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Wednesday, August 7, 2024

Illegal-immigration surge has cost these swing-state taxpayers billions, study says

 Immigration boosts federal tax revenue, but states and localities bear unique costs

Immigration is a central theme in this year's presidential election, as former President Donald Trump seeks to capitalize on voter discontent over a recent surge in unauthorized immigration to the U.S.

Polling suggests immigration is a top concern for Americans in 2024, and immigration-court data shows that swing states including Pennsylvania, Georgia and Arizona are among those with the greatest increase in unauthorized migrants since 2021.

Winning these bellwether contests could be decisive for Trump or Vice President Kamala Harris, the Democratic nominee, in the November election.

Immigration, both legal and illegal, tends to grow the national economy and improve the federal fiscal budget outlook, according to a July report from the Congressional Budget Office. That's because even undocumented immigrants typically pay more in income and payroll taxes than they receive in federal benefits.

It's a different story for many state and local governments.

"The research literature has generally found that increases inimmigration raise state and local governments' spending - particularly on education, health care, and housing - more than their revenues," the report said.

A record share of Americans said in February that they see illegal immigration as a "critical threat to the vital interests of the United States," and the issue ranks as the No. 1 most important problem facing the country, according to Gallup.

A separate Gallup poll released last month showed that for the first time since 2005, a majority of Americans would like to see a decrease in all immigration.

Housing, emergency healthcare and education costs

One reason for the discontent could be related to the strains that a disorderly surge in immigration can put on state and local infrastructure and services.

"Illegal immigration is a drain on public resources because the services they are likely to use are more expensive than the contributions they make through any taxes [undocumented] immigrants may pay," Jessica Vaughan, director of policy studies at the Center for Immigration Studies, told MarketWatch.

CIS is a think tank that advocates for less immigration and tougher enforcement of laws meant to dissuade illegal immigration.

The CBO estimates that between 2021 and 2026, 8.7 million more immigrants will come to the U.S. than had been expected based on prepandemic trends.

The Federation for American Immigration Reform, which also advocates for reduced immigration, estimates that illegal immigration costs more than $150 billion in government services annually, mostly borne by states and localities.

State and local governments must find ways to provide shelter, emergency healthcare and education to these populations, even if local laws are inhospitable to undocumented immigrants.

Several swing states are home to large numbers of unauthorized immigrants or have seen a large surge in their numbers since 2021, according to federal court data compiled by the Transactional Records Access Clearinghouse at Syracuse University.

While these data aren't a comprehensive account of where all undocumented immigrants are residing, TRAC says they do provide a general sense of which destinations are attractive.

The most popular destinations are large states with strong economies, including Texas, Florida, California, Illinois, New Jersey and New York.

But several key swing states have also seen their unauthorized populations grow, according to court filings.

        State        Unauthorized migrant population  Percent increase since 2021  Rank 
        Georgia                  45,747                          401%               7 
    North Carolina               32,681                          446%               9 
     Pennsylvania                25,721                          241%               11 
        Arizona                  24,563                          734%               13 
        Nevada                   15,931                          562%               22 
       Michigan                  13,162                          775%               26 
       Wisconsin                 10,768                          467%               28 


Vaughan recently authored a study on the budgetary impact of the migrant surge on Massachusetts, which ranks 10th in states with the most migrants, in part because of the relatively generous social services provided there.

The state has a right-to-shelter law, which requires the state to provide emergency shelter for families meeting certain requirements, and a growing immigrant population is putting strain on the program.

The initiative now costs more than $1 billion per year, and Massachusetts Gov. Maura Healy, a Democrat, had to sign legislation limiting the program earlier this year.

FAIR estimated in 2023 that through education, police and corrections services, and healthcare and public assistance, the unauthorized-migrant population cost Pennsylvania $1.64 billion. For the other swing states, the costs run from $1.12 billion for Michigan to $3.2 billion for Arizona.

Not all analysts believe these tallies accurately communicate the benefits and costs of immigration to public finances and local economies, because they don't take into account an immigrant's overall economic impact, including that of their descendants.

In addition, it's difficult to estimate the marginal cost of a new migrant to state in terms of services like education and public safety.

"Beyond the immediately visible impacts in terms of costs - education and healthcare in particular - and the benefits from tax payments, there are far more diffuse impacts from the fact that immigrants are consumers and generators of productivity," said Michelle Mittelstadt, director of communications at the Migration Policy Institute, a nonpartisan group that seeks to improve immigration and integration policies.

MPI hasn't conducted an analysis of the fiscal costs to state governments over the migrant surge.

The typical recent immigrant boosts the U.S economy at a present value of $13,000 when accounting for taxes paid, benefits received and economic activity done by the immigrant and his likely descendants, according to estimates in a 2023 report from the libertarian Cato Institute on the lifetime fiscal impact of immigrants on the U.S. economy.

In the long run, "immigrants pay more taxes than they consume in benefits on average," Alex Nowrasteh, Cato's vice president for economic and social policy studies, wrote at the time. "But the results differ based on their age of arrival in the United States and their ultimate level of education."

https://www.morningstar.com/news/marketwatch/20240807247/illegal-immigration-surge-has-cost-these-swing-state-taxpayers-billions-study-says

CryoPort cut to Hold from Buy by Jefferies

 Target to $8 from $20

https://finviz.com/quote.ashx?t=CYRX&p=d

Super Micro CEO Blows The Lid Off NVIDIA’s Latest Blackwell AI GPU’s Purported Delay

 Data center equipment provider Super Micro shared details about reports of a delay in NVIDIA's latest Blackwell AI GPUs during the firm's Q4 2024 earnings call conference earlier today. Blackwell is NVIDIA's leading edge AI GPU lineup, and during the call, Super Micro's chairperson and CEO Charles Liang shared that the overall impact of any delay should not be significant for his firm and that it was ready to deploy and provide customers with new products like H200 cooling.

Super Micro Treats Potential NVIDIA Delays As Completely Normal, Says Chairperson

The Super Micro earnings call was the first time analysts were able to tune into a company that's a part of NVIDIA's artificial intelligence ecosystem. Right off the bat, the firm's management was peppered with questions about potential GPU delays affecting its financials, which management had shared was because of the nonavailability of components.

The first question that probed Super Micro came from JPMorgan, and in response, Liang affirmed that his firm had "heard that NVIDIA may have some delay." However, he stressed that Super Micro treats any potential delays "as a normal possibility" since technology companies "always have a chance to go in a little bit or push out a little bit."

In this case, it appeared to him that NVIDIA "push[ed] out a little bit," which does not affect Super Micro's ability to provide its customers with a "new solution like H200 cooling" since Super Micro has lots of customers. He concluded by adding that "this push out overall impact to us, there should be not too much."

Among the significant coverage that the rumored Blackwell delay has received, Citi has assured investors that even if the GPUs are delayed, the impact on NVIDIA's financials should only see revenue extended forward from its quarter ending in January to the quarter ending in April 2025. While Super Micro designed liquid cooling solutions keeping the power hungry Blackwell chips in mind, it also offers it for other products such as H200 and H100.

Wells Fargo's question was more direct, with analyst Aaron Rakers cutting to the chase and asking Liang if he believes whether Super Micro "will be shipping the Blackwell platform solutions for revenue in the December quarter, or should we think about the full year guide as a bit more weighted to the back half of the fiscal year given some of these concerns around the timing of Blackwell availability."

Super Micro's fiscal year ends in June of each year, and its fiscal year 2025 will end in June 2025. The firm's full guidance for FY2025 is between $26 billion and $30 billion, and Liang's response to Rakers' direct question was much more telling.

He replied that "I mean, uh, indeed, we are, relatively, very conservative. Understand, Blackwell may postpone, how much, we don't exactly know, because new technology always what, can be, push out, right. He then commented on the revenue impacts based on calendar year quarters,  with the third quarter ending in September and the fourth quarter ending in December.

According to the Super Micro chief, "for Q3, for sure, we do not expect, any Blackwell volume. For Q4, I mean December quarter, I guess will be very small. Engineering sample. Small volume, so that really volume I believe will have to be March quarter next year. And that's why we [inaudible] only 26 to 30 billion dollars."

https://wccftech.com/super-micro-ceo-blows-the-lid-off-nvidias-latest-blackwell-ai-gpus-purported-delay/

Ocular Trial Seen Appropriate Registrational Study in Wet AMD

 Clear Regulatory Path for AXPAXLI™ in Wet AMD Through Ongoing SOL-1 and SOL-R Registration-Enabling Trials

Ocular to Host a Q2 2024 Conference Call and Webcast Today, August 7th, at 8:00 AM ET

Ocular Therapeutix will host a conference call and webcast today at 8:00 AM ET to discuss recent business progress and financial results. To access the call, please dial: 1 (800) 343-4136 (United States) or 1 (203) 518-9843 (International) and reference the conference ID “OCULAR”. To access the webcast, please click here. The live and archived webcast can also be accessed by visiting the Ocular Therapeutix website on the Events and Presentations section of the Investor Relations page. A replay of the webcast will be archived for 90 days.

https://www.globenewswire.com/news-release/2024/08/07/2925816/0/en/Ocular-Therapeutix-Announces-FDA-Feedback-That-SOL-R-Trial-is-Appropriate-as-a-Registrational-Study-in-Wet-AMD.html

'White House Believes Iran Backing Down From Israel Strike After Diplomatic 'Blitz''

 The Washington Post has said that intensive international diplomatic efforts to get Iran to step back from launching a new attack on Israel may be having an effect.

The report cited a "blitz" of diplomatic interventions with both Tehran and Tel Aviv. "It’s urgent that everyone in the region take stock of the situation, understand the risk of miscalculation, and make decisions that will calm tensions, not exacerbate them," US Secretary of State Antony Blinken said following a meeting with Australian Foreign Minister Penny Wong and Defense Minister Richard Marles.

"We’ve been engaged in intense diplomacy with allies and partners, communicating that message directly to Iran. We’ve communicated that message directly to Israel," he described.

Defense Secretary Lloyd Austin coming out of the same meeting Tuesday described that the Pentagon is still on alert, with the possibility still high for an Iranian attack, and with American naval and aerial assets still on standby in the region.

"What I’ve been focused on is making sure that we’re doing everything we can to put measures in place to protect our troops and also make sure that we’re in a good position to aid in the defense of Israel, if called upon to do that," Austin said.

But the White House's messaging of late has been more than just a message of defending Israel "if called upon"; instead, President Biden has definitively promised to come to Israel's military aid in the scenario of a major Iranian and Hezbollah attack.

And US administration officials believe this muscle-flexing on behalf of Israel has caused Tehran leaders to "think twice"

Washington’s willingness to flex its military muscles in the region may also be causing Iran to think twice, according to one senior Biden administration official, who told the Post that Iran "understands clearly that the United States is unwavering in its defense of our interests, our partners and our people."

US Defense Secretary Lloyd Austin has laid out several US military steps in recent days to help defend Israel from possible attacks by Iran and its proxies, and to safeguard US troops, including the deployments of additional fighter jets. He also said the USS Abraham Lincoln aircraft carrier will replace the USS Theodore Roosevelt in the region “later this month.”

Additionally, it has been newly revealed that a dozen F/A-18 fighter jets and an E-2D Hawkeye surveillance aircraft from the USS Theodore Roosevelt have moved from Gulf waters more inward in the Middle East region upon the start of this week.

The past days have also seen sporadic renewed attacks on US bases in Iraq. Austin addressed this threat in his Tuesday remarks, saying "Make no mistake, the United States will not tolerate attacks on our personnel in the region." He additionally asserted that "we remain ready to deploy on short notice to meet the evolving threats to our security, our partners or our interests."

Russia too has joined in the efforts to prevent a regional war from exploding:

Russian President Vladimir Putin has asked Iran’s supreme leader Ayatollah Ali Khamenei for a restrained response to Israel’s suspected killing of the leader of Hamas, advising against attacks on Israeli civilians, two senior Iranian sources told Reuters.

The message, according to the sources, was delivered on Monday by Sergei Shoigu, a senior ally of the Kremlin leader, in meetings with top Iranian officials as the Islamic Republic weighs its response to the assassination of Hamas terror group leader Ismail Haniyeh.

On Wednesday, in a fresh call with France's Macron new Iranian President Pezeshkian has said that if Western countries are truly desirous of preventing war, they must force Israel to halt the "genocide" in Gaza and accept a ceasefire, state media reported.

https://www.zerohedge.com/geopolitical/white-house-believes-iran-backing-down-israel-strike-after-diplomatic-blitz

Madrigal’s MASH drug launch gets off to a fast start, but...

 

  • The first medicine approved for a liver disease known as MASH is off to a faster launch than Wall Street analysts expected, according to quarterly results disclosed Wednesday by developer Madrigal Pharmaceuticals.

  • Madrigal said its drug Rezdiffra, which was approved by the Food and Drug Administration in March and became available the following month, generated $14.6 million in U.S. sales in the second quarter. As of June 30, more than 2,000 patients were on treatment and coverage policies were in place for more than 50% of people with commercial health insurance, the company said.

  • While only an early snapshot, the results surpassed consensus analysts estimates of about $4 million and have encouraged Madrigal to commercialize Rezdiffra in Europe on its own. An approval decision there is expected next year. “We're still in the early stages, but we are confident that we're building the foundation needed to create a blockbuster medicine,” CEO Bill Sibold told analysts.


Rezdiffa’s launch is barometer for what’s long been viewed by Wall Street analysts as a significant market opportunity.

The drug is the first medication for MASH, or metabolic dysfunction-associated steatohepatitis, a condition characterized by the buildup of liver fat and inflammation that causes progressive organ damage. The FDA has cited estimates that, in the U.S. alone, about 6 million to 8 million people have MASH with moderate-to-advanced liver scarring, making them eligible for treatment with Rezdiffra.

Yet the sales outlook for Rezdiffra has been debated. MASH tends to go undiagnosed for years, is usually confirmed through a liver biopsy and some of its symptoms can be addressed through diet and exercise. The drug’s benefits have also been described by some outside experts as modest, and its yearly per-patient list price of $47,400 was higher than analyst expectations of about $30,000. In-demand medicines for weight loss have produced early results in MASH that compare favorably with Rezdiffra, too.

While the FDA didn’t direct patients to undergo a liver biopsy before treatment — a hurdle that’s been seen as a barrier to using MASH drugs — the Veterans Affairs Department has. Analysts are keeping an eye on whether large commercial insurers might follow suit or instead endorse less invasive alternatives.

Drug access without a biopsy requirement or “onerous preauthorization will be key to driving prescriber and patient uptake,” wrote Leerink Partners analyst Thomas Smith, in a research note earlier this week.

On a conference call Wednesday, Sibold said that, so far, less than 5% of patients with commercial insurance have been asked to get biopsies, and “virtually all” Medicaid policies have been accepting non-invasive diagnostic tests. The company expects to obtain Medicare coverage next year, Sibold said.

“There are some outliers out there that are requiring biopsies, so we'll keep working at it,” he said. “We don’t want any patients to be subjected to it.”

Analysts pressed executives on whether Rezdiffra’s fast start was due to actual demand for the drug or because suppliers stocked up on inventory. Chief Financial Officer Mardi Dier said sales were driven by “mostly demand,” though she declined to provide specifics.

But Dier, and other Madrigal executives, also reiterated that the launch remains in its early stages. “We just want everyone to be careful not to get ahead of ourselves,” she said.

Madrigal has told investors to anticipate slow initial uptake that accelerates afterwards, as awareness increases and the company gets broader insurer support. The company has been aiming to get about 80% of people on commercial insurance covered by the end of the year, and on Wednesday indicated it’s on track to meet that goal.

“It takes time when you're launching a first-in-disease product in a community that's never had anything,” Sibold said. However, “we think that we are in the lead position now, and we think that we will be in the lead position for a long time.”

https://finance.yahoo.com/m/2ed54f64-c0cd-3894-b619-ec1d2c07ca00/madrigal%E2%80%99s-mash-drug-launch.html

Reckoning Has Come for K-12 Sex Abuse, and You the Taxpayer Are on the Hook

 

By James Varney, RealClearInvestigations

The teenage female athletes at California’s Pomona High School said they felt special when a handful of coaches there took them under their wing, spending more time with them than others, providing extra encouragement, sharing personal stories and, sometimes, seemingly harmless flirtatious talk.

One track team member was amazed at a Nevada meet when she saw the coaches drinking, smoking marijuana, and sharing the party scene with teammates. But that attention turned to tragedy at a subsequent meet in Las Vegas when a coach brought the 16-year-old to his hotel room, plied her with alcohol, and, she says, raped her.

She mentioned the assault to administrators at the time and the principal assured her the matter would be handled. Instead, the coach kept his job and she endured so much ridicule she wound up leaving California.

Decades after the 1997 incident, her tragedy turned to triumph when a Los Angeles jury awarded her $35 million for pain and suffering in a civil trial this January – made possible when the California legislature in 2020 opened a three-year window in which adults could bring litigation for sexual abuse they suffered as children. 

And that's not the only penalty the Pomona Unified School District taxpayers and insurers face from those reckless 1990s: Seven other former students have alleged abuse by the coaches, leading to three other lawsuits that have been settled privately and a fifth that remains active.

The long timeline from the incidents to settlement or trial, and the thumping amounts the Pomona Unified School District was hit with, reflect a new willingness to acknowledge and punish sexual predators. In the wake of the #MeToo movement and infamous cases such as those involving Catholic priests, Hollywood, and top-tier sports, momentum is building for what might comprise the biggest group of victims in sexual misconduct scandals: K-12 students victimized by teachers and other school employees. 

A review of insurance industry reports, legal blogs and media accounts by RealClearInvestigations turned up $1.2 billion in settlements for school districts in the last decade. And there are clear indications that the pace and amount of legal liability has been rising, along with the impact that has for taxpayers and schools.

In 2021, for example, the insurance entity United Educators reported nine K-12 sexual misconduct settlements of a million dollars or more in seven states, totaling $38.6 million. Those figures rose to a dozen in 2022, totaling $233.3 million, before exploding last year. In 2023, UE reported on 19 such K-12 settlements that amounted to more than $325 million. Only one of those cases – a $50 million settlement against the now defunct Miracle Meadows School in West Virginia – involved a private school.

Pomona Unified School District
End of the runaround? Finally, a sexual abuse reckoning in Pomona, Calif., girls' track, with taxpayers liable.
As states grapple with limitations on litigation against government entities, and in some cases open new windows for plaintiffs to sue, more victims are coming forward and school districts and insurers are scrambling to find the money juries and judges are awarding. Just how much all this may cost is unclear, because only cases that go to trial are a matter of public record, and usually it is only the big settlements or awards like Pomona Unified School District’s that draw attention. Scores of other lawsuits are being settled for smaller amounts or are kept private through agreement between the parties. 
AP
The #MeToo movement has come for Hollywood producers like Harvey Weinstein, Boy Scout leaders ...
AP
... and top-tier sports figures like Jerry Sandusky of Penn State. Now it's K-12 education's turn.

“I think we’ve only seen the tip of the iceberg,” Oregon attorney Peter Janci told RealClear-Investigations. “There has been a lot of abuse that happened in schools, and there are more coming forward every day as public education and the sentiment to support victims has grown.”

Janci won a $3.5 million settlement against the St. Helens School District in March, the highest figure yet awarded in Oregon in a case involving sexual misconduct by school employees. He said that case and many others reflect years of shifting ideas about how victims of sexual misconduct are perceived and a growing awareness of the scale of the problem.

“Historically, there weren’t as many cases because of the stigma and because the deck was stacked against the victims,” Janci said. “Often we see this time lag where the victims have been struggling with what happened, and the biggest change now is kids are coming forward. Nationally, this trend is just now hitting the K-12 public school sector with the same force.”

crewjanci.com
Peter Janci, Oregon lawyer: “I think we’ve only seen the tip of the iceberg." 

Some of the once most respected institutions in the U.S. now face ruinous economic prospects after being engulfed by similar litigation. The Boy Scouts of America and some dioceses of the Roman Catholic Church have declared bankruptcy after grappling with thousands of lawsuits filed by people alleging sexual abuse at the hands of officials of those organizations.

The Boy Scouts are insolvent after a $2.4 billion settlement on more than 80,000 lawsuits, while the Catholic Church is still wrestling with the fallout from its long-term harboring of predatory priests, with their current legal bill standing at $3 billion. The totals for K-12 public school districts could potentially exceed those, given there are nearly 17,000 such districts in the U.S. with close to 50 million students today.

The exposure for the nation’s schools may be much greater, though the extent is unclear. News reports offer a steady of stream of articles about teachers arrested for molesting students – though those typically involve young, attractive female instructors and not men, who are more often the perpetrators. As RCI has previously reported, the Biden administration reversed Trump-era requirements that that Department of Education collect data on incidents of sexual misconduct. In the face of fierce criticism, the department backtracked and says that at present, it “has no data.”

Large Loss Report 2024
Biggest sex-abuse scandal ever? The trend line is clear for K-12 schools and higher education.

One of the few academic studies on the subject – a 2004 report Hofstra University researchers prepared for the DOE – estimated that one in 10 K-12 students suffer some form of verbal or physical sexual misconduct from school employees. The vast majority of incidents never result in an arrest or trial.

Sesame
Terri Miller, victims' advocate: “If only they would address this appalling problem ... they would spare child suffering and decrease the astronomical dollars spent on lawsuits and legal fees.”

While there is no nationwide clearinghouse of information for how much money has been awarded in these cases, staggering penalties have mounted in the past four years: $121.5 million against the Moreno Valley, California, system; $102.5 million in the Union School District in San Jose, California; and nearly $88 million in various Long Island districts. Those have been accompanied by scores of smaller settlements, ranging from several hundred thousand dollars to $50 million.

The annual "large loss reports" prepared by United Educators cover a variety of areas where losses topped $1 million since 2021. Each year, the single largest category has been sexual misconduct cases. In 2021, UE said, those represented 10% of large losses it tracked. By 2023, sexual misconduct accounted for 25% of such cases, although that includes higher education litigation and a handful of incidents involving student-on-student misconduct.

To some extent, the rising totals reflect the surge in cases after some state legislatures, like California’s, opened new windows in which former victims could sue public entities for long-ago abuse. 

The cases also reveal a pattern in which school officials either ignored or downplayed warning signs that teachers, coaches, bus drivers or volunteers were engaged in problematic situations with students. The record is also dotted with predators who claimed victims at more than one school, having dodged flares at one place only to work again at another, a phenomenon advocacy groups call “passing the trash.” These patterns emerged in 78% of United Educators’ 2021 cases, although it fell to 42% in 2023. 

Last year, the Sacramento Unified School District was hit with a $52 million settlement stemming from the abuse of at least eight elementary school students that led to a former aide being sentenced in 2016 to 150 years to life in prison. In that case, court papers said, administrators blew off myriad complaints from parents alleging the aide offered the students “secret candy” and “prizes,” and some of those who ignored complaints were in turn promoted by the district.

“That is what complicity of silence has rendered in our nation’s schools,” said Terri Miller, president of the advocacy group SESAME (Stop Educator Sexual Abuse Misconduct & Exploitation).

“We hear too often how our school systems are struggling for money to afford paying teachers well, repair/build schools, provide supplies to classrooms, etc.,” Miller told RCI in an email. “If only they would address this appalling problem they have chosen to ignore or hide, they would spare child suffering and decrease the astronomical dollars spent on lawsuits and legal fees.”

Percentage of Victims by Job Title of Alleged Offender

Another partial accounting, maintained by Public Justice, shows settlements in 14 states between 2013 and 2019. All told, Public Justice’s Student Civil Rights Project tracked 304 K-12 settlements in sexual misconduct and bullying cases. From that, RCI culled 41 cases that involved school employees and students.

pcva.law
Vincent Nappo, plaintiffs' attorney in Washington state: Multiple settlements.

Public Justice shows California as the state with the most such settlements, recording 21 there between 2013 and 2019, totaling $408.7 million. In two-thirds of those cases, school officials failed to recognize or act on warning signs that employees were crossing boundaries with students, according to the lawsuits. While Public Justice shows settlements in 14 states during that same timeframe, the most any state outside of California showed was three – in Iowa, New Jersey, and New York – amounting to $22.1 million.

Neither Public Justice nor United Educators responded to RCI’s request for comment.

“What we’ve seen is the statute of limitations on sexual abuse charges extended up to ten years in many states,” said Vincent Nappo, a plaintiffs’ attorney in Washington state. He praised the state’s “very progressive tort law.”

Nappo has won multiple settlements against Washington school districts in sexual misconduct lawsuits, including a $9.5 million settlement in 2022 against the University Place School District.

That district, a sliver of Tacoma, has been hit with multiple lawsuits stemming from a volunteer wrestling coach who was at the school from 2005 to 2007. Nappo’s settlement involved three students, between 14 and 16 years old at the time, who said they were abused by the coach at an off-campus training camp he held. The coach had been convicted of sexual misconduct with students back in 1977, according to court papers, a record the district did not uncover at the time he was hired. A police complaint from parents in 2014 had been dismissed by cops because the statute of limitations had expired.

What happened at University Place was a failure of common sense, not a lack of proper procedures – something all too prevalent in the school system for decades, Nappo said.

“It’s good that we’ve opened the courts to these claims, but I think this all is going to need some more time to play out, because the abuse and the crimes in many cases happened back in the ’80s or ’90s,” he said. “And what you find is that most of these predators are or were well-liked in their place of employment.”

United Educators,
Business of redress: Sexual victimization is a focus of insurers like United Educators. Above, from one of its brochures.

One way or another, taxpayers are financing these settlements, through higher costs or redirection of money that could go to education or other municipal services. In Pomona Unified’s case, for example, taxpayers will foot 60% of the total over five years. In University Place District’s settlement, insurers have thus far met the full cost, which currently stands at $13.5 million, according to Superintendent Jeff Chamberlin, who was not in that post when the sexual misconduct occurred.

While Nappo insisted he “hasn’t seen any insurance companies in the soup line lately,” Chamberlin said the current environment is fraught with danger for schools and taxpayers. 

“In Washington, there’s been a series of laws that created a thriving industry of lawsuits,” Chamberlin told RCI. “Generally, there’s just a real fear of jury verdicts. They are awarding astronomical settlements and sooner or later it will be the taxpayer who is paying these.”

'This Has Spiraled
Out of Control Nationally'

“You have to understand the fiscal landscape of all this,” he said. “So far, our policy has been sufficient, but I do worry that at some point in the future we’ll be unable to get insurance. The lawsuits now cover a range of behaviors, and this has spiraled out of control nationally.”

Some districts are paying more than others, especially in California. RCI reached out to a half dozen of the K-12 public school districts that have dealt with multiple lawsuits, including the Los Angeles Unified School District which, according to a Los Angeles Times story in April 2023, has paid nearly $400 million in settlements involving sexual misconduct by employees.

Since then, LAUSD has been hit with even more settlements, including $19.9 million in an elementary school abuse case last November, and a $13 million deal in February stemming from a special needs assistant teacher’s conduct in 2014. 

The LAUSD said it had “nothing at this time,” in response to questions about its history of lawsuits and settlements. The other school districts, including Clark County School District in Nevada, which last year settled a $9 million case tied to a convicted sex offender who drove a bus for special needs students, did not respond to requests for comment.

The tab for all this is being shifted to the public in various ways, from higher insurance premiums and legal bills to the liquidation of public assets. In Long Island, for instance, the Cold Springs Harbor school district voted to drain a $7.7 million capital fund to pay settlements and legal fees after it reached a $14 million deal in the case of two students who alleged a teacher sexually abused them in the 1980s.

That lawsuit and others came about because New York opened the window in which such litigation could be filed. The Child Victims Act in 2019 extended the deadline for when sexual abuse claims could be filed in state or federal courts. The act, which former Gov. Andrew Cuomo extended for another year after COVID shutdowns in 2020, allowed people up to the age of 55 to file suit. That window closed in November 2022.

“But those cases are now all coming to fruition,” said Jeffrey Fritz, a Philadelphia attorney who specializes in sexual misconduct litigation and represented victims of Jerry Sandusky, an assistant football coach at Penn State convicted of serial child molestation through a youth charity he founded. 

“There’s been a sea change in the way people look at these things, and we’ve become much more aggressive about rooting it out,” Fritz told RCI. “You now have the law playing catch-up in terms of justice.”

https://www.realclearinvestigations.com/articles/2024/08/06/the_reckoning_has_arrived_for_k-12_sex_abuse_and_you_the_taxpayer_could_well_pay_a_heavy_price_1049273.html