Is California parole program worth $100 million a year?

California has spent more than $600 million over the past decade to house and rehabilitate parolees in the state’s single-largest reentry program for former prisoners.

After all that money, state officials can’t say whether those services were effective in preventing future crime. That’s because the California Department of Corrections and Rehabilitation has not tracked whether parolees find jobs or commit new crimes after leaving the program.

CalMatters reporter Bryhonda Lyons spent the past year examining the privately-run program, known as Special Treatment for Optimized Programming. We’re publishing the first of her stories today.

Drawing on interviews with former participants and policy experts, as well as tax documents and state reports, CalMatters found:

• Corrections department data on the program is outdated, inaccurate or doesn’t exist;
• Department officials struggled to explain how many people enrolled in the STOP program and how many people completed all of the services offered to them in 2020-21;
• State numbers show only two out of five parolees who participated in the program in 2020-21 completed at least one service offered to them, and based on how the state collects data, it’s unclear if anyone finished all of the services offered to them; 
• Some of the nonprofit vendors that manage reentry homes lease their facilities from their own executives, according to public records, raising “red flags” among experts who say the arrangements could signal financial conflicts of interest;
• And the state’s July 2022 list of reentry homes included several with suspended business licenses and nonprofit status revoked years ago by the California Department of Justice — effectively barring them from doing business in California.

The lack of information frustrates both critics and supporters of rehabilitation programs. 

• Assemblymember Reggie Jones-Sawyer, a Los Angeles Democrat: “I… want to ensure the public that they’ve been safe with all these people not recidivating… And the only way we can do that is to come up with data.”

• Michael Romano, director of the Three Strikes Project at Stanford Law School: “Almost nothing we do has any evidence suggesting that it works. It’s a problem well beyond STOP that they don’t have evidence that it works. I don’t think the (corrections agency) has any evidence that any of its programs — or any of its punishments — work or don’t work.”

Read the story to learn what happened after CalMatters began reporting about the STOP program. And watch Byrhonda in a TikTok from our engagement team.

A new CalMatters newsletter: We’re adding to our selection of newsletters with one that goes out on Fridays from the California Divide team that focuses on the politics and policy of inequality. Read the latest installment here and subscribe here.

Youth journalism: CalMatters is ramping up its youth journalism initiative for high school students and educators. That includes an educator fellowship, with a workshop for 23 fellows today through Thursday at CalMatters’ offices in Sacramento. Read more from our engagement team.

Other Stories You Should Know

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1 Media bill held for more study

From CalMatters politics reporter Alexei Koseff:

Australia forced tech companies to share their advertising revenue with news outlets whose work appears on their platforms. Canada is following suit.

For now, California will not join them: Proponents hit pause on a similar measure last week in the face of fierce tech industry opposition, lingering legal questions and division among media organizations about whether it is the right approach to save a struggling journalism ecosystem.

Assemblymember Buffy Wicks, the Oakland Democrat carrying Assembly Bill 886, plans to hold the proposal in committee until next year as she considers additional changes that could not be completed ahead of a key legislative deadline this week.

She told CalMatters on Friday that she remains committed to providing a financial boost to California newsrooms that have been hollowed out by a collapse in revenue over the past two decades. Her bill would allow news outlets to enter arbitration with tech companies to set fees when their stories are displayed or linked to on sites like Google and Facebook, and require those media organizations to use the money primarily to pay journalists.

• Wicks: “I want to make sure when I put this policy on the governor’s desk, it’s the right policy.”

She dismissed the tech industry’s sway in stalling her bill, noting that parent company Meta threatened to pull news from Facebook and Instagram a day before the Assembly overwhelmingly passed the measure last month in a bipartisan 55-6 vote.

Supporters — including the California News Publishers Association and the California Broadcasters Association, major news outlets such as the San Francisco Chronicle and the media workers union — argue tech companies should pay for the benefits they derive from the difficult and expensive newsgathering efforts of journalists.

But alongside an array of tech groups, some independent, nonprofit and ethnic media outlets have spoken out against the bill. During the Assembly floor vote, opponents repeatedly referenced a letter from CalMatters CEO Neil Chase, who argued the system would encourage “clickbait” stories and mainly benefit large publishers that could afford to pursue arbitration.

“I have no problem with government helping out journalism. It’s a public good that needs to be supported,” Chase said in an interview. “I don’t buy the premise that Google and Facebook have done something bad to journalism and need to be penalized for it. We have been running journalism with a business model that was invented by Benjamin Franklin.”

Chase said his position was not influenced by donations the nonprofit has previously received from Facebook and Google. CalMatters reporters also maintain editorial independence from Chase and funders.

Before she revives the bill next year, Wicks said she hopes to sort through those concerns about where the money goes and how it is spent, including ensuring that California journalists would benefit and small publications would have a seat at the table.

“I don’t want to enrich hedge funds,” she said. “Fundamentally, we all agree on the problem and that there needs to be a solution.”

2 Will CA student athletes get paid?

Speaking of controversial bills being put on hold — a proposal to give student athletes a share of college sports revenue is also now a two-year bill, held until 2024.

As Ryan Loyola of CalMatters’ College Journalism Network explains, the bill would enable college athletes to earn up as much as $25,000 for every year they participate in their sport by requiring colleges to put a portion of their sports revenue into a fund. If passed, it’d be another first-in-the-nation step California would take in compensating student athletes.

Students would get paid when they complete their degrees, and payments would depend, in part, on how much revenue their sport generates, as well as how much their team already distributes in athletic grants. The pot for potential funds is big: In 2022, California’s 26 Division I schools earned $1.2 billion in revenue from media contracts, ticket sales, alumni contributions and other ventures.

• Liam Anderson, a Stanford track and field athlete and co-president of the university’s Student Athlete Advisory Committee: “This is the only labor market where the primary labor input — the players — receive essentially zero compensation from their employers. It is very difficult on a philosophical level to argue that these players do not deserve some form of compensation.”

But critics of the bill, including the University of California, California State University, Team USA and the NCAA, say it would further prioritize men’s basketball and football, which are the top revenue earners for athletic departments. Currently, some of their funds go to subsidizing other sports, and this bill, opponents say, would divert resources away from less lucrative sports, such as swimming, volleyball, women’s sports and men’s olympic sports.

• Elise Byun, a UC Berkeley gymnast and member of the NCAA Division I Student-Athlete Advisory Committee: “If the revenue that’s being taken is just giving back to football and basketball, we can’t advance the student athlete experience. There’s no money left over to help bring up everyone.”

Not all student athletes would be to receive degree payments either: Students who have not received an athletic grant or scholarship are ineligible for the money, as well as Division II, Division III and community college athletes.

In other college news: With the Supreme Court’s June ruling to strike down race-conscious college admissions in the U.S., the debate over increasing campus diversity has grown more acute. In addition to considering grades and test scores, nearly all of California’s public universities use a holistic approach to review applicants.

This includes explicit consideration of the education level of the student’s parents or guardians. But according to CalMatters’ community college reporter Adam Echelman, the definition of a “first-generation college student” varies in California, depending on the school system:

• University of California: Anyone whose parents did not receive a bachelor’s degree or equivalent.
• California State University: Lists numerous definitions on its website. In one scenario, 31% of CSU students are considered first generation; using another definition, 52% are.
• Community College Chancellor’s Office: Any student whose parents never attended college at all.

For students, this lack of consistency around what first generation means leaves some unsure about how they should proceed. Those who lack support from family to navigate college often find the term “first generation” as a meaningful part of their identity. And in some cases, it means access to targeted state and federal services. 

For colleges, the definition of first generation can affect admissions and the amount of funding that a school receives or allocates for these students. 

• Sarah Whitley, vice president of the nonprofit Center for First-Generation Student Success: “There’s nothing really clear and centralized. It’s something that we’re hoping to get to, but the data is just so messy everywhere.”

For more information about first-generation college students, read Adam’s story.

Have a question about California higher education? Fill out this form and it could be addressed in a future “Ask CJN.” We now have a Spanish version of the form.

3 AG Bonta signs off on hospital sale

From CalMatters health policy reporter Ana B. Ibarra:

California Attorney General Rob Bonta has conditionally approved the sale of Beverly Community Hospital, a 202-bed facility in the city of Montebello, his office said Friday. 

The hospital is set to be acquired by American Healthcare Systems, a nonprofit corporation. Beverly Hospital filed for bankruptcy in April and stopped key services, including pediatric care and maternity services. The sale will allow those services to be restored, according to Bonta. The Montebello hospital is one of a handful of independent hospitals that had made their financial troubles public in recent months. 

• Bonta, in a statement: “Montebello’s people deserve access to high-quality, affordable healthcare services, and today, we are ensuring they can continue to rely on Beverly for those services.”

Under state law, the attorney general must review and approve health care mergers and acquisitions that involve a nonprofit entity — and the attorney general usually sets conditions for the buyer as a way to secure consumer protections. Republican legislators tried to limit this power earlier this year via now-stalled legislation. Republicans blamed Bonta for the closure of Madera Community Hospital, after an interested buyer refused to meet his conditions and pulled out from a purchase deal.  

In the case of Beverly Hospital, American Healthcare Systems has agreed to meet the following conditions, according to Bonta’s office:

• Keep all of the hospital’s current services;
• Restore services that were shut down during bankruptcy, including obstetrics, gynecological services and pediatrics;
• Ensure access to Medi-Cal and Medicare patients, who make up about 75% of the hospitals’ patient population;
• Notify patients about charity care and financial assistance policies;
• Provide interpreter services;
• Comply with state staffing levels.

4 Unemployment debt still climbing

From CalMatters investigative reporter Lauren Hepler:

California’s unemployment debt to the federal government will surge past $20 billion next year, according to a new state analysis of the financial fallout from an unprecedented spike in jobless claims during the COVID-19 pandemic.

That’s up from $19 billion still owed as of earlier this year, which the Friday update from the Legislative Analyst’s Office warned means that the state’s tax-funded Unemployment Insurance fund “is now structurally insolvent.” The imbalance stems from the state’s forecasted $5.3 billion in annual payroll taxes growing slower than benefit payments expected to hit $6.8 billion next year — a dynamic that economists have argued could be addressed by changing the state’s tax structure.

California, like other states during both the pandemic and the Great Recession, borrowed money from the feds to keep paying the millions of claims that flooded the Employment Development Department during these economic emergencies. After the worst of the pandemic, employers are already on the hook to pay a temporary unemployment tax hike, which the Analyst’s Office found will still likely prove insufficient because of the nagging financial hole.

• Chas Alamo, Legislative Analyst’s Office policy analyst: “Historically, benefit payments have only exceeded contributions during major economic downturns — most recently, during the pandemic and Great Recession. For the first time, the fund is expected to be out of balance during a period of job growth.”

Other things worth your time

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Newsom won’t seek to block parole for Manson follower Leslie Van Houten // AP News

Is Rep. Barbara Lee too old to replace Sen. Dianne Feinstein? // Los Angeles Times

Veteran US Rep. Grace Napolitano plans to announce retirement // Los Angeles Times

Religious right blindsided by angry parents in Southern California school district // Politico

Bay Area public meetings are being ‘Zoom bombed’ with hate speech // The Mercury News

California bills could remove hurdles to becoming a teacher // EdSource

What CA can learn on earthquake safety from Santa Monica // Los Angeles Times

Chemehuevi tribe still doesn’t have fair share of Colorado River water // High Country News

Board and care homes face struggle to survive // Los Angeles Times

Following State Farm’s exit, Farmers Insurance retreats // The San Francisco Standard

These SF mothers are trying to make the city more child-friendly // San Francisco Chronicle

Yosemite National Park says reservations may return amid crowding // San Francisco Chronicle

Southern California Edison, others pay settlement in Rey fire // Los Angeles Times

SF  mayor rejects allegations in lawsuit over homeless camps // San Francisco Chronicle