Five private prisons in Texas will lose their contracts following the Department of Justice (DOJ) announcement to phase out the use of private prisons, according to The Texas Tribune.
The announcement came after the inspector general of the DOJ recently concluded in a report that federal prisons operated by private companies have greater issues with contraband and inmate discipline than those run by the Federal Bureau of Prisons. The office noted that "In recent years, disturbances in several federal contract prisons resulted in extensive property damage, bodily injury, and the death of a correctional officer."
Multiple incidents in Texas were among those driving the DOJ decision.
Two riots broke out in 2009 at the Reeves County Detention Center, operated by GEO Group. In 2011 prisoners attacked staff at the Big Spring Correctional Center, which is operated by GEO Group. Then in 2015, the Bureau of Prisons ended its contract with Management and Training Corporation for the Willacy County Correctional Center after prisoners set fires and damaged property beyond the company’s ability to maintain federal standards.
Shares for Corrections Corporation of America dropped 35% after the announcement, while shares for GEO Group dropped 39%