“What happens if you privatize prisons is that you have a large industry with a vested interest in building ever-more prisons.” -- Molly Ivins, 2003

Report on CCA 2007 4th Quarter Conference Call

The Corrections Corporation of America (CCA), the nation’s largest prison provider, held its 2007 4th Quarter conference call earlier this year. During the call, CCA updated investors regarding capacity and addressed new beds the company was bringing online as a result of increased demand for new prison beds. Company representatives emphasized that while the country is an economic downturn, the prison system is not impacted by negative economic cycles.

As of February 2008, CCA 41 owned facilities with 50,909 beds and 24 managed only facilities with 26,751 beds. The company managed contracts with 20 states, all three federal agencies, and the District of Columbia. Further, of the beds that CCA owned or managed in 2007 about 6.64% were in Texas.

CCA likes to emphasize its strong presence in the private prison industry; controlling approximately 47% of the private prison and jail beds in the nation. The company acknowledged it's own contributions to the growth of the private prison industry where staff mentioned that in 1990 private prisons numbered 10,973 and in 2007 that number increased to over 164,000 beds.


Total Capacity

U.S. Market
Owned and
Controlled Beds
CCA 77,660 47.2% 50,909
The Geo Group Inc. 43,402 26.4% 19,902
Cornell Companies 16,024 9.7% 14,017
Management & Training Corp. 11,945 7.3% 506
All Others 15,581 9.4% unavailable

Source: CCA Q4 2007 Investor Presentation

CCA officials stated that new reports relating to a reduction in Texas prison capacity will not impact CCA contracts since the the private prison company was not planning any local expansion. However, CCA staff emphasized that the state continues to operate its prison -- public and private -- at capacity.

The call also addressed trends at the federal level, including those that would facilitate capacity expansion and benefit CCA's bottom line. Specifically, the recently passed federal FY 2008 budget supports an increase of the immigrant detention population of 32,000 prison beds up from 27,000 beds from FY 2007 and an increase from the President’s previous budget. Further, the budget authorizes the Department of Homeland Security (DHS) to issue future budget requests for additional capacity if needed and requires the agency to update Congress monthly on immigrant detention capacity.

Additionally, the President recently released his FY 2009 budget that increases detention population beds to 33,000. In 2005, funding for detention beds numbered only 19,000. As a result, there will be an addtional 1,000 to 1,500 new immigrant detention beds that will come online by 2009.

The call highlighted trends at the state and federal level and painted an overall picture of the direction of CCA. As advocates working to address the problem of mass incarceration and how private prison operators contribute to that growth it is truly disturbing to observe the comments of CCA represenatives who relish the nation's projected prison prison growth.

Emerald Proposes Another Caldwell County Detention Center; Mustang Ridge Official Condemned for Racial Slur

A number of readers have alerted us about this story. Emerald Corrections is proposing yet another 1,000 bed immigrant detention center in Caldwell County ("Area's 2nd Immigrant Holding Center..." KLBJ, March 21) just months after a similar proposal was defeated after widespread community opposition on the other side of the county. This time, Emerald has proposed the private detention center in Mustang Ridge, a small town on the border between Caldwell and Travis Counties.

The issue was thrust into the public eye last week after an agenda item appeared on Creedmoor-Maha Water Supply Corporation agenda calling the proposed facility a "holding pen for wetbacks." The copy of the agenda is online. The man who put the offensive item on the Water Supply Corporation meeting agenda is Charles Laws, who in addition to his role as Creedomore-Maha Board of Directors, is also the Mayor Pro Tem of Mustang Ridge and a founder of the town which was incorporated in 1985.

Laws refused to apologize or step down after his comments drew condemnation as "open bigotry" from public officials ("Mustang Ridge Official..., Statesman, March 22) such as Austin City Council Member Mike Martinez, state Sen. Kirk Watson, and state Rep. Eddie Rodriguez. Creedmore-Maha's water contracts with the city of Austin and other entities could be in jeopardy. Not everyone in Mustang Ridge seems happy about Mr. Laws comments either. According to a News 8 story ("Mustange Ridge Residents React", March 22), several residents of the city think Mr. Laws should resign.

Lisa Munoz and her family have called Mustang Ridge home for nine years. She called the use of the phrase "very offensive." "No he does not deserve to stay in office. I don't think so," Munoz said.

The population of Mustang Ridge is just under 1,000 people. According to the Mayor more than 60 percent are Hispanic, including himself. "It was a shock to me," Mustang Ridge Mayor Alfred Vallejo said.

Of course, possibly more offensive than Mr. Laws comments is the proposed detention center itself. Proposed by Louisiana-based private prison operator Emerald Corrections, it appears the private prison would be built on speculation with the idea that it would house up to 1,000 immigrant detainees. KLBJ's story speculates that the facility might hold immigrant families like the notorious T. Don Hutto detention center.

What is more likely in my opinion is that the facility would house a combination of adult immigrant detainees contracted from Immigration and Customs Enforcement and the U.S. Marshals Service - including immigrants being charged criminally and incarcerated for merely crossing the border under the ludicrously wasteful (and dreadfully misnamed) Operation Streamline. Bloomberg News ("Bush Crackdown on Illegal Aliens Stretches Marshals to Limit" March 12) reported last week that this policy is already diverting resources from traditional Marshals tasks like "capturing escaped prisoners and rounding up sex offender."

We'll have more posts coming on the Mustang Ridge detention center, including a post on the economic impact of the facility. In the meantime, take a look at our previous coverage of Emerald's attempts to build a detention center in Caldwell County:

MTV on Puryear Nomination, Part 2

Here is part 2 of the Think MTV piece on the controversial nomination of Gus Puryear, CCA's former head lawyer, to the federal bench. It features our friend Alex Friedmann of Prison Legal News and the Private Corrections Insitute.



See part 1 here. We'll keep you updated on the developments from the Puryear nomination.

Superdelegate Has Ties to CCA

Tracie McMillan over at the Huffington Post has profiled Superdelegate Joseph F. Johnson, a former Corrections Corporation of America board member. He is a member-at-large of the Democratic National Committee from Chantilliy, Virginia - a suburb of Washington D.C.

Reports indicate that he is supporting Senator Hillary Clinton. However, he has not publicly committed to either Clinton nor Senator Barack Obama. In fact, Johnson has donated to both campaigns:

  • Records show that he and Sharron Johnson (of the same address) each donated a legal maximum of $2300 to Senator Clinton's campaign in late 2007; and
  • In the summer of 2007, Johnson gave $1,000 to Senator Obama.

Johnson was appointed to the board of Corrections Corporation of America, the largest operator of private prisons in the country. While serving in that position from 1996 to 1999, Johnson earned accolades and handsome rewards from CCA for convincing Washington, D.C. to send prisoners to CCA's Youngstown, Ohio prison. Johnson also has a history of lobbying for private prison companies in Texas and around the nation.

The private prison in Ohio had a notorious reputation for violence and escapes. By 1998, there had been two fatal stabbings, 44 assaults, and six escapes at the prison. Despite the egregiousness of the incidents, Johnson claims that no one's was to blame. According to McMillan's article:

Mr. Johnson nonetheless profited from the deal, receiving $2.6 million in stock options for his work linking CCA with officials in Washington, D.C. Calling his work "instrumental" to their receipt of the contract, CCA said that Mr. Johnson had "exceeded his duties and obligations" to the company and also paid him $382,000 for his "consulting services" in helping to arrange the deal, and $991,000 for NCRC's services in another CCA prison in Texas.

What an interesting development in the presidential campaign that keeps on going. As potential president-makers, the Superdelegates continue to face scrutiny. It will be interesting to see if any others are linked to private prison companies.

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