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March 11, 2012

"States reject offer to buy prisons: Trend moving away from once-popular privatization"

The title of this post is the headline of this notable new AP article, which includes these excerpts:

The nation’s largest private prison company made an enticing offer to 48 states that went something like this: We will buy your prison now if you agree to keep it mostly full and promise to pay us for running it over the next two decades.  Despite a need for cash, several states immediately slammed the door on the offer, a sign that privatizing prisons might not be as popular as it once was.

Corrections Corporation of America sent letters to the prison leaders in January, saying it had a pot of $250 million to buy facilities as part of an investment.  The company is trying to capitalize on the landmark deal it made with Ohio in the fall by purchasing a facility, the first state prison in the nation to be sold to a private firm.

Prison departments in California, Texas and Georgia all dismissed the idea. Florida’s prison system said it doesn’t have the authority to make that kind of decision and officials in CCA’s home state of Tennessee said they aren’t reviewing the proposal.  The states refused to say exactly why they were rejecting the offer....

Critics of private prisons called the offer a backdoor way to delay the sentencing reform movements that have sprung up in many states looking to cut prison budgets.  Lawmakers in many conservative states that once eagerly passed tough-on-crime laws are now embracing alternative sentences for low-level offenders who would otherwise be locked up.

CCA said selling a prison to a private firm doesn’t block states from pursuing sentencing reform. The company also said it was still too early to say whether any state would take them up on the bid.  “It was an outreach letter making them aware of these offers, it’s yet another tool in the toolbox,” said company spokesman Steve Owen.  “We can design and build and own facilities from scratch or manage government facilities, but this is a third business model.”...

The private prison industry boomed in the late 1980s and 1990s as states sought cheaper ways to jail people and voters began resisting building more prisons.  But efforts to privatize prisons have become highly-charged political debates in many states, partly because a sale often requires legislative approval by the governor.

In Louisiana, lawmakers last year defeated Gov. Bobby Jindal’s proposal to privatize and sell several state prisons to generate $90 million. Relatives of prison employees aggressively fought the move, fearing that they would get lower pay and less benefits working for a private firm. An effort to privatize a chunk of Florida’s prisons also met stiff opposition from lawmakers in February. They blocked what would have been the largest prison privatization in the U.S.

March 11, 2012 at 11:49 PM | Permalink

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