Grayson County

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Sherman's Fight Against Proposed Private Prison

From a story I wrote at Private Prison Watch, the city of Sherman, TX in Grayson County has been entrenched in an ongoing battle against a proposed for-profit prison and an irresponsible construction scheme for years. Just recently, the city commissioners met again last Monday to discuss a land deal for the new prison -- before even signing a contract with a prison operating company! However, the county remains at a stalemate, as commissioners take the public opposition into consideration. All-in-all, it will cost the county $33 million to contract the construction and maintenance to LaSalle Corrections, when it would only cost $31 million to rennovate and expand the existing Sherman jail. Perhaps cost is not the only issue.

Grayson County Judge Drue Bynum, the main figure in the debates who has been responsible for encouraging these plans, said in regards to the proposed plans "we [need] to get ourselves off high-center, and now we are off high-center" ("Private Jail Option Approved by Grayson County Leaders" KTEN, July 13th). In other words, he wants to remove the County's involvement with their prisoners and take the out of sight, out of mind approach.

The proposed land siting for the new prison has some Sherman residents upset, and for good reason. The proposed prison site (shown here in red) is directly across Highway 11 from a residential area. With concerns over 24/7 bright lights and noise, one can only speculate as to the upcoming property value decreases. The prison site is only 0.6 miles from the second nearest densely populated residential area, city parks (shown in blue), and within one mile from the Sherman elementary school (shown in pink). 
Because of these concerns, a second proposed prison site has been proposed on laned owned by by cotton mammoth Anderson Clayton as a disposal location for decades before today, where it is owned by a Dow Jones board member Christopher Bancroft. This siting would move the prison away from the Southeast into the Northeast, away from the elementary school and residential areas. This proposed siting, however, has not been approved. With the proposed prison to hold 1,500 additional people, there will without a doubt be a sizeable increase in traffic from prisoner visitors, prison employees, legal counselers, and police personnel coming and going at a regular rate. If this new facility is constructed, it will increase Sherman's prison population five fold. Sherman's Mayor, Bill Magers has said, "I understand the concerns of those who live there about having this [prison] near them. I would have the same concerns if I lived there" (Herald Democrat; February 5, 2008). The mayor appears to be the only city official to speak out against moving the Sherman prison out of downtown, stating that it doesn't make to create 1,500 more prison beds when the population of Sherman is 140,388 and the Texas Commission on Jail Standards estimates that about 3 people for every 1,000 are incarcerated -- meaning Sherman only needs about half the amount of the 1,500 prison beds.

The opponents and the Sherman mayor are in a standoff against the pricinct commissioners who have plans of importing prisoners from Dallas to make a profit. The startup costs, both in finance and safety are extremely high if this plan follows through, and the potential for profit is minimal. "I think it's time to stop the for-profit, private option and return to the basic concept of expanding the jail downtown," said Sheriff Keith Gary. "[The downtown prison is] near the courts and avoid[s] the pitfalls we have learned exist with a private corporation" ("Private Jail Option Approved by Grayson County Leaders," KTEN, July 13th). 

There is a great risk that Sherman's jail project will amount to another failed Public Facilities Corporation situation (read about PFCs in Grassroots Leadership's "Considering a Private Jail...?"). So long as Mayor Magers and the citizens of Sherman keep thinking about their own interests and not the interests of private companies, there is a good chance this stalemate will end in the rational choice to remodel instead of reinvent. 

Grayson Commissioners sidestep voters with privatization scheme

The Herald Democrat reported ("Grayson County Jail to be run by private company," July 13) last week that Grayson County commissioners will negotiate a deal with Southwestern Correctional LLC to build and operate a new 747-bed private jail. This decision by the commissioners means Grayson voters will be denied the opportunity to put the issue of jail expansion to a vote.  By deciding to negotiate a deal with Southwestern Correctional, commissioners ignored calls for a bond election by Grayson Sheriff J. Keith Gary, Sherman Mayor Bill Magers, Former Grayson County Commissioner Carol Shea, Former Grayson County Democratic Party Chair Tony Beaverson, the Combined Law Enforcement Association of Texas, and dozens of Grayson residents.

Grits for Breakfast did an excellent job covering the proposed Grayson Privatization scheme offered up by County Judge Drue Bynum (see links at the bottom of this post), and he argues compellingly that the over-reliance by Grayson Judges on pretrial detention continues to unnecessarily fill the county jail and fuel the perception that a larger facility is needed. (The numbers as of June 1, 2009 show 51% of inmates in Grayson County Jail are pretrial detainees).

Judge Bynum was trying to sell Grayson residents a larger facility than the county needed for its inmates, arguing that a private company would need the extra space to profit from incarceration and offset the county's per diem rate. In spite of the cost-saving rationale offered by Bynum, it doesn't seem that Grayson County was made a very good first offer by Southwestern Correctional.

From the Herald Democrat article (July 13th):

The deal presented Monday by the Southwestern staff said the county will pay between $32.50 and $46.50 per inmate housed per day, depending upon variables including the percentage of beds filled, income from the jail phone system and other fees and income. It could also depend on the final negotiations between the county and Southwestern.

So Southwest Correctional's current proposal doesn't even guarantee 6% cost savings from the county's current per diem of $49.35. And as Grits contributed:

Whether the county or a private contractor operates the facility, it still must meet minimum standards set by the Texas Commission on Jail Standards, so it won't be any cheaper to operate (except to the extent that a private company pays its employees less than deputies make - a marginal benefit at best in the scheme of things that's wiped out if the company takes a profit).

And what happens if Grayson isn't able to contract with outside jurisdictions, or if prisoners don't make expensive phone calls to their families? County tax payers would end up paying for construction and operation costs in addition to Southwest Correctional's profit through increased per diem rates

Sheriff Gary presented commissioners with a less expensive, less risky alternative to privatization before they made a decision.  The Herald Democrat (July 13th):

"The best, safest, most economical option is an expansion of the existing jail in downtown Sherman, near the courtrooms it serves. I have reviewed the 2002 plan, and with some updating and modernization it can service our needs. Ironically, it can actually be downsized slightly if you decide that you prefer to limit the number of federal prisoners in our jails as I have been required to do during the last several years," he told commissioners.

Sheriff Gary was called on to oppose privatization by the Combined Law Enforcement Association of Texas (CLEAT), which called on him to, "stop the takeover of the county jail by a company out of Louisiana." CLEAT continued in a press release, "Private county jails are a bad idea for the citizen-taxpayer, a bad idea for the deputies and even a bad idea for the prisoners detained there. These fast and loose privatization deals never work out well for the local citizens who are left holding the bag."


As Grits mentioned, it seems increasingly likely that counties could have trouble filling extra beds with state inmates, because TDCJ's population is declining and forecasted budget deficits will force Texas lawmakers to put corrections costs under a microscope. That may leave federal contracts as the only revenue target for private contractors, and those contracts are likely to be a bit more competitive with planned state prison population reductions across the United States. If Southwestern Correctional eventually decided to cancel its contract with Grayson, the county would be held responsible for the cost and operation of the facility, as its public facility corporation would be the bond holder.

For a quick dissection of public facility corporations, see Bob's post.

Counties have been sucker-punched by the effects of large private prison contract cancellations before. In 2003, the north-Texas town of Littlefield had its tax and revenue obligations downgraded (October 24, 2006, Yahoo.comas a result of the city's weakened financial position after a pullout of the Texas Youth Commission's prisoners. Fitch ratings agency wrote:

"If the city had to levy an interest and sinking fund tax to meet detention center related debt obligations, officials estimate that the overall tax rate would have to double over the current operations and maintenance tax rate, which Fitch believes would be extremely difficult to impose.”

In my judgment, Judge Bynum seems aware of the risk of financing the facility with a Public Facilities Corporation. He skirted a question about the riskiness of using public facility corporations to finance private jails when asked by a former Grayson County commissioner who would be responsible for the bond if the enterprise failed. Bynum said, "the bondholder" would be responsible. Bynum's answer strikes me as less than straightforward, as Grayson County and its tax payers would essentially be saddled with the debt if the new county jail beds aren't filled.

Check out these other sources for background:

Herald Democrat



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