There are now at least six different eminent reform bills before the Rhode Island legislature that, if enacted, would ban, limit, or regulate the government’s ability to take private property from one owner and give it to another owner in the name of economic development. Three of the bills are reasonable, one is obsolete, and two are not very good. As of the date of this posting, none of the six have been scheduled for a committee hearing.
The Good
The strongest eminent domain reform bill is House Bill 7151 (sponsors), which tries to slam the door shut on any use of eminent domain to transfer property from one private owner to another to foster economic development. The bill’s first section applies at the state level…
Notwithstanding any other provision of the general or public laws to the contrary, neither the state nor any of its departments, divisions, agencies, commissions, corporations, quasi-public corporations, boards, authorities, or other such entities thereof, may exercise the power of eminent domain to condemn property for purposes of private retail office, commercial, industrial, or residential development; or for enhancement of tax revenue; or for transfer to a person, nongovernmental entity, public-private partnership, corporation or other business entity.
H7151 does include an exception for public utilities, but, except for that, allows no other loopholes. The second section of the bill applies the same prohibition — no forced transfers of property from one private owner to another in order to promote economic development — to municipal government.
(House bill 6725 (sponsor) is also a general ban on the use of eminent domain for economic development, but expressed more loosely. H6725 is based on a local ordinances passed by the Cranston City Council and Charlestown Town Council.)
Governor Donald Carcieri has had his own version of eminent domain reform introduced to the Senate in the form of Senate bill 2408 (sponsors)…
Notwithstanding any other provision of law, neither this state nor any political subdivisions thereof…shall use that power of eminent domain to take residential property owned by and used by a person as their primary owner-occupied residence without the consent of the owner if that property is intended to be used for economic development, for which purposes the property will be transferred to, or used for, private enterprise or where the action primarily benefits a private person or entity.
S2408 very specifically limits its scope to owner-occupied residential property. What are the feelings of eminent domain reform advocates on this? Is the good fight only to prevent people from being forced out of their homes, or is there a concern about a broader class of property rights? Also, the condition that a taking not “primarily benefit a private person or entity” opens up some wiggle-room. How, for instance, would S2408 apply to takings related to the development of a casino that supposedly benefits both a private operator and the state?
A third reform proposal has been introduced in the Senate at the behest of Lieutenant Governor Charles Fogarty. Senate bill 2155 (sponsors) differs from the Governor’s proposal in that it applies to all residential property, not just those that are owner occupied. S2155, however, leaves a (maybe reasonable) loophole allowing for the occasional economically motivated eminent domain taking…
The entity shall not take by eminent domain property for economic development purposes that is significantly residential and is not in substantial violation of applicable state laws and regulations and/or municipal ordinances and codes, regulations governing land use or occupancy at the time of the proposal of the development plan for development, but may acquire such property in accordance with the development plan for a negotiated, mutually agreed on price.
In other words, S2155 allows eminent domain transfers of property from one private owner to antoher in cases where the property is in violation of building and zoning codes, leaving open the possibility of zoning board mischief involving politically-connected developers. Still, S2155 applies to a broader class of properties than does the Governor’s bill in its current form.
The Not-So-Good
There are also two not-so-good eminent domain reform options before the legislature. The first is House bill 6739 (sponsors)…
No taking of private property for public use under the provisions of this chapter shall in any instance result in ownership of that property in any private entity or individual not related to this state or a municipality or any subdivision therein in an amount greater than twenty percent (20%) of non-state ownership.
This bill is far too vague. The key is not the 20% non-state ownership ceiling, but the “not related to this state or municipality…” hedge. Does a private owner who works with some economic development board become sufficiently “related to the state” to get eminent domain rights? To eliminate any possible misinterpretation in this vein, the “not related to this state” phrase should be dropped from this bill. A hearing on this bill had been scheduled for today, but was cancelled.
Finally, there is House bill 7350 (sponsors) introduced at the behest of Attorney General Patrick Lynch. H7350 seeks to legitimize eminent domain takings for economic development 1) by requiring the government to file a report before seizing land for economic development (ooh, tough requirement there) and 2) by requiring the government to pay 150% market value in certain cases — but NOT in cases where the public would have “free public access” to 50% or more of the land given to a private developer (they don’t even have to write the report in this case). This provision might be used to allow, for instance, residential property to be taken to to build a privately owned shopping mall, because the public would have “free public access” to the shops in the mall.
In summary, H7151, S2408, and S2155 could become the bases of a real eminent domain reform. H6739 are H7350 too vague to be viable starting points when better proposals are already out there.
A Jessica Selby article in the Kent County Times describes yesterday’s celebration of Dr. Seuss’ birthday in local schools…
Yesterday was Dr. Seuss’s Birthday and school children around the Valley took time out of their academic day to celebrate it….What many people don’t know (and this might make a nice addition to the celebration for the older kids) is that early in his career, Dr. Seuss was an uncompromising World War II political cartoonist who didn’t pull any punches when challenging America through his artwork on subjects like isolationism, anti-semitism, racism, and most importantly, on the need for the United States to stand united and defeat its enemies.
Each year on March 2, millions of children nationwide join the National Education Association in celebrating “Read Across America Day,” the day devoted to celebrating Dr. Seuss’s birthday. It is, according to information from NEA, the nation’s largest reading celebration and serves as a prime showcase for focusing the country’s attention on literacy and the importance of reading.
The University of California at San Diego (the source of the above links) has a large collection of Dr Suess’ World War II cartoons here. [Open full post]
The encouraging school choice proposal by Cranston Mayor Steve Laffey, discussed here, and the absurd response by Senator Chafee has led me to repost below an expanded version of a November 18, 2005 posting on the moral imperative for school choice.
Contrasting this week’s posting with an earlier posting on this issue – also by Andrew and entitled Cranston’s and Rhode Island’s Need for a Sensible School Choice Program – shows how Mayor Laffey and other Cranston leaders have evolved their policy solution in recent months in response to a genuine problem. The comments section of that earlier posting is alive with a debate about two issues: Should children from Providence – where public schools are mediocre – have the right to attend better schools in Cranston and what effect does this have on education funding flows? These are two central questions underlying the school choice debate.
School choice is a moral imperative because the performance of our schools greatly influences whether (i) our children have a clean shot at living the American Dream; and, (ii) whether our country can maintain the strength of its economy via a well educated citizenry capable of competing successfully in an increasingly global economy.
To provide an indepth review of the school choice debate, this posting is divided into nine sections. Each section is identified below and you can proceed directly to it by clicking on the title of that individual section below:
I. The Unavoidable & Serious Performance Problems with Public Education
II. The Current Problem in Rhode Island: Spending a Lot of Money & Getting No Return on our Investment
III. The Structural Problem with Public Education
IV. Myths Propagated by Defenders of the Status Quo
V. Defenders of the Status Quo: Bureaucrats, Politicians & Teachers’ Unions
VI. The Magnitude of Teachers’ Union Monies at Work to Maintain the Status Quo
VII. Irreversible Change has Begun
VIII. Elaborating on the Rationale for School Choice
IX. Why School Choice is a Moral Imperative
Fred’s sarcasm in the comments to Andrew’s foregoing post regarding my previous complaints that Mayor Laffey hadn’t tied his arrest of Maria Hernandez to the issue of school choice doesn’t really work based on Laffey’s ex post facto announcement. Will’s comments fair a little better, since his previous assertion was of an unseen plan on Laffey’s part. But for all we know, it was discussion on this very blog that prompted Cranston’s newly minted school choice policy. Probably not, but the timeline hardly invalidates my argument that Laffey had said absolutely nothing about the topic previously.
If this matter is unfolding according to some master plan, however, I have to say that I find the strategy to be unnecessarily manipulative. Pushing a family into the state spotlight with an arrest and promises of prosecution in order to embarrass foes and tentative allies alike with a gotcha probably isn’t the most politic means of advancing conversation.
Of course, if there were a plan in operation, I’d have expected materials to have been prepared (e.g., on the Web site) for simultaneous release. I also wouldn’t have expected this to be the case:
[Open full post]Laffey said he has not contacted Providence to brief them on his plan, or to work on the problems together.
Robert Walsh, executive director of the Rhode Island chapter of the National Education Association, has responed, point-by-point, to Tom Coyne’s education proposals for Rhode Island. Mr. Coyne’s proposals are in boldface. Mr. Walsh’s responses are in italics.
1. Start by saving money through the use of a single state health insurance plan for teachers and putting RIPTA in charge of scheduling out of district transportation.
1) A single plan would likely average costs among districts versus saving significant funds, due the the use of a statewide rate versus community ratings. It’s good to see Mr. Coyne’s faith in the union members at RIPTA, however, perhaps letting the state fund the out of district transportation requirements would be best.
2. Use [funds saved from proposal 1] for (a) more in-class room materials; (b) merit pay for the best teachers; and (c) shoring up the teachers crumbling pension system.
a) We certainly need more class room materials b) merit pay reintroduces politics into the system and misunderstands how teachers are motivated and c) we have been advocating shoring up the pension system for years.
3. Institute a common state teachers contract with a longer school year and longer school day.
More time (which means more compensation) may be merited in some districts (or programs within districts), but not in others. If Mr. Coyne is unhappy with what teachers are doing, why does he want them to do it for a greater period of time?
4. Restore management rights to school principals so they can pursue innovations that are appropriate for the students they serve.
Management has lots of rights, but teachers are the ones pursuing innovations, principals (all of whom were teachers) should manage the process.
5. Reform our current system for classifying children as “learning disabled” as recommended in the late Rep. Paul Sherlock’s report to the General Assembly.
Why is he picking on these students, and how will it improve outcomes? Which students does he believe are incorrectly identified?
6. Make it easier for experienced mid-career people to teach in areas where they are needed, like math and science.
Gutting the pension system and having lower pay than math and science professionals currently receive is a lousy start.
7. Lift the ban on charter schools.
How about taking the programs that work in charter schools and applying them to all public schools? How about funding charter schools without robbing local school districts of needed funds so taxpayers will support them as learning laboratories?
8. Strengthen Rhode Island’s academic standards, and require that students demonstrate proficiency as a graduation requirement.
Good idea – fund the programs to back it up.
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Just a reminder to accompany all the quotes you may be reading (like the quotes in this Scott Mayerowitz Projo article) coming from people who say that it is absolutely impossible to expect the government of Rhode Island to spend within its budget (the state budget shortfall is now estimated at $77,000,000 for this fiscal year).
The state comptroller of Connecticut is projecting a $536,800,000 budget surplus for Connecticut for fiscal year 2006.
By the most conservative estimates, Massachusetts is projecting a surplus of at least $120,000,000. Here is an estimate of the Massachusetts surplus proivded by the poverty advocates at the Massachusetts Budget and Policy Center…
If tax collections for FY 2007 simply reach the level announced last week…the state could open the FY07 budget cycle with a modest structural surplus of $120 million.What is the magic that our neighboring states have discovered that seems untransferrable to Rhode Island? [Open full post]
If tax collections for FY 2007 ultimately prove higher than those now envisioned, this positive gap could be larger. For example, the FY07 surplus could exceed $210 million if tax collections attain the upper bound of the FY07 estimate put forward by the Department of Revenue in December; it could climb to roughly $390 million if tax collections sustain their recent rates of growth and continue to grow in a robust fashion throughout FY07.
Jonah Goldberg offers these words on the destruction of the Askariya mosque, a sacred Shiite mosque in Iraq:
[Open full post]But where are the protests in London and Denmark and Pakistan (other than the anti-American ones) denouncing the destruction of the shrine in Iraq? You judge people by what they do. Is blowing up Mosques and Holy Shrines not as offensive to mainstream Muslims as doodling cartoons in Denmark? No? Prove it.
The next two problem/solution pairs proposed in Steve Laffey’s plan to remedy high drug costs concern different aspects of the problem of regulation. (The first two problem/solution pairs are discussed here) .
1. The first issue is the relationship between the pharmaceutical industry and the Food and Drug Administration…
Today’s Problem: FDA regulates drugs foremost on financial interest–not consumer safety (i.e. Vioxx)In 1992, the Federal Government implemented a “user fee” system where drug companies pay the government to help provide the resources needed for drug testing.
Laffey’s Solution: Eliminate fees for FDA approval and ban experts with financial ties on drug advisory committees.
The problem with a user fee system is not conscious corruption. The problem is the nature of government bureaucracy and its incentive structure. In the private sector, success is measured in terms of a profit. In government, where there is no profit, we foolish humans still need some way to score our successes and failures. In public bureaucracy, management often measures its success in terms of its ability to increase its budget allocation. (An article in the Spring 2002 issue of the Cato Institute journal Regulation, mostly supportive of the user-fee system, agrees with this principle).
Once user-fees are built into the system, pressure inevitably builds on the government to push as many drugs through the testing process as possible in order to collect as much fee money as possible. It is certainly plausible that the 1.56% increase in drug recalls between 1993-1996 and the 5.35% increase in drug recalls between 1997-2001 reported by the Journal of the American Medical Association (via the Christian Science Monitor) is related, in part, to the bureaucracy’s tendency to act, not evilly, but shortsightedly, thus warranting some re-examination of the practice of user-fees.
2. A second reform proposal focuses on the issue of patent law…
Today’s Problem: Generic drugs are priced 20%-80% below brand names drugs, but comprise on 10% of total drug sales.A patent is supposed to be a deal that benefits both innovators and the public. An innovator gets rewarded for his work by having and exclusive period to market and/or license his product. In return for granting a period of exclusivity, the public learns the details of the innovation and, after the patent expires, is allowed to build upon those innovations.
Laffey’s Solution: Increase generic drug distribution by closing drug loopholes, ending anti-competitive payoffs and adjusting effective patent life.
Unfortunately, patent law’s current structure and enforcement is not consistent with its purpose. As soon as the generic drug maker notifies the Food and Drug administration that it is preparing to produce a generic version of drug about to enter the public domain, the brand name manufacturer can sue for a 30-month extension. In that period (and because of the sorry state of patent scrutiny in this country) they can attempt repatenting their original product, triggering other delays. Here’s an example from reporting from PBS’ Newshour with Jim Leherer showing how current law allows frivolous patents to stifle the purpose of the patent process…
What brand name manufacturers have done in some instances is go back and file new patents on those same drugs, some of them frivolous patents. In one instance, for example, a company suddenly went back and decided to patent the brown bottle that the cancer drug came in, because it said this brown bottle will preserve the potency of this drug. So it filed that patent anew. That triggered another 30-month stay.Other provisions in patent law encourage generic drug producers to sue brand-name producers in an attempt to shorten the lives of patents. A provision in the law allowing a generic drug producer an 180-day period of exclusivity after winning a patent-shortening suit caused an explosion in litigation starting in the 1980s. Robert Goldberg, Director of the Manhattan Institute Center for Medical Progress, explains the effect that this has had…
During the 1980s only two percent of generic drugs tried to cut patent life short as a way to approval. Today over 20 percent of all generic drugs now enter the market through legal attacks on patent life. And generic firms are attacking as soon as a drug hits the market — with multiple challenges of the same patent in many cases. No wonder generic companies such as Barr Labs make most of their money not from selling medicines but from suing drug companies and settling cases.The Laffey plan would address these problems by simplifying patent law. Drug companies would not get an automatic 30-month extension on their patents. And to make sure that the get fully rewarded for their innovation, Mayor Laffey suggests reforming the law so that the clock on pharmaceutical patent doesn’t start until the drug actually hits the market.
Clearer and simpler patent law would have a positive effect of creating a stable, non-litigious playing field for the production of both brand name and generic drugs. [Open full post]
The most difficult part of Steve Laffey’s campaign platform for the traditional Republican base to swallow (so to speak) has been his promise to “fight the big drug companies”. On Monday, Mayor Laffey laid out in detail his plan to remedy high drug costs. (Katherine Gregg and Jim Baron both provide good tastes of the overall flavor of the presentation in their reporting in the Projo and the Pawtucket Times, respectively).
Mayor Laffey summarizes his program in terms of six problems with six solutions. The first two problem/solution pairs are based on the assumption that pharmaceutical industry advertising creates an “artificial” demand that keeps drug prices high…
Today’s Problem: Direct-to-Consumer advertising can inflate the need for brand name drugs and lead to inappropriate prescribing.Here are some general concerns about this set of solutions.
Laffey’s Solution: Re-instate pre-1997 FDA disclosure requirements (for full-disclosure of ALL side effects).
Today’s Problem: Drug companies are spending more dollars on “Me-too” drugs that don’t improve America’s health.
Laffey’s Solution: Require new brand name drugs to be superior than current drugs (or no patent!)
1. Certainly advertising is influential (after enough TV-ads, people will actually consider voting for Matt Brown for the Senate!) but prescription drugs, by being “prescription”, are already supposed to involve a layer of protection between advertiser and consumer. They can only be sold after being prescribed by a doctor. In theory, doctors’ judgements shouldn’t be swayed by slick advertising campaigns.
If there is a problem with advertiser created demand, doesn’t a large measure of the problem have to reside with the doctors who are writing the prescriptions? Also, if advertising is this powerful (and profitable), then why haven’t generic drug makers developed their own advertising campaigns announcing that their drugs are just as good as brand name drugs to increase the demand for generic products?
2. The focus on “me-too” drugs — drugs that have a different enough chemical composition to get their own patent, but serve the same function as a previous drug (the less perjorative term used to describe them is “follow-on” drugs) — raises some specific concerns. The argument against follow-ons is that they inflate drug prices by discouraging people from purchasing cheaper generic drugs after the latest-greatest brand names hit the market.
Not everyone, however, agrees that follow-ons, because they have the same function as their parents, are all bad. The first argument for follow-ons is that they are necessary for providing treatment to patients who cannot use the orginal due to allergies or side-effects. (John Calfee of the American Enterprise Institute makes this argument). The second argument is good, solid economics. In theory, follow-ons ultimately drive prices down by making negotiation with drug companies possible by increasing the supply of drug options available for treating a particular problem. Too much regulation against follow-ons would restrict supply of available treatments, ultimately driving prices up. (Malcom Gladwell argues this position in the October 25, 2004 issue of the New Yorker).
Have all of the possible consequences of increasing the regulatory burden on developing follow-on drugs been given their due diligence?
Up Next: Some very sensible suggestions in the Laffey Plan on FDA & Patent Reform… [Open full post]
Gary Ezovski, Chairman of the North Smithfield School Committee, offers these thoughts in a recent ProJo editorial:
I can comfortably say that I have yet to hear a suggestion that will solve the schools-budget challenge in our community or throughout the state…
The business of education is nearly 80-percent labor. Payroll and benefits are where we need to make a difference. The real issue is that our cost of labor is among America’s highest, and not one suggestion has been made to take that issue by the horns. We must take control of the single largest cost in education.
Let’s do what the Education Partnership has talked about and change the balance away from union control to what serves the interests of students. Let’s tackle three critical areas of salary and benefits on a statewide basis.
Most commonly, between 40 and 70 percent of teachers in each district are at their contract’s top step. The total cost of salary for top-step teachers statewide may be our single largest payment in education. Beyond that, these salaries are the driver for all others in the system, since they are the metric to which the others move.
For anyone who has been involved in a Rhode Island teacher-contract negotiation, it is plain that the negotiations constantly surround how the negotiating district compares with all other districts in the state.
Why did Coventry set the top-step target for so many years? Whatever the reason, the paradigm must change. How do we do that? Waiting for 36 school districts to do it is not sensible.
Rhode Island has the ability to act as if it already were one school district. Legislative action is needed to limit top-step teacher compensation.
That can be done by connecting top-step pay with average Rhode Island family income and state aid to education. If a community’s top-step teacher salary exceeds, say, 1.3 times the Rhode Island average family income of a baseline year, then the district’s distribution of aid for education should be reduced by the same percentage of the excess.
At the same time, we must immediately freeze and ultimately set a timeline to eliminate lanes — extra pay for teachers’ levels of education — and longevity payments as a means of hidden supplements.
Two other issues that are a constant source of challenge in contract negotiations for all municipal employees (teachers, fire, police, DPW, and city hall) are health care and sick time. Each of these must be streamlined to a single statewide program. We must stop purchasing health care as a result of what might be as many as 200 different collective-bargaining negotiations programs in our 39 cities and towns. Our small state can establish one program to establish fairness for employees and affordability for taxpayers.
The program established very recently for the Cranston Teamsters unit should be studied as a model to follow. Even the retirement provisions should be equalized. Should one community grant health care for life while another provides nothing? Wouldn’t one statewide program streamline the local negotiations process and create cost-efficiency for all taxpayers? Should a community that displays self-control have to pay the bill for waste in those that spend gratuitously?
Sick time also requires a single solution to stop senseless disparity between groups within the same town and around the state. We need legislative action to create a sensible program for all municipal employees that allows no more than six to eight days per year, coupled with mandatory employee participation in temporary-disability insurance (TDI), plus an employer-provided long-term-disability insurance product.
Beyond creating uniformity, such a program could increase attendance, decrease use of substitutes (which will improve student achievement), and eliminate career-end golden parachutes, while also creating a respectable benefit for employees that includes reasonable short-term coverage and valuable disaster protection. Wouldn’t that be better for employees and the taxpayers?
In short, I believe that we can create reasonable controls and guidelines for our 39 cities and towns and our 36 school districts without a statewide contract or a statewide school district. With good controls, we can keep government close to its people, prevent waste in gluttonous districts, and sustain the resources for redistribution of our current dollars to districts that can use them efficiently to improve student achievement.
If you have suggestions to fine-tune or expand on these ideas, please send them to me, at gezovski@lincolnenv.com, to your state senators and representatives, by logging on to www.rilin.state.ri.us, or to Governor Carcieri, at rigov@gov.state.ri.us.
A very thoughtful editorial, indeed. Let our elected officials hear from you.
For more information on public education issues here in Rhode Island, check out the various writings at the bottom of this posting.
