Money/Financial Interests

ICE Makes Changes to Hutto, Lays Groundwork for Expansion of Family Detention

Recent media reports at the T. Don Hutto detention center, a prison owned by the Corrections Corporation of America (CCA), highlight changes to the private prison.  The notorious Hutto facility has been the target of numerous protests and a lawsuit as a result of its use to incarcerate immigrant families; some detainees as young as  newborns.  Press reports state that government officials are using a media blitz to lay the groundwork for additional family detention facilities that will be added to federal prison capacity over the next year.

According to an article in the San Antonio Express-News, reporter Hernán Rozemberg states:

Mired in controversy since its opening in May 2006, the 512-bed center has been through several makeovers. Administrators opened it for a swift media tour Tuesday to show how much has changed since the first tour 14 months ago.

Last year, the use of family detention at the private prison was resulted in litigation by the American Civil Liberties Union and the Immigration Clinic at the University of Texas Law School.  The lawsuit settlement required CCA, which contracts with Immigration and Customs Enforcement (ICE) and Williamson County, to meet comply with several standards that change the conditions of confinement at the prison.

ICE officials, like Gary Mead, stated in an Austin American-Statesman article written by Juan Castillo, that they learned a lot as they moved to lock up children and their parents:

"Candidly, when (Hutto) opened, we were new to the family residential facility business. We learned a lot," Gary Mead, acting director for detention and removal at Immigration and Customs Enforcement, said Tuesday.

As a result the changes required by the settlement and to improve public relations, the private prison recently opened its doors to the media to advertise changes underway at the facility.  Despite any aesthetic changes and additions of certain amenities, the facility in Taylor, Texas is fundamentally still a prison. 

Specifically, certain structures such as cell walls and the location of toilets in the space where someone sleeps cannot be altered.  However, that does prevent the news media from participating in the coordinated public relations campaign According to news reports those changes include:

  • Metal toilets changed to porcelain;
  • Curtains to surround the toilet and shower area;
  • Eliminating the razor wire that surrounds the private prison;
  • Outdoor recreation area that includes two soccer fields, a volleyball court, and tow playgrounds;
  • Exercise area including treadmills and stationary bikes;;
  • Planned fieldtrips for the children who are imprisoned; and
  • Salad bar and a "hot bar" in the cafeteria — and the more homestyle recipes are a hit with the mostly Central American detainees thanks to one of them working as a cook.

Regardless of these changes, Hutto continues to be a private prison.  What continues to be disturbing is that ICE is going to expand the policy of locking up families.  Once again this represents a failed social policy as the United States continues to rely on incarceration even though Congress has insisted on alternatives to family detention.

Given that ICE is implying that they are looking to expand family detention capacity, we will monitor these developments.

GEO Group Presents to Lehman Brothers Investors

Last month, the GEO Group presented information at the Lehman Brothers 2008 High Yield Loan and Syndicated Loan Conference. On the call, George Zoley, the company’s Chairman and CEO, discussed why GEO is a good investment for Lehman Brothers stockholders. The call makes clear that private prison profiteers continue to exploit the poor sentencing policies in the United States and across the world that result in the over use of incarceration as a social policy.

It was truly remarkable and disturbing how Zoley talked about the nation’s significantly large prison population in terms of profit and revenue. His presentation mentioned nothing regarding the human factor of prison expansion and how GEO’s large market share contributes to overuse of a failed social policy and the disintegration of communities.

Zoley mentioned that GEO has a total global bed capacity of 59,000 beds. That makes GEO the 7th largest prison in the U.S. directly after the state of New York; according to GEO, Texas is number three after only California and the Federal system. That number includes beds in operation and those under construction in 61 U.S. facilities and 6 international facilities in Australia, South Africa, and the United Kingdom.

According to Zoley, GEO has 7,400 beds under development in Texas alone for completion over the next few months. Those beds include:

Facility Ownership
Beds Under Development
Annual Operating Revenues
Exp. Start Date
Montgomery Co. Detention Center
Managed Only
1,100
$14M
Sept.-08
Maverick County Detention Center
Managed Only
654
$10M
Sept.-08
Laredo USMS Facility
Owned
1,500
$36M
Oct.-08


Zoley also mentioned that two facilities are empty and GEO is looking for customers at the federal or state level to contract with. One of those prisons includes the notorious Coke County Juvenile Justice Center. The Texas Youth Commission (TYC) contracted with GEO to provide beds in the facility until late last year when scandals were widely reported in the news that young prisoners were not given proper education and forced to live in squalid conditions.

He mentioned that GEO is the world’s second largest private prison provider after the Corrections Corporation of America (CCA). According to GEO figures, there are a total of 210,000 private prison beds worldwide; CCA has 36% of the global market share while GEO claims 28% of the global market share.

Zoley, the company’s top executive, emphasized that demand for prison bed space continues to be driven by U.S. social policy that has resulted in a 1 out of 100 adults in prison or jail, and 1 out of 31 adults under some form of criminal justice supervision in the form of probation, parole or imprisonment. To rationalize why GEO is a good investment, Zoley relied heavily on recent reports published by the Pew Research Center in 2007 and 2008. Those reports mention the nation’s prison population will continue to increase over the next five years and that 24 states are operating over capacity leading to an increased demand for more prison bed space.

According to Zoley, specific social policies that continue to drive private prison demand include the efforts to control borders with Mexico which lead to a need in more detention bed space. Further, he mentioned that Immigration Customs Enforcement (ICE) and United States Marshal Service (USMS) are consolidating contracts in an effort to reduce costs that all contribute to an increase in demand for private prison space.

GEO finances private prison construction in several ways using public bonds, 3rd party ownership, and company ownership. The company values federal clients because they offer the largest contracts and the most profitable contracts on the best terms.

The GEO presentation provided a great deal of information regarding the priorities of the private prison corporations and the overall vision of the company's senior executive. It is disturbing how Zoley and other private prison profiteers continue to exploit bad public policies in an effort to increase revenues for corporations that should not exist in the first place.

If you would like to listen to the GEO presentation, you can find it online here: GEO presentation to Lehman Brothers

Opposition of CCA Executive to Federal Judgeship

A significant amount of opposition has been registered against Gustavus A. Puryear IV, general counsel since 2001 for Corrections Corporation of America (CCA). CCA is the nation's largest for-profit private prison company. As many of you know, several of the private prisons in Texas are operated by CCA. We recently posted information on CCA's latest investor phone call.

Puryear was nominated by President Bush in June of 2007 for a federal judgeship for U.S. District Court in the Middle District of Tennessee (the same jurisdiction where CCA's corporate headquarters is located).

An effort in Tennesse has developed that has worked hard to oppose the Puryear nomination. Tennesseans Against Puryear opposes the nomination for several reasons including:

  • Because as CCA's general counsel, Puryear, would hold a judgeship in the same district where CCA's corporate office is located, where numerous lawsuits against CCA are filed;
  • He has little trial experience in federal court; during his time at CCA he has worked to conceal damaging information about the company and has belittled prisoner litigation; and
  • As the top lawyer for the nation's largest private prison company is particularly ill suited to serve as a federal judge.

We find it encouraging that community groups are working the process to hold the President accountable for his nominations. Puryear's appointment could significantly impact the ability of the judicary to oversee private prison corporations and the various government agencies that contract with them. As the nomination process continues we will keep y'all posted.

Is a Private Detention Center Good for Caldwell County's Economy?

The debate over the recently proposed Caldwell County detention center, proposed by private prison corporation Emerald Companies, has largely centered on the inflammatory comments of Charles Law, mayor pro tem of the City of Mustang Ridge and a local water board official. Law called the detention center a "holding pen for wetbacks" and has been rightly condemned for his comments. In January, a similar proposal was defeated after widespread community opposition on the other side of the county.

Ignored in the debate about the current Emerald proposal has been one of the key driving forces behind detention center expansion in rural Texas - the idea that building a prison will stimulate the local economy and create jobs. Which begs the question, does building a prison or detention center in a rural community help the local economy? The answer, perhaps surprisingly, is no. And it points to one of the most persistent myths surrounding prisons and detention centers - that they are good for rural economies. In fact, the exact opposite appears to be true.

According to multiple studies on prisons and economic development, rural counties that build prisons actually end up worse off than those that do not. According to one of the most comprehensive study on the topic, The Prison Industry: Carceral Expansion and Employment in U.S. Counties, 1969-1994, rural counties with slow-growing economies that built prisons actually fared worse than comparable counties that did not build prisons. In faster-growing areas, prisons had no positive economic benefit.

The reasons for this outcome aren't entirely known, but researchers have offered several hypothesis.

  1. The so-called "prison-town effect" where large prisons deter more beneficial businesses from wanting to come to a community while at the same time scaring off tourism and other industries reliant on a positive community image.
  2. Prisons can drain scarce public resources such as water hook-ups and other utilities, law enforcement, and road construction monies.
  3. These factors are compacted by private prisons where "profits" from the facility are taken out of the community and given to shareholders or invested in future prison and detention center expansion efforts.

Unfortunately, Carceral Expansion is not online in its entirity, but you can read a review of the study by University of Texas LBJ School professor Michele Deitch in the Considering a Private Jail? resource guide. These studies should provide food for thought for local public officials dealing with private prison or detention center proposals.

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