CCA Holds Investor Call. Still Pursuing Harris County Contract.

Corrections Corporation of America held its quarterly conference call earlier this month.  Despite the spin that company officials project a mix of declining crime rates, state budget problems, and stabilizing prison populations have contributed to a reduction in average compensated occupancy for CCA prisons around the nation. 

The company is actively pursuing an RFP in Texas as Harris County (Houston) considers bids by prison profiteers to assume the management of the state’s largest county jail system.  According to CCA officials, a final proposal was submitted in April and they expect the county to make the decision by this summer.  Of course we know the county has other options.

CCA representatives also stated that the Bureau of Prisons added capacity to its overall system this year in two states – California and Texas.  Given the nation’s austerity framework, company reps don’t expect the BOP to be appropriated funding for future prison capacity over the next few years.  However, the agency is projected to grow by 5,000 prisoners per year increasing demand for capacity which has the private profiteers actively seeking new federal contracts.  Currently, the federal prison system is 35% over capacity.

Despite the economy the company is still adding capacity.  CCA officials reported investing in new prison construction during 2012 – approximately $30 million to $35 million in on-going prison construction and expenditures related to potential land acquisitions.  Earlier this year, former BOP official and now CCA representative – Harley Lappin – sent a letter to state governors offering to buy state prisons with the agreement that they remain 90% occupied. The letter follows the company's effort to purchase a prison in Ohio during 2011 -- a move that may prove to be a trend. 

Finally, CCA reported engaging in negotiations with eight undisclosed states on contracting prison capacity for their overcrowded prison systems.  Folks in Texas will have to continue to monitor CCA’s developments to see if any negotiations are going on.  And we will too. 

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