The GEO Group is set to acquire a smaller corrections corporation, LCS Corrections. The merger could cost GEO up to $350 million dollars—borrowed from their $700 million revolving line of credit—and will add eight new facilities, and 6,500 new beds to GEO’s existing 79,000 bed capacity.
GEO is looking forward to an estimated $75-80 million extra in annual revenue. On LCS's end, the deal will bail them out of nearly $302 million in debt. The deal will reportedly be finalized by the end of this February.
A Louisiana based company, LCS, while small in comparison, is no stranger to GEO-sized gaffes and scandals. LCS has a long history of not taking proper care of the people in their facilities, racking up a number of wrongful death and corruption suits. Most recently, a former LCS warden was indicted for attempting to bribe a Justice of the Peace in Texas.
The acquisition will expand GEO Group's reach in Texas, where LCS Corrections currently operates the Brooks County Detention Center, the East Hildago Detention Center, and the Coastal Bend Detention Center.
Almost as soon as it opened in August, the Karnes Family Detention Center was the subject of controversy.
First, immigrant rights advocates rallied around Sara and her 7-year-old daughter Nayely when word got out that the GEO Group was denying the girl medical treatment for a life-treatening brain cancer and that Immigration and Customs Enforcement (ICE) was refusing to release them. Calls demanding their released flooded the facility for two days. Once reporters started calling, officials at the facility finally released Sara and Nayely.
Nayely went on to get treatment at Dell Children's Hospital in Austin before she and her mother moved to be with family in the U.S.
Then in October, news broke again of problems at the facility. The Mexican American Legal Defense and Education Fund (MALDEF), along with Immigration Rights and Civil Rights Clinics at the University of Texas Law School, Human Rights First, and the Law Office of Javier N. Maldonado, filed a complaint with the Department of Homeland Security (DHS) and ICE demanding the immediate investigation of and swift response to widespread allegations of sexual abuse and harassment at the detention center in Karnes City.
According to the complaint, guards removed female detainees from their cells late in the late evening and early morning hours for the purpose of engaging in sexual acts in various parts of the facility, and attempted to cover up these actions.
The MALDEF release also says that "although this unlawful conduct was reported to Karnes Center personnel, to date, no reasonable actions have been taken to stop or prevent this abuse, or to prevent its escalation."
But that wasn't the end of the controversy. In November and December, the Karnes County Commissioners Court faced wide-spread public opposition to a proposal before them to approve GEO's plans to expand the facility. Several public meetings were packed as the Commissioners weighed the proposal.
Though the Court would eventually vote 3-2 in favor of expansion, one commissioner who voted "no" was particularly upset over threats made by GEO. Commissioner Pete Jauer voted against the expansion in part because GEO Group said that they would sue the county if they didn't vote in GEO's favor. "I still don't like to live under the threat hanging over my head with their right to sue us if they're good neighbors,” Jauer told KSAT.
The family detention center is now poised to expand to 1,200 beds and cribs in the New Year, which will also double GEO's profits on the facility.
The city of Littlefield tried a number of times to fill the empty private prison that has been draining revenue from the tiny West Texas town of Littlefield for years.
The first opportunity came when news broke this summer of Central American children showing up at the U.S. border seeking asylum. Officials in the City of Littlefield asked Immigration and Customs Enforcement (ICE) to send some of the families and children to their empty private prison, hoping it would be the end of a years-long debacle that started when the for-profit private prison came to town.
Littlefield City Manager Mike Arismendez told KCBD in Lubbock that a contract with ICE could mean having the facility up and running soon to detain the women and children seeking refuge at the border.
“It would actually be a revenue stream to be able to offset the debt we have on the facility,” Arismendez said.
The idea to house refugee families at Bill Clayton gained bipartisan agreement in Littlefield, with the support of both U.S. Rep. Randy Neugebauer, R-Lubbock, and Neal Marchbanks, who was his Democratic opponent in the November general election.
“It sounds bad to put [children] in a prison, but that’s about all we can do," Marchbanks said.
Then, in August came news that Littlefield may have been pitching the facility to a private company from California to incarcerate people convicted of sex crimes at Bill Clayton. It was unclear whether the City was attempting to win a contract from the state of Texas or the state of California, but California does ship nearly 9,000 prisoners to out-of-state private prisons — all of which are operated by Corrections Corporation of America.
Neither of these plans worked out, because in October news broke that the town was seeking a civil commitment contract with Correct Care Solutions. Correct Care Solutions, formerly known as GEO Care, is a spin-off corporation of GEO Group, the same corporation that operated the facility until 2009. Had this been approved, the facility would have housed approximately 200 individuals convicted of multiple violent sexual offenses — but who have already completed their prison sentences.
As of now, it seems that the town has not found anyone to fill the facility and it will likely continue to cost local taxpayers millions.
Immigrant rights advocates and conservative U.S. congressmen alike were shocked and concerned about the speed with which the Corrections Corporation of America (CCA) won and began to implement the contract for the South Texas Family Residential Center in Dilley, TX.
The center, created in an existing "man camp" for oil field workers, is set to hold 2,400 people and is rumored to be opening in the early weeks of December. Plans for the facility were announced in September.
The unusual contract involves a lease agreement between real estate group Koontz McCombs, Immigration and Customs Enforcement (ICE), CCA, and the town of Eloy, AZ, which is nearly 1,000 miles away.
As a result of the contract being "passed through" Eloy — which already contracts with CCA — the competitive bidding process, environmental impact report, and other safeguard measures were completely bypassed in the interest of opening the detention camp as expediently as possible. This deal streams revenue to Eloy, but leaves them free from any of the liability that comes with running a private detention facility.
The contract has been the subject of protests at the University of Texas, where the business school is named for one of the partners in the deal — Red McCombs.