WHEREAS:
The private equity industry, made up of specialized investment partnerships that acquire and manage companies in pursuit of larger profits not typically obtainable as publicly traded firms, is increasingly buying up public service providers; and
WHEREAS:
The private equity model typically focuses on extractive profits and cost-cutting at the expense of workers, communities and long-term sustainability, putting it fundamentally at cross purposes with public service; and
WHEREAS:
Private equity firms extract exorbitant rents and management fees from the entities they acquire while saddling them with debt. In the case of public service providers, this means our public dollars are diverted away from our benefit and toward private profit; and
WHEREAS:
Private equity has a documented record of causing harm in hospitals and nursing homes, by eroding the quality of care and by shuttering critical safety-net facilities. Private equity investors prioritize the exploitation of government funding streams and extraction of facilities’ real estate value, at the expense of providing much-needed services; and
WHEREAS:
Private equity firms have taken over providers in an ever-wider range of public services, from foster care to prison health care to youth treatment centers. Private equity continues to expand into home care and hospice services, with 39 deals closing in 2025 alone; and
WHEREAS:
Private equity firms acquire and profit from companies providing essential ancillary services within the immigration detention systems — including prison communications, health care and food/commissary service — creating incentives to increase the detention population, including record level increases in ICE’s detention population under the Trump administration; and
WHEREAS:
Private equity firms’ acquisitions transform services historically bound by public accountability into revenue streams shielded from transparency, oversight and legal accountability typically applied to government agencies; and
WHEREAS:
Private equity firms have purchased single-family homes, apartment complexes and manufactured communities as a commodity to extract maximum short-term returns for shareholders often through aggressive rent increases, reduced maintenance spending and the imposition of excess fees; and
WHEREAS:
Research reveals that private equity firms own nearly 3 million apartment units in the U.S., which amounts to about 1 in 8 of all apartments in the U.S. This unprecedented buying spree coupled with private equity firms’ predatory practices exacerbate the housing crisis by reducing affordability, increasing eviction rates and shifting housing from a community resource into a purely financial asset class; and
WHEREAS:
In child care, 13 of the 16 largest for-profit chains have taken private equity investments, even as the cost of care continues to place an unrelenting burden on families with young kids. The national average price of $11,582 per year represents approximately 14% of median household income, double the 7% level considered affordable; and
WHEREAS:
Delegates at the 46th International Convention in 2024 passed Resolution No. 25, “Regulating the Takeover of Not-for-Profit Hospitals by Private Equity,” opposing most takeovers of hospitals by private equity firms and strengthening federal and state regulation of the practice.
THEREFORE BE IT RESOLVED:
That AFSCME reaffirms its opposition to private equity-backed entities operating within the health care system; and
BE IT FURTHER RESOLVED:
That AFSCME opposes the acquisition of public service providers by private equity firms in all services where the private equity model’s exploitative profit motive is inconsistent with the universal, equitable and efficient provision of services to the public; and
BE IT FINALLY RESOLVED:
That AFSCME supports policies and efforts at the state and federal level to limit and regulate private equity-backed entities from providing public services.
SUBMITTED BY:
Michael Avant, President
Kathryn Lybarger, Executive Vice President and Delegate
AFSCME Local 3299
California