Money/Financial Interests

CCA Holds 2011 Third Quarter Conference Call -- Reports Excess Bed Capacity

The Corrections Corporation of America held its third quarter invCCA LogoCCA Logoestor call in early November.  The company reported an increase in revenue primarily due to an increase in federal contracts with various agencies.

"revenue for the third quarter of 2011 increased 1.9% to $433.5 million from $425.3 million during the third quarter of 2010, primarily driven by a 2.3% increase in average daily inmate populations... The increase in federal revenue primarily resulted from per diem increases associated with certain management contracts, higher populations primarily from the U.S. Marshals Service (USMS) as well as the commencement in October 2010 of a new contract with the USMS at [the] Nevada Southern Detention Center. These increases were partially offset by the September 30, 2010 expiration of the contract with the Federal Bureau of Prisons (BOP) at [the] California City facility, which contained a 95% guarantee through the expiration date."

The company is adding capacity to it’s overall system -- none in Texas -- at the Lake Erie Correctional Institution (Ohio), Jenkins Correctional Center (Georgia), and is expanding capacity under its McRae Correctional Facility (Georgia) with the BOP.  The prison profiteers reported an increase in  daily compensated population by 2.3% to 80,851 in the third quarter of 2011 from 79,053 during the same time last year. 

Despite expanded contracts and new capacity, company officials reported an excess inventory of 10,500 beds.  The excess capacity has the private prison profiteers looking for new contracts.  One potential customer is Harris County (Houston) where there are have been discussions about privatizing the jail system.  While we know there are better approaches that county officials can look too, it’s important to keep an eye on CCA and any negotiations that company is engaging in the bayou city.  Something to pay attention to in 2012. 


Human Rights and Private Prisons - They Don't Mix

Today is International Human Rights Day.  A day when people from across the world come together to reaffirm the basic rights that all people are entitled to, regardless of “race, colour, sex, language, religion, political or other opinion, national or social origin, property, birth or other status.”  On December 10, 1948 the Universal Declaration of Human Rights (UDHR) was adopted by the United Nations General Assembly.  The United States played a key role in securing the adoption of the UDHR.  The UDHR has since become the foundation of the modern UN human rights system, or in the words of Eleanor Roosevelt “the international Magna Carta.” 


While December 10th is a day for celebration, a day where we look back on the progress we have made, it is also a day for action, a day to speak out against the injustices and depravations of basic human dignity that still occur on a daily basis.  In Texas, we need not look far to see that our state and our nation have too often failed to uphold these basic rights.  The numerous immigration detention facilities in Texas provide a clear case in point. 


As frequent Texas Prison Bid’ness readers no doubt know, the Immigration and Customs Enforcement (ICE) locks up approximately 400,000 each year at a cost of $1.9 billion.  To accomplish this horrendous feat, ICE contracts many of these detainees out to the for profit private prison industry, including to a number of private facilities in Texas.  The result: a massive transfer of public funds to private corporations that wastes scarce tax dollars and results in the depravation of basic human rights.  Just last week, ICE transferred immigrant women out of the Jack Harwell Detention Center in Waco, a private jail operated by Community Education Centers, a for-profit private prison corporation after reports from inside the facility alleged a lack of access to medical care, including for pregnant women; spoiled food; no contact visits; and virtually non-existent access to attorneys.  Allegations such as these do not signal the existence of a few bad apples, rather they clarify the structural flaw in the private prison model: the legal obligation to both ensure basic human dignity and maximize shareholder profit.  These obligations are mutually exclusive.    


Want to do something to stop this abuse?  Join the Waco Dream Act Alliance, Hope Fellowship Church, Texans United for Families, Grassroots Leadership, and those affected by the immigrant detention system at a vigil in Waco for detained immigrants on International Human Rights Day (Saturday, 12/10).  The vigil will begin at 2pm at Heritage Park at Third and Austin and will highlight the more than 10,000 immigrant detention beds (and the humans suffering in them) in Texas.

TX Prison Capacity Continues to Grow. Private Contract Authority Remains Strong.

Earlier this week, Mike Ward with the Austin American Statesman reported that state prison capacity had grown in recent years despite reforms.  The reporting emphasizes that continued prison growth is a policy choice that results in Texas being one of the world's biggest jailers. 

Earlier this year, Texas closed it's first state run prison but added capacity in other facilities.  Reports left open the option open for contracts with private companies.

"Instead of closing the other two prisons, Madden said budget writers agreed to leave them open and to set aside about $15 million for prison officials to lease additional beds if needed over the next two years." (Mike Ward, "Budget writers agree to shut old prison" Statesman, May 17, 2011)

The problem with the framework of Texas prison reform is that it is focused on back-end in measures including persons under community supervision who revocate to prison.  While that initial approach has helped shift the dialogue in Texas -- it does not go far enough.  Lawmakers have not paid enough attention to what triggers a prison sentence and the length of time persons spend incarcerated. 

Texas policy makers and advocates, should rethink efforts to address the state's mass incarceration problem.  The only true way to continue to address costs and, more importantly, change the state's criminal justice system is to minimize demand for a large supply of prison beds and permanently close them down.


Private Profit, Public Debt … The Story of Willacy County's Tent City

The Bureau of Prisons and Management and Training Corp. of Utah (MTC) recently announced a $532 million deal to convert “tent city” in Willacy County from a facility contracted by Immigration and Customs Enforcement into a Bureau of Prisons (BOP) facility.  The first wave of new prisoners have begun to arrive ("New prisoners begin arriving at 'tent city'" McAllen Monitor, October 10).  Under the new agreement, the Willacy facility will continue to be managed by MTC and will house immigrant prisoners convicted of federal crimes exclusively. 

This is great news for MTC.  As an MTC representative stated, “[t]he Bureau of Prisons has good contract system; they need beds, we need the stability” ("New jail contract described as a win-win deal for county, MTC," Raymondville Chronicle, June 22).  Unfortunately, while this may be good news for MTC, Willacy County, that funded the construction of the facility through revenue bonds issued by a Public Facilities Corporation, continues to receive the short end of the stick. 

Under the Willacy County’s first contract with MTC, the facility housed undocumented immigrants under an agreement with ICE and, according to Willacy County Judge John Gonzales, “the income the county had hoped to gain from the facility fell far short of expectations.”  In fact, the facility never reached 50% capacity (Monitor, October 10).  To add to the county’s loss, earlier this year MTC handed out pink slips to almost 20% of its local staff.  Under the new plan to convert the facility into a BOP unit, MTC will reduce its local staff by more than 32% below the number of employees it had prior to handing out pink slips (Raymondville Chronicle, June 22). 

Under the new agreement, the county will receive a minimum of $104,900 a month, much more than the $970,000 the county received from ICE over the past year.  While this may seem like a lot of money, it will only put a small dent in the outstanding debt obligation of $75 million (after the most recent refinancing goes through) incurred by the county to finance the facility’s construction (Raymondville Chronicle, June 22).  

Things must be really bad in Willacy if this deal can be reported as a win for the county.

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