solvers Caucus is New Jersey Rep. Josh Gottheimer, a protégé of Mark Penn, who urged Hillary Clinton to attack Barack Obama as un-American in the 2008 presidential primary. As The Intercept previously reported, Penn, a longtime partisan and the husband of No Labels’s head Nancy Jacobson, is closely involved with the group’s work.

Jacobson pushed back on Daily Beast questions about Penn’s involvement in No Labels as “shameful and sexist.” She asked if a man were running the organization, would reporters still suggest — “based on little to no evidence — that his spouse is serving as the puppet master behind the scenes?”

Emails obtained by The Intercept show Jacobson consulting her husband on No Labels decision-making, and Penn himself executing strategy for No Labels campaigns. This past May, for instance, when discussing ad buys for the congressional race in Pennsylvania’s Lehigh Valley district (No Labels backed John Morganelli, an anti-choice, pro-Trump Democrat who lost the primary to Susan Wild), Jacobson looped her husband in on discussions and said, “Mark penn can you advise?” Penn was similarly asked to weigh in on ad spending and strategy on behalf of Rep. Dan Lipinski, D-Ill., whom No Labels backed in a primary race.

The Intercept confirmed the authenticity of the emails with three sources who previously worked with No Labels.

A lawsuit filed in September by the political consulting firm Applecart alleged that No Labels shorted them on millions of dollars, and terminated their relationship to hire consultants with financial ties to Jacobson and Penn. No Labels maintains that Applecart’s performance was unsatisfactory. Dan Webb, an attorney representing political organizations allied with No Labels, provided The Intercept a statement on behalf of the group. “No Labels is currently in litigation with Applecart, which limits what we can say at this time. Having botched their work for the PACs, Applecart is attempting to spin a false narrative in an effort to harm the PACs and No Labels,” he said.

In 2015, Penn founded Stagwell Group, a private-equity firm that soon bought Democratic consultancy firm SKDKnickerbocker. Stagwell also purchased a polling firm, Harris, and a minority stake in the Republican consulting company, Targeted Victory. Penn remains president and managing partner at Stagwell.

No Labels has employed the services of Harris for polling and uses Victory Passport, an affiliate of Targeted Victory, for its online fundraising. Emails show SKDK’s Andrew Shipley and Bill Knapp also working with No Labels — and Penn directly — on television ads in the 2018 primary season, though SKDK maintains that the company did not work with No Labels on anything.

One email Shipley sent in March to Jacobson, Penn, and others has the subject line “Tentative Media Buy” and is addressed to “Mark and team.”

Another March email cited Shipley as having worked on a television ad for Lipinski, though Jacobson replied that “SKDK was conflicted out” — suggesting that Shipley had either stopped at some point or been removed at the beginning.

In an earlier exchange from February, Jacobson emailed Penn for his advice on how to spend money in the Lipinski race. “Do you have a position if we should spend more?”

“My position is you need to add cable from here to election,” Penn told her.

Jacobson responded by saying that No Labels currently had no plans for cable, but she brought other members of the team into the email exchange to ask if they could trim their budgets so that Penn’s strategy could be executed.

Two days later, emails between Jacobson, Penn, and Knapp show Knapp explaining that SKDK couldn’t work on an ad for Lipinski because his company had clients on the other side of the contest: NARAL and Planned Parenthood were major SKDK clients backing primary challenger Marie Newman. Human Rights Campaign was also heavily involved in backing Newman and has been a client of SKDK.

He offered to refer the work to a separate consulting firm, 2k Strategies, owned by a former SKDK employee, but remain involved. “I would/could be on a first organizing call and will bird dog the creative to make sure it’s right,” Knapp told them on February 26.

Penn clearly believed that he was working with Knapp on the Lipinski project. Later that day, he emailed Jacobson, “Tomorrow cleared to get the ad done with bills [sic] team.”

By March 3, things were moving, and No Labels had budgeted $408,000 for an ad buy, which Knapp, with Shipley copied on the chain, was put in charge of placing. “You are scoping the buy and I’ll then decide who to use based on which one I like better,” Penn wrote to Knapp.

On March 5, Shipley wrote back to “Mark and team” with the news that “we had to go with a new buyer since two of our buyers are conflicted out between the race [and] the IE.”

Shipley on March 7 noted that a $21,000 bill for work to Penn and Jacobson was on its way. “And we have a production bill coming shortly for about 21k,” he wrote.

Knapp told The Intercept that he offered to help as a volunteer and did so by connecting Jacobson to a different media consultant. “We decided as a firm to not work for Lapinski  [sic] directly or through any third party organization/group,” he wrote in an email. “We also long ago decided as a firm not work [sic] for No Labels. Nancy is a long time friend and I sometimes look at scripts and help her, but I don’t work for her organization. We didn’t work on the race as a firm, we did not produce an ad for Lapinski [sic] and we have never worked for No Labels.” He said that the vendor erroneously sent the invoice to SKDK, so Shipley simply forwarded it to No Labels, but no money changed hands.

Newman’s challenge to Lipinski — who is anti-choice, opposed to marriage equality, hostile to immigration, and against a $15 an hour minimum wage — was the first high-profile insurgent primary of the 2018 cycle, and she had the broad support of major progressive groups. No Labels spent more than $1 million and made the difference in the race, in the assessment of operatives who worked on both sides. On Election Day on March 21, Lipinski narrowly beat Newman by just over 2,000 votes.

Officials with SKDK also got involved in the Pennsylvania race. An email on May 7 shows Shipley working on a No Labels ad for that contest, with Shipley writing, “We are working on the edit and graphics and plan to have something to share later this afternoon. In terms of a voiceover, do you have a preference of male versus female. My original thinking was going with the white male.”

Later that day, Shipley forwarded a script to No Labels. “Can we confirm this being [sic] paid for by United for Progress,” he asked, referring to a No Labels Super PAC. A No Labels consultant replied that, in fact, it was being funded by a different one, called “United Together.”

Shipley did not return a request for comment, but Knapp said that Shipley shared with him The Intercept’s inquiry and that SKDK did not work on the Pennsylvania race. “Ship knows Nancy and connected the media consultant with our production facilities and Shipley helped coordinate that,” Knapp said. “My recollection was it was a positive ad. Again, we didn’t do the race and did not make money doing the race.”

Additional emails and documents reviewed by The Intercept point to other potential conflicts of interest involving No Labels and Penn’s Stagwell Group.

In August 2017, Jacobson sent an email to No Labels staff, saying, “For republican races would like to use targeted victory.” Targeted Victory is the firm part-owned by Penn’s Stagwell Group.

On April 10, 2018, back when No Labels was still working with Applecart, Jacobson sent an email to an Applecart consultant, copying Targeted Victory CEO Zac Moffatt and wrote, “Matt you are using targeted victory for digital ads for Republicans right?”

And in late March, according to an email reviewed by The Intercept, a representative for a No Labels donor expressed concern over the organization having “perceived or potential” conflicts of interest. They urged Jacobson to disclose potential conflicts to the No Labels governing board. “We believe that all Governing Board members need to be aware of the situation in order to prevent any misunderstanding and confusion going forward,” they wrote.

No Labels then worked to prepare a list of potential conflicts. In an email dated April 13, Jacobson noted that No Labels is “no longer using targeted victory” and suggested leaving that company off its disclosure list. “Why open the door?” she asked.

In a memo prepared for the No Labels’s governing board, the group outlines business it did with Marlin Strategies, which is run by a former SKDK staffer, and Schule Media, which was referred to No Labels by SKDK. The memo says, “Mark Penn wrote and advised on the [Marlin Strategies] TV ad” but “did so pro bono.” With regards to Targeted Victory, No Labels disclosed just that the company worked on the Lipinski race.

The memo also listed business No Labels did with Rising Tide Interactive, a Democratic digital advertising firm founded by Eli Kaplan, the fiancé (and now husband) of No Labels’ vice president and chief of staff, Sasha Borowsky. Borowsky worked at No Labels from 2012 until this past October.

Mark Penn did not respond to questions about the specific nature of the work he has done for No Labels on a paid or unpaid basis, and whether he has recommended that No Labels work with any companies in which he has a vested financial interest.

Originally published in The American Prospect on December 19, 2018.
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Less than two months ago, hundreds of Baton Rouge educators voted to stage a walkout in protest of requests by ExxonMobil for millions of dollars in local property tax abatements. Working in conjunction with a faith-based group, Together Baton Rouge, the teachers called on the state to direct the proposed corporate subsidies back into public education. ExxonMobil has defended its tax breaks as necessary to create a stable and hospitable business climate.

Unlike teachers in Baton Rouge, who learned of the oil giant’s exemption from their state’s longstanding Industrial Tax-Exemption Program, most jurisdictions have lacked any real picture of how much money public schools are losing, or could lose, due to corporate tax abatements.

That all began to change in 2015 when the Government Accounting Standards Board, a private organization that sets professional standards for public-sector bookkeeping, issued a new rule requiring state and local governments to disclose corporate subsidies on their annual Comprehensive Annual Financial Reports (CAFRs). The Government Accounting Standards Board—“GAZ-bee,” for short—does not have legal authority, but most municipalities abide by its guidelines because doing so can help them get better credit ratings and lower interest rates. The new rule—known as GASB Statement 77—took effect in 2016. So now, for the first time, the public can finally get a broad look at the corporate giveaways that impact public education.

Armed with data from the new accounting rule, Good Jobs First, a national nonprofit that tracks corporate subsidies, put out a report this month finding that at least $1.8 billion was given away by state and local governments over the last fiscal year to attract businesses, money that otherwise would have gone to public schools. Good Jobs First tracked giveaways in 28 states, and suggests the total estimate for corporate abatements was likely much higher, since not every state and locality complied with the new reporting rule.

“While some school board members have been aware that their districts are losing money through abatements, hardly any knew how much,” says Scott Klinger, the primary author of the report. “This has been completely invisible money that they’ve been losing for years.”

The report examined financial reports of more than 5,600 of the nation’s 13,500 school districts, and found that school districts in ten states accounted for the vast majority of the (disclosed) tax giveaways: South Carolina, Louisiana, New York, Ohio, Oregon, Missouri, Pennsylvania, Michigan, Texas, and Georgia. Beyond that, Good Jobs First found that almost 250 school districts in 22 states each lost more than $1 million in revenue due to corporate tax giveaways last year. “If abatements were curtailed and the resulting tax revenues were reinvested to hire additional teachers (at each state’s average teacher salary rate), the ten most affected states could hire a total of 28,059 more teachers,” the group concluded.

Good Jobs First predicts more states and localities will comply with the new rule as time goes on, and recommends governments adopt better data reporting practices that would more easily facilitate public understanding of the information. The organization also recommends that states pass laws to prohibit tax abatements from adversely affecting school funding, something Alabama and Florida already do.

Randi Weingarten, the president of the American Federation of Teachers, cheered the new Good Jobs First report, and cited her union’s work in pushing the Governmental Accounting Standards Board to change its disclosure rules. “We will continue to fight for the funds kids and communities need and expose how these handouts hurt kids’ futures,” she said.

Klinger says he’s optimistic that the disclosures will bring about change, though it can take time. “More and more legislators are beginning to question the value of business subsidies,” he said. “A few years ago people would only say that subsidies are good, that they bring jobs. Now people are saying ‘I’m not so sure’ and I think Amazon has been a big awakening for that.”

So next time when a school board or mayor or state official says they can’t afford to raise teacher salaries, or improve classroom-based technology, or repair crumbling schools, the public can point to the specific dollar amounts of corporate tax giveaways that are draining money each year from their children’s schools. “By disclosing the money,” says Klinger, “it allows a different kind of conversation to happen.”

Originally published in The Intercept on December 10, 2018.
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IN 1993, A 40-year-old man in Maryland who was serving a life sentence for a 1975 murder left prison on the state’s prerelease program. Correctional officers had described Rodney Stokes as a model prisoner who had demonstrated no inclination to reoffend. Stokes had been in the work-release program since 1988 and had worked for the Baltimore Department of Public Works as a laborer since 1989. But one day after leaving, he killed his former girlfriend and then himself.

The murder-suicide came on the heels of three other incidents in Maryland involving the prerelease of prisoners. The Willie Horton ad that derailed Democratic presidential candidate Michael Dukakis’s 1988 presidential campaign was also still fresh in the public’s mind. Horton was a convicted felon serving a life sentence in Massachusetts; while on a weekend furlough, he committed assault, armed robbery, and rape. He was captured and sentenced in Maryland, where he remains to this day.

In reaction to the Stokes incident, Maryland’s Democratic governor at the time, Parris Glendening, removed all lifers from the prerelease program and announced, in 1995, that he would approve no recommendations to parole lifers going forward. “A life sentence means life,” he declared. Maryland, along with California and Oklahoma, is one of just three states in which the governor’s signature is required in order to parole prisoners with life sentences; in the 25 years leading up to Glendening’s decision, three Maryland governors had paroled 181 prisoners with life sentences. The state courts upheld Glendening’s pronouncement in 1999, and it remains effectively in place today — even with respect to juvenile offenders, who in recent years have seen their life sentences revisited around the country.

There are an estimated 2,100 people in prison nationwide who were sentenced to life for crimes they committed when they were 17 or younger. But recently, some states have eliminated life without parole sentences for juveniles altogether. Others have devised alternative sentencing schemes to give juvenile offenders a “meaningful opportunity” for release. The changes were prompted by a bevy of scientific evidence about adolescent brain development and powerful U.S. Supreme Court decisions that have been issued in the past eight years.

Maryland, however, appears to be stuck in the tough-on-crime fervor of the 1990s. Not one juvenile lifer in Maryland has been paroled outright — released on a formal recommendation to the governor based on the prisoner’s good behavior and signs of rehabilitation — since 1995. There are currently more than 200 parole-eligible juveniles toiling away in the state’s prisons. That’s in large part, criminal justice reformers say, because of the governor’s role in the process, which they describe as highly politicized — and which leads to people being locked up forever.

Republican Gov. Larry Hogan was re-elected to a second term last month. He now has an opening to parole more individuals with life sentences, and then ultimately remove himself from the parole approval process altogether.

“Republicans are presumed to be about law and order, and it can be easier for law-and-order politicians to move on criminal justice reform or grant clemency,” said Jane Murphy, a University of Baltimore law professor. “There’s a lot of pressure on him, but it’s also politically easier for him to [grant parole]. We’re sort of hopeful now, because this is his second term and he’s term-limited. … If this is the end of the road for Hogan, he might be more courageous.”

HOGAN’S APPROACH TO juvenile lifers is rooted in the Maryland Court of Appeals’s 1999 decision upholding Glendening’s decree. The court found that the rights of lifers were not violated by the governor’s blanket refusal to approve any recommendation from the Maryland Parole Commission.

From then on, Maryland’s governors would reject recommendations — typically without explanation — to parole lifers who had demonstrated good behavior. Sometimes recommendations to parole lifers would be left in limbo, sitting on the governor’s desk for years.

In 2011, advocates confronted the Maryland legislature with evidence that parole and commutation requests were pending indefinitely, and the General Assembly responded by modifying the statute, requiring the governor to act on a parole recommendation within six months. The governor at the time, Democrat Martin O’Malley, responded by swiftly rejecting all pending recommendations.

Criminal justice reformers have continued to press the legislature to take the governor out of the process, and to leave parole decisions up to the Parole Commission. Those efforts, however, have been routinely stymied by legislators that are fearful of being blamed for another Rodney Stokes or Willie Horton. “It’s hard for someone to say, ‘I’m going to undo this policy,’” said Sonia Kumar, a juvenile justice-focused attorney with the American Civil Liberties Union of Maryland. “They’ll say, “Well, one bad headline and my political career is in the toilet.’”

In 2017, the Maryland House of Delegates approved a bill that would have removed the governor from the decision-making process, leaving it up to the Parole Commission to make a final determination. “It is the Parole Commission that sits in front of these individuals who are serving life sentences, and can aptly gauge the person’s rehabilitation, remorse, and disposition, while conducting a thorough review of the relevant records and documents,” reads testimony in support of the bill from the University of Baltimore law school’s Juvenile Justice Project and the University of Maryland law school’s Gender Violence Clinic.

But Hogan fought the bill in the Senate and wrote on Facebook that he “strongly disagree[s] with giving this important responsibility to a nameless board with no accountability to voters and people of this state.” He described it as a partisan attempt to “radically change our state government” and deny Marylanders the “needed and appropriate oversight” they deserve. The bill ended up floundering in the Senate, due to some proposed amendments that advocates deemed unacceptable.

“I think the pushback came because [Hogan] views it as just a challenge to his authority,” said Walter Lomax, the executive director of the Maryland Restorative Justice Initiative. Lomax was released from prison in 2006, after serving 40 years for a murder he did not commit. “We try not to be adversarial when pushing for this legislation,” Lomax added. “We’ve just tried to present the hard facts as to why this policy should be changed.”

THESE POLITICAL BATTLES are especially urgent, criminal justice reform advocates say, because the process for parole and commutation is shrouded in secrecy.

Murphy, who directs the Juvenile Justice Project at the University of Baltimore law school, put it this way: “Our sources of information are occasional leaks from the Parole Commission, or if the ACLU can glean facts through a lawsuit discovery. We don’t know how many people have been commuted, and the only reason we have any information at all is because we push and [file requests under the Freedom of Information Act] and call and write letters and ask for favors, but the vast majority of people in the parole system are unrepresented and there’s no accountability at all.”

There’s “a recognition that secrecy does not tend to breed fair outcomes,” said Kumar of the ACLU. Unlike many other states, Maryland does not recognize a right to counsel in parole hearings, and there are no records of what happens during the proceedings. When the ACLU of Maryland filed a public records request in order to learn how many people had been recommended for clemency, the Parole Commission refused to even disclose that number, saying the information was protected by executive privilege.

The consequence of all this, advocates say, is a loss of hope for people who have spent decades in prison working to rehabilitate themselves, while being told that good behavior could one day lead to parole.

When Hogan ran for governor in 2014, he gave the impression that he would govern differently on this issue, promising to parole lifers who were recommended for release more quickly. And his record on approving parole requests has been slightly better than that of his Democratic predecessor, O’Malley, but that bar is so low that advocates see the situation as still fundamentally broken.

“In office, he’s dealt with it like [Republican Gov. Robert] Ehrlich dealt with it,” said Lomax, “where he’d commute a few sentences and then let people be paroled out that way.”

As of February, according to a letter sent to the state Senate by Hogan’s chief counsel and reviewed by The Intercept, the governor approved two out of nine parole requests during his first three years and granted seven commutations. By contrast, O’Malley, in his eight years in office, granted three commutations and authorized just two medical paroles, a form of release granted to prisoners who are terminally ill and need to move into hospice.

Amelia Chasse, a Hogan spokesperson, told The Intercept that the governor received one recommendation to parole a juvenile lifer, which he denied, but he commuted the sentence of another juvenile lifer, and has granted medical parole to three juvenile lifers. Chasse did not answer questions about whether the bases for the governor’s decisions are available for public review or available to the prisoners themselves.

THE NATIONWIDE PUSH to eliminate life sentences without parole for juvenile offenders came to a head in 2010, when the U.S. Supreme Court, in Graham v. Florida, struck down such sentences for non-homicide offenses. “The juvenile should not be deprived of the opportunity to achieve maturity of judgment and self-recognition of human worth and potential,” Justice Anthony Kennedy wrote in the majority opinion.

Two years later, in Miller v. Alabama, the Supreme Court held that life sentences without parole for juvenile offenders, even in cases of homicide, violated the Eighth Amendment, which prohibits cruel and unusual punishment. “Mandatory life without parole for a juvenile precludes consideration of his chronological age and its hallmark features — among them, immaturity, impetuosity, and failure to appreciate risks and consequences,” wrote Justice Elena Kagan in the majority opinion. In Miller, the court held that juvenile offenders, unless they were “irreparably corrupt,” were entitled to a “meaningful opportunity” for release from prison. Four years later, in Montgomery v. Louisiana, the Supreme Court held that Miller should be applied to juvenile offenders retroactively — giving juveniles who’d previously been sentenced to life without parole for killing someone a chance to reopen their cases.

In Maryland, attorneys and advocates argue that while juvenile offenders are technically eligible for parole, in reality they’re systematically denied it, given the politicized nature of the governor’s approval process.

“Graham was decided in 2010, and we have people who are still not getting anything close to a meaningful opportunity for release eight years later,” said Kumar of the ACLU of Maryland.

In February, Hogan issued an executive order that stipulated he would consider “the same factors and information assessed by the Maryland Parole Commission” when deciding whether to parole juvenile lifers, as well as “other lawful factors deemed relevant by the Governor.” Hogan said this was codifying what he already did but stressed that the order would not apply retroactively. In other words, he was not opening a chance to review past decisions.

Advocates blasted Hogan’s executive order as a political stunt. “He issued something he can change at any time, and there’s nothing enforceable about the order,” said Kumar. “As a practical matter, the order doesn’t alter the system in any way that shifts it from one of clemency to parole, which is the fundamental failing.”

The state’s highest court, however, disagrees. This past summer, in a 4-3 ruling, Maryland’s Court of Appeals held that state law provides a meaningful opportunity for release for juvenile defenders. The court cited Hogan’s executive order, finding that it “attempts to bridge the gap between unfettered discretion that the legislature has given to the governor with respect to parole of inmates serving life sentences and the requirements of the Eighth Amendment as to juvenile offenders.”

In a dissent, Chief Judge Mary Ellen Barbera said the majority opinion does not apply the U.S. Supreme Court’s rulings to Maryland’s situation in a “realistic manner.” She was unconvinced that Hogan’s executive order “cures the constitutional infirmity of Maryland’s current parole system,” she wrote.

While the August decision was a blow for criminal justice reformers, Kumar described it as a “mixed bag,” since it also brought about some positive new pressure. It was the first time the state’s highest court spoke to any of the questions that had grown out of the U.S. Supreme Court’s cases on youth serving life sentences.

In contrast, other states have taken real steps to respond to the decisions of the Supreme Court, including Pennsylvania, which has more juvenile lifers than any other state in the country. In 2017, in the case of Commonwealth v. Batts, the Pennsylvania Supreme Court set forth a series of protections to effectuate the constitutional decrees of Montgomery and Miller. As a result of these protections, explained Riya Saha Shah, an attorney at the Pennsylvania-based Juvenile Law Center, fewer people have received life without parole at resentencing hearings, and Pennsylvania has also been paroling out people who have served long prison sentences on good behavior. “Overall, the parole process offers a more meaningful opportunity for release than a state like Maryland, which effectively denies it,” she said.

THE PRESSURE ON Hogan to take criminal justice reform more seriously is coming from a number of directions. A group of about 50 attorneys came together in 2017 to fight for protections for juvenile offenders. The Maryland Juvenile Lifer Parole Representation Project offers pro bono legal services to juvenile offenders languishing in jail. “Our goal is not only to provide individual representation, but to unleash these large firm lawyers on this system,” explained Murphy.

The state is also currently defending itself against a 2016 federal lawsuit, brought by the ACLU, that challenges the constitutionality of Maryland’s parole scheme for juveniles. The case remains pending.

There is also an economic argument for enacting reform. During the gubernatorial campaign, Hogan’s Democratic opponent, Ben Jealous, spent significant time talking about the amount of money wasted on mass incarceration that could be better spent elsewhere. In a 2015 report, the ACLU of Maryland found that the detention of more than 2,000 with life sentences costs the state more than $70 million per year. By contrast, a recent report from the Justice Policy Institute estimated that it would cost about $6,000 per year to support the successful re-entry of prisoners into society. (The report focused on about 200 former Maryland prisoners who were freed on probation under a landmark 2012 decision and who provided with substantial philanthropic support upon release. Less than 3 percent of them have reoffended, the Justice Policy Institute found, compared to a recidivism rate of 40 percent for the general prison population. Chasse, Hogan’s spokesperson, did not return request for comment on the findings.)

While Maryland has taken some recent steps to tackle its prison system — notably, the Justice Reinvestment Act of 2016, which took effect last fall — the bulk of the new reforms have focused on low-level, nonviolent offenders.

“We’re not really going to take on mass incarceration,” said Kumar, “until we help people who made horrible mistakes with tragic outcomes and have turned their lives around.”

Originally published in The Intercept on November 30, 2018.
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HAKEEM JEFFRIES’S VICTORY in the race for Democratic House caucus chair on Wednesday was a loss for progressive groups that rallied against him, but it was a victory for one national group in particular: Democrats for Education Reform, or DFER — a political action committee that funds candidates supportive of charter schools and is critical of teachers unions. DFER was founded in 2005 by a number of Wall Street leaders, with the mission, as co-founder Whitney Tilson explained it, “to break the teacher unions’ stranglehold over the Democratic Party.”

While DFER really began to flex its financial muscles in 2008 — when it raised about $2 million to help elect pro-charter candidates — its earlier work focused primarily on New York. There, the group helped elect Hakeem Jeffries to the New York State Assembly in 2006. (He served in the state Legislature from 2007 to 2012.) In 2007, DFER also helped lobby New York legislators to lift the state’s charter school cap, increasing it from 150 schools to 250. In 2010, Jeffries co-sponsored legislation to raise the state’s charter cap even further, to 460 — where it stands today.

Over the years, Jeffries has become one of DFER’s top candidates. In 2012, when Jeffries announced that he would run for Congress, the group rallied behind him, elevating him to its so-called DFER Hot List. No other Democrat received more in direct DFER contributions that cycle, according to the Center for Responsive Politics.

Though Jeffries has long been close to DFER, he’s rejected money from other school reform advocacy groups. In 2012, he turned down funds from a new group called StudentsFirstNY which offered him a six-figure contribution in the form of an independent expenditure. “The Jeffries campaign does not believe that independent expenditures have a place in this race,” his campaign spokesperson said at the time. “We did not seek it, do not want it, and will win without it. Those involved with the proposed independent expenditure should refrain from involvement in this race and respect the candidate’s strong belief that unregulated money has no place in the political discourse.”

Reached for comment, a spokesperson for Jeffries did not respond to questions on Jeffries’s relationship with DFER, his plans for education reform advocacy as caucus chair, and his current views on independent expenditures.

Jeffries “embodies the Obama education agenda we support: greater investments in public education; strong standards to ensure our children are ready for the global economy; and diverse, high quality public school options for our parents to choose from,” DFER president Shavar Jeffries told The Intercept. (The two Jeffries are not confirmed blood relatives, but identify as cousins.)

“Alongside the election of reform-supporting governors and state and local officials around the county,” Shavar Jeffries continued, “his ascendancy into greater leadership in the House signals that the Obama reform agenda remains strong.”

While in Congress, Jeffries has stayed close to the charter movement. He’s spoken at fundraisers for Success Academy, the prominent New York City charter network, and in 2016 was the keynote speaker for a large pro-charter rally, organized to pressure Mayor Bill de Blasio to expand charters in New York City.

De Blasio has been critical of the publicly funded, privately managed schools. For a while, there were rumblings that Jeffries could mount a charter school-backed challenge to de Blasio’s 2017 re-election, something he did not immediately rule out at the time. “My inclination remains to remain in Washington. … However all options are on the table and I am going to take a hard look at where I can make a difference in the next few years,” he told Politico in 2016. (Eva Moskowitz, the CEO of Success Academy, also considered a pro-charter challenge to de Blasio for mayor, but decided to remain on her perch to influence education reform politics nationally.)

Jeffries has been called the “Barack Obama of Brooklyn,” in part for his education policy stances, as Obama was also an early DFER-backed candidate. DFER is credited with derailing Linda Darling-Hammond’s bid for education secretary in the Obama administration. Darling-Hammond is a progressive education policy expert who has positive relationships with teachers unions. As education journalist Dana Goldstein reported in 2009:

In recent months, DFER has had a number of high-profile successes, chief among them a highly coordinated media campaign to call into question the work of Obama education adviser Linda Darling-Hammond, once considered a top contender for the job of education secretary. During the same week in early December, the New York Times, Washington Post, Wall Street Journal and Boston Globe published editorials or op-eds based on DFER’s anti-Darling-Hammond talking points, which focused on the Stanford professor’s criticisms of Teach for America and other alternative-certification programs for teachers. Less than two weeks later, Obama appointed DFER’s choice to the Education Department post, Chicago schools CEO [Arne] Duncan.

DFER, and education reform generally, has traditionally been linked to affluent white collar industries like tech and — especially in New York — finance. For example, when Moskowitz, a DFER supporter, published a memoir in 2017, she urged her readers to approach income inequality “delicately in an age when hedge fund managers can work anywhere in the world with an Internet connection.” She scolded de Blasio’s “class-warfare rhetoric” as “imprudent and dangerous.” The financial sector has contributed substantially to Jeffries’s political campaigns.

POLITICS WITHIN BOTH the Democratic Party and the national electorate, however, have changed since 2009, and DFER’s strategies of opposing teachers unions and raising money from the super wealthy have grown more controversial. As progressives have embraced a sharper critique of Wall Street and economic inequality, and as organized labor continues to battle escalating attacks from right-wing interest groups and a hostile judicial system, an anti-union message from Wall Street Democrats has grown considerably less popular.

It was clear, even before Trump won the presidency in 2016, that Democratic elected officials were facing greater pressure to balance their support for charters, a favored cause of many of their donors, with growing public skepticism of the schools. In 2016, candidates like Hillary Clinton and elected officials like Jeffries himself maintained their vocal support for charters but began articulating their opposition to for-profit charter schools, a small but politically powerful segment of the movement. (Kevin Chavous, a co-founder of DFER and a former board chair for the organization, now serves as president of academics, policy and schools for K12 Inc., a national for-profit charter school company.) Democrats also explicitly spelled out opposition to for-profit charters for the first time in their 2016 party platform.

Education reform Democrats suffered a significant loss in 2016, when a high-profile and expensive effort to lift the state’s charter school cap, led by DFER’s Massachusetts chapter, failed 62 percent to 38 percent, with cities all over the state, including Boston, voting in opposition. (The now-defunct pro-charter group Families for Excellent Schools, was later finedfor illegally funneling nearly $2.5 million from out of state into the charter expansion effort.)

Then, in 2017, with Trump in office and billionaire Betsy DeVos appointed to lead the Education Department, the Democratic-leaning education reform movement was put further on the defensive, forced to explain why its vision for school choice should not be confused with that of the Trump administration, and why it should shoulder no blame for the escalating attacks on public education. It didn’t help having people like former New York Mayor Rudy Giuliani proclaiming, “President-elect Trump is going to be the best thing that ever happened for school choice and the charter school movement.”

Later that year, Gallup reported a growing partisan divide on charters, with Democratic support at 48 percent, down from 61 percent in 2012. Republican support remained steady over the five years, at 62 percent.

DFER has at times struggled to find its footing in this changing political landscape. Shavar Jeffries told the education news website Chalkbeat in 2017 that while his group has been fighting DeVos’s policies and for-profit charter schools, they also still spend much of their time fighting Democrats. “When we fight the union and old-guard Democrats, which is honestly what we spend most of our time doing, we don’t fight them because they’re Democrats; we fight them because we think they’re wrong on what’s right for kids.”  In addition to charter-friendly policies, their website lists additional advocacy focus areas, including school funding, test-based accountability, and teacher prep programs.

To maintain its credibility within the party, DFER often points to Obama, who remains very popular among liberals. “We’re very clear about the legacy in which we operate,” Shavar Jeffries told Buzzfeed earlier this year. “We operate within the legacy of Barack Obama. His agenda is our agenda, and it’s an agenda that hundreds of Democrats across the country support.”

GETTING HAKEEM JEFFRIES, a pro-charter DFER-affiliated politician, into a top Democratic leadership position is no doubt good news for the organization, which suffered several blows in the 2018 midterm elections. (It spent at least $4 million in the latest cycle.)

Earlier this month, the organization’s endorsed candidate for California state superintendent of public instruction, Marshall Tuck, lost to Tony Thurmond, who was backed by the state Democratic party and teachers unions. DFER had also endorsed Antonio Villaraigosa in an unsuccessful bid to become California’s next governor. The charter movement spent $23 million in support of Villaraigosa, the largest independent expenditure for a gubernatorial primary in California’s history, but his opponent Gavin Newsom won the Democratic primary and general election easily.

In New York, a slew of progressive Democrats won their state Senate races, dramatically upending the composition of the state assembly and unseating the caucus of moderate Democrats who backed charter schools and often voted with Republicans. The new crop of Democrats is expected to fight efforts to lift New York’s charter school cap and to push for more charter school regulations.

In Washington, D.C., DFER’s involvement in the local school board election also raised eyebrows this year. One parent blogger determined that in 2018, DFER DC political action and independent expenditure committees raised over $520,000 — four times as much in contributions as the rest of the city’s independent expenditure committees combined. One DFER DC-endorsed candidate, Jason Andrean, raised the most money out of all individuals vying for a State Board of Education seat, though he ended up losing his race to a candidate who is vocally critical of DFER candidate. In the lead-up to election, DFER itself became a campaign issue, with candidates frequently challenged on their support for or opposition to the organization.

And in Colorado, though the state’s Democratic leadership has been broadly supportive of education reform policies and Gov.-elect Jared Polis has founded charter schools himself, Democratic voters have been voicing growing distrust of DFER. Last spring, delegates at the Colorado Democratic State Assembly voted overwhelmingly for a platform amendment calling DFER to remove the word “Democrats” from its name.

DFER held its 5th annual “Camp Philos” conference, a national gathering for education reform advocates, this week. At the conference, taking place in Boulder, Colorado, leaders grappled with how to chart their political path heading into 2020.

On Wednesday morning, before votes were cast in the caucus chair race, Rep. Juan Vargas, D-Calif., introduced Jeffries, He was, Vargas told the assembled Democrats, “the next Obama.”

Originally published in Washington City Paper on November 26, 2018.
—–

At some point soon, as early as this week, the Council will vote on legislation for an education research collaborative—an independent research body that will conduct studies on the city’s public schools. The idea is to better determine how various educational policies impact schools and student academic performance.

Ward 3 Councilmember Mary Cheh proposed the research collaborative in April, introducing legislation with eight co-sponsors. In the wake of a series of school scandals over the previous year, many parents, education advocates, and elected officials began voicing doubt in the data produced by the mayoral-controlled school system, and considered the idea of an independent research entity to be a vehicle to help rebuild that trust. The collaborative would have an advisory board of school system officials, parents, community leaders, and teachers to drive the research agenda, and the Council allocated $500,000 in its latest budget to help get it off the ground.

In September, the Education Committee, chaired by At-Large Councilmember David Grosso, revised and approved a new version of the bill—the latest publicly available version—and moved it on to the full Council.

Two months earlier, in July, the public learned that while the Council was working on establishing an education research collaborative, Mayor Muriel Bowser’s administration was in private talks with the Urban Institute, a national, D.C.-based think tank, to establish its own separate collaborative. At a joint roundtable in September, councilmembers urged the executive branch to pause their separate effort, so as to not undermine the legislative process. (For more information, read City Paper’s “Council Challenges Executive Branch, Urban Institute at Contentious Education Research Collaborative Hearing.”)

At the time, then-interim Deputy Mayor for Education Ahnna Smith would not agree to pause her office’s plans with the Urban Institute, but said she would take the Council’s request “under consideration.”

Beginning in October, Mayor Bowser replaced Smith with Paul Kihn, the new Acting Deputy Mayor of Education, and a former Deputy Superintendent of the Philadelphia School District. In an interview with City Paper, Kihn confirmed that their separate research collaborative is “definitely on hold” as the Council proceeds with its legislation.

“At the last hearing we were raising questions and making them quite uncomfortable,” says Cheh. “I think they heard the message that that was probably a wrong approach.”

The latest version of the legislation out of the Education Committee has sparked some protest and organizing from parents and advocates. In a recent email newsletter, Ward 3 State Board of Education representative Ruth Wattenberg wrote that the bill had been amended in “at least two ways that badly undermine the purpose the Collaborative,” and urged her readers to email and tweet at the Council with their concerns.

Specifically, Wattenberg noted that the latest version of the bill greatly limited the number of “DC education stakeholders” that would be represented on the steering committee, stacking it primarily with mayoral appointees. She also criticized how quickly it would spin out of the D.C. Auditor’s office, to be permanently housed in a “private, unaccountable home.”

Cheh’s original legislation also proposed spinning the research collaborative out of the auditor’s office after an “incubation” period, but some advocates say they worry the latest version would shorten that incubation phase by too much. These proponents think launching the collaborative in the auditor’s office is a way to help ensure its success and long-term independence, but the Council’s Education Committee stated in its Sept. 24 report that it “had reservations and concerns about the ability of the Auditor to be a fair and collaborative partner in conducting research meant to improve practice.”

“My concern is that you want to be able to stand up an operation that can function independently, that can stand up to pressure from wherever that pressure is coming from,” Wattenberg tells City Paper. “And in this city, the educational institutions are very powerful and I worry that you can’t put something really independent like that into place within a year [of incubation in the auditor’s office]. You probably need three years or so.”

City Paper reached out to Council Chairman Phil Mendelson, who says he has seen Wattenberg’s most recent newsletter and received a few emails from concerned constituents.

Mendelson suggests that concerns about the steering committee being stacked too heavily toward the executive branch will likely be resolved once the public sees the latest version of the bill. “I would say we’ve moved beyond” the Education Committee’s version, he says. “People are upset now that the mayor’s appointees might dominate the steering committee, but I don’t think that’s what the composition will look like. The steering committee will be larger.” He adds that he expects D.C.’s committee to resemble the University of Chicago Consortium on School Research’s steering committee, which has about two dozen people. (Grosso’s version proposed a committee with 11 members—7 voting, and 4 nonvoting, and Cheh’s version proposed 16 voting members.)

Mendelson says their real challenge moving forward is figuring out how to build the needed trust with the executive branch to make this effort successful. “The executive is very uneasy about housing it in the auditor’s office, and the executive is not going to be cooperative if they’re uncomfortable,” he says.

The idea of designing the research collaborative as an education watchdog, Mendelson adds, is not the direction they’re moving in. “That’s where some people want us to go, but that’s not where we’re going,” he says.

Kihn tells City Paper that one of his primary goals as Deputy Mayor of Education is to “build public confidence,” and notes that “we cannot do that without clear systems of accountability and data systems that have integrity and are trustworthy.” He says he’s far less concerned with education agency heads being comfortable than with the reported information being transparent and accurate. He cites his role in setting up a similar research collaborative in Philadelphia, which launched in 2014.

Kihn emphasizes that he sees it as important to establish the research consortium as “independent of government,” and for that reason, outside of the auditor’s office, which is part of the legislative branch. In late October, D.C Auditor Kathy Patterson released a statement pushing back on concerns that her office was incapable of incubating the independent research collaborative, noting that her office regularly undertakes projects that go beyond data audits.

In early November, Kihn, Grosso, Mendelson, and Hanseul Kang, the State Superintendent of Education, traveled together to Chicago to visit the city’s research consortium. Kihn notes that Chicago’s model—considered one of the best in the country—is funded almost exclusively through philanthropy, with some in-kind contributions from the University of Chicago. He says he very much supports the idea of bringing “actionable insights” and “additional analytic capacity” to the public sector at low-cost or no-cost to taxpayers.

Rita Lewis, a spokesperson for At-Large Councilmember Robert White, says White would want to wait to see the latest version of the bill offered by Mendelson before commenting further. While White did vote to move Grosso’s version out of the Education Committee in September, he raised concerns at the time that there was not enough input from parents, students, and teachers on the steering committee.

Cheh tells City Paper that as the bill moves through the final stages of the legislative process, the “most important” concern will be the makeup of the steering committee. She acknowledges that the role of the auditor has also not yet been “clearly resolved,” and says they’ll be looking at that.

When asked whether the Urban Institute might be chosen to run the education research collaborative, Mendelson said, “there’s a chance, but I don’t want to say that’s probable. I think we’re just at the point where we’re trying to figure out how to gestate this thing.

Originally published in DCist on November 19, 2018.
—–

Already a leader in offering universal preschool for three and four-year olds, Washington D.C. now aims to position itself again at the forefront of early childhood investments. In June, the city council unanimously approved the Birth-to-Three For All D.C Act, a big ticket bill which Mayor Muriel Bowser then signed into law in September.

The legislation calls for increased investments in health services provided to infants and toddlers, particularly those living in Wards 7 and 8, and expands the city’s home-visiting program, a support for pregnant women and new parents. The legislation also boosts subsidies for early childhood learning, both to expand access and to increase the wages of low-paid workers. While the most generous supports are still targeted at the poorest families, the bill caps out-of-pocket childcare expenses for even the most affluent, with no household paying more than 10 percent of their income.

This all comes at a steep price: an estimated $500 million over the next decade. So far, just $1.3 million has been earmarked for the Birth-to-Three Act in the 2019 budget, financed by a tobacco tax increase last spring.

This month 18 local organizations—banding together under the umbrella of the “Birth to Three Policy Alliance”—sent a letter to the mayor, requesting she invest $30 million in her next budget for the legislation ($22 million to raise the wages of educators, $6 million to expand home visiting, and $2 million to expand healthcare supports).

“We can’t forget that this city is in better shape financially than most communities in this country,” says Carrie Thornhill, the chair of the D.C. Early Learning Collaborative. “That allows us to do some things that other jurisdictions can’t do.”

Advocates say these are smart investments, especially as scientific evidence continues to show the bulk of brain development happens in a child’s earliest years, a period where young people learn social-emotional skills like focusing, empathy, and regulating feelings. Research suggests that greater investments in early childhood can help close the achievement gap, help more students graduate from high school, and avoid the criminal justice system.

Quality childcare, advocates say, will also help attract jobs and families to the District. A study released in September by the Center for American Progress found that since D.C. began offering universal pre-K in 2009, the city has seen a large, positive increase in its maternal labor force participation, almost entirely attributable to the preschool expansion. Part of the goal of the Birth-to-Three Act is to raise the job standards for early childhood educators, making the workforce itself more professionalized, and to pay them more.

“Generally when states talk about investments in their early childhood workforce, they’re asking what scholarships can we put in place to encourage educators to obtain higher credentials, or what bonuses can we give them once they do,” said Barbara Gebhard, the assistant director of public policy at ZERO TO THREE, a national organization focused on infants and toddlers. “It’s largely tweaking around the edges. I like that D.C.’s legislation is really targeting the problem, which is that compensation is just too low. Until we really crack that nut, we’re not going to solve the problem.”

There’s been some pushback to the city’s new requirement that early childhood workers obtain advanced degrees, a policy change leaders say will improve teaching quality. A federal lawsuit was filed this spring, arguing that D.C. requiring college credentials is an unconstitutional occupational regulation that will needlessly lock people out of the profession and cause a spike in costs for parents. “You don’t need to know how to integrate a function or write in iambic pentameter to take care of a newborn or toddler,” said a lawyer for the plaintiffs.

Still, advocates and city officials say science is on their side, pointing to evidence like a 2015 National Academies report which made recommendations on improving the child care workforce. But the report, opponents point out, is “inconclusive” when it comes to the link between teacher education level and quality of instruction. Supporters counter that the report also says “almost all rigorous studies of childhood programs that have shown large effects have come from programs with licensed teachers who have bachelor’s degrees.”

The Bainum Family Foundation, based in Bethesda, has been a key driver behind the Birth-to-Three Act and the associated advocacy for it. Founded 50 years ago and long-focused on providing students with college scholarships, the foundation pivoted in 2015 to focusing on early childhood investments. A Bainum-funded report released that year detailed the wide disparities in early childhood development between rich and poor families in the District, leading to a five-year $10 million pledge to change that.

Earlier this month, the Reinvestment Fund released a new Bainum-funded report detailing the supply and demand for early learning opportunities in D.C. Among other things, the study found the city would need to add about 31,000 high-quality seats if it wanted to serve all infants and toddlers, including those who commute with parents into the District. The report also showed more than 30 percent of infants and toddlers live in areas where the cost of a center-based program exceeds 50 percent of the median household income.

“That kind of data—it’s hard to come by, and it’s frankly expensive to put together,” says Noel Bravo, the Senior Director of Program Development at the Bainum Family Foundation. “But it’s extremely important to understand the issue, and that’s one way we feel we can be helpful.”

Birth-to-Three advocates are trying to glean lessons from the District’s successful universal preschool expansion. Carrie Thornhill, a leader in that effort as well, notes one similarity: In both cases, they had the unanimous support from the D.C. Council.

Infant and toddler care was originally part of the preschool legislation, but was stripped from the bill because legislators back then had difficulty being convinced that it was truly a necessary educational reform. “Things have changed a lot since 2008,” says Thornhill. “People really do get it now.”

In September, after signing the legislation, Bowser sent a letter to Council Chairman Phil Mendelson saying that, while the goals are “laudable,” she worries the Birth-to-Three Act creates “false expectations” for families because of its cost. She encouraged the council to consider redirecting money allocated to paid family leave to the Birth-to-Three Act, a suggestion that sparked protest in the community.

“Paid parental leave is one of the most essential investments we can make in caring for our youngest kids,” says Judith Berman, the deputy director of DC Appleseed. “It really does not make sense to take money from one pot to support the other.”

LaToya Foster, a mayoral spokesperson, would not comment directly on whether Bowser still supports shifting funds from paid family leave to Birth-to-Three, but noted the mayor “has made critical investments in early childhood education and will continue to look for opportunities to do so going forward.” Foster added that Bowser thinks “we must invest strategically in our greatest needs” and recognizes child care costs “continues to substantially burden many families.”

The Child Care Aware of America estimates the average annual cost of D.C. center-based early learning to exceed more than $23,000 per year. A single parent with one child living at the federal poverty line would need to spend 91 percent of their income to afford the opportunity absent a subsidy.

According to Thornhill, Ward 7 Councilmember Vincent Gray told the D.C. Early Learning Collaborative that an increased tobacco tax, revenue from legalized sports betting, and tapping into the city’s surplus budget are three possible funding sources for the legislation.

In a statement to DCist, Gray said that while the city had to work hard to secure funding for universal preschool, they were ultimately successful, and the same will be true for this.

“Again, as with Pre-K, we knew it would be a heavy lift,” Gray said. “While we do not have a firm timetable for funding Birth-to-Three, with Pre-K, we projected it would take five years. We did it in three. I am confident we can do the same with funding for Birth-to-Three.”

Originally published in The Intercept on November 15, 2018, co-authored with David Dayen

Amazon’s announcement this week that it will open its new headquarters in New York City and northern Virginia came with the mind-boggling revelation that the corporate giant will rake in $2.1 billion in local government subsidies. But an analysis by the nation’s leading tracker of corporate subsidies finds that the government handouts will actually amount to at least $4.6 billion.

But even that figure, which accounts for state and local perks, doesn’t take into account a gift that Amazon will also enjoy from the federal government, a testament to the old adage that in Washington, bad ideas never die.

The Amazon location in Long Island City, in the New York City borough of Queens, is situated in a federal opportunity zone, a Jack Kemp-era concept resurrected in the 2017 tax law that, in theory, is supposed to bring money into poverty-stricken areas. The northern Virginia site, in the Arlington neighborhood of Crystal City (which developers and local officials have rebranded as “National Landing”), is not directly in an opportunity zone but is virtually surrounded by other geographic areas that are.

Under the tax overhaul signed by President Donald Trump last year, investors in opportunity zones can defer payments of capital gains taxes until 2026, and if they hold them for seven years, they can exclude 15 percent of the gains from taxation. If investors carry the opportunity zone investment for 10 years, they eliminate taxes on future appreciation entirely. Investment managers have been salivating at the chance to take advantage of opportunity zones. Special funds have been built to cater to people holding unrealized capital gains — such as Amazon employees with large holdings of company stock.

Not only could Amazon benefit from the opportunity zone directly in Long Island City, but Virginia employees with unrealized capital gains will have an escape valve next door to an Amazon campus. “People who happen to be sitting around with long-term capital gains may now have vehicles for hiding them,” said Greg LeRoy of Good Jobs First, a nonprofit that scrutinizes economic development incentive deals between cities and companies, and has analyzed the Amazon deal.

Amazon did not respond to a request for comment on the opportunity zone or the Good Jobs First estimate of the subsidies it could receive.

Supporters claim opportunity zones spur renewal and revitalization in impoverished areas. It’s a decades-old bipartisan fantasy that sits uncomfortably at odds with the demonstrated results. Researchers who have studied opportunity zones find that these tax schemes rarely ever help cities, and often financially cripple them.

“At best, they divert investment from one part of the city from another, resulting in no net gain for the city as a whole,” wrote Timothy Weaver, an urban policy and politics professor at the University of Albany, last year. “At worst, they result in tax-giveaways to firms that would have been operating anyway, thereby generating a net loss to city revenues.”

Still, Republicans and Democrats are loathe to give up on what they continually tell themselves can be a win-win for everyone, if we just try really hard. And now a major beneficiary of this federal largesse happens to be one of the world’s richest companies, led by the world’s richest man.

According to Good Jobs First’s calculations, Amazon will get $4.6 billion in state and local subsidies for its new headquarters — and that’s not counting the opportunity zone benefit.

Amazon’s press release cited two New York state incentives, a $1.2 billion grant over the next decade from the Excelsior Program and a $325 million, 10-year grant from Empire State Development. But Amazon did not quantify proceeds from two other city incentives, the Industrial & Commercial Abatement Program, or ICAP, and the Relocation and Employment Assistance Program, or REAP.

ICAP gives a partial tax abatement for 25 years, and based on the expected $3.6 billion campus in Long Island City, Good Jobs First estimates that value at $386 million. REAP, a per-employee tax credit of $3,000 per year for 12 years, comes out to $897 million if Amazon meets its projection of hiring 25,000 employees.

Those estimates, combined with what Amazon already cited for the Long Island City location, brings the total to $2.808 billion. That results in a cost per job of $112,000, far more than the $48,000 per job Amazon claimed they would get in the Long Island City deal.

LeRoy, of Good Jobs First, noted that ICAP and REAP are available to most businesses relocating into New York, but a single entity’s ability to combine all their benefits distorts the purpose of attracting economic development. “I don’t think the original sponsors ever envisioned individual transactions costing 10 figures,” he said. “There’s a strong argument for capping programs on a per-deal basis.”

LeRoy added that this is not a full accounting of the benefits out of New York. Amazon will benefit from a payment in lieu of taxes, or PILOT, in which a portion of the company’s property taxes will flow directly into enhancements for the project area. Plus, there’s the federal opportunity zone.

That Long Island City is a designated opportunity zone Amazon might exploit is especially mind-boggling given that the fast-gentrifying area has had no trouble attracting new investment, has a 10 percent poverty rate (half that of New York City), and has a median income of $130,000 per year.

While the overwhelming majority of opportunity zones are defined by having high poverty rates, about 200 of the 8,700 Treasury Department-approved census tracts are like Long Island City, economically prosperous but adjacent to poverty. This includes neighborhoods in well-off cities like Los Angeles, San Jose, Seattle, and Portland. Treasury Secretary Steven Mnuchin said last month that he expects the opportunity zones to attract $100 billion in investments.

Amazon’s estimate for Virginia — $573 million in cash grants — also leaves out a huge benefit for Amazon. “They’re planning a big Virginia Tech campus in Alexandria, adjacent to the site,” LeRoy said. “It’s a public university, the money is coming from taxpayers.” In a press release, Virginia Tech puts the cost of the campus at $1 billion and added that Amazon “credited the Innovation Campus in Alexandria as a key component in its decision to locate in Northern Virginia.”

Good Jobs First added that a redevelopment subsidy known as tax increment financing for on-site infrastructure and green space in the area could also benefit Amazon at the northern Virginia site. There was no cost estimate provided for this, though the Amazon press release mentions $195 million in commonwealth-funded infrastructure projects in the neighborhood, and another $28 million in funding from the city of Arlington.

The total amount of subsidies in northern Virginia, according to Good Jobs First, is at least $1.8 billion, almost as much as Amazon said it would be reaping in government subsidies overall.

Previously, Amazon has reaped $1.6 billion in state and local subsidies for its warehouses and data centers elsewhere across the country. On the same day as the New York and Virginia announcements, Amazon also announced a new “Operations Center of Excellence” in Nashville, Tennessee, a 5,000-worker facility for which the city gave Amazon $102 million in subsidies. Nashville was one of the top 20 finalists for the HQ2 auction, and parts of the city are also opportunity zones.

The cash handouts also do not take into account regulatory leniency and accelerated permitting that characterizes the Amazon projects. “There is a strain of thought that says if you give a company prompt variances, because time is money, companies would value that more than property tax abatement,” said LeRoy. In this case, the cities are offering both!”

The deals do not appear to include guard rails for what is expected to be rapid gentrification in the locations. Condo sellers in Crystal City took note of overnight price hikes of as much as $20,000 the day after the announcement. As gentrification likely pushes out residents in the opportunity zones surrounding the northern Virginia site, Amazon employees who buy real estate could not only find a place to live, but also avoid unrealized capital gains taxes.

Progressive politicians like Rep.-elect Alexandria Ocasio-Cortez, D-N.Y., and conservative commentators have joined forces to question the deal. Community organizations held a rally in New York on Wednesday, urging a re-channeling of the taxpayer subsidies. Following Amazon’s announcement, Ron Kim, a Queens assembly member, introduced new legislation to redirect taxpayer funds designated for corporate subsidies to canceling or buying student debt. Virginia delegate Lee Carter, a democratic socialist, also criticized the deal for its exorbitant tax giveaways and the lack of transparency under which the terms were negotiated, calling it “comic book villain stuff.”