Money/Financial Interests

Dawson State Jail's contract renewed for next seven years

Earlier this year, we wondered what would come of the Dawson State Jail's contract in light of the plans for the Texas Department of Criminal Justice's plans for budget cuts. As Grits for Breakfast noted earlier in March, 

Dawson State Jail's contract with Corrections Corporation of America is up for renewal next January [2011]. This ill-placed facility is located in downtown Dallas on the banks of the Trinity River in prime real estate the city hopes to redevelop. So the fact that Dawson's contract ends on January 15, 2011 is a significant date for the city of Dallas: If the state renews the contract, the proposed riverfront redevelopment could be put on hold indefinitely. It's possible, then, we may see members of the Dallas delegation and related development interests pushing for non-renewal, though certainly CCA will have its own lobbyists on the other side.

Unfortunately, it appears Scott's prediction will not come to fruition. Despite Lt. Gov. David Dewhurst's dedication to budget cuts, and the Dallas citizens' outcry to move the prison off the valued real estate, TDCJ renewed their contract for the Dawson State Jail, operated by Corrections Corporation of America.

the Dawson State  Jail ain't going anywhere: The Texas [Department] of Criminal Justice awarded CCA a new contract for operations of the Dawson State Jail at its meeting last month, TDCJ Director of Public Information Michelle Lyons tells Unfair Park. (Minutes from that meeting are supposed to be available; they are not.) She says the contract will run for the next seven years. (Robert Wilonsky, "The City Would Love to Get Its Hands On the Dawson State Jail. It'll Have to Keep Waiting," Dallas Observer, 16 November 2010.)

The facility is contracted out by the state for a price of $23,177,553 per year, which over seven years comes to a grand total of $162,242,871. The city/state might be surprised at what could get accomplished over seven years if they spent $162 million on environmental restoration. Nevertheless, unless something changes between now and January 15, 2011, Texas will keep the Dawson State Jail around for longer.

Citing private prison connections, human rights coalition opposes U.S. Marshals nominee

A coalition of human rights and criminal justice reform groups, including my organization Grassroots Leadership, issued a press release announcing its opposition to the nomination of Stacia Hylton to the head post at the U.S. Marshals.  According to the press release,

Hylton, a former Marshal and Acting Deputy Director of the U.S. Marshals Service with a lengthy career in law enforcement, was employed from June 2004 to February 2010 as the Federal Detention Trustee, where she oversaw the detention of federal prisoners awaiting trial or immigration proceedings. Following her retirement she was nominated by President Obama on September 20, 2010 to direct the U.S. Marshals Service.
During Hylton’s tenure as Federal Detention Trustee, GEO Group, the nation’s second-largest for-profit private prison company, was awarded a number of lucrative contracts to house federal prisoners. These included a sole-source ten-year contract at GEO’s Western Region Detention Facility in San Diego, generating approximately $34 million in annual revenue; a 20-year contract to operate the 1,500-bed Rio Grande Detention Center in Laredo, Texas with an estimated $34 million in annual revenue; and a 20-year sole-source contract to manage the Robert A. Deyton Detention Facility in Lovejoy, Georgia, generating $16-20 million in annual revenue.
As reported by the Washington Times in an October 25 article, after retiring as Federal Detention Trustee earlier this year, Hylton quickly accepted a consulting job with GEO Group through her Virginia-based company, Hylton Kirk & Associates LLC, of which she is the president and sole owner. In her financial disclosure statement, Hylton reported income of $112,500 for “consulting services for detention matters, federal relations, and acquisitions and mergers.” GEO Group is the only company listed in her disclosure statement in connection with such consulting services.

Organizations included in the coalition opposing Hylton's nomination include Private Corrections Working Group, Detention Watch Network, The Alliance for Justice, Human Rights Defense Center, Private Corrections Working Group, Grassroots Leadership, National Lawyers Guild, International CURE, Detention Watch Network and Justice Policy Institute.

GEO expands in other states, mental health market but loses two TDCJ contracts

The GEO Group held its 3rd quarter earnings call this morning.  You can read the company's press release here. On the call, GEO CEO George Zoley, Chief Operating Officer Wayne Calabrese, and Chief Financial Officer Brian Evans lead investors through quarterly earnings and analyzed GEO's three major business areas: US Corrections, GEO Care, and International Services.  The company's overall revenues for the quarter were nearly $328 million, up from $294 million a year ago. $217 million of that earnings came from U.S. Corrections, $60 million from GEO Care, and $47 million coming from International Operations.

U.S. Corrections

Zoley was generally optimistic about the quarter, announcing an increased outlook for 4th quarter and the full integration of Cornell facilities after GEO's buy-out of that company earlier this year.  Major developments/expansions for the company included the announced award of a 2,800 Federal Bureau of Prisons contract to the D. Ray James facility in Georgia, and a Florida contract to develop the 2,000 bed Blackwater prison in Florida.  Zoley also announced that the company is "actively pursuing a number of new organic opportunities." Investors congratulated the company on yesterday's news that California will move 2,580 prisoners to GEO facilities to its Baldwin, Michigan facility that was previously shuttered after reports of abuse against youth prisoners.

GEO's Texas' Operations

In Texas news, the company announced the loss of TDCJ contracts for the Bridgeport Correctional Center (which we reported in June) as well as the previously unreported loss of South Texas Intermediate Transfer Facility, apparently to MTC. This marks at least the sixth GEO facility to either be closed or re-contracted to another company in Texas in recent years.

The company anticipates the opening of its Montgomery County GEO Care facility in March 2011 pursuant to an agreement by state and Montgomery County.  Last year, we reported that the earmark for the facility raised many eyebrows.  As Emily Ramshaw, then at the Dallas Morning News and now with the Texas Tribune, reported ("Troubled prison firm's deal for new psychiatric hospital raises questions," July 11, 2009):

Lawmakers inserted an earmark into the state budget to fund the future Montgomery County facility starting in 2011. But they said they didn't know until this week that the county had selected the GEO Group to operate it, although GEO lobbyists were pushing for it as early as February.

The new facility came as a post-session shock to mental health advocates, who acknowledge the need for it. But they say they weren't informed about it and never would have signed off if they knew Florida-based GEO was operating it.

"Why would we want to use an entity that hasn't had a stellar reputation?" asked Monica Thyssen, children's mental health policy specialist with Advocacy Inc. "If the process had been more transparent, there probably would have been other state officials who would've said, 'I don't know if GEO is the best use of state dollars."

GEO officials, who run more than 50 facilities in the United States, including five mental health facilities in Florida, declined to comment, saying in an e-mail that they don't discuss "specific business development efforts and/or contracts."

We'll keep you posted on GEO developments from Montgomery County and elsewhere here in Texas. 

Texas State Senator speaks out prison industry's involvement in SB 1070

Following yesterday's story about the prison industry's involvement with the Eliot ShapleighEliot Shapleighcreation of SB 1070, Texas State Senator Eliot Shapleigh spoke some strong words against the bill and its creation, claiming that he would resist passing a similar bill in Texas. The Rio Grande Guardian (Steve Taylor, "Shapleigh: Private prison industry involvement in SB 1070 'despicable,'" October 29) reports:

State Sen. Eliot Shapleigh says stopping a bill similar to Arizona’s SB 1070 from being passed by the Texas Legislature will mean not only battling against racists but also the private prison industry.

“That the private prison industry writes a bill in secret to profit from an immigrant’s day in jail is despicable. America is better than that." 

We encourage you to read the NPR article in its entirety, as it outlines the extent to which private prison corporations were involved with the drafting of the SB 1070 bill which would make the failure to carry immigration papers a misdemeanor and would also broaden the powers of Arizona police to detain those who are suspected of staying in the country illegally. This bill is important for private prison corporations because immigrant detention is the main crux of their business, and with an increase in immigrant detention comes an increase in profits. 

In this same report by the Rio Grande Guardian, the U.S. Attorney General is quoted, challenging the constitutionality of the bill:

U.S. Attorney General Eric Holder believes SB 1070 is unconstitutional, arguing that Arizona is trying to trump the federal government’s authority on immigration law. Holder instructed the Department of Justice to sue the State of Arizona and has won the backing of the U.S. Attorney for Arizona, Dennis Burke.

Arizona Senator Russell Pearce disagrees with the NPR article, and calls it a "lie:"

An NPR story about the origins of Senate Bill 1070 drew an angry response Thursday from its author, who said the radio account exaggerated the role prison lobbyists had in drafting it.

State Sen. Russell Pearce, who first introduced a bill in 2003 to require law enforcement to question individuals about their immigration status, denied a report by NPR reporter Laura Sullivan that "Pearce's idea took shape" last year at a conference of conservative lawmakers and corporate interests.

"It's a lie," said Pearce... (Alia Beard and Casey Newton, "Sen. Russell Pearce: SB 1070 story 'a lie,'" AZ Central, 29 October 2010.)

If you are interested, we have recently investigated the extent to which prison corporations are donating to Texas campaigns politics. You can also see 2009 lobbying figures here. The NPR report on prison companies' involvement with Arizona legislation is extremely disturbing, but it has been an ongoing problem. We are glad that the story has caught the headlines in such a manner so that other Texas legislators, not just Shapleigh, can see the prison industry for what it truly is.

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