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What factors contributed to the emergence of a market for private prisons in the U.S.? Discuss the relationship between politics, ideology, and private prisons. How can policy makers optimize the use of private prisons in the criminal justice system. Utilize APA 7th Edition and include a title page and reference page.  Be sure to utilize level headings as per APA 7th edition.

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Justice Assistance


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Office of Justice Programs

Bureau of Justice Assistance



This document was prepared by the National Council on Crime and Delinquency, under
grant number 97–DD–BX–0014, awarded by the Bureau of Justice Assistance, Office of Jus-
tice Programs, U.S. Department of Justice. The opinions, findings, and conclusions or recom-
mendations expressed in this document are those of the authors and do not necessarily
represent the official position or policies of the U.S.␣ Department of Justice.

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Bureau of Justice Assistance

Emerging Issues on
Privatized Prisons

MonographFebruary 2001 NCJ 181249

James Austin, Ph.D.
Garry Coventry, Ph.D.

National Council on Crime and Delinquency

Cover photo used with permission from The American Correctional Association.


Emerging Issues on Privatized Prisons


One of the most daunting challenges confronting our criminal justice sys-
tem today is the overcrowding of our nation’s prisons. The past decade
has witnessed a doubling of the number of adult offenders brought before
our courts. According to one estimate, as we begin the new millennium,
the nation’s inmate population approaches the 2 million mark. Securing
and humanely housing such a large population has placed an enormous
burden on prison administrators as well as the federal, state, and local
jurisdictions that must finance the institutional confinement of so many

In the 1980s, the public’s frustration over a perceived failure of the penal
system to rehabilitate offenders and a reluctance to provide more funding
for correctional institutions, coupled with the increasing demand for more
jail space, precipitated a crisis. One proposed solution that emerged was
the privatizing of prisons and jails by contracting out, in part or in whole,
their operations. In 1987, the number of inmates incarcerated in privately
operated correctional facilities worldwide was 3,100; by 1998 the number
had risen to 132,000. In the United States today there is a total of 158 pri-
vate correctional facilities. Proponents of privatization have suggested that
allowing the facilities to be operated by the private sector could result in
cost reductions of 20 percent.

To explore the issues pertaining to the privatization of prisons, the Bureau
of Justice Assistance funded a nationwide study that has resulted in this
monograph, Emerging Issues on Privatized Prisons. The monograph exam-
ines the historical factors that gave rise to the higher incarceration rates,
fueling the privatization movement, and the role played by the private sec-
tor in the prison system. It outlines the arguments, both in support of and
opposition to, privatized prisons, reviews current literature on the subject,
and examines issues that will have an impact on future privatizations. An
appendix provides practical guidelines for policymakers who are consid-
ering privatizing a facility.

The study resulted in some interesting conclusions. For example, it was
discovered that, rather than the projected 20-percent savings, the average
saving from privatization was only about 1 percent, and most of that was
achieved through lower labor costs. Nevertheless, there were indications
that the mere prospect of privatization had a positive effect on prison ad-
ministration, making it more responsive to reform. It is hoped that this
monograph will prove enlightening to those involved with the issue of
privatized prisons and promote a greater discussion about it.


Emerging Issues on Privatized Prisons

Executive Summary ………………………………………………………………………….. ix

Current Trends in Privatization ……………………………………… ix

Prior Research Findings on Privatization ………………………… x

National Survey Results ………………………………………………….. x

Future Trends …………………………………………………………………. xi

Chapter 1 Introduction ……………………………………………………………………. 1

Chapter 2 The History of and Key Debates Over Privatization ……. 9

Privatization of Corrections: A Historical Overview ……….. 9

The Debate …………………………………………………………………….. 13

Chapter 3 Recent Research Regarding Privatization ……………………. 21

Background ……………………………………………………………………. 21

Costs ………………………………………………………………………………. 22

Inmate Services, Quality of Confinement,
and Public Safety …………………………………………………………… 29

Health Care ……………………………………………………………………. 33

Additional Literature …………………………………………………….. 35

Summary ……………………………………………………………………….. 37

Chapter 4 The National Survey of State Prison Privatization ……… 39

Background ……………………………………………………………………. 39

Survey of Public and Private State Facilities ………………….. 39

Reanalysis of Survey Data Controlling for
Facility Security Level ……………………………………………………. 52

Chapter 5 Summary ………………………………………………………………………. 59

The Diminishing Returns on Privatization …………………….. 59

The Future of Privatization ……………………………………………. 60

Notes ………………………………………………………………………………………………… 61

References ………………………………………………………………………………………… 65

Appendix Guidelines for Contracting for a Private Prison ………….. 69

Sources for Further Information ……………………………………………………… 83



Emerging Issues on Privatized Prisons


Table 1 Number of Persons Held in State or Federal
Prisons or Local Jails, 1985, 1990–1997 ……………………………. 2

Table 2 Prison Operating Costs, Fiscal Years 1980–1994 ……………… 3

Table 3 Private Adult Correctional Firms, December 31, 1998 …….. 4

Table 4 Geographic Distribution of Privately Operated
Correctional Facilities, December 31, 1998 ………………………. 5

Table 5 Geographic Distribution of Privately Operated
Correctional Facilities Outside the United States,
December 31, 1998 …………………………………………………………… 6

Table 6 Public Strategies for Private Prisons ……………………………… 14

Table 7 Financial Data for Corrections Corporation of America,
1987 and 1997 ………………………………………………………………… 29

Table 8 Inmate Characteristics at Public Facilities at Midyear
1995 and Private Facilities as of December 31, 1997 ………. 41

Table 9 Characteristics of Private Facilities by Level of Security
as of December 31, 1997 ………………………………………………… 42

Table 10 Types and Rates of Participation in Institutional
Programs at Public Facilities at Midyear 1995 and at
Private Facilities as of December 31, 1997 ……………………… 44

Table 11 Persons Employed in Public State Facilities at
Midyear 1995 and at Private State Facilities as of
December 31, 1997 …………………………………………………………. 46

Table 12 Characteristics of Employment in Private Facilities,
January 1–December 31, 1997 ………………………………………… 47

Table 13 Major Incidents in Public Facilities (July 1, 1994–
June 30, 1995) and in Private Facilities (January 1–
December 31, 1997) ………………………………………………………… 48

Table 14 Disciplinary Resources at Private Facilities,
January 1–December 31, 1997 ………………………………………… 50

Table 15 State Facilities Under Court Order or Consent Decree:
Public Facilities at Midyear 1995 and Private Facilities
on December 31, 1997 ……………………………………………………. 51


Bureau of Justice Assistance

Table 16 Characteristics of Inmates at Public Medium- and
Minimum-Security Facilities at Midyear 1995 and
Private Medium- and Minimum-Security Facilities on
December 31, 1997 …………………………………………………………. 53

Table 17 Characteristics of Public Medium- and Minimum-
Security Facilities at Midyear 1995 and Private
Medium- and Minimum-Security Facilities on
December 31, 1997 …………………………………………………………. 54

Table 18 Types and Rates of Participation in Institutional
Programs at Public and Private Medium- and
Minimum-Security Facilities …………………………………………. 55

Table 19 Characteristics of Persons Employed in Public Medium-
and Minimum-Security Facilities at Midyear 1995 and
Private Medium- and Minimum-Security Facilities on
December 31, 1997 …………………………………………………………. 56

Table 20 Major Incidents in Public Medium- and Minimum-
Security Facilities (July 1, 1994–June 30, 1995) and
Private Medium- and Minimum-Security Facilities
(January 1, 1997–December 31, 1997) …………………………….. 57

Tables (continued)


Emerging Issues on Privatized Prisons

Executive Summary

The state of corrections has come under attack by many during the past
decade. Many contend that the current state of affairs will not work in the
21st century. Some argue that the public sector is incapable of handling the
complex and changing dynamics associated with corrections, and there-
fore more prisons need to be handed over to the private sector; others
argue that private industry should not be a part of the public matter of
penalizing offenders of crime. Although the private sector has had a long
history of involvement in corrections, private prisons make up less than 5
percent of the current market. This study offers a review of the history of
privatization, presents a review of relevant research on the issues in-
volved, and compares some of the major findings from the National Survey
of State Prison Privatization, 1997, conducted by the National Council on
Crime and Delinquency (1998) and the Census of State and Federal Correc-
tional Facilities, 1995, conducted by the Bureau of Justice Statistics (1997a),
on the benefits and costs associated with private- and public-managed
prison facilities.

Although private prisons tend to house mostly minimum-security inmates,
the findings from this report suggest that private prisons operate much
the same as public facilities. Private prisons offer only modest cost
savings, which are basically a result of moderate reductions in staffing
patterns, fringe benefits, and other labor-related costs. No evidence was
found to show that the existence of private prisons will have a dramatic
effect on how nonprivate prisons operate.

Current Trends in Privatization
❑ It is estimated that worldwide there are 184 privately operated

correctional facilities, which hold 132,346 inmates.

❑ Within the United States, a total of 158 private correctional facilities are
operating in 30 states, Puerto Rico, and the District of Columbia. Texas
has the most facilities (43), followed by California (24), Florida (10), and
Colorado (9). Most private correctional facilities tend to be concentrated
in the Southern and Western United States.

❑ Another 26 private facilities operate in 3 other countries, with Australia
(12) and the United Kingdom (10) topping the list.

❑ Total revenues allocated to private prisons and jails are estimated at
$1␣ billion.


Bureau of Justice Assistance

❑ Despite rapid growth in the number of private correctional facilities,
they represent only a small share of the entire correctional facilities
market. With jail and prison populations totaling approximately 1.7
million in the United States, the estimated 116,626-bed capacity of
private correctional facilities makes up less than 7 percent of the U.S.
market. Less than 5 percent (52,370 inmates) of the total 1.2 million
U.S.␣ prison population is housed in private facilities.

Prior Research Findings on Privatization
❑ Few studies have been completed regarding the impact that privatizing

prisons has on costs, protection from harm, recidivism, and conditions
of confinement.

❑ A major conclusion reached from the few studies completed is that
privately operated prisons function as well as publicly operated

❑ With respect to operating costs, privately operated prisons can reduce
expenditures in those markets in which public employee benefit rates
are relatively high in comparison to national rates.

❑ Management problems that have occurred with privatized prisons
can␣ usually be linked to poorly drafted contracts, lack of oversight by
contracting agencies, and transferring inmates with classification level
requirements to private prisons that do not have the resources and
capabilities to handle these inmates.

❑ Evidence shows that the presence of private prisons has encouraged
public facilities to adopt similar cost-saving strategies in staff deploy-
ment and procurement policies.

❑ Evidence also shows that private entities can construct new facilities
faster and cheaper than can be done by firms in the public sector.

National Survey Results
❑ Most privately operated prisons (not including jails or detention

centers) are relatively new, with bed capacities of 800 or less, and
designed for medium- and minimum-security custody inmates.


Emerging Issues on Privatized Prisons

❑ Results from previous studies show that privately operated prisons
function similarly to publicly operated prisons with respect to program
and work participation by inmates and the distribution of staff by key
functional areas. Three exceptions to these findings are in the areas of
staffing levels, management information system (MIS) support, and
critical incidents. Privately operated facilities have a significantly lower
staffing level than publicly operated prisons and lack MIS support.
They also report a significantly higher rate of assaults on staff and

❑ The differences mentioned above may be related to factors such as
reporting standards or the fact that most correctional facilities exper-
ience management difficulties when newly opened. However, insuffi-
cient training and lack of qualified staff in key positions may also be
valid reasons for these differences. Nonetheless, the assumption that
privately operated prisons are safer or better managed than publicly
operated facilities is not supported by the results presented in this

Future Trends
❑ The number of privatized prisons is likely to increase, but not at the

pace exhibited during the past decade.

❑ The number of companies operating privatized prisons is likely to
decrease as competition and the costs of doing business increase, thus
forcing a consolidation of firms within the industry.

❑ It is unlikely that privatized prisons will develop a strong market in the
high-security inmate population market due to the recent flurry of well-
publicized disturbances. However, important inroads can be expected
for the private sector within low-security medical, mental health, and
geriatric inmate populations.

❑ Speculative prisons will face the greatest scrutiny and resistance by
state and federal correctional agencies. These facilities are the most
difficult to monitor and regulate.

❑ Unless there is a sharp reduction in major incidents at private prisons,
litigation directed at facilities that are immune from the Prison
Litigation Reform Act will likely increase.


Emerging Issues on Privatized PrisonsChapter 1


Prison overcrowding is one of the most burdensome problems plaguing
our criminal justice system and a major catalyst for privatizing correctional
facilities. Over the past decade the number of adult offenders under the ju-
risdiction and control of the United States justice system has doubled. Be-
tween 1980 and 1995, the probation, parole, and jail populations grew
almost as rapidly as the prison population. In 1995, more than 5.4 million
adults—approximately 1 out of every 46—were under some form of cor-
rectional supervision (Bureau of Justice Statistics, 1997a). The public has
witnessed an increase in the nation’s prison and jail populations from
nearly 750,000 in 1985 to more than 1.7 million in 1997 (table 1). This rise in
prison and jail populations and the corresponding need for additional bed
space have been accompanied by similar increases in alternative forms of
correctional supervision.

As the number of inmates in prisons and jails and on probation and parole
increased, a corresponding surge in prison spending has occurred. Accord-
ing to a report issued by the U.S. General Accounting Office (1996a), prison
operating costs grew steadily between fiscal years 1980 and 1994, due in
part to the continuous growth in the inmate population. Total U.S. prison
operating costs (federal and state) grew from about $3.1 billion in fiscal year
1980 to more than $17 billion in fiscal year 1994. This is an increase of nearly
550 percent based on constant or inflation-adjusted dollars (table 2).

The National Council on Crime and Delinquency (NCCD) has estimated
that up to $15 billion will be needed to construct additional prisons to ac-
commodate the anticipated growth in the inmate population by the year
2000, with an additional $21.9 billion needed to operate these prisons. This
combined $37 billion does not include the additional billions of dollars re-
quired to service the debt associated with the loans necessary to pay for
additional prison construction (Clark, 1998). Based on current trends,
NCCD estimates that prison and jail populations will reach 2 million by
the end of 2000.

Compounding the problems created by the growing demand for prison
space and funding is the lack of public confidence in the quality of correc-
tional services provided by federal, state, and municipal governments. Pe-
nal programs designed to rehabilitate offenders have not demonstrated a
significant reduction in crime or recidivism and have thus lost credibility
with the public and policymakers. In short, the belief that government is
not equipped to meet the challenges of contemporary institutional confine-
ment is spreading.

In the 1980s, private prisons and jails were seen as part of the solution to
meet the increasing pressure for prison bed space at a time when taxpayers


Bureau of Justice Assistance

Total Incarceration
Year Inmates Federal State Jail Rate †

1985 744,208 35,781 451,812 256,615 313

1990 1,148,702 58,838 684,544 405,320 458

1991 1,219,014 63,930 728,605 426,479 481

1992 1,295,150 72,071 778,495 444,584 505

1993 1,369,185 80,815 828,566 459,804 528

1994 1,476,621 85,500 904,647 486,474 564

1995 1,585,586 89,538 989,004 507,044 600

1996 1,646,020 95,088 1,032,440 518,492 618

1997 1,725,842 99,175 1,059,588 567,079 645

increase 6.5 8.4 7.0 4.9 5.8

Table 1 Number of Persons Held in State or Federal Prisons or Local Jails, 1985, 1990–1997*

* Jail counts are for midyear (June 30). State and federal prisoner counts for 1990–1995 are for December 31. Counts for 1994–1997 exclude
persons who were supervised outside a jail facility.
† Persons in custody per 100,000 residents on July 1 of each year.
Source: Bureau of Justice Statistics (1998).

were reluctant to pay for correctional services and were not supportive of
divestiture of resources from other areas of state responsibilities and ser-
vices (Travis et al., 1985). To confront escalating prison populations and
costs, an increasing number of policymakers are now turning to the private
sector for assistance.

Privatization is commonly defined as a contract process that shifts public
functions, responsibilities, and capital assets, in whole or in part, from the
public sector to the private sector. Privatization in correctional services
can assume a number of institutional characteristics. For instance, the
most common form of privatization in corrections is the contracting out
(or outsourcing) of specific services that entails a competition among pri-
vate bidders to perform governmental activities. Over the past two de-
cades, the practice of state and local correctional agencies contracting with
private entities for medical, mental health, educational, food services,
maintenance, and administrative office security functions has risen
sharply. Under these circumstances, the correctional agency remains the
financier and continues to manage and maintain policy control over the
type and quality of services provided.


Emerging Issues on Privatized Prisons

Fiscal Year Federal State Total

1980 $ 319,274,000 $ 2,787,369,000 $ 3,106,643,000

1981 346,517,000 3,229,234,000 3,575,751,000

1982 368,000,000 3,794,178,000 4,161,178,000

1983 435,000,000 4,346,273,000 4,781,273,000

1984 529,245,000 5,066,666,000 5,595,911,000

1985 500,941,000 5,934,160,000 6,435,101,000

1986 555,097,000 6,619,534,000 7,174,631,000

1987 580,097,000 7,601,594,000 8,181,691,000

1988 878,502,000 8,586,498,000 9,465,000,000

1989 900,334,000 9,611,020,000 10,511,354,000

1990 1,148,678,000 11,194,236,000 12,342,914,000

1991 1,318,741,000 12,514,171,000 13,832,912,000

1992 1,585,498,000 13,290,202,000 14,875,700,000

1993 1,767,019,000 14,239,710,000 16,006,729,000

1994 1,918,067,000 15,776,174,000 17,694,241,000

Table 2 Prison Operating Costs, Fiscal Years 1980–1994

Source: U.S. General Accounting Office (1996a).

A more radical approach is to have government transfer ownership of
assets, commercial enterprises, and management responsibilities to the
private sector. This approach, called an “asset sale,” leaves the government
with a limited or nonexistent role in the financial support, management,
or␣ oversight of the sold asset (U.S. General Accounting Office, 1997). This
form of privatization was not adopted by governments in operating correc-
tional facilities until the 1980s.

A dramatic increase in the use of private correctional facilities has
occurred—initially in the United States and more recently in the
United Kingdom, Australia, and South Africa.1

In 1987, the total number of inmates in privately operated prisons and
jails␣ worldwide was approximately 3,100. By December 31, 1998, that
number had increased to more than 132,000 (table 3). Although 14 private
correctional facility firms existed at that time, 2 companies (Corrections
Corporation of America and Wackenhut Corrections Corporation) accounted


Bureau of Justice Assistance

for more than three-fourths of the entire worldwide market (Thomas,

In the United States, a total of 158 private correctional facilities are operat-
ing in 30 states, Puerto Rico, and the District of Columbia (table 4). Texas
has the most facilities (43), followed by California (24), Florida (10), and
Colorado (9). Most private correctional facilities tend to be concentrated
in the Southern and Western United States. Another 26 private facilities
operate in 3 other countries, with Australia and the United Kingdom topping

Table 3 Private Adult Correctional Firms, December 31, 1998

Outside Total
Management Firm U.S. Capacity U.S. Capacity Capacity Percentage*

Alternative Programs, Inc. 340 0 340 0.3%

Avalon Correctional
Services, Inc. 350 0 350 0.3

Bobby Ross Group 464 0 464 0.4

CiviGenics Inc. 3,563 0 3,563 2.7

Cornell Corrections, Inc. 5,794 0 5,794 4.4

Correctional Services
Corporation 6,727 0 6,727 5.1

Correctional Systems, Inc. 272 0 272 0.2

Corrections Corporation
of America 65,748 2,244 67,992 51.4

Group 4 Prison Services Ltd. 0 4,510 4,510 3.4

GRW Corporation 362 0 362 0.3

Management and Training
Corporation 7,465 0 7,465 5.6

Maranatha Production
Company 500 0 500 0.4

Securicor 0 800 800 0.6

Wackenhut Corrections
Corporation 25,041 8,166 33,207 25.1

Total 116,626 15,720 132,346 100.0

* Discrepancy in total is due to rounding.
Source: Thomas (1998).


Emerging Issues on Privatized Prisons

Jurisdiction Number of Facilities Percentage of Facilities*

Texas 43 23.4 %

California 24 13.0

Florida 10 5.4

Colorado 9 4.9

Oklahoma 8 4.3

New Mexico 7 3.8

Tennessee 6 3.3

Mississippi 6 3.3

Arizona 6 3.3

Georgia 5 2.7

Kentucky 4 2.2

Puerto Rico 4 2.2

Arkansas 2 1.1

North Carolina 2 1.1

Louisiana 2 1.1

Missouri 2 1.1

Ohio 2 1.1

Kansas 2 1.1

13 other states and D.C. 14 7.6

U.S. total 158 85.9

Non-U.S. total 26 14.1

Total 184 100.0

* Discrepancy in total is due to rounding.
Source: Thomas (1998).

the list (table 5). There are another 530 nonsecure, privately operated facili-
ties, such as halfway houses, residential drug treatment, and other juvenile
correctional facilities in the United States. Total revenues allocated to
private prisons and jails in 1998 are estimated at $1 billion (McDonald
et al., 1998).

Table 4 Geographic Distribution of Privately Operated Correctional Facilities,
December 31, 1998


Bureau of Justice Assistance

Table 5 Geographic Distribution of Privately Operated Correctional Facilities Outside the
United States, December 31, 1998

Despite the rapid growth in the number of private correctional facilities,
they represent only a small share of the entire correctional facilities mar-
ket, at least within the United States. With jail and prison populations
totaling approximately 1.7 million in the United States, the estimated
116,626-bed capacity of private correctional facilities makes up less than
7␣ percent of the U.S. market. The recently completed Abt Associates Inc.
report (McDonald et al., 1998) found that less than 5 percent (or 52,370
inmates) of the total 1.2 million United States prisoner population was
housed in private prisons.

In terms of prison facilities, the Abt study identified no more than 65 facili-
ties that could house state prisoners, which is a small percentage of the
more than 1,500 prisons in the United States. Furthermore, indications
show that growth in privatization may be slowing. For example, Lanza-
Kaduce and colleagues (1998) report that private facility bed capacity has
not increased since January 1, 1998. Additionally, stock prices for most of
the major firms have dropped substantially in the past year. There have
also been a number of highly publicized management problems with
several privately operated facilities.

This report gives attention to issues surrounding the current debate on
privatization. The privatization of correctional operations and services has
resurfaced as a controversial topic, yet its antecedents developed early in
this country’s history. Chapter 2 examines the factors, particularly demo-
graphic shifts, sentencing law changes, and the political backdrop that
gave rise to increased incarceration rates since the early 1980s, leading to
the recent privatization movement for incarceration. Another section of
chapter 2 investigates the historical role of private-sector involvement in
the provision of correctional services in the United States. This chapter also
briefly outlines the various arguments in favor of and against privately op-
erated prisons.

Country Facilities Capacity by Country Percentage

South Africa 2 3,000 19.1%

U.K. 12 8,061 51.3

Australia 12 4,659 29.6

Total 26 15,720 100.0

Source: Thomas (1998).


Emerging Issues on Privatized Prisons

Chapter 3 reviews the current research literature on prison privatization,
with particular attention given to recent federal, state, and local experi-
ences with privatization. Chapter 4 outlines the methodology used by the
NCCD to conduct a national survey of private prison facilities in late 1997
and reports the findings of this survey. Chapter 5 summarizes the major
findings of the study and examines the most critical issues that will likely
have an impact on privatization of the nation’s prison systems.

Finally, the appendix contains practical guidelines for state and local
policymakers to consider should they decide to privatize a facility. These
guidelines were developed by the Oklahoma Department of Corrections,
which has been very active in the privatization movement.


Emerging Issues on Privatized Prisons

Privatization of Corrections:
A Historical Overview
Private enterprise in the United States has an extensive history of involve-
ment in the provision of correctional services. According to Feeler (1991),
the involvement of the private sector in corrections stems, in part, from an
Anglo-American political culture that is somewhat skeptical of govern-
mental authority yet promotes private initiative. Feeler traces the private-
sector involvement back to shortly after the first English colonists arrived
in Virginia in 1607. The colonists were followed by a handful of convicted
felons, who were transported by private entrepreneurs to America as a
condition of pardon to be sold into servitude.2

The overseas transportation of these felons was organized by private entre-
preneurs. Merchants transported convicts in exchange for the privilege of
selling them as indentured servants (Ammon et al., 1992). Transporting
convicts to America (and later many more to Australia following the
American Revolution) was an innovation that radically transformed the
administration of criminal justice. This innovation expanded the power of
the state to impose sanctions without the need to increase its administra-
tive structure. In other words, transportation of felons increased the state’s
penal capacity at a low cost to the government.

During the 18th century, the modern prison emerged in America as a vi-
able alternative to servitude or the death penalty. Also during this time,
the use of privately operated facilities became popular. In the colonies,
criminal justice procedures were copied from English custom, which had
a␣ long history of private involvement in operating jails. Privately operated
jails date back to medieval England (Pugh, 1968).

For a fixed fee states allowed private contractors to supervise prisoners in-
side prison walls (Ethridge and Marquart, 1993). Although appointed by
the government, a head jailer was considered an independent operator of
a␣ profit-making enterprise functioning as a government contractor. Often,
jailers employed prisoners (McCrie, 1993). In privately operated facilities,
inmates were often engaged as laborers and craftsmen in private-sector
activities. Early American jails may be characterized as exploitative. Cripe
(1997: 378) describes the conditions:

Chapter 2

The History of and Key Debates
Over Privatization


Bureau of Justice Assistance

There was seldom any separation of types of prisoners—women and
children were often confined with hardened criminals. Many jails were
very crowded; most were unsanitary. Payments were extracted for
special services, such as better meals or other privileges. Some money
was given to the jailer (often the sheriff) for basic services. But it was
widely accepted that jailers could charge additional money for virtually
any type of special benefit.

By 1885, 13 states had contracts with private enterprises to lease out prison
labor (McCrie, 1993: 24). One of the more interesting situations occurred
in California at the San Quentin prison, which was the first facility con-
structed and operated by a private provider in the 1850s. Private entrepre-
neurs persuaded state officials that the facility could best be operated
under a long-term lease arrangement with an entity that had experience in
law enforcement. Even back then the debate centered on costs, with the ar-
gument made that a private-sector entity would be less expensive and less
corrupt than the government. However, after a number of major scandals
surfaced surrounding the mismanagement of the facility by the private
provider, the state decided to turn the facility over to the control of state
government. Eventually, the government turned out to be as ineffective
and corrupt as the private provider (Lamott, 1961: 74, 78):

As the year [1856] went on it became increasingly clear to more and
more people that, regardless how much money it might save the tax-
payers, a private contract was no way to run the state prison. The
Bulletin was not alone when it demanded that, whatever it cost, a final
end had to be put to the system of farming out the management of the
state convicts. . . . After the final ejection of [Warden] McCauley, how-
ever, the prison fell into the hands of men who were primarily profes-
sional politicians rather than pirates. The distinction is a nice one, and
the change was more a matter of style than of substance. The prison
remained a rich piece of political spoils, but the looting was now carried
on more in line with the ancient traditions of American state politics.

Even back then, private contractors were claiming that they could both
manage prisons and employ convicts in labor, arguing that the practice
would be both rehabilitative and financially rewarding.3 Prison models of
convict labor took various forms. At some, companies outside the prison
provided raw materials that were refined in prison workshops and later
sold by private companies. At others, prisons leased their inmates out to
private farms or other businesses if they could not produce salable items
within the prison. In a number of states, contractors paid the prison a fee
or a percentage of the profits for the right to employ convicts. For example,
in the 1860s the Texas legislature directed state correctional administrators
to contract out inmate labor to the private sector. Even when prisons were
not operated entirely by private entrepreneurs, inmates were used as a
cheap source of labor. Prisoners often worked on farms, railroads, and
mines, in addition to other public work programs.4


Emerging Issues on Privatized Prisons

For most of the correctional history of the United States, prison labor was
expected to generate a profit for the institution. If generating a profit was
not feasible, it was incumbent upon the prisoner to pay the costs of incar-
ceration and become self-supporting. The “managers” of early detention
facilities charged their inmates for food and clothing, while providing sub-
standard service. The income generated by inmate labor, however, was not
sufficient to cover the high costs of operating correctional systems, despite
persistent and intense efforts to make the system pay for itself (Feeler,
1991). Without independent oversight and monitoring, the convict labor
system eventually succumbed to bribery and corruption.

Moreover, organized labor, manufacturers, and farmers strongly opposed
the convict lease system. This broad constituency opposed what it consid-
ered was unfair competition and pressed for legislation restricting the use
of convict labor and convict-produced goods. Public opposition was also
mobilized by reformers and religious groups that protested the scandalous
conditions found at many of the privately run facilities and in labor lease
systems. State legislatures began investigating alleged incidents of mis-
management and cruelty within privatized institutions, resulting in
modifications to the leasing system.5

An executive order signed by President Theodore Roosevelt in 1905
prohibited the use of convict labor on federal projects. In 1929 Congress
passed the Hawes-Cooper Act permitting states to ban the importation of
inmate products from other states (Ammon et al., 1992: 4–5). During the
Great Depression, Congress and state legislatures also passed laws that
further curtailed the use of inmates in private enterprise.

By the 1920s, the prevailing practice in American correctional agencies was
to increase governmental involvement. The subsequent demise of the con-
vict lease system eventually gave way to state-run institutions. The opera-
tions and administrative functions in correctional facilities were delegated
to governmental agencies, authorized by statute, staffed by government
employees, and funded solely by the government (Cripe, 1997: 380).

Beginning in the early 20th century and until more recently, the custom in
American correctional agencies was to provide virtually all correctional
services as governmental functions in institutions constructed and main-
tained at the government’s expense.6 In some program areas, rehabilitative
services were provided by volunteer associations (religious and educa-
tional). Generally, however, private involvement in the provision of
correctional services was diminished.

To manage escalating costs associated with supporting the many functions
required to effectively run penal institutions, a trend gradually developed
in the 1900s for the contracting out of prison services to both profit-making
and not-for-profit firms. Prisons added services such as food preparation,
vocational training, and inmate transportation to the list of provisions that
were contracted out (which already included medical, dental, and mental


Bureau of Justice Assistance

health services). By the mid-1970s, federal, state, and municipal govern-
ments were again willing to expand their association with the private sec-
tor, moving beyond the conventional contractual relationship that had
become common in the early 20th century, and private enterprise began
to␣ play an influential and expanded role in the functioning of correctional
facilities. According to Durham (1993: 33), the 1970s ushered in a new
phase in the development of private corrections, beginning with juvenile
correctional operations:

In 1976 RCA Services, a private company, assumed control of the
Weaversville Intensive Treatment Unit located in North Hampton,
Pennsylvania. This facility was designed to handle male delinquents.
Although the private sector had long been involved in providing a wide
range of correctional services . . . this was the first modern institution
for serious offenders to be completely operated in what has become an
increasingly lengthy line of such institutions in the American correc-
tional system.

The Weaversville Intensive Treatment Unit for Juvenile Delinquents is
widely regarded as the first high-security institution that was entirely pri-
vately owned and operated under contract to the state. The second such
institution did not open until 1982, when the state of Florida turned the
operation of the Okeechobee School for Boys over to the Eckerd Founda-
tion (Logan and Rausch, 1985: 307).

The trend toward privately operated juvenile correctional facilities has
continued, with more than 40,000 youth now housed in privately operated
juvenile facilities. It is noteworthy that these operations have not received
nearly the level of scrutiny and criticism as have their adult counterparts.
This may be due to the fact that some, but not all, are not-for-profit operations.

The U.S. Immigration and Naturalization Service (INS) was among the
first governmental agencies to take advantage of the emerging market of
private prison operators. At the end of 1984, INS had contracts with two
private companies for the detention of illegal aliens; by the end of 1988,
the␣ number of private INS detention facilities had grown to seven, housing
roughly 800 of the 2,700 aliens in INS custody (McDonald, 1994). Also
during this period, the Corrections Corporation of America (CCA) was
awarded a contract to manage the Hamilton County Jail in Chattanooga,
Tennessee. This was followed by the first state-level contract award in
1985, when Kentucky contracted with the U.S. Corrections Corporation
to manage a correction facility.

According to McDonald (1994), these developments initially provoked
little controversy or even notice, most likely because private-sector in-
volvement in correctional management was still limited in size and scope.7

The importance of these early contracts has been noted by Thomas (1997b),
a strong advocate of private prisons.


Emerging Issues on Privatized Prisons

The importance of these contract awards to the subsequent develop-
ment of correctional privatization would be difficult to over-estimate
and the fact that all remain still in force today with the same manage-
ment firms is not inconsequential for those who would be willing to
accept this fact as at least an oblique performance indicator. Each
provided a real world opportunity to test the hypothesis that contract-
ing could yield meaningful benefits to government. Each also provided
a valuable model that subsequent units of government could examine
and improve upon in such critical areas as procurement strategies, the
formulation of sound contracts, and the creation of effective means of
contract monitoring.

Security adult institutions, once considered the near exclusive and
inextricable preserve of government, emerged as a central issue debated
among correctional agencies. Finally, in the last few years, governments
have sought to contract out capital expenditure costs and operational
services, including prison design, construction, and management
(Yarden, 1994).

Thus, the pressure of increased incarceration rates, combined with rising
correctional costs, has enabled privatization of penal facilities to reemerge
as␣ an acceptable political and correctional system operational concept. This
reemergence, however, has stirred considerable debate over the viability
of␣ privately operated prison facilities. The current enthusiasm for privatiza-
tion is fueled by the prospect of more innovative, cost-effective prison
management, including the anticipated private-sector involvement in the
financing of new prison construction. This enthusiasm is not shared by all.
Much of the contention is reflected in the literature, especially with regard to
the alleged advantages and disadvantages to private facility management.

The Debate
Many claims have been made by observers on the advantages and disad-
vantages of privatization. Cunningham (1999) has summarized the major
reasons either to accept or reject the privatization concept (table 6). These
reasons can be reduced to the overriding desire of many states and local
governments to rapidly increase desperately needed prison bed capacity
and to reduce prison operational costs. Others have raised the issue of
whether private prisons can enhance the quality of care for inmates (in-
cluding enhanced protection from harm for inmates and staff) and reduce
litigation. Thus far, there has been little need on the part of private provid-
ers to argue that inmates incarcerated in privately operated prisons are
more likely to be rehabilitated and less likely to recidivate, although such a
claim was recently made in a Florida study (Thomas, 1998). These claims,
which form the core of the debate on whether to privatize, are discussed in
this section.


Bureau of Justice Assistance

Table 6 Public Strategies for Private Prisons

Source: Cunningham (1999).

Reasons To Privatize Reasons Not To Privatize

1. Private operators can provide construction 1. There are certain responsibilities that only the
financing options that allow the government government should meet, such as public safety
client to pay only for capacity as needed in and environmental protection. To provide incarcera-
lieu of encumbering long-term debt. tion, the government has legal, political, and moral

obligations. Major constitutional competition among
both public and private issues revolves around the
deprivation of liberty, discipline, and preserving the
constitutional rights of inmates. Related issues
include use of force, loss of time credit, and

2. Private companies offer modern state-of-the-art 2. Few private companies are available from which to
correctional facility designs that are efficient to choose.
operate and built based upon value engineering

3. Private operators typically design and construct 3. Private operators may be inexperienced with key
a new correctional facility in half the time of a corrections issues.
comparable government construction project.

4. Private vendors provide government clients with 4. Operator may become a monopoly through
the convenience and accountability of one political ingratiation, favoritism, etc.
entity for all compliance issues.

5. Private corrections management companies are 5. Government may lose the capability to perform
able to mobilize rapidly and to specialize in the function over time.
unique facility missions.

6. Private corrections management companies 6. The profit motive will inhibit the proper performance
provide economic development opportunities of duties. Private prisons have financial incentives
by hiring locally and, to the extent possible, to cut corners.
purchasing locally.

7. Government can reduce or share its liability 7. Procurement process is slow, inefficient, and
exposure by contracting with private corrections open to risks.

8. The government can retain flexibility by limiting 8. Creating a good, clear contract is a daunting task.
the contract duration and by specifying facility

9. Adding other service providers injects 9. Lack of enforcement remedies in contracts
competition among both public and private leaves only termination or lawsuits as recourse.


Emerging Issues on Privatized Prisons

Faster and Cheaper Bed Capacity
The dramatic increase in prison and jail populations and the associated need
to construct prison and jail facilities quickly and cheaply have often been
cited as a major impetus behind the move toward privatization. Contracting
with the private sector allows prospective prisons to be financed, located,
and constructed quicker and cheaper than government prisons. This flex-
ibility is especially advantageous when a new facility is under consider-
ation. Based on experience, governments take 5 to 6 years to build a facility,
whereas some private companies claim they can do it in 2 to 3 years (or less).

For example, CCA built a 350-bed detention center in Houston, Texas, for
INS. CCA completed the project in 5 1/2 months at a cost of $14,000 per
bed. INS␣ calculated construction to take 2 1/2 years at a cost of $26,000 per
bed (Yarden, 1994: 328). In a comprehensive study of privatizing the Dis-
trict of␣ Columbia’s Department of Corrections, Clark (1998) estimated that
rebuilding several prison facilities would take the public sector 5 to 6
years, whereas it would only take the private sector 3 to 4 years.

Based on these and other reports, it seems clear that the private sector can
add prison bed capacity faster and cheaper than most public entities. Cripe
(1997: 384) cited the numerous advantages advocates assert in support of
private prison construction:

Because private firms are not bound by governmental rules that tend to
slow down prison construction, such as political pressures from un-
happy neighbors, environmental hassles, and requirements of com-
peted bidding and construction contracting, private firms have shown
an ability to open new facilities more quickly. They claim they can also
get the money to build new institutions more quickly from private
investors or from lenders, while the government has to work more
slowly, getting appropriations from the legislature or going through a
bond issue process.8

On the other hand, Robbins (1997) points out that privatization allows
prisons to be built without the approval of the public. For example, the
construction costs of a privately operated facility can be lumped together
in the state’s prison operating budget whereas the state must seek voter
approval on a construction bond for a publicly operated facility, as is usu-
ally the case.

Reduced Operational Costs
Representatives of private-sector firms assert that they can save taxpayers
money by providing correctional services traditionally supplied by gov-
ernment at less cost. As already noted, private entrepreneurs can build fa-
cilities faster and cheaper than the government. However, the next claim is
that they are also able to operate facilities more efficiently than the govern-
ment. This can be achieved by reducing the costs of labor associated with


Bureau of Justice Assistance

operational costs. Labor costs are controlled by reducing one or more of
the following personnel cost factors: (1) number of staff, (2) wages, or (3)
fringe benefits. The private sector alleges that these costs can be contained
or that, for the same dollar, it can provide more or at least better services
(Travis et al., 1985: 13).

This point of containing labor costs is the crux of the privatization move-
ment. Prisons are extremely labor intensive, with approximately 65 to 70
percent of the costs of operating a prison going to staff salaries, fringe ben-
efits, and overtime. Controlling these costs is more difficult to achieve with
unionized government workers. Private firms typically use nonunion la-
bor, allowing for the lowest benefit packages. Overall, private firms claim
that they can save 10 to 20 percent in prison operations due largely to effi-
cient handling of labor costs.

Another, less powerful argument in favor of private contracting is that the
private sector has greater flexibility in the procurement process. It is ar-
gued that private-sector contractors are not bound by the cumbersome and
rigid government procurement system. Consequently, private vendors can
purchase goods and services quicker; maintain lower food, supplies, and
equipment inventories; and negotiate better prices for these goods
(Ammon et al., 1992: 10).

It is not uncontested that a private institution would be more cost effective.
The incentive to contain costs is directly related to the type of contract
structured (Travis, Latessa, and Vito, 1985: 14).

A public utilities or “pentagon” model reimbursement where a contrac-
tor receives costs plus a profit percentage would not necessarily pro-
vide an incentive to contain costs of service. On the other hand, a client
charge may result in cost-overruns or even bankruptcy should the
initial estimate prove wrong.

One expense not normally included in the financial calculation of private
firms is the cost to the government for monitoring contract performance.
Constant monitoring of all aspects of internal performance is essential to a
good contractual relationship, which may become expensive over time. If
continual federal or state monitoring of private institutions is required for
accountability purposes, the costs of monitoring ultimately raise the price
of privatized services. The potential costs of increased prison litigation is
also rarely discussed by private prison advocates.

As a policy matter, opponents to privatization also claim it is inappropri-
ate to operate prisons based on a profit motive. In many instances, private
prison operators are paid according to the number of inmates housed. Ar-
guably, it is in the operator’s financial interests to encourage lengthier sen-
tences for inmates to keep bed spaces filled. If the private vendor enters
into a contract based on a per-client charge, the profit margin and even the
continued operation of the private facility depend upon total population


Emerging Issues on Privatized Prisons

size. Firms driven by the profit motive could adversely influence prison
population size by lobbying for longer sentences and stricter sentencing
guidelines. Similarly, as private firms are in business to make a profit, high
returns on their investments are important. Critics of prison privatization
argue that firms will cut corners, from construction materials to hiring in-
experienced personnel, forsaking security and quality of service in the pro-
cess of making a profit.

Improved Quality of Service
In addition to the proposed cost savings and associated efficient services,
one must also remember that the nation’s prison and jail systems were fac-
ing widespread allegations about the lack of quality of care afforded to
staff and inmates. Since the 1980s, most of the state prison systems as well
as the major urban jails have been under far-reaching consent decrees re-
garding medical, mental health, education, overcrowding, and protection-
from-harm issues. There have also been major prison disturbances in
California, Illinois, New Mexico, and New York, to name a few, that have
added to the public perception that public agencies have not been doing a
good job in managing prisons.

However, one of the central concerns raised by critics of correctional
privatization is that firms motivated by financial gain might make deci-
sions that enhance profits at the expense of the rights and well-being of
inmates (Durham, 1994). History shows that privately operated prison fa-
cilities were plagued by problems associated with the quest for higher
earnings. The profit motive produced such abominable conditions and ex-
ploitation of the inmates that public agencies were forced to assume re-
sponsibility. The lack of contract supervision contributed, in part, to the
squalid and inhumane living conditions in privately run prisons.

The current movement to reprivatize primary facility management assumes
that modern entrepreneurs are somehow more benevolent and humanistic
so that the exploitations of the past will not reoccur (Walker, 1994). Critics,
however, contend that privately managed facilities will bring new opportu-
nities for corruption. Given poorly paid, undereducated, and inadequately
trained staff, opponents question the professionalism and commitment that
privatized staff will bring to the job.

Proponents, on the other hand, suggest that present-day judicial activism
provides oversight over private prison operations. The threat of inmate
lawsuits and court-mandated consent decrees act as a deterrent to abusive
behavior. Further arguments suggest that tolerance of abusive behavior
by staff defeats the long-term interests of private contractors and can be
avoided with careful monitoring mechanisms. Moreover, it is presumed
that competition between firms will hold down costs and provide for supe-
rior service because contract renewals will depend on job performance.
To␣ date, the limited experience with privately managed prisons does not


Bureau of Justice Assistance

allow a thorough evaluation of public and private prisons in terms of
overall quality of inmate services.

Legal Issues
Disagreements surrounding cost and efficiency may eventually be re-
solved with more complete data. Better contract monitoring and judicial
oversight should curtail instances of exploitation and abuse of the inmate
population. However, the legal ramifications of privatization pose chal-
lenging questions not easily rectified. Three complex issues stimulate
heated debate on correctional privatization:

❑ The propriety of private firms taking over state functions.

❑ Inmate rights and due process considerations.

❑ Liability and accountability for state actions.

A fundamental issue is public responsibility for the well-being of society. It
is taken for granted that the apprehension and conviction of offenders are
public responsibilities. Hence, the notion that convicted offenders should
be the responsibility of private entrepreneurs motivated by profit seems
contradictory (Walker, 1994: 582). The central question should be whether
government has the authority to contract out what is now widely regarded
as a public function. Commenting on the issue, Durham (1993: 43) states
with some urgency that, “if the transfer of responsibility to penal institu-
tions is not carefully executed, the consequences may be disastrous. Be-
yond inconvenience and unanticipated costs, both public safety and
inmate well-being may be at stake.”

The courts have clearly decided that private prisons can be assigned the
same management responsibilities as those undertaken by state and local
governments. This is not to say that state and local governments can
wholly delegate their functions and duties to a private provider. Indeed,
based on a number of recent infractions committed in private facilities, the
courts will hold government responsible for actions taken by a private pro-
vider that violate an inmate’s constitutional rights or that put the prison
staff, inmates, or surrounding community in harm’s way (Schosser, 1998;
Clark, 1998).

What has not yet been resolved is whether privatization will undermine or
enhance prisoners’ rights as compared to publicly operated systems (Tho-
mas, 1991). The U.S. Constitution protects individuals against the violation
of due process (5th and 14th amendments) as well as the related issue of
cruel and unusual punishment (8th amendment). Recent decades have
witnessed a large volume of prison litigation concerning inmate rights and
prison conditions that has resulted in most state correctional systems (or
a␣ facility within a state) operating under an imposed consent decree. The
concern is whether private prisons can operate in such a manner that the
exposure to litigation against government is reduced.


Emerging Issues on Privatized Prisons

A number of U.S. Supreme Court cases have held that a person can only
assert a denial of due process rights if that deprivation resulted from “state
action” (Yarden, 1994: 331). The ultimate issue in determining whether an
entity is subject to suit for violation of an individual’s rights is whether the
alleged infringement is attributable to an action by the state.

A person acts or purports to act under the “color of state law” when in the
performance of official duties under any state, county, or municipal law,
ordinance, or regulation (42 U.S.C. 1983) (Robbins, 1986). Federal civil
rights law prohibits state officials or agencies from being named as defen-
dants in civil suits while operating in their official capacities if a plaintiff
seeks monetary damages. The question remains whether the actions of pri-
vate corrections facilities regulated by the state can be considered trans-
formed into state actions under “color of state law.”

Thus far, the courts have decided that persons who provide services to in-
mates under contract are not immune from litigation for constitutional vio-
lations.9 What is yet to be settled is the propriety of private firms running
entire correctional facilities and the broad legal or constitutional questions
that might apply (Cripe, 1997: 394).

The issues raised heretofore have practical implications in the day-to-day
operations of a private correctional facility. Before entering into a contrac-
tual agreement with a private firm for the operation of a prison or jail, it
would be necessary to identify whether the private company can be autho-
rized to exercise force (including deadly force) to prevent escapes, to im-
prison citizens against their will, and to impose penalties on those who
violate the regulations and rules of the institution. In the event that staff of
private facilities are not allowed to enforce the rules and regulations of the
institution, the likelihood of success of these corporations is obviously di-
minished. However, allowing a private prison to punish inmates who have
violated institutional rules (which may differ from publicly operated facili-
ties) without oversight by the state could be a denial of due process, espe-
cially if the punishment entails the loss of good time, which would serve to
lengthen an inmate’s period of imprisonment.

The other area of concern deals with actual prison conditions, such as ac-
cess to medical care, mental health services, work, vocational and educa-
tional services, overcrowding, and protection from harm. Travis and
colleagues (1985) pose a series of questions to be considered before full
privatization of correctional facilities becomes commonplace. These issues
include whether the contracting government agency would be liable for
any illegal actions of the contractor; if conditions in the contracted penal
facility are found to violate constitutional requirements, who would ulti-
mately be responsible for their correction and held liable for damages;
whether the contracting governmental agency could be rendered immune
to the actions of the contractor, any negligence that results in the escape of
prisoners, or the financial mismanagement of the facility; and whether the


Bureau of Justice Assistance

contracting agency would be responsible for bailing out a bankrupt con-
tractor. With no clear court precedent on whether private prisons will
come under the state action doctrine, prisoners’ rights may ultimately de-
pend on the nature of the contractual agreement between the state and the
private operator.


Emerging Issues on Privatized Prisons

Recent Research Regarding

Chapter 3

The debate over whether private-sector involvement in corrections should
be increased has generated an extensive body of literature, comprising for
the most part essays and position papers that reflect the author’s stance on
the issue. Often the ideological and political predispositions of the re-
searchers seem to have shaped the interpretation of the data. However,
as␣ stated by Thomas (1997a):

[I]t is equally clear that a rapidly growing body of literature is accumu-
lating within which one finds highly repetitive themes. The core theme
is that properly conceptualized, properly managed, and properly
monitored privatization initiatives can serve the public interest. . . .
Sound performance presupposes competent and qualified people from
both the public and the private sector coming together cooperatively to
attack important public policy problems.

Much of the discourse on correctional privatization entails an introduction
to the topic, a review of the circumstances that gave rise to the demand
for increased private-sector involvement, followed by a discussion of the
issues involved (see for example, Bowman et al., 1993). The discussion of
issues is invariably cast in favor of or in opposition to privatization. As dis-
cussed in chapter 2, there are a number of reasons why advocates support
the use of the private sector in the provision of institutional correctional
services. Most are related to the potential cost savings and efficient service
that the private sector can achieve over the public sector. On the other
hand, the movement against privatizing prisons is gaining momentum by
attacking such issues as the transfer of services from a public to private
provider, the potential decline in the quality of inmate services, the
propriety of private-sector operation of correctional facilities, and the
legal liability surrounding privatization.

There are literally hundreds of documents related to privatization of cor-
rectional services, and a few dozen studies have attempted an empirically
based comparison of public and private facilities. This chapter examines
the results of some of the more well-known comparative institutional
studies, rather than the numerous essays and position papers that
comprise the bulk of the publications in the field.


Bureau of Justice Assistance

As noted previously, one of the most often debated issues in privatization
literature is whether private facilities are more cost-efficient than government-
operated institutions. The first and foremost argument in favor of privatiz-
ing prisons is that private managers will be more effective and efficient
than public managers of prison facilities. It is argued that unlike state and
federal governments, private firms are free (to some extent) from politics,
cumbersome bureaucracies, and costly union contracts. Private contractors
are accountable to their investors and, therefore, are presumably more mo-
tivated to satisfy the terms of their financial obligations to return a profit,
which, in turn, would lead to more cost-effective operations.

There is no consensus among academics and professionals in the field con-
cerning the potential cost savings that privately managed operators can
provide. Some researchers looking at privatization initiatives proclaim “a
realistic expectation of cost savings as a result of contracting is probably in
the range of 5 to 15 percent,” whereas others declare that the evidence ac-
cumulated thus far is not yet persuasive (Thomas and Logan, 1993).

The National Institute of Corrections Study:
Okeechobee, Florida
One of the first evaluation studies of costs was funded by the National In-
stitute of Corrections (1985) to assess the transfer of a state-operated juve-
nile facility to private management by a private, not-for-profit organization.
In August 1982, the Jack and Ruth Eckerd Foundation was awarded a con-
tract to manage the Florida School for Boys at Okeechobee. The Arthur G.
Dozier Training School for Boys in Marianna, Florida, was chosen as the
comparison facility.

Essentially, two questions were posed by the National Institute of
Corrections study:

1. Would Florida’s Department of Health and Rehabilitative Services
(which manages the juvenile training school system) realize substantial
cost savings under the new management structure?

2. Would the Eckerd Foundation deliver a program that was equal to or
exceeded that provided by the state?

Data pertaining to client characteristics, managerial and administrative
functions, and staff morale were collected and compared. Bearing in mind
that the Eckerd Foundation is a private, not-for-profit foundation that may
not have cost-efficiency profit motives, the Okeechobee study concluded:


Emerging Issues on Privatized Prisons

Management data collected during the project indicated that a number
of state-required procedures were streamlined by the Eckerd Founda-
tion; e.g., a more expeditious operation was initiated in such areas as
purchasing and personnel procedures. However, the transfer brought
with it additional expenses which the state-operated facility met at a
less costly level; e.g., insurance, overhead charges, etc. In response to
the first question: on balance, the fiscal data seem to indicate that the
Eckerd Foundation achieved no significant reduction in operational
costs. (National Institute of Corrections, 1985: xiii).

The study also found that no fundamental program differences were found
when comparing Eckerd Foundation and Dozier clients, although staff mo-
rale was significantly lower at the Eckerd Foundation. The study noted a
number of improvements in the delivery of services at the Eckerd Founda-
tion. It also concluded that after 2 years, the Eckerd Foundation did not ex-
ceed the overall services provided by the state at the Dozier Training

The National Institute of Justice Studies: Tennessee,
Kentucky, and Massachusetts
Two earlier studies completed for the National Institute of Justice (NIJ)
analyzed the issue of cost savings and reached varied conclusions. In the
first study, research conducted by Logan and McGriff in 1989 estimated
that by contracting out prison management to the Corrections Corporation
of America, located in Hamilton County, Tennessee, saved at least 4 to 8
percent annually over a 3-year period on operating costs for the Hamilton
County Penal Farm. Potential cost savings were estimated at 5 to 15 percent
(Logan and McGriff, 1989). The Hamilton County study provided an illus-
trative analysis that can serve as a guide for calculating accurate cost

The Hamilton County Penal Farm shifted from public to private manage-
ment in 1984. The physical structure of the facility was in a state of deterio-
ration that required extensive renovation by CCA. The private contractor’s
claim to lower operating costs while renovating the physical aspects of the
facility, expanding inmate capacity, and improving the quality of correc-
tional services was tested.

The Hamilton County auditor supplied the data for the study and also as-
sessed the hidden costs.10 Despite the hidden costs, which were estimated
to be as high as 20 to 30 percent above direct agency costs, CCA was able
to demonstrate an overall savings.


Bureau of Justice Assistance

A second 1989 study reached a different set of conclusions. The Urban Insti-
tute compared a public adult minimum-security institution with a privately
operated prison in Kentucky and compared two pairs of public and private
facilities for violent youth in Massachusetts (Urban Institute, 1989). In Ken-
tucky, the Marion Adjustment Center, which began operation in 1986 under
private contract, was compared with the state-run Blackburn Correctional
Complex. In Massachusetts, the Connelly Secure Treatment Unit (public)
was matched with Boston Secure Treatment (private) and the Westboro Se-
cure Treatment Program (public) was matched with the Delany School (pri-
vate). The selection of private and public juvenile facilities in Massachusetts
was based on similar offender characteristics and facility conditions. In each
of the three sets of facilities, the Urban Institute found that the costs were

The unit costs of the private Kentucky adult facility were approximately
10 percent higher than the publicly operated facility. The authors of the
Urban Institute report suspect that this 10-percent difference is likely to
have occurred because of (1) the inclusion of capital costs in the private or-
ganization price and (2) economies of scale achieved by the public facility,
which had an inmate population that was approximately 50 percent larger
than the private facility population. The program costs in Massachusetts
were all within 1 percent of one another.

The study on juvenile facilities in Kentucky and Massachusetts also exam-
ined quality-of-confinement issues. Using survey information, physical ob-
servation, interviews, and agency records, the study appraised the quality
of service based on a number of key dimensions, or performance indicators
(confinement, internal security and control, participation of inmates in and
the quality of programs aimed at social adjustment and rehabilitation,
management issues, and health care). For most of these performance indi-
cators, the privately operated facilities had a small advantage. Overall,
both staff and inmates gave better ratings to the services and programs
provided at the privately operated facilities. In addition, escape rates were
lower, there were fewer inmate disturbances, and, in general, both staff
and clients felt more comfortable at the privately operated facilities.

The Sellers Study
Sellers (1989) compared three privately operated detention and jail facilities
with three publicly operated prison facilities to learn which type operates
more efficiently.11 Due to the limited number of private correctional facili-
ties in operation at the time, well-known privately operated institutions
were selected first before matching them with comparable public facilities.

The criteria used to select public facilities included similarity in size, loca-
tion, structure, age, type, capacity, and average daily occupancy. Site visits
consisted of structured interviews with executive and custodial personnel,
as well as other key staff (such as chaplains and nurses). The structured in-
terview questions focused on management’s view of privatization, barriers


Emerging Issues on Privatized Prisons

to privatization, program and service availability, program goals, and
relevant cost elements.

Sellers concluded that the three private facilities operated at a lower cost
per inmate than the three comparable public facilities ($46.75 per day in
the private facilities versus $73.76 in the public facilities)12 even though the
private facilities had more programs available than their public counter-
parts. In two of the three private facilities, the overall prison conditions
were notably better than the comparable public facilities. With such com-
pelling information, Sellers concluded that public prison facilities do not
operate with the same motives and incentives as private prison facilities.
Sellers further argued that the public sector operates its facilities less effi-
ciently than the private sector. His findings support the argument for gov-
ernment to seriously consider private prisons as an alternative to public
operation of correctional services. However, Sellers’ failure to control for
key factors that directly affected costs, such as facility design and inmate
characteristics, severely limits his pro-privatization conclusions.

Texas Sunset Advisory Commission Study
In 1987, the 70th Texas Legislature enacted legislation authorizing the
Texas Department of Corrections to contract with private vendors to fi-
nance, construct, operate, maintain, and manage correctional facilities
(Texas Sunset Advisory Commission, 1991). One legislative mandate was
that the state could not enter into a private contract unless the contract
provided a savings of 10 percent or more over an equivalent state-run
program. The Texas legislation directed the Legislative Budget Board
(LBB) to␣ establish an estimate of the financial costs for a state-run facility
that would be equivalent to those proposed by the private vendor. LBB
developed costs based on a hypothetical prison facility that complied with
the conditions set forth by the state senate bill, existing prison operation
policies, and other relevant court requirements.

The Texas Sunset Advisory Commission report calculated the total cost
to␣ the state of operating four private prisons (contract costs plus indirect
costs)13 and compared this figure with the costs the Texas Department of
Criminal Justice would incur if it took over operation of the four private
units. The report concluded that at the end of fiscal year 1990, the price of
operating the private prisons was close to 10 percent less than if the state
were to operate equivalent facilities. In addition to operating at a cost savings,
the private prisons contributed to state and local economies by paying an esti-
mated $400,000 per prison in state and local sales taxes, franchise taxes, and
payments in lieu of property taxes.

The results of this study have received some criticism. A U.S. General Ac-
counting Office (GAO) report places little faith in these hypothetical com-
parisons, which do not allow for unanticipated changes in components
such as staffing levels, rate of occupied bed space, or other factors that


Bureau of Justice Assistance

could affect actual costs (U.S. General Accounting Office, 1996a). The GAO
report also noted that any changes in any assumption, or set of assump-
tions, for the hypothetical institution could change the size, or even the di-
rection, of the difference in comparative operational costs. The GAO report
is discussed in greater detail later in this chapter.

California Community Correctional Facilities
Sechrest and Shichor (1993) attempted a different type of public/private
evaluation. Their preliminary study examined two types of correctional
facilities in California: a facility operated by a private, for-profit corpora-
tion (private proprietary) and two facilities operated by municipal govern-
ments for profit (public proprietary). Public proprietary facilities are a
relatively new concept in corrections. In California, these types of facilities
are generally located in small cities that do not have strong economic
bases. These public proprietary community correctional facilities (CCFs)
have the potential to generate income and employment opportunities.

The three facilities were chosen based on their progress in establishing pro-
grams for inmates (e.g., work, education, drug/alcohol counseling, family
and individual counseling, vocational evaluation and training). The study
demonstrated that private proprietary CCFs cost less when considering
startup costs but appear to cost about the same as public proprietary facili-
ties in the second year. Both types of CCFs cost about $16 less per inmate
per day than the California Department of Corrections (CDC) prisons.

The results of the study, however, were inconclusive due to methodologi-
cal problems. Costs could not be compared with any precision because of
a␣ lack of data on capital construction for CDC facilities. The inclusion of
capital costs in proprietary facility estimates, in addition to the lack of uni-
formity in overhead cost figures, also made comparisons between public
and private facilities difficult. Nevertheless, the study is instructive for its
examination of the public proprietary concept and for highlighting the
problems related to gathering incomparable data elements for analysis.

The U.S. General Accounting Office Review
One of the more comprehensive reviews of comparative studies was com-
pleted by the U.S. General Accounting Office (1996a). GAO reviewed five
studies completed since 1991 on correctional facilities in California, New
Mexico, Tennessee, Texas, and Washington. The preliminary results of the
California and Texas studies in the GAO analysis are cited previously.
Four of the five studies (with the exception of New Mexico) assessed the
operational costs of private versus public facilities. In their assessment of
the studies, GAO researchers concluded that the “studies reported little
difference and/or mixed results in comparing private and public facilities”
(U.S. Government Accounting Office, 1996a: 7). On the basis of this ap-
praisal, GAO “could not conclude whether privatization saved money.”


Emerging Issues on Privatized Prisons

Three of the studies (California, Tennessee, and Washington) made com-
parisons of costs between reasonably matched private and public facilities.
In Sechrest and Shichor’s (1994) California study, the private facility’s av-
erage annual cost per inmate was $15,578. This amount was higher than
comparable costs for one of the government-run facilities but lower than
the other government-run facility ($16,627). With respect to cost efficiency,
the study was inconclusive. The Tennessee study found little difference in
the average daily operational costs per inmate between the one private and
two state-run prisons (Logan and McGriff, 1989). The daily operational
costs were $35.39 for the private facility versus $34.90 and $35.45 for the
two public facilities.

Thomas and Logan (1993) disagree with the GAO 1997 report. They level
the following criticisms of the report:

❑ The authors of the GAO report knew that the statutes of several
jurisdictions defined contracting as unlawful (such as with the Texas

❑ The authors of the GAO report disregarded the cost benefits that have
justified more than a decade of federal-level contracting experience.

❑ The authors chose to ignore recent reports from Australia, Florida,
Texas, and the United Kingdom concerning the cost benefits of

❑ The authors shielded the draft version of the report they were
circulating around the country from prepublication comments by
well-established experts in the area of privatizing prisons.

The Washington State Review of the Tennessee, Texas,
and Louisiana Studies
Similar to the GAO review, the Washington State Legislative Budget Com-
mittee analyzed information from the Tennessee and Louisiana studies to
help the state determine the feasibility and benefits of privatization (State
of Washington, 1996). Operational costs for the three Tennessee facilities
mentioned previously, as well as operational costs of three multicustody
facilities in Louisiana (two private and one state-run), were reexamined.
For Tennessee, the private facility’s average daily operational cost per in-
mate ($33.61) was approximately 7 percent lower than comparable costs
per inmate for the two public facilities studied ($35.82 and $35.28).

For Louisiana, the average inmate costs per day for the two private facili-
ties studied were $23.75 and $23.74, and the comparable daily operational
cost for the public facility was $23.55 per inmate.

Similar to the GAO review, the Washington state review also found very
little difference in the costs of private and public facilities.


Bureau of Justice Assistance

Only the Texas study, whose preliminary findings are previously cited,
reported findings of substantially lower (14 to 15 percent) operational costs
for private versus public correctional facilities. The results of the Texas
study, however, raise skepticism because the results were based on esti-
mates rather than actual costs.

The Arizona Study
Thomas (1997b) conducted a cost analysis of a minimum-security private
prison in Arizona with several publicly operated minimum-security pris-
ons. During fiscal year 1995–1996, the privately run Marana Community
Correctional Treatment Facility, managed by Management and Training
Corporation, housed both male and female inmates. Although it was not
possible to find a similar state-run prison in the state with respect to archi-
tectural design and inmate population, Thomas aggregated the costs of all
public/state-run minimum-security prisons in the state and compared the
average of these costs with the costs of the Marana facility. He found that
the Marana operating costs were 13 to 17 percent less than the average for
the state-operated facilities. However, some of the public facilities had
costs equal to or below those of the Marana unit. It is not clear whether
the␣ lower costs of the Marana facility were more a function of its facility/
architectural design and inmate population attributes than a result of

Disclosed Corporate Financial Reports
In addition to examining these individual reports, it is possible to assess
the earnings of the private correctional corporations, most of which are
publicly traded. By far the most detailed and favorable information on
finances has been provided by Corrections Corporation of America. For
example, CCA (1997) reports that the average cost per day of incarceration
was $30.51 per inmate. In fact, since the organization has been in existence,
it has kept its per diem operating cost per inmate near the $30 to $32 level
while its level of compensation has increased from $32.71 per inmate in
1987 to $42.72 in 1997. CCA was compensated by its clients per inmate in
1997 for $42.72. With 10.5 million billable man-days in 1997, the corpora-
tion had revenues of more than $460 million and a net profit of well over
$400 million using the cost figures shown in table 7.

Despite this positive financial picture, there may be problems ahead. For
example, CCA announced on October 10, 1998, that it would not be renew-
ing four contracts in Texas because the terms of the proposed new con-
tracts had become less profitable (Wall Street Journal, October 10, 1998).
Furthermore, the average share value for all private corrections companies
had declined sharply since April 1998. Wackenhut’s stock had dropped by
more than 25 percent from its high to its close in April 1998 due to lower
than expected revenue growth rates.


Emerging Issues on Privatized Prisons

Table 7 Financial Data for Corrections Corporation of America, 1987 and 1997

Much of the disillusion with these stocks involves concern over the lack of
future growth. Few announcements have been made of major new con-
tracts; most of the “added capacity” has occurred when larger firms
merged with smaller firms. For example, CCA bought U.S. Corrections
Corporation and the facilities and contracts formally managed by the
Bobby Ross Group. Correctional Services Corporation has announced it
will merge with Youth Services International. All of these transactions sug-
gest a consolidation of private-sector firms and, more significantly, little
growth in overall bed capacity as the public sector becomes more wary
about the benefits of privatization.

In summary, the cost benefits of privatization have not materialized to the
extent promised by the private sector. Although there are examples of cost
savings, there are other examples in which such benefits have not been re-
alized. Moreover, it is probably too early to determine if the initial cost
savings can be sustained over a long time period. It only takes one major
disturbance for such costs to greatly accelerate.

Inmate Services, Quality of Confinement,
and Public Safety
A central issue raised by critics of privatization is that firms motivated by
financial gain might make decisions that enhance profits at the expense of
the rights and well-being of inmates (Durham, 1993). Privatization oppo-
nents are concerned about possible deterioration in the quality of inmate

Financial Item 1987 1997

Revenues $17,011,000 $462,249,000

Beds under contract 1,715 52,890

Compensated man-days 520,101 10,524,537

Available man-days 614,098 11,293,228

Percentage capacity 84.7 93.2%

Revenue per man-day $32.17 $42.72

Cost per man-day $28.18 $30.51

Stock price range $31/2 – 33/4 $457/8 – $281/2

Source: Corrections Corporation of America (1997).


Bureau of Justice Assistance

services. History shows that privately operated facilities are often plagued
by problems associated with the quest for higher earnings. Proponents ar-
gue that abusive behavior and poor service would defeat the long-term in-
terests of private contractors and can be avoided with careful monitoring
and legislation to hold the contractor accountable.

Studies comparing the quality of inmate confinement are less common
than studies comparing costs, although a number of studies attempt both.
To date, the limited experience with privately managed prisons does not
allow a thorough evaluation of inmate services provided by public and
private prisons. However, the limited number of studies that systemati-
cally evaluate the performance of private and public facilities regarding
the quality of confinement yield insight into methods of improving future
research in this area.

The Silverdale Study
One of the first of its kind, the Silverdale Study (Brakel, 1988) surveyed in-
mates at the Silverdale Detention Center in Chattanooga, Tennessee. This
facility has been under contract with CCA since fall 1984. The study used
a series of interviews with prison inmates and staff and close observation
of institutional conditions and procedures to provide documentary evi-
dence of various aspects of prison life. A questionnaire was given to a
sample of 20 inmates. The 16 questions on the questionnaire covered topics
such as conditions of confinement, programs and services, due process
procedures, and opportunities for inmate contact with outside community
groups. For each primary question the inmates were also asked two sub-
sidiary comparative questions. One question asked inmates to compare
a␣ specific area of CCA’s private management with the county’s manage-
ment. The second question was included because relatively few inmate
respondents had experienced living conditions at Silverdale under county
management and therefore could not properly evaluate the difference
between the two. Inmates were asked to compare the operation of the
Silverdale facility with any other prison facility in which they had served
time (typically the county jail in downtown Chattanooga).

The inmates rated the Silverdale facility under the management of CCA
highly on most issues (e.g., physical improvements, upkeep and cleanli-
ness, staff competence and fairness, work assignments, request and griev-
ance procedures, counseling and religious services, visitation and telephone
privileges, and outside contacts). In other areas there was an equal balance
of positive and negative responses (e.g., safety, security, classification,
medical care, food, education, and legal access). Recreation and release
procedures received mostly negative ratings.

Brakel (1988) concluded that “the evidence is overwhelming that the pri-
vate takeover of Silverdale has resulted in substantial improvements in the
institution’s physical conditions and upkeep, as well as several critical ar-
eas of inmate service and institutional procedure.”


Emerging Issues on Privatized Prisons

Thomas and Logan (1993), however, asserted that, although some may ar-
gue that Silverdale was a case of a poorly managed county operation that
CCA could not fail to improve, prisoners with relevant experience favor-
ably compared the private operation with a local jail or the state peniten-
tiary. In this regard, the results of the study could not be considered

The New Mexico Study
Logan (1991) compared the quality of confinement in a state-operated
women’s prison in 1988 with a privately operated version of the same
prison in 1989 and a federal women’s prison in New Mexico. Defined
along eight dimensions, quality of confinement is measured using 333
indicators (131 of which were available also for the federal prison). The
sample consisted of 132 inmates and 112 staff members at the state prison,
134 inmates and 76 staff members at the private facility, and 78 staff mem-
bers at the federal institution. Results of all possible pairing comparisons
between prisons were summarized (for each prison on each dimension) in
a comparative score called the Prison Quality Index. The quantitative data
were supplemented with qualitative information from survey comments
and site visits.

Logan concluded that the private prison outperformed its state and federal
counterparts on all dimensions except care (where the state scored slightly
higher) and justice (where the federal prison matched the private).14 Logan
found that both the state and private prisons were good-quality institu-
tions, using the federal prison as a standard of good quality. Although
each prison had different strengths and weaknesses, on most dimensions
the state had improved the quality of confinement for its female felons by
contracting with a private operator.

The U.S. General Accounting Office Review
The U.S. General Accounting Office (1996a: 9) also examined measures of
confinement quality. With regard to comparisons of quality, the report

Of the five studies reviewed, two (New Mexico and Tennessee) assessed
the comparative quality of service between private and public institutions
in great detail. Both studies used structured data-collection instruments
to cover a variety of quality related topics, including safety and security,
management, personnel, health care, discipline reports, escapes, and
inmate programs and activities. The New Mexico study reported equivo-
cal findings, and the Tennessee study reported no difference between the
private and public institution.

On the basis of correctional staff surveys and reviews of institutional
records, the New Mexico study reported that the private prison


Bureau of Justice Assistance

“outperformed the public facility on most of the measured quality dimen-
sions.” On the other hand, inmate surveys showed the public facility out-
performing the private facility on every dimension except inmate work
and training program activities.

The Tennessee study of one private and two public facilities reported that
“all three facilities were operated at essentially the same level of perfor-
mance.” The results were based upon an operational audit of the facilities
by a team of inspectors.

Florida Correctional Privatization Commission
Recidivism Study
A study conducted by the Florida Correctional Privatization Commission
implemented a different approach to comparing public and private prisons
(Lanza-Kaduce, et al., 1998). The study matched 198 inmates from both
private and public prisons in several categories and compared their rates
of recidivism. The study compared inmates in the areas of rearrest, techni-
cal violations of terms of release, resentencing on a new offense, and
reincarceration. In virtually every category the private prison outper-
formed the public facility. The major findings of the study include:

❑ Ten percent of the private prison inmates were rearrested during the
12␣ months following release versus 19 percent of the public prison

❑ Six percent of the private releases were resentenced for a new offense
versus 10 percent of the public inmates.

❑ Ten percent of private inmates were reincarcerated within 12 months
compared with 14 percent of public inmates.

❑ Overall the indicators revealed that 17 percent of the private releases
have an indication of recidivism versus 24 percent of public releases.

The only area in which public prisons outperformed private prisons was in
technical violations. The study found that technical violations of the terms
of release were lower for public releases than for private ones.

The study has come under criticism by researchers at the Florida Depart-
ment of Corrections (FDOC). The study was criticized for its small sample
size (396 total); equivalencies based on racial identity, age, and prior incar-
ceration and offenses that did not provide true matches of inmates; and the
fact that many of the inmates in private prisons also spent time in public
prisons, thus tainting the comparison group. Other areas FDOC would
have liked to see factored into the results were sentence length, time
served, custody level, and true matches of prior records, all of which
would influence recidivism.

Logan (1991), however, earlier suggested that, although such a study can-
not definitively conclude that recidivism rates are lower at private prisons


Emerging Issues on Privatized Prisons

because of the problems with the equivalency of matches, the results
do show that private facilities had more of an incentive to develop
antirecidivism programs because they could lose support from the
legislature if they performed poorly.

Health Care
Although not comparative in nature, the issue of privatized health care for
correctional institutions was the focal point of two additional studies—one
conducted by the Joint Legislative Audit and Review Commission (JLARC)
of the Virginia General Assembly and the other by KPMG Peat Marwick, a
private management consulting firm. Both studies examined the potential
benefits of a shift to private health providers in the District of Columbia. In
both Virginia and Washington, D.C., the state of correctional health care
was in crisis, due primarily to budgetary constraints. Not surprisingly, the
two agencies reached different conclusions concerning the feasibility of
privatized health care.

The Virginia study concluded that the Virginia Department of Correction’s
(VDOC’s) experiment with privatization of inmate health-care delivery at
the Greensville Correctional Center was a failure at the time the study was
conducted (Joint Legislative Audit Review Commission, 1994). Among the
problems cited were:

❑ Documentation of health-care services was poor, including medical
records, sick-call logs, and tuberculosis testing documentation and

❑ Physician coverage was uneven and medical segregation units at
Greensville had problems obtaining adequate physician coverage.

❑ Respiratory isolation rooms and x-ray equipment problems were not
addressed in a timely manner.

❑ The contractor at Greensville had not complied with the contract
requirements for implementing quality improvement activities.

❑ Costs of the contract exceeded appropriated amounts by 50 percent in
fiscal year 1992; communications on contract modifications were poor;
and contract compliance issues remained unresolved during the
contract period.

JLARC indicated that although VDOC had contracted with a vendor to
provide services at Greensville, the department was still responsible for
ensuring inmate access to adequate care, monitoring the provision of ser-
vices at the facility, documenting services rendered, and ensuring ad-
equate monitoring of contract costs.

The second private health-care study was conducted by management con-
sultants KPMG Peat Marwick (1994) in response to deficiencies found in


Bureau of Justice Assistance

the mental and medical care that the District of Columbia’s Department of
Corrections (DOC) provided at the District’s jail and at the Lorton Correc-
tional Facility. Four privatized health-care delivery options were analyzed
using three criteria identified by the District as goals for privatization. The
options by type of services covered were:

Option 1: Contractor covers medical outpatient, dental, medical
inpatient, and mental health services.

Option 2: Contractor covers medical outpatient, dental, and medical
inpatient services.

Option 3: Contractor covers medical outpatient and dental services.

Option 4: Contractor covers medical outpatient services.

The criteria used to analyze these options were:

1. Cost: Does the option reduce costs?

2. Incentives: Does the option avoid cost shifting to other health-care

3. Accreditation and quality of care: Does the option ensure high-quality
care and the best chance for accreditation at all DOC health-care

Each option carried with it the assumption that one contractor would pro-
vide services at all DOC facilities and the District would continue to cover
any services that the contractor does not cover.

KPMG Peat Marwick (1994: v) recommended that a “comprehensive con-
tract for all services—medical, mental, and dental—at all DOC facilities is
the best privatization option for the District.” Option 1 was considered the
best alternative, for it met all three criteria mentioned above.

Option 1 meets the costs, incentive, and accreditation criteria. Using
the average cost for privatization, Option 1 reduces District costs by
7.3 percent annually (this excludes one-time severance costs). One
bid shows savings that exceed 10 percent over the life of the contract.
Option 1 avoids the costs shifting that occurs when one party is respon-
sible for outpatient care and another is responsible for inpatient care.
Finally, because Option 1 covers all services, including mental health,
the District’s chances for achieving accreditation for all facilities is

KPMG’s analysis of privatization alternatives failed to address the disad-
vantages and potential problems that may arise during the process of
privatization because privatized health care was viewed as the best solu-
tion to the legal requirements mandated by District law. Yet, given the ex-
periences in Virginia, adequate monitoring mechanisms must be in place
to ensure that the advantages of privatized services are achieved.


Emerging Issues on Privatized Prisons

Additional Literature
Additional sources on privatization are worth noting. These studies are
primarily informative in nature but do not offer a comparative analysis of
public versus private services on the issues relating to costs and quality of

An often cited seminal study in the field of privatization was conducted by
Camp and Camp (1984). This study reviewed literature on private-sector
involvement in corrections and gathered data from interviews with correc-
tional administrators, researchers, and private vendors. Interviews with
correctional administrators focused on the benefits and liabilities of
privatization, as well as their concerns about monitoring, accountability,
and control. The study also based its findings on information collected
from various state adult and juvenile correctional systems in the District
and in the federal prison system. Among the information gathered was
which agencies do the most contracting (juvenile agencies), the variety of
contracts reported, and how much is spent on contracted services.

GAO produced a study on lessons learned from privatization experiences
of state governments in Georgia, Massachusetts, Michigan, New York,
and␣ Virginia, as well as the city of Indianapolis, Indiana (U.S. General Ac-
counting Office, 1997). The study did not specifically address the topic of
correctional privatization, although many guidelines were proposed for
successful privatization in the field of corrections. On the basis of their re-
view of the literature, interviews with privatization experts, and the com-
bined practical experiences with privatization efforts in each jurisdiction,
GAO made the following observations:

❑ Privatization requires a political champion. When introducing and
sustaining privatization initiatives, political and administrative leaders
should anticipate the need to develop and communicate a privatization
philosophy and attempt to garner outside support.

❑ Once privatization has been introduced, a formal structure to ensure
effective implementation must be designed. Such a structure can
include a commission to identify privatization opportunities and set
privatization policy, a staff office that can support agencies in their
privatization efforts and oversee implementation, and a framework for
making privatization decisions.

❑ Government agencies may need to enact resource changes to encourage
or facilitate the use of privatization. These changes are necessary to
signal to managers and employees that privatization efforts are

❑ Reliable and complete cost data on government activities are needed to
ensure a sound competitive process and to assess overall performance.
Reliable data can simplify the privatization decisions and make these
decisions easier to implement and justify.


Bureau of Justice Assistance

❑ Strategies are needed to manage workforce transitions. These include,
but are not limited to, encouraging employee involvement in the
privatization process, providing skills training for either competing
against the private sector or monitoring contract performance, and
creating a safety net for displaced employees.

❑ Monitoring and oversight that not only evaluate compliance with the
terms of the privatization agreement but also evaluate compliance with
the private firm’s performance in delivering services are needed when
the government’s direct role in the delivery of the service is reduced
through privatization. This is necessary to ensure that the government’s
interests are protected and that accountability of both government and
the private party is maintained.

One other report should be noted, although it is not a traditional research
report (Clark, 1998). This report takes a look at the troubled CCA facility in
Youngstown, Ohio, referred to as the Northeast Ohio Correctional Center.
This facility was constructed in 1996 as a “spec prison.” Soon after it
opened, it was largely filled with sentenced felons from the District’s DOC.
Under the terms of the contract between CCA and the District, all inmates
transferred to the facility were to be classified no higher than medium se-
curity. However, according to the Clark report, maximum-custody inmates
were transferred to the facility with the knowledge and approval of both
the District and CCA. The Clark report listed the following major incidents
that had occurred within the first 15 months of operation (Clark, 1998: 7):

❑ Six inmates escaped.

❑ Two homicides occurred, including one between known enemies in the
high-security unit, involving breakdowns in a number of critical

❑ Seventeen inmates were stabbed and numerous other serious assaults
against staff and inmates occurred.

❑ Homemade weapons were discovered.

❑ For long periods of time the facility was forced to operate under full or
partial lockdown to prevent further incidents of unrest.

The U.S. District Court in the District on March 1, 1999, granted prelimi-
nary approval of a $1.6 million settlement on behalf of the District inmates
who claimed that they were abused, denied adequate medical care, and
not properly separated from other inmates. CCA has been ordered to pay
$756,000 in legal fees toward this judgment. These costs do not include the
costs incurred by CCA and the District to defend themselves in the law-
suit. Furthermore, families of the inmates who were killed or died at the
correction center from other causes can sue CCA and the District sepa-
rately. One family has already filed a multimillion-dollar lawsuit against
the former District Director of Corrections, CCA, and the District for the


Emerging Issues on Privatized Prisons

death of a family member. The Federal Bureau of Investigation has opened
an investigation into allegations of abuse of inmates by CCA staff.

The Youngstown situation is a sobering illustration of how badly things
can go in a contract. There have been other recent examples of private pris-
ons having major operational difficulties. In a recent article in The Atlantic
Monthly, Schosser notes a number of major scandals and examples of bad
management in private prisons (Schosser, 1998). This is not to say that situ-
ations like those in Youngstown are typical of most private prisons. In-
deed, the national survey results reported in chapter 4 suggest that the
functions of private prisons are similar to those of public prisons. How-
ever, if the basic management structures are not in place, serious problems
can quickly erupt that will have severe litigation, public safety, protection-
from-harm, and cost consequences.

Only a few studies can be relied upon in a debate over cost efficiency of
prisons. It is generally accepted that the best research conducted to date
was the Tennessee study that showed no or very minimal differences with
respect to costs. The remaining studies had serious methodological flaws
that limit their ability to reach firm conclusions. In general, these flaws
pertain to an inability to control for factors known to be associated with
inmate conduct and costs in making comparisons between public and pri-
vately operated facilities. For example, facilities chosen for comparisons
often had inmates that differed on key attributes such as inmate age and
classification level—factors known to be associated with inmate conduct.

In some studies impact or outcome data used for analysis either were
flawed or may have been contaminated by staff because they knew the re-
sults would be used to reach unflattering conclusions by the researchers
studying the facility. Information on measures such as inmate assaults and
even escapes can be easily manipulated by staff unless rigorous controls
are applied to ensure inmate behavior is being measured in a standard and
reliable manner.

Studies of public and private facilities must include comparable facility
types, institutional capacity, and inmate demographics. In addition, the di-
mension of time must be considered. The studies thus far are essentially
one-time studies that measure the attributes of private and public facilities
at a given time. To date, no long-term studies have been conducted to de-
termine whether privately operated facilities can sustain their cost savings
or quality of confinement over an extended period of time, especially if
staff salaries and fringe benefits increase as their service tenure lengthens.

As pointed out by Gaes and colleagues (1998), a coherent theory of why
privately operated prisons would outperform public facilities has yet to


Bureau of Justice Assistance

emerge. Instead, one could argue that the private sector has simply drawn
upon the methods used by the public sector with respect to inmate manage-
ment and staffing and only attempted to reduce the costs associated with
that model. In effect, the private sector may be applying a more efficient
model that is essentially mimicking the public sector. This is most obvious
in facilities at which former public-sector managers have been recruited by
the private sector to manage the private facilities. Should this approach be
considered by policymakers, the future of privatization may be very limited
as the public sector in turn copies the private sector’s methods.

For these reasons it may be concluded that there are no data to support the
contention that privately operated facilities offer cost savings over publicly
managed facilities. Similarly, no definitive research evidence would lead to
the conclusion that inmate services and the quality of confinement are sig-
nificantly improved in privately operated facilities. It is clear that private
prisons can function as well as public-sector prisons for certain types of in-
mates (such as minimum security) and that they are aggressively pursuing
a share of the multibillion-dollar prison and jail industrial complex.


Emerging Issues on Privatized Prisons

The National Survey of State
Prison Privatization

Chapter 4

A major conclusion one can draw from the research review is that limited
information exists on the performance of most privately operated facilities.
The National Council on Crime and Delinquency (1998) estimates that only
13 privately operated facilities have undergone contemporary evaluations
of their performance in comparison to public facilities. This is less than 1
percent of all prisons now operating in the United States and about 20 per-
cent of the private prisons. To secure a more comprehensive overview of
all privately operated prisons, a national survey was funded by the Bureau
of Justice Assistance (BJA), U.S. Department of Justice, to develop a more
comprehensive review of the private prisons. The methodology and results
of the survey are presented in this chapter.

Survey of Public and Private State Facilities

In late 1997, private correctional management firms were asked to partici-
pate in the national survey of state prison privatization. The firms received
copies of the survey instrument for distribution at their facilities.15 The sur-
vey was based on a format used by the Bureau of Justice Statistics (BJS) in
its Census of State and Federal Correctional Facilities, 1995 (Bureau of Justice
Statistics, 1997b).16 By using the BJS survey, comparisons could be made
directly between the public prison population for midyear 1995 and the
private prison population as of December 31, 1997.

Information from privately operated state facilities was gathered during
the first quarter of 1998. Survey respondents were asked to provide infor-
mation from calendar year 1997 and, in many instances, details specifically
for December 31, 1997. Ten private companies were identified as managing
at least one operational state prison. Three of the ten firms chose not to
participate in the survey.17 These three firms operated five state facilities.
The seven remaining management firms were identified as managing 76
state facilities either in operation or under construction. Of those 76 state
prison facilities, 4 were not open during the timeframe covered by the sur-
vey instrument and 7 of the facilities did not return questionnaires before
data collection and analysis began. Three international facilities were origi-
nally identified as juvenile confinement facilities in the data analysis,


Bureau of Justice Assistance

bringing the final tally to 7 operators of 65 private prisons. The Corrections
Corporation of America and Wackenhut Corrections Corporation manage
49 of the 65 private state facilities identified.

Inmate and Facility Characteristics
Table 8 summarizes inmate characteristics for the 65 private facilities in-
cluded in the survey. A total of 46,120 inmates were housed in privately
operated state prisons on December 31, 1997. More than 90 percent were
male, a percentage comparable to the inmate population at federal and
state public facilities at midyear 1995. As in public facilities, a total of more
than 60 percent of all persons held in private state facilities were black or

Data provided in table 8 and table 9 also indicate that the private sector
has yet to penetrate the market for housing maximum/close-custody pris-
oners. More than 93 percent of incarcerated inmates at private state prisons
were medium- and medium/low-custody inmates (table 8). Only 2 facili-
ties out of 65 were identified as maximum-security institutions, with 1
located outside of the United States (table 9).18 Medium-security institu-
tions accounted for the largest number of private state facilities sampled:
38 of 62 were medium security, and 25 were minimum or low-level secu-
rity. Approximately three out of four facilities housed exclusively male in-
mates—not surprising given the composition of public prison populations.
Seventeen percent of the private state facilities housed both sexes; 8 per-
cent housed females only. Approximately 75 percent of the male inmate
population was housed in exclusively male facilities; the other approxi-
mately 25 percent was housed in facilities for both sexes. The female pri-
vate prison population was split evenly between females-only institutions
(50.6 percent) and mixed housing (49.4 percent).

The two maximum-security facilities were large institutions, housing 1,000
inmates or more. Minimum-security facilities tend to be much smaller, with
72 percent housing fewer than 500 inmates. The average daily populations
of medium-security prisons ranged from as low as 106 inmates to as high as
1,600. About 50 percent of all inmates in private facilities (22,674) were
housed in medium-security institutions; 44.2 percent (20,379) were detained
in minimum-security institutions. Only 4.6 percent of the inmates (2,111)
were confined in maximum-security prisons and all were male.

Table 9 provides information about the age, average daily population, and
function of private state facilities. The majority of institutions (83.1 per-
cent) were confinement institutions that manage general adult popula-
tions. Substance abuse treatment and work release/prerelease were named
in 21.5 percent of the cases as the primary facility function; persons re-
turned to custody was a primary facility function in 18.5 percent of cases.
Data on the ages of the facilities attest to the recent emergence of the pri-
vate corrections industry; for example, nearly 90 percent of state facilities
sampled were constructed within the last 10 years.


Emerging Issues on Privatized Prisons

Table 8 Inmate Characteristics at Public Facilities at Midyear 1995 and Private Facilities as of
December 31, 1997

Public Facilities* Private Facilities

Inmate Characteristics Number of Percentage Number of Percentage
Inmates Inmates

Number of inmates 1,023,572 46,120


Males 961,210 94.0% 42,215 91.5%

Females 62,362 6.0 3,905 8.5

Under age 18 5,309 0.5 180 0.4

Custody level

Maximum/close/high 202,174 19.8 2,111 4.6

Medium 415,688 40.6 22,674 49.2

Minimum/low 366,277 35.8 20,379 44.2

Not classified 39,433 3.8 956 2.1

Racial or ethnic identity†

White 363,918 35.5 14,620 31.7

Black 488,222 47.7 20,268 43.9

Hispanic 147,365 14.4 9,550 20.7

American Indian/Alaska
Native 10,519 1.0 494 1.1

Asian/Pacific Islander 8,436 0.8 291 0.6

Not reported 5,112 0.5 897 1.9

* Data for midyear 1995 include federal and state correctional facilities.
† The number of inmates of Hispanic origin is underreported for public facilities. In 28 federal facilities, racial identity but not ethnic
identity was reported for 21,563 inmates.
‡ Discrepancies in totals are due to rounding.
Sources: Bureau of Justice Statistics (1997b) and National Council on Crime and Delinquency (1998).


Bureau of Justice Assistance

Table 9 Characteristics of Private Facilities by Level of Security as of December 31, 1997

Facility Total Maximum Medium Minimum

Characteristic N % N % N % N %

All Facilities 62 100.0% 2 3.1% 38 58.5% 25 38.0%

Sex of Inmates Housed

Males only 49 75.4 2 3.1 29 44.6 18 27.7

Females only 5 7.7 0 0 3 4.6 2 3.1

Both sexes 11 16.9 0 0 6 9.2 5 7.7


General adult
population 54 83.1 1 1.5 37 56.9 16 24.6

Boot camp 0 0 0 0 0 0 0 0

diagnosis 5 7.7 0 0 3 4.6 2 3.1

treatment/hospital 3 4.6 0 0 2 3.1 1 1.5

treatment 14 21.5 1 1.5 6 9.2 7 10.8

Youthful offenders 2 3.1 1 1.5 1 1.5 0 0

Work release/
prerelease 14 21.5 0 0 6 9.2 8 12.3

Returned to
custody 12 18.5 0 0 6 9.2 7 10.8

Other 5 7.7 1 1.5 3 4.6 1 1.5

Age of Facility (in yrs)§

< 10 58 89.2 2 3.1 36 55.4 20 30.8 10–19 0 0 0 0 0 0 0 0 20–49 5 7.7 0 0 1 1.5 4 6.2 50–99 1 1.5 0 0 0 0 1 1.5 ≥ 100‡ 1 1.5 0 0 0 0 1 1.5 43 Emerging Issues on Privatized Prisons Table 9 Characteristics of Private Facilities by Level of Security as of December 31, 1997 (Cont.) Programming The 65 private state facilities surveyed produced an impressive record of programming activities (table 10). All of these facilities maintain some type of work, education, and counseling program for inmates. Facility support projects such as office work, food service, laundry, and building repair en- gaged inmates at all institutions surveyed. In addition, public works as- signments were reported for 43 percent of the facilities. Nearly 22 percent of the private facilities reported other types of work programs, most nota- bly work in education and community service. A number of facilities sup- port private industry joint ventures or free world industry projects that have the potential to aid inmates in postrelease transition. About 64 per- cent of all inmates at private facilities participated in one or more work programs as of December 31, 1997, a similar percentage to those who par- ticipated in work programs in public institutions at midyear 1995. More than 96 percent of the private facilities provide both secondary edu- cational programs (including the general equivalency diploma) and basic adult education. A large percentage (81.5 percent) also provide some type of vocational training. Special educational programs for inmates with learning disabilities were available at 47.7 percent of the private facilities, and 43.1 percent offer college-level coursework. Overall, 38.3 percent of private facility inmates were participating in some form of educational programming on December 31, 1997. This finding indicates a higher pri- vate facility participation rate on December 31, 1997, than that at public facilities (23 percent) in midyear 1995 (table 10). Drug and alcohol awareness programs were available at almost every private institution surveyed, as were life skills/community adjustment * Figures may add to more than the total number of facilities because some facilities may have more than one function. § Refers to the number of years between the date of original construction and the survey year. ‡ The oldest privately operated facility is operated by CiviGenics, which originally opened as a hospital in 1896. ‡ ‡ Discrepancies in totals due to rounding. Source: Bureau of Justice Statistics (1997b). Facility Total Maximum Medium Minimum Characteristic N % N % N % N % Average daily pop. (number of inmates) < 500 28 43.1 0 0 10 15.4 18 27.7 500–999 27 41.5 0 0 22 33.8 5 7.7 1,000–2,499 10 15.4 2 3.1 6 9.2 2 3.1 ≥ 2,500 0 0 0 0 0 0 0 0 44 Bureau of Justice Assistance Table 10 Types and Rates of Participation in Institutional Programs at Public Facilities at Midyear 1995 and at Private Facilities as of December 31, 1997* Facility Public Private Characteristics N % N % All Facilities 1,500 100.0% 65 100.0% With Work Programs 1,404 93.6 65 100.0 Prison industries 560 37.3 8 12.3 Facility support services 1,348 89.9 65 100.0 Farming/agriculture 371 24.7 9 13.8 Public works assignments 781 52.1 28 43.1 Other work programs 149 9.9 14 21.5 With education programs 1,311 87.4 65 100.0 Basic adult education 1,118 74.5 63 96.9 Secondary education† 1,115 74.3 64 98.5 Special education 496 33.1 31 47.7 Vocational training 806 53.7 53 81.5 College courses 498 33.2 28 43.1 Study releases 161 10.7 5 7.7 With counseling programs 1,451 96.7 65 100.0 Drug counseling 1,327 88.5 64 98.5 Alcohol counseling 1,345 89.7 65 100.0 Psychological counseling 1,028 68.5 46 70.8 Employment counseling 897 59.8 53 81.5 Life skills, community adjustment counseling 999 66.6 64 98.5 Parenting 576 38.4 35 53.8 Other 296 19.7 13 20.0 Inmates participating in Work programs 662,807 64.8 29,668 64.3 Educational programs 234,966 23.0 17,685 38.3 * Inmate participation numbers are based on reporting from 95 percent or more of the facilities. Totals for public facilities include federal and state confinement institutions. † Includes general equivalency diploma (GED). Sources: Bureau of Justice Statistics (1997b) and National Council on Crime and Delinquency (1998). 45 Emerging Issues on Privatized Prisons counseling. A high percentage of the private institutions also provide em- ployment consultation (81.5 percent), psychological or psychiatric counsel- ing (70.8 percent), and parenting and child-rearing skills (53.8 percent). Data from public facilities also reveal a high percentage of facilities that maintain a variety of counseling programs. Corresponding completion or attrition rates were not available; thus the participation figures can be mis- leading about the positive influence of such programs. Staffing and Employment Private facilities reported a total of 13,344 regular and nonpayroll support staff (table 11). The number of full-time, or regular, staff ranged from as low as 19 at the smallest institution to 532 at the largest. Correctional offic- ers accounted for 63.2 percent of employees at private facilities in 1997; a similar percentage were employed as security staff at public correctional facilities. Professional treatment staff accounted for 12 percent of private correctional employees, followed by clerical (7.9 percent), educational (5.8 percent), and maintenance and food service (5.5 percent). Private state prisons have higher proportions of minority employees com- pared with public prisons. Fifty-three percent of the staff at private facili- ties were white (table 11), whereas 31.7 percent (table 8) of the inmate population was white. At public facilities, the corresponding figures in 1995 were 71.3 percent (table 11) and 35.5 percent (table 8), respectively. The racial composition of staff to inmates was similar for blacks at both types of facilities. Blacks comprise 22.4 percent of the staff and 43.9 percent of inmates at private state prisons versus 20 percent of staff and 47.7 per- cent of␣ inmates at public facilities. Hispanics, on the other hand, comprise 14.4 percent of the inmate popula- tion at federal and state public facilities but only 6.3 percent of the correc- tional staff. Among the 65 private state facilities surveyed, Hispanics made up 20.7 percent of the inmate population and 18 percent of the staff. When the three facilities located in Puerto Rico were excluded from the analysis, the private facilities still had a larger percentage of Hispanic staff (13 per- cent staff and 17 percent inmate population) than those employed at public facilities.19 Table 12 displays, by private state facility, basic salary information and the number of employees hired, terminated, tested for drugs, and unionized. The average starting salary for correctional officers in 1997 was $17,514.20 U.S. Corrections Corporation reported the lowest average starting salary at $14,824; Wackenhut Corrections Corporation had the highest at $18,785. The number of staff hired and terminated is largely driven by the number of facilities in operation and facility size—large and medium-sized institu- tions tend to have higher staff turnover rates. Only one private facility in the United States is unionized. In contrast, three of the four unionized fa- cilities were international prisons operated by Wackenhut Corrections 46 Bureau of Justice Assistance Table 11 Persons Employed in Public State Facilities at Midyear 1995 and at Private State Facilities as of December 31, 1997 Corporation and located in Australia and the United Kingdom. CiviGenics is the only operator that does not have an employee drug testing policy. Inmate Violations and Deaths Table 13 compares the number of major infractions at public and private institutions per 1,000 inmates, including staff assaults, riots, fires, and other disturbances. The table reveals a greater number of inmate-on- inmate assaults per 1,000 inmates at private prisons (35.1 percent) than at public facilities (25.4 percent). Assaults resulting in inmate deaths were Personnel Public Private Characteristics N % N % All facilities 247,320 100.0% 13,344 100.0% Administrative 9,509 2.8 554 4.2 Correctional/security 220,892 65.4 8,427 63.2 Clerical support 27,383 8.1 1,060 7.9 Educational 11,020 3.3 774 5.8 Professional treatment 45,291 13.4 1,604 12.0 Maintenance and food service 23,605 7.0 735 5.5 Other 0 0 190 1.4 Racial or ethnic identity† White 232,382 71.3 6,954 53.0 Black 65,513 20.0 2,964 18.0 Hispanic 20,702 6.3 2,364 18.0 Native American/Other‡ 6,576 2.0 131 1.0 Asian/Pacific Islander NA NA 60 0.5 Not reported 974 0.3 669 5.1 * A total of 241 employees were not designated by employment category at 20 of the facilities. † Includes only payroll staff for public facilities. Private facilities data include nonpayroll staff when given by private operator: 21 private facilities included 200 nonpayroll staff in their racial breakdowns. Two private facilities with 669 payroll staff could not provide a racial breakdown of staff. ‡ Figures for public facilities include Alaska Natives, Asians, Native American, and Pacific Islanders. Sources: Bureau of Justice Statistics (1997b) and National Council on Crime and Delinquency (1998). 47 Emerging Issues on Privatized Prisons Table 12 Characteristics of Employment in Private Facilities, January 1–December 31, 1997 extremely rare at both types of institutions. Rates of assaults on staff, riots, fires, and other disturbances are comparable for private and public facili- ties. A total of 45 escapes occurred at 14 private facilities between January 1, 1997, and December 31, 1997. The rate of escapes per 1,000 inmates for the 62 private facilities is 1.06 percent. BJS’s Census of State and Federal Cor- rectional Facilities, 1995 reported that the number of inmate deaths rose from 2.4 per 1,000 state inmates in 1990 to 2.7 in 1995. The death rate at pri- vately operated prisons is considerably lower at 0.7 per 1,000 inmates for the same time period. However, as with all of these comparisons, they cannot be used to conclude that either a private or a public prison is supe- rior to the other as this analysis cannot control for all factors that influence Facilities Employees Co-Starting Staff Staff That Test Tested for Unionized Contractor Facilities Salary Hired Terminated for Drugs Drugs Facilities Min: $14,580 Cornell Max: $16,598 Corrections 3 Avg: $15,537 58 33 1 125 0 Correctional Min: $14,040 Services Max: $20,800 Corporation 3 Avg: $17,333 224 132 3 150* 0 Corrections Min: $13,200 Corporation Max: $24,600 of America 27 Avg: $17,246 4,454† 1,327‡ 24 3,029§ (U.S.) 1 Min: $16,000 Max: $16,000 CiviGenics 2 Avg: $16,000 9 0 0 0 0 Management Min: $16,640 Training Max: $22,425 Corporation 3 Avg: $18,665 111 89 3 223 0 U.S. Min: $14,040 Corrections Max: $17,200 Corporation 5 Avg: $14,824 271 257 4 342 0 Wackenhut Min: $12,958 Corrections Max: $35,173 3,022 1,750 20 2,735†† (Aus.) 2 Corporation 22 Avg: $18,785** (U.K.) 1 * Based on 2 facilities reporting. † Based on 25 facilities reporting. ‡ Based on 24 facilities reporting. § Based on 17 facilities reporting. Three facilities do not test, and 7 facilities were missing data. **Based on 21 facilities reporting. One international facility reported data in British pounds. †† Based on 19 facilities reporting. Two facilities do not test, and 1 facility was missing data. Source: National Council on Crime and Delinquency (1998). 48 Bureau of Justice Assistance these performance measures. However, later in this chapter a reanalysis of private and public facilities is conducted controlling only for medium- and minimum-security facilities. Disciplinary Resources Data on disciplinary resources are limited due to the absence of automated data collection systems at the facilities. Only 23 facilities maintained an Table 13 Major Incidents in Public Facilities (July 1, 1994–June 30, 1995) and in Private Facilities (January 1–December 31, 1997)* * Excludes tickets, official warnings, and other minor incidents. † Based on average daily population. ‡ Includes only incidents that had five or more inmates participating, that required the intervention of additional or outside assistance, and that resulted in serious injury or significant property damage. § Other causes include accidents and other deaths. Sources: Bureau of Justice Statistics (1997b) and National Council on Crime and Delinquency (1998). Number of Violations per Inmate Number of Violations 1,000 Inmates † Violation Public Private Public Private Assaults on inmates 25,948 1,617 25.4 35.1 Resulting inmate deaths 82 1 0.1 0.0 Assaults on staff 14,165 584 13.8 12.7 Resulting staff deaths 14 0 0.0 0.0 Riots‡ 317 12 0.3 0.3 Fires 816 29 0.8 1.2 Other disturbances 1,808 56 1.8 1.2 Total 43,054 2,298 42.3 50.5 Number of Deaths per Inmate Number of Deaths 1,000 Inmates † Deaths Public Private Public Private Homicides by other inmates 82 1 0.1 0.0 Suicides 169 1 0.2 0.0 AIDS 1,111 4 1.1 0.1 Natural causes 1,186 21 1.2 0.5 Other causes§ 113 3 0.1 0.1 Total deaths 2,661 30 2.9 0.7 49 Emerging Issues on Privatized Prisons automated data collection system to count the number of assaults, escapes, deaths, disturbances, staff turnover, inmate participation in programs, and so on. Twenty of those 23 facilities had performance monitoring capabili- ties. Two private management firms, CiviGenics and Management Train- ing Corporation, operated minimum-security, specialty-function prisons that did not maintain disciplinary, protective custody, or administrative segregation units (table 14). Most Corrections Corporation of America fa- cilities operate disciplinary and administrative segregation units, as do the majority of Wackenhut Corrections Corporation facilities. On December 31, 1997, 95 percent of the inmates consigned to disciplinary action units and 90 percent held in administrative segregation were housed in either a CCA or Wackenhut Corrections Corporation institution. A smaller number of facilities (20) operated a distinct protective custody unit. All inmates within protective custody were housed in a CCA or Wackenhut Correc- tions Corporation institution. Lockdowns were not a primary means of discipline or control at the major- ity of privately operated institutions surveyed. The 65 facilities together reported 67 lockdowns for a total of 394.5 days between January 1 and December 31, 1997. However, the majority of the days in lockdown (282) occurred at only three medium-security facilities. One Corrections Corpora- tion of America institution reported three facility lockdowns for 50 days each and two Wackenhut institutions reported nine facility lockdowns for a␣ total of 232 days. The remaining facilities together averaged about 1.8 days in lockdowns over the course of the year. Court Orders and Consent Decrees As of December 31, 1997, five private facilities were under a state or federal court order or consent decree to limit the number of inmates they could house; one was a women’s medium-security prison. Seven facilities were reported to be under court order or consent decree for the totality of condi- tions at their facilities,21 with an additional two facilities under court order or consent decree for specific conditions (table 15). Education was the most frequently cited specific consent decree condition, affecting seven private facilities, followed by medical facilities (6), admin- istrative segregation (6), staffing policies (6), inmate classification (6), and grievance policies (6). At public state facilities, crowding was the most of- ten cited condition (213), followed by medical facilities (139), library ser- vices (129), and staffing (118). 50 Bureau of Justice Assistance Table 14 Disciplinary Resources at Private Facilities, January 1–December 31, 1997 Lockdowns Days Inmates Inmates Inmates Jan. 1, 1997– Locked Contractor Facilities DAU in DAU PCU in PCU ASU in ASU Dec. 31, 1997 Down Cornell Corrections 3 1 21 0 0 2 17 7 3 Correctional Services Corporation 0 3 2 13 1 0 2 21 7* Corrections Corporation of America 27 25 374† 12 182‡ 25 199§ 23 102.5** CiviGenics 2 0 0 0 0 0 0 0 0 Management Training Corporation 3 0 0 0 0 0 0 5 9 U.S. Corrections Corporation 5 2 4 0 0 3 20 0 0 Wackenhut Corrections Corporation 22 14 367†† 7 614‡‡ 15 306§§ 25 280*** Total 65 44 779 20 796 47 563 67 394.5 Note: DAU=Disciplinary Action Unit; PCU=Protective Custody Unit; ASU=Administrative Segregation Unit. * One facility reported 7 lockdowns, each of short duration. † Based on 22 facilities reporting: 2 facilities do not have a disciplinary unit; 3 facilities have disciplinary units but did not provide the number of inmates. ‡ Based on 11 facilities reporting: 15 facilities do not have a protective custody unit; 1 facility has a protective unit but did not provide number of inmates. § Based on 22 facilities reporting: 2 facilities do not have an administrative segregation unit; 3 facilities have administrative segregation units but did not provide number of inmates. **One facility reported 3 lockdowns for a total of 50 days. †† Based on 12 facilities reporting: 8 facilities do not have a disciplinary action unit; 2 facilities had disciplinary action units but did not provide the number of inmates. ‡‡ Based on 6 facilities reporting: 1 facility is considered a protective custody prison and reports 438 protective custody inmates; 15 facilities do not have a protective custody unit; 1 has a protective custody unit but did not provide the number of inmates. §§ Based on 14 facilities reporting: 7 do not have an administrative segregation unit; 1 facility has an administrative unit but did not provide the number of inmates. *** One facility reported 6 lockdowns for a total of 154 days; another reported 3 lockdowns for a total of 78 days. Source: National Council on Crime and Delinquency (1998). 51 Emerging Issues on Privatized Prisons Table 15 State Facilities Under Court Order or Consent Decree: Public Facilities at Midyear 1995 and Private Facilities on December 31, 1997* Public Private Court Order Status of Facilities N % N % Not under court order 1,054 76.7% 56 86.2% Under court order for specific conditions 378 27.5 9 13.8 Overcrowding 213 15.5 5 7.7 Medical facilities 139 10.1 6 9.2 Administrative segregation 76 5.5 6 9.2 Staffing 118 8.6 6 9.2 Food service/nutrition 83 6.0 5 7.7 Education 96 7.0 7 10.8 Disciplinary policies 78 5.7 5 7.7 Recreation 100 7.3 5 7.7 Visiting/mail 88 6.4 4 6.2 Fire hazards 78 5.7 3 4.6 Counseling programs 69 5.0 4 6.2 Inmate classification 76 5.5 6 9.2 Library services 129 9.4 4 6.2 Grievance policies 74 5.4 6 9.2 Religion policies 74 5.4 5 7.7 Search policies 30 2.2 4 6.2 Other 88 6.4 5 7.7 * A total of 238 state public and private facilities were under court order or consent decree to limit population, for specific conditions, or for both reasons in 1995. These reasons are not mutually exclusive and therefore do not sum to 100 percent. Sources: Bureau of Justice Statistics (1997b) and National Council on Crime and Delinquency (1998). 52 Bureau of Justice Assistance Reanalysis of Survey Data Controlling for Facility Security Level The previous analysis suggests that private facilities do not differ substan- tially from publicly operated facilities, with three possible exceptions. First, the number of staff assigned to private facilities is approximately 15 percent lower than the number of staff assigned to public facilities (28 per 100 inmates in private facilities versus 32 per 100 inmates in public). Sec- ond, management information system (MIS) capabilities appear to be lacking in private facilities. Third, the rate of major incidents is higher at private facilities than at public facilities. Recognizing that the 1995 public facility survey includes all types of facili- ties and that the private facilities are primarily medium- and minimum- security facilities, a better analysis would be to attempt to make direct comparisons between medium-security and minimum-security public facilities with the same type of private facilities. Tables 16–20 reinforce the earlier analyses and show that it cannot be con- cluded that a private or a public prison is superior to the other. In these tables, responses from public and private facilities that identified them- selves as maximum or higher custody levels have been eliminated. The re- sults are similar to the original analysis with one major exception: in this comparison, the privately operated facilities have a much higher rate of inmate-on-inmate and inmate-on-staff assaults and other disturbances. These differences may be related to other factors such as reporting stan- dards or the fact that correctional facilities often experience management difficulties when they are newly opened. The CCA Youngstown facility is a good example of such difficulties (Clark, 1998). However, insufficient training for and lack of qualified staff in key positions may also be a valid explanation for these differences. This would be consistent with the claims of critics of privatization who charge that private prisons are inadequately staffed by inexperienced and poorly trained correctional officers. Coupled with a lack of programs and work assignments, higher rates of misconduct from inmates predictably occur. Nevertheless, the notion that privately operated prisons are safer or better managed than public facilities is not supported by these results. 53 Emerging Issues on Privatized Prisons Table 16 Characteristics of Inmates at Public Medium- and Minimum-Security Facilities at Midyear 1995 and Private Medium- and Minimum-Security Facilities on December 31, 1997 Public* Private Inmate Characteristics N % N % Number of inmates 654,891 100.0% 43,828 100.0% Gender Males 607,547 92.8 39,933 91.1 Female 47,344 7.2 3,895 8.9 Custody level Maximum/close/high 0 0 1,225 2.8 Medium 463 39.1 21,942 50.1 Minimum/low 721 60.9 20,262 46.2 Not classified 0 0 399 0.9 Racial or ethnic identity† White 234,894 35.9 13,235 30.2 Black 300,339 45.9 19,454 44.4 Hispanic 106,062 16.2 9,504 21.7 American Indian/Alaska Native 6,871 1.0 494 1.1 Asian/Pacific Islander 6,532 1.0 254 0.6 Not reported 193 0 887 2.0 * Data for midyear 1995 include federal and state correctional facilities. † The number of inmates of Hispanic origin is underreported for public facilities. In 28 federal facilities, racial identity but not ethnic identity was reported for 21,563 inmates. Sources: Bureau of Justice Statistics (1997b) and National Council on Crime and Delinquency (1998). 54 Bureau of Justice Assistance Table 17 Characteristics of Public Medium- and Minimum-Security Facilities at Midyear 1995 and Private Medium- and Minimum-Security Facilities on December 31, 1997 Public Private Facility Characteristics N % N % All facilities 1,184 100.0% 63* 100.0% Function** General adult population 864 73.0 53 84.1 Boot camp 44 3.7 0 0 Reception/diagnosis 91 7.7 5 7.9 Medical treatment/hospital 111 9.4 3 4.8 Alcohol/drug treatment 194 16.4 13 20.6 Youthful offenders 30 2.5 1 1.6 Work release/prerelease 420 35.5 14 22.2 Returned to custody 83 7.0 13 20.6 Other† 208 17.6 4 6.3 Age of facility (in years)‡ < 10 327 27.6 56 88.9 10–19 239 20.2 0 0 20–49 336 28.4 5 7.9 50–99 245 20.7 1 1.6 ≥ 100§ 28 2.4 1 1.6 Average daily population (number of inmates) < 500 778 65.7 28 44.4 500–999 200 16.9 27 42.9 1,000–2,499 180 15.2 8 12.7 ≥ 2,500 26 2.2 0 0 * Two facilities failed to provide sufficient data for inclusion in this table. ** Figures may add to more than the total number of facilities because some facilities may have more than one function. † Includes U.S. Marshals Service, pretrial/posttrial federal offenders, prearraignment, and community service. ‡ Refers to the number of years between the date of original construction and the survey year. § The oldest privately operated facility is operated by CiviGenics, which originally opened as a hospital in 1896. Source: National Council on Crime and Delinquency (1998). 55 Emerging Issues on Privatized Prisons Table 18 Types and Rates of Participation in Institutional Programs at Public and Private Medium- and Minimum-Security Facilities Public* Private Facility Characteristics N % N % All facilities 1,184 100.0% 63** 100.0% With work programs Prison industries 368 31.1 8 12.7 Facility support services 1,049 88.6 63 100.0 Farming/agriculture 267 22.6 9 14.3 Public works assignment 661 55.8 28 44.4 Other work programs 128 10.8 13 20.6 With education programs Basic adult education 839 70.9 61 96.8 Secondary education* 906 76.5 62 98.4 Special education 342 28.9 29 46.0 Vocational training 582 49.2 51 81.0 College courses 363 30.7 26 41.3 Study releases 150 12.7 5 7.9 With counseling programs Drug counseling 1,039 87.8 62 98.4 Alcohol counseling 1,053 88.9 63 100.0 Psychological counseling 746 63.0 44 69.8 Employment counseling 720 60.8 51 81.0 Life skills, community adjustment counseling 783 66.1 62 98.4 Parenting 462 39.0 33 52.4 Other programs 205 17.3 13 20.6 Inmates participating in Work programs 438,016 66.9 28,856 65.8 Educational programs 161,877 24.7 16,760 38.2 * Includes GED. ** Two facilities failed to provide sufficient data for inclusion in this table. Source: Bureau of Justice Statistics (1997b). 56 Bureau of Justice Assistance Table 19 Characteristics of Persons Employed in Public Medium- and Minimum-Security Facilities at Midyear 1995 and Private Medium- and Minimum-Security Facilities on␣ December 31, 1997 Public Private Characteristics N % N % All facilities 206,126 100.0% 12,420 100.0% All staff Administrative 6,015 2.9 530 4.3 Correctional/security 127,395 61.7 7,912 63.7 Clerical support 17,147 8.3 894 7.2 Educational 7,147 3.7 717 5.8 Professional treatment 27,042 13.0 1,514 12.2 Maintenance and food service 15,395 7.5 686 5.5 Other 5,985 2.9 167 1.3 Racial or ethnic identity White 137,831 66.9 6,315 50.8 Black 37,206 18.1 2,683 21.6 Hispanic 13,698 6.6 2,344 18.9 Native American/other 1,654 0.8 131 1.1 Asian/Pacific Islander 3,063 1.5 57 0.4 Not reported 12,674 6.2 890 7.2 Source: Bureau of Justice Statistics (1997b). 57 Emerging Issues on Privatized Prisons Table 20 Major Incidents in Public Medium- and Minimum-Security Facilities (July 1, 1994– June 30, 1995) and Private Medium- and Minimum-Security Facilities (January 1, 1997–December 31, 1997)* Number of Violations Number of Violations* per 1,000 Inmates † Inmate Violations Public 1995 Private 1997 Public 1995 Private 1997 Assaults on inmates 12,721 1,469 20.2 33.5 Resulting inmate deaths 29 1 0.6 0 Assaults on staff 5,182 537 8.2 12.2 Resulting staff deaths 12 0 0.3 0 Riots‡ 172 12 3.7 0.3 Fires 444 29 0.7 0.7 Other disturbances 150 56 0.2 1.3 Total deaths 1,711 29 2.7 0.7 Homicides committed by other inmates 31 1 0.7 0 Suicides 65 1 0.1 0 AIDS 565 4 0.9 0.1 Natural causes 1,001 20 1.7 0.5 Other causes§ 49 3 1.1 0.1 * Excludes tickets, official warnings, and other minor incidents. † Based on average daily population. ‡ Includes only incidents that had five or more inmates participating, that required the intervention of additional or outside assistance, and that resulted in serious injury or significant property damage. § Other causes includes accidents, homicides, and other deaths. Source: Bureau of Justice Statistics (1997b). 59 Emerging Issues on Privatized Prisons Summary Chapter 5 The Diminishing Returns on Privatization This report supports the basic premise that private facilities appear to per- form at the same level of efficiency as public facilities. Although they tend to house a higher proportion of minimum-custody inmates in relatively new facilities, private facilities tend to have the same staffing patterns; pro- vide the same levels of work, education, and counseling programs for in- mates; and have the same rates of serious inmate misconduct as public facilities. The few credible impact studies show more similarities and fewer differences between the two methods of operation. What seems to have evolved in the United States is a privatization model that essentially mimics the public model but achieves modest cost savings, at least initially, by making modest reductions in staffing patterns, fringe benefits, and other labor-related costs. There is no evidence showing that private prisons will have a dramatic impact on how prisons operate. The promises of 20-percent savings in operational costs have simply not mate- rialized. Even if they had, the limited market share of less than 5 percent for private prisons would have had a limited impact on prison budgets. For example, assume that 10 percent of a state’s prison system becomes privatized and that each private prison produced a 10-percent savings in operational costs. Even at this level, the overall impact on a state prison budget would be only 1 percent (10 percent of 10 percent=1 percent). This amount of savings will not revolutionize modern correctional practices. Today it appears that achieving even a 10-percent market share will prove to be increasingly difficult for several reasons. The growing number of well-publicized stories of poor performance in private prisons is growing (e.g., Colorado, Louisiana, Oregon, South Carolina, and Texas). The prob- lems associated with the CCA-operated Northeast Ohio Correction Center in Youngstown, Ohio, have dramatized how badly a privatized prison can be operated. In this facility, 17 inmates were stabbed, 2 were murdered, and 6 escaped in the first 15 months of operation. Operational flaws were linked to inexperienced staff, inadequate training, and a willingness on the part of prison authorities to accept inmates who should not have been transferred to the facility (Clark, 1998). If nothing else, the private sector has shown that it is as equally capable of mismanaging prisons as the public sector. These problems suggest that the sales division of the private sector may well be outperforming the production division. It may well be that the difficulties private prisons are experiencing may increase simply because they, like prisons in the public sector, are finding it increasingly difficult to␣ recruit competent staff. 60 Bureau of Justice Assistance The Future of Privatization Despite these criticisms, privatization still provides a vital function within the correctional system. Although the private sector has been unable to keep its promise of greatly improving prison operations, its mere presence has had a significant impact on traditional prison operations. Gaes and col- leagues (1998) acknowledge that privatization has forced the public sector to reexamine how it conducts business. Certainly in those markets where correctional officer salaries and fringe benefits have been excessive, privatization has fostered a reexamination of those costs, which has led to cost savings. In this sense, privatization has served as a catalyst for change by demonstrating other means for doing the business of corrections. As limited as they are, however, these cost-saving innovations should not be the only items on the privatization agenda. It would be extremely interesting and productive for the private sector, in partnership with the public sector, to become the vehicle for testing far more substantive changes in correctional policy in a number of areas—not just prisons and jails. For example, an extremely promising strategy would be for the private sector to test the long-term effects of state-of-the-art cor- rectional programming in reducing recidivism in the areas of education, vocational training, and various forms of counseling, both in prison and after release. One could also test the effects of reducing prison terms and other correctional policies using the flexibility of the private sector. Finally, new management techniques, staff training, and facility designs could be tested by the private sector under controlled conditions. All such innova- tions should be directed at reducing the current ineffective correctional practices rather than producing a system that is less expensive but as inef- fective as the public-sector system. 61 Emerging Issues on Privatized Prisons Notes 1. The term “correctional facilities” refers to jails and detention centers that do not house state or federal prisoners. 2. During the North American phase of transportation, some 50,000 convicts were shipped across the Atlantic and sold as agricultural laborers. 3. The modern “penitentiary,” based on the ideas of Jeremy Bentham, 18th-century English philosopher, was first established in Philadelphia and New York in the United States. It became the prototype of prison reform efforts in the late 18th and early 19th centuries. Solitary confine- ment for personal reflection, combined with hard labor, became the cornerstones of this new approach. 4. Ethridge and Marquart (1993) identify other forms of private inmate labor such as the piece-rate system and public account system. Under the piece-rate system, inmates worked inside prison walls under the supervision of state employees. In the public account system, prisoners worked under state supervision and produced goods for state institu- tions. However, the convict lease system was considered the most prof- itable and the most brutal and corrupt of all inmate labor systems. 5. McCrie (1993) refers to the case of the privatized prison in Hunts- ville, Texas, which was the subject of a legislative investigation into prison conditions. The investigation resulted in modifications to the leasing system in which the state maintained control of the penitentiary and convicts but continued contracting arrangements with private in- terests beginning in 1883. 6. Health-care services were the exceptions. Smaller jails and prisons could not economically provide the full range of specialized care by competing for staff in the health-care market. These services were usu- ally contracted out to local hospitals. 7. In addition to juvenile and INS detention centers, since the late 1960s private firms have established sites with various low-security facilities and in the “less visible” regions of the adult and juvenile penal sys- tems, such as community treatment centers and halfway houses (McDonald, 1994: 30). 8. For instance, privately operated facilities for juveniles tend to be small and residential with flexible programming catering to individual needs (McCrie, 1992). 62 Bureau of Justice Assistance 9. The leading case on this is West v. Atkins, 108 S. Ct. 2250 (1988). The case addresses whether private persons under contract with the state can be sued under § 1983 or whether only public employees can be sued under this federal law. By deciding that such persons can be held liable and are acting under the “color of the law” when performing services, the court ex- panded the number and categories of individuals who may be sued under § 1983. In 1997 the U.S. Supreme Court held that private prison guards em- ployed by a private firm are not entitled to qualified immunity from suit by prisoners charging a § 1983 violation (Richardson v. McKnight). 10. The hidden costs of a public correctional facility typically include exter- nal administrative overhead, legal services, court-ordered judgments, property insurance, staff training, and other items not usually part of the direct budget. 11. The three private correctional facilities were: (1) RCA Services’ Weaversville Intensive Treatment Unit, Pennsylvania; (2) CCA’s Silverdale Detention Center, New Jersey; and (3) Buckingham Security Limited’s But- ler County Prison, New Jersey. The three public prisons were: (1) Pennsyl- vania Department of Welfare’s North Central Secure Treatment Unit; (2) New Jersey’s Warren County Correctional Center; and (3) New Jersey’s Salem County Prison. 12. Weighted 3-year averages were calculated by dividing each facility’s 3- year average cost by the number of services available, then multiplying the cost-per-service figure for a particular facility by the number of services available at the facility with the largest number of services. 13. After the LBB report was released, the Texas Department of Criminal Justice negotiated contracts with CCA and Wackenhut Corrections Corpo- ration to operate two prerelease facilities each. At the time of the Sunset report, the four private units had been in operation for over a year and ac- tual cost data were available. 14. Care was defined as services of medical personnel: doctors, dentists, psychologists, and dietitians as they perform treatment consistent with a basic, minimum level of service. Justice referred to adherence to the rules by staff inside the prison—sanctions were to be clear, specified in advance, and applied consistently with due process. 15. Each firm was asked to categorize the type of facility in operation (e.g., state prison, jail, juvenile, detention, or community). This, combined with information from secondary sources such as Thomas (1997b) and Camp and Camp (1997), allowed NCCD researchers to distinguish state prisons from other types of facilities. 16. For comparative purposes, data from the BJS 1995 census are presented together with NCCD’s 1997 figures. 63 Emerging Issues on Privatized Prisons 17. One operator did not participate because of pending litigation. The other two did not respond to requests for information. 18. Both maximum-security institutions are operated by Wackenhut Corrections Corporation. A number of other institutions, however, house maximum-custody inmates but identify themselves at lower security levels. 19. Data from the three privately operated state facilities in Puerto Rico were adjusted to eliminate potential bias. The three prisons consisted of 877 Hispanic staff and 2,267 Hispanic inmates. The results again indi- cate a higher staff-to-inmate ratio for Hispanics in private state prisons. 20. Based on 62 facilities reporting. 21. Four of the five facilities that reported being under court order or consent decree for overcrowding are also under order for other speci- fied conditions. 65 Emerging Issues on Privatized Prisons References Ammon, David, Richard Campbell, and Sandra Somoza (1992). The Option of Prison Privatization: A Guide for Community Deliberations. Athens, GA: University of Georgia. Bowman, Gary W., Simon Hakim, and Paul Seidenstat (eds.) (1992). Privatizing the United States Justice System: Police, Adjudication, and Cor- rections Services from the Private Sector. Jefferson, NC: McFarland & Company, Inc. Bowman, Gary W., Simon Hakim, and Paul Seidenstat (eds.) (1993). Privatizing Correctional Institutions. New Brunswick, NJ: Transaction Publishers. Brakel, Samuel J. (1988). “Prison Management, Private Enterprise Style: The Inmates’ Evalua- tion.” New England Journal of Criminal and Civil Confinement 14: 175–244. Bureau of Justice Statistics (1995). Prisoners in 1994. Washington, DC: U.S. Department of Jus- tice, Office of Justice Programs. Bureau of Justice Statistics (1997a). Prisoners in 1996. Washington, DC: U.S. Department of Jus- tice, Office of Justice Programs. Bureau of Justice Statistics (1997b). Census of State and Federal Correctional Facilities, 1995. Washington, DC: U.S. Department of Justice, Office of Justice Programs. Bureau of Justice Statistics (1998). Prison and Jail Inmates at Midyear 1997. Washington, DC: U.S. Department of Justice, Office of Justice Programs. Camp, George, and Camille Camp (1984). Private Sector Involvement in Prison Services and Opera- tions. Washington, DC: National Institute of Corrections. Camp, George, and Camille Camp (1997). The 1997 Corrections Yearbook. South Salem, NY: Criminal Justice Institute. Clark, John L. (1998). Report to the Attorney General: Inspection and Review of Northeast Ohio Correctional Center. Washington, DC: Office of the Corrections Trustee for the District of Columbia. Corrections Corporation of America (1997). An- nual Report: Financial and Operating Highlights. Nashville, TN. Cripe, Clair A. (1997). Legal Aspects of Correc- tional Management. Gaithersburg, MD: Aspen Publishers. Cunningham, Dennis (1999). Public Strategies for Private Prisons. Paper presented at the Private Prison Workshop held January 29–30, 1999, at the Institute on Criminal Justice, University of Minnesota Law School. Durham, Alexis M., III (1993). “The Future of Correctional Privatization: Lessons From the Past.” G. Bowman, S. Hakim, and P. Seidenstat (eds.) Privatizing Correctional Institutions. New Brunswick, NJ: Transaction Publishers. Durham, Alexis M., III (1994). Crisis and Reform: Current Issues in American Punishment. Boston, MA: Little, Brown and Co. Ethridge, Philip A., and James W. Marquart (1993). “Private Prisons in Texas: The New Pe- nology for Profit.” Justice Quarterly 10(1). Feeler, Malcolm M. (1991). “The Privatization of Prisons in Historical Perspective.” Criminal Jus- tice Research Bulletin 6(2): 1–10. Gaes, Gerald G., Scott D. Camp, and William G. Saylor (1998). “Appendix 2: Comparing the 66 Bureau of Justice Assistance Quality of Publicly and Privately Operated Pris- ons, A Review.” D. McDonald, E. Fournier, M. Russell-Einhorn, and S. Crawford (eds.) Private Prisons in the United States: An Assessment of Current Practice. Boston, MA: Abt Associates Inc., 1–38. Joint Legislative Audit and Review Commission (1994). Review of Inmate Medical Care and DOC Management of Health Services. Richmond, VA. Jones, Michael A., and James Austin (1995). The NCCD National Prison Population Forecast: The Cost of Truth-in-Sentencing Laws. San Francisco, CA: National Council on Crime and Delinquency. KPMG Peat Marwick (1994). District of Columbia Department of Corrections Privatization of Inmate Health Care Services. Washington, DC. Lamott, Kenneth (1961). Chronicles of San Quentin: The Biography of a Prison. New York, NY: David McKay Company. Lanza-Kaduce, Lonn, Karen F. Parker, and Charles W. Thomas (1998). “A Comparative Re- cidivism Analysis of Releasees From Private and Public Prisons.” Crime and Delinquency 45: 12–29. Logan, Charles (1991). “Well Kept: Comparing the Quality of Confinement in Private and Public Prisons.” The Journal of Criminal Law and Crimi- nology 83(3): 577–613. Logan, Charles, and B. McGriff (1989). Comparing the Costs of Public and Private Prisons: A Case Study. Washington, DC: U.S. Department of Jus- tice, Office of Justice Programs, National Insti- tute of Justice. Logan, Charles, and Sharla Rausch (1985). “Pun- ishment for Profit: The Emergence of Private En- terprise Prisons.” Justice Quarterly 2(3): 303–318. McCrie, Robert D. (1992). “Three Centuries of Criminal Justice Privatization in the United States.” G. Bowman, S. Hakim, and P. Seidenstat (eds.) Privatizing the United States Justice System. Jefferson, NC: McFarland & Company, Inc. McCrie, Robert D. (1993). “Private Correction: The Delicate Balance.” G. Bowman, S. Hakim, and P. Seidenstat (eds.) Privatizing Correctional Institutions. New Brunswick, NJ: Transaction Publishers. McDonald, Douglas C. (1994). “Public Imprison- ment by Private Means: The Re-emergence of Private Prisons and Jails in the United States, the United Kingdom, and Australia.” British Journal of Criminology 34: 29–48. McDonald, Douglas C., Elizabeth Fournier, and Malcom Russell-Einhorn (1998). Private Prisons in the United States: An Assessment of Current Prac- tice. Cambridge, MA: Abt Associates Inc. National Council on Crime and Delinquency (1998). National Survey of State Prison Privatization, 1997. San Francisco, CA. National Institute of Corrections (1985). Private Sector Operation of a Correctional Institution: A Study of the Jack and Ruth Eckerd Youth Develop- ment Center, Okeechobee, Florida. Washington, DC: U.S. Department of Justice. Pugh, R.B. (1968). Imprisonment in Medieval Eng- land. Cambridge, UK: Cambridge University Press. Robbins, Ira P. (1986). “Privatization of Correc- tions: Defining the Issues.” Vanderbilt Law Review 40(1): 813–828. Robbins, Ira P. (1997). “The Case Against the Prison-Industrial Complex.” Public Interest Law Review Winter: 23–44. Schosser, Eric (1998). “The Prison-Industrial Complex.” The Atlantic Monthly 283: 51–80. 67 Emerging Issues on Privatized Prisons Sechrest, Dale, and David Shichor (1993). “Cor- rections Goes Public (and Private) in California.” Federal Probation 57(3). Sechrest, Dale, and David Shichor (1994). Final Report: Exploratory Study of California’s Commu- nity Corrections Facilities. San Bernardino, CA: Parole and Community Services Division, Cali- fornia Department of Corrections. Sellers, Martin P. (1989). “Private and Public Prisons: A Comparison of Costs, Programs, and Facilities.” International Journal of Offender Therapy and Comparative Criminology 10(1). State of Washington Legislative Budget Commit- tee (1996). Department of Corrections Privatization Feasibility Study, Report 96–2. Olympia, WA. Texas Sunset Advisory Commission (December 1990). Contracts for Correctional Facilities and Services. Austin, TX. Texas Sunset Advisory Commission (1991). “Information Report on Contracts for Correction Facilities and Services.” Final Report. Recom- mendations to the Governor of Texas and the 72d Legislature. Austin, TX. Thomas, Charles W. (1991). “How Correctional Privatization Redefines the Legal Rights of Pris- oners.” The Privatization Review Winter 6(1): 38–55. Thomas, Charles W. (1997a). Testimony Regard- ing Correctional Privatization, presented before the Little Hoover Commission of the State of California. Sacramento, CA. Thomas, Charles W. (1997b). Comparing the Cost and Performance of Public and Private Prisons in Arizona: An Overview of the Study and its Conclu- sions. Gainesville, FL: Private Corrections Project. Thomas, Charles W. (1998). “Issues and Evi- dence From the U.S.” Stephen T. Easton (ed.) Privatizing Correctional Services. Vancouver, BC: The Fraser Institute. Thomas, Charles W., Diane Bollinger, and John Badalamenti (1997). Private Adult Correctional Facility Census, 10th Edition. Gainesville, FL: Private Corrections Project. Thomas, Charles W., and Charles H. Logan (1993). “The Development, Present Status, and Future Potential of Correctional Privatization in America.” G. Bowman, S. Hakim, and P. Seidenstat (eds.) Privatizing Correctional Institu- tions. New Brunswick, NJ: Transaction Publish- ers, 213–240. Travis, Lawrence F., III, Edward J. Latessa, and Gennaro F. Vito (1985). “Private Enterprise and Institutional Corrections: A Call for Caution.” Federal Probation 49(4): 11–16. Urban Institute (1989). Comparison of Privately and Publicly Operated Corrections Facilities in Ken- tucky and Massachusetts. Washington, DC. U.S. General Accounting Office (1996a). Federal and State Prisons: Inmate Populations, Costs, and Projection Models. Washington, DC. U.S. General Accounting Office (1996b). Private and Public Prisons: Studies Comparing Operational Costs and/or Quality of Service. Washington, DC. U.S. General Accounting Office (1997). Privatization: Lessons Learned by State and Local Governments. Washington, DC. Walker, Donald B. (1994). “Privatization in Cor- rections.” Peter C. Kratcoski (ed.) Correctional Counseling and Treatment. Prospect Heights, IL: Waveland Press. Yarden, David (1994). “Prisons, Profits, and the Private Sector Solution.” American Journal of Criminal Law 21(1): 325–334. 69 Emerging Issues on Privatized Prisons Guidelines for Contracting for a Private Prison Appendix *This Appendix was prepared by Dennis Cunningham, Private Prisons Administrator, Oklahoma Department of Corrections. It is based on a presentation by James Austin, Research Professor, Department of Sociology, The George Washington University, presented at the National Conference of Privatization, March 1998. Public Strategies for Private Prisons* Types of Privatization Option 1: State owns existing prison and hires private contractor to operate the publicly owned facility (often used for halfway houses and proposed for the District of Columbia). Option 2: State owns existing prison and sells facility to private vendor. Private vendor enters into contract with state to house inmates in the now privately owned and operated facility (CCA contract with the District of Columbia’s Correctional Treatment Facility). Option 3: State constructs new prison according to its specifications and then hires private contractor to operate the publicly owned facility (Ohio and Michigan Departments of Corrections). Option 4: State funds construction of new prison and owns the facility. State awards contract to private vendor to build and operate the facility according to the vendor’s specifications (often used for Texas Department of Criminal Justice State Prisons). Option 5: State funds construction for all facilities. State builds and operates a portion of the facilities funded. Local government selects private vendor to build and operate outstanding portion of facilities funded (Texas state jails). Option 6: Private contractor constructs new prison and enters into contract with state in which facility is located to house the state’s inmates in the privately owned and operated facility. 70 Bureau of Justice Assistance Option 7: Private contractor constructs new prison and enters into contracts with states other than the one in which the facility is located to house inmates in the privately owned and operated facility (CCA’s Northeast Ohio Correctional Facility in Youngstown, Ohio). Option 8: Local municipality funds construction of facility through the development of a not-for-profit corporation, which, after receiving state approval, sells tax-exempt bonds to fund the construction and equipping of a facility to house inmates from other jurisdictions (Texas). Option 9: Consortium of counties owns or has private facility and operates to house inmates from those counties (Tuscaloosa County, Alabama). Option 10: State contracts with a private vendor to build and operate a prison in another jurisdiction (proposed in Oregon). Key Points The National Institute of Justice (1987) report entitled Issues in Contracting for the Private Operations of Prisons and Jails provides an excellent early over- view of facility privatization issues. Much has been learned about private corrections in the United States in the years since that report. In this section, key points of the NIJ report are updated to include recommendations and additional key points based on present-day practices and experiences. Public Policy Considerations 1. Before contracting with a private service provider, a state should undertake a systematic, detailed analysis to determine if, and under what conditions, contracting is likely to be feasible for the correctional agency. This should include an examination of statutory authority, current state prison costs, crowding, performance standards, legal issues, availability of vendors, ways to reduce the likelihood and consequences of contractor defaults, and the attitudes of political stakeholders. 2. A public policy on privatization should be developed that provides guidance on key issues such as contract length, types of private services to be requested, private facility purchase options, performance standards, and reassurances to public employees. 3. If a government’s goal in contracting is to obtain new beds quickly at a lower construction cost, the private sector offers an attractive option. However, if the government seeks a more economical operation, the evidence available to date suggests that private contracting does not necessarily save a significant amount of money. 71 Emerging Issues on Privatized Prisons 4. The government should have a long-range plan that specifies how privatization fits into the agency’s plans and to what degree privatization will be pursued, such as what percentage of agency facilities or services will be offered to private contractors. 5. Public employees should be given the opportunity to participate in the competitive process and to win a contract if it can be proved that the public offer is the most suitable and the most appropriate choice. 6. A key issue that must be addressed by the public sector is What is success and how do we determine if we are successful in the delivery of correctional services? The current public trend of determinate sentencing policies bears close watching to ensure that privatization does not lead to harsher sentencing policies, increased recidivism, and further increasing of the scale of imprisonment. Protection of the State and the Inmates 1. Careful attention must be devoted to ensure that each contract provides adequate protection of inmates’ rights and also protects the state from liability claims. 2. Speculative prisons, proposed by economic development proponents, jeopardize the government’s debt-incurring ability because, if a speculative prison built with public trust bonds fails, the government ultimately becomes responsible for repayment of the debt. 3. Private prison contractors will not be able to escape liability under Section 1983 of the Civil Rights Act, and the contracting government entity will be unable to protect itself from lawsuits resulting from the wrongful acts of the selected operator (Richardson v. McKnight). The␣ government can reduce, but not eliminate, its vulnerability to privatization-related lawsuits by specifying in law, and subsequent- ly in the contract, that the government be indemnified against any damage award and for the cost of litigation. 4. The government may consider requiring that a significant perform- ance bond be posted or a trust fund established to indemnify it in the event of a contractor’s financial or other problems. The agency will need to determine whether the cost of the additional protection is necessary. The Process of Privatization 1. When contracting, the use a competitive bidding process is highly recommended. This will help to avoid accusations of favoritism or impropriety. To improve the competitive climate the agency can: 72 Bureau of Justice Assistance ❏ Develop and maintain a list of potential bidders. ❏ Provide public policy and rules for procurement of private facilities and services. ❏ Permit both private nonprofit and for-profit organizations to bid. ❏ Assist with the financing of the design and construction. ❏ Provide an ample window of opportunity for development of responses to the agency’s request for proposal (RFP). The RFP is sent to potential bidders to solicit an offer. 2. The agency must identify all the cost components of the public operations and the oversight functions so that they can be adequately addressed in negotiations and during the agency’s budget planning process. 3. The agency may mandate additional certification or credentials in critical areas such as: firearms, chemical agents, self-defense, emergency response apparatus/weaponry, health care, and transportation. 4. FBI felony background investigations of vendor employees and contractors must be required. Personnel standards and training should be comparable to the agency’s standards or American Correctional Association (ACA) standards—whichever are higher. 5. Information about the proposal evaluation process should be included in the RFP. Evaluation criteria include, but are not limited to: ❏ Vendor’s experience and past success in similar undertakings. ❏ Design and construction details. ❏ Timetable and availability. ❏ Staff qualifications. ❏ Qualitative review of operational plan details and program proposals. ❏ Vendor’s financial condition and references. ❏ Cost proposal. 6. The agency must specify and agree to a method for resolving any contractual differences that may emerge before the service commencement date. Contract Provisions 1. RFPs and subsequent contracts should specifically state: (a) the responsibilities of each party and (b) what levels of performance are expected to ensure compliance with performance standard policies, 73 Emerging Issues on Privatized Prisons procedures, and practices. The use of nationally recognized standards like those from ACA and the National Commission on Correctional Health Care (NCCHC) is recommended. 2. Governments can control contract costs by stipulating that per diems may not rise above the urban consumer price index. 3. Contracts should include specific staffing pattern information, inmate activity plans, treatment plans, and detailed operational plans. For example, staffing levels are determined by calculating the minimum personnel required for three shifts, the number of days per week for each person, and a relief factor or ratio. In addition, mandatory posts or pull posts (which are not always needed, such as visiting room officers), support positions, and outside subcontractors should also be specified in contracts. 4. RFPs and contracts should also identify sanctions or penalties that will apply for inadequate performance. Liquidated damages may be tied to failure to meet ACA mandatory standards and NCCHC standards, failure to staff adequately, inmate idleness, failure to meet court orders, improper use of force, or failure to meet any other performance standard as defined in the contract. 5. A variable cost structure that is fair for all parties should be built into the contract so that no misunderstanding will arise regarding cost for vacant beds and/or additional inmates beyond the specified ceiling. 6. The payment structure should be based on a pricing system such as single fixed price, fixed unit-price award, or cost plus. A per diem for actual inmate days is often preferred by states, as it addresses only beds used. There should be a provision to contract for additional services required by the state, court order, or other reason. Performance incentives may be desirable to include in the payment section. 7. Prison contracts should be rebid on a relatively short basis, such as every 3 to 5 years. State laws may mandate a maximum contract length. 8. Governments should include provisions in the contracts requiring that the contractor provide advance notification of issues that may result in a major impact on the facility, such as the end of a union contract period, major worker grievances that could force a work stoppage or slowdown, change of ownership or in rating of the facility, loss of insurance coverage, and defaults by subcontractors. 9. The contractor should rely on community resources for operating the facility whenever possible by, for instance, hiring local people and buying supplies and services locally. 74 Bureau of Justice Assistance Facility Concerns 1. Contracting for new or reoccupied facilities may entail fewer problems (e.g., personnel problems) than turning over an existing facility to a private firm. An important exception may be the case of trying to convert a jail into a prison. The experiences of several states (especially Texas) clearly demonstrated the problems with trying to manage long- term state prison incarcerates in former county jail lockups, often with poorly trained personnel. 2. Governments contracting to replace existing facilities should take steps to resolve personnel problems, including: ❏ Requiring contractor to give employment preference to displaced staff. ❏ Providing transfer, retraining, and outplacement services to em- ployees not choosing to work for the contractor. ❏ Carefully calculating and making provisions for disposition of␣ benefits (e.g., retirement benefits and vacation and sick leave accrual). 3. Governments establishing any contract facility should develop a public relations plan, because good public relations are crucial for community education. The government should fully inform community leaders and should also keep correctional employees fully informed of contract deliberations. The media should be made aware of the contracting initiative at an early stage. Selection of Inmates 1. The RFP and contract should explicitly describe the type and level of offender and the main construction and security features the agency deems necessary to confine the prisoners appropriately. The contract should be based on the state’s inmate classification policy and its opera- tional definitions of the privileges and level of supervision required by the custody level of the inmate population. This will include a section on special populations such as inmates with AIDS, the mentally ill, inmates under protective custody, and pregnant inmates. 2. The state should contractually require the vendor to accept all prisoners in certain categories (e.g., medium security) for the duration of the contract period up to the agreed maximum number of inmates to be incarcerated at any given time. The state should also mandate classifica- tion parity among public and private facility inmate populations. This will protect the state against “cherry picking,” or the␣ selection of only the best inmates by the private operator. 75 Emerging Issues on Privatized Prisons 3. Selection of inmates for placement in a contract facility, and decisions about their movement, is the government’s responsibility as described in the contract. Criteria should be mutually agreed upon to avoid misunderstandings. The contract should include the provision that the state makes the decisions about inmate reassign- ment, reclassification, and transfer to and from the facility. Public officials should make the decisions, based on vendor input, whether to award sentence credit and whether to release an inmate. 4. Minimum and maximum inmate population levels should be stated in the contract to facilitate planning and cost estimates. 5. States contracting for large institutions should specify in the RFP and the contract that the selected private vendor should use unit management—a system of smaller population subunits within a facility. Level of Authority 1. Government officials must ensure that disciplinary hearings conducted by the contractor follow legally required practices when discipline problems occur. A private firm should adopt the policies and procedures used by the agency. Major disciplinary actions should be formally approved by the contract monitor. 2. Private companies should closely adhere to the same type of procedures used by the government agency. Where necessary, contractor discretionary actions involving inmate rights and discipline should be made in the form of a recommendation to the␣ agency or official for approval. 3. In the event of an escape attempt, private prison employees should use reasonable and appropriate apprehension measures according to state law. Generally, once an inmate has left the facility’s property, law enforcement officials should become responsible for the ultimate capture and return of the escapee. 4. Private operators should be required to obtain an agreement with local law enforcement or other government entities to provide assistance in the event of an emergency. Private operators are responsible for the associated costs of such an emergency response. Contract Monitoring 1. The state should assign a full-time contract monitor to work onsite at the private facility. 2. The state should plan for this critical task and implement an effective system for continuous contract monitoring. Planning 76 Bureau of Justice Assistance occurs prior to the issuance of an RFP and is written in the contract. This should include: ❏ Regular timely reports showing tabulations, analyses of perfor- mance standards, and the results of inspections. ❏ Regular onsite inspections using a detailed checklist based on the contract performance standards, rating categories, and guidelines on how to complete the inspection. ❏ Periodic documented fire, safety, health, medical, and sanitation inspections. ❏ Participation in disciplinary hearings concerning major rule infrac- tions, approval of inmate classification actions, and sentence and time credit issues. ❏ Provision for regular interviews with inmates to obtain feedback on such performance standards as treatment of prisoners; amount of internal security; drug use; and helpfulness and adequacy of educa- tional, work, treatment, and recreational programs. ❏ Annual indepth, onsite inspections by a team of experts, covering the various procedures used and the results of periodic reports on the facility’s quality of services based on performance standards. ❏ Provision for prompt review by government officials of the written inspections, identification of a corrective action plan with due dates, and followup to determine compliance. ❏ Provision for relating information from the monitoring process for consideration during contract renewals. 3. The same monitoring procedures should be applied to publicly operated and contractor-operator facilities. Governments can then use the information as a basis for comparisons and making future privatization decisions. Contract Evaluation 1. The government and the private operator should cooperate on systematic, comprehensive evaluations of the cost and operational effectiveness of the contract. The government should require that a comprehensive evaluation be made of the degree of success of the contract within a few years of the contract award. If possible, the contracted facility should be compared with publicly operated facilities. 2. Agreement on the success of prison privatization is important. Although the most discussed comparison usually involves cost of services, other variables may have greater bearing on the overall degree of success of the privatization efforts. Quality-of-service analyses and studies of recidivism and public safety could become critical review 77 Emerging Issues on Privatized Prisons components. One researcher’s classification of important dimensions of prison services and quality of confinement was defined by Logan (1991) as: Security: With respect to inmates, staff, and community. Activity: Assurance that inmates are not idle; promote rehabilitation. Safety: Environmental hazards, sanitation, freedom from disease. Justice: Rule of law inside prison; fairness. Order: Enforcement of inmate compliance; assurance of orderly running of the institution. Care: Medical, dental, psychological. Conditions: Crowding, health risk. Management: Staff capability, efficiency. Summary Success in privatizing prisons is highly dependent on the care taken in developing a public policy that includes a long-range plan, a manage- ment procurement process, identification of all of the state’s costs, an RFP, a contract that includes performance standards, guidelines for choosing a contractor, details on executing the contract, and standards for monitoring the contract. Sample Contract Performance Standards 1. Health and Safety: The facility is in compliance with all local, state, and federal fire and health codes. The facility retains on file com- pleted inspection forms from these authorities that are available for review. 2. ACA Accreditation: Owner/operator will become a candidate for ACA accreditation within 9 months of the initial contract and achieve accreditation within 36 months of the services commencement date. 3. Emergency Procedures: The facility has in place procedures to follow in the case of an emergency and has provided a copy of such procedures to the department. 4. Sanitation and Hygiene: The facility provides equipment and supplies to ensure the maintenance of a clean and healthy 78 Bureau of Justice Assistance environment. Hygiene items are provided to inmates for their personal use through the commissary or through indigent services as necessary. 5. Health Services: Medical, mental health, and dental services provided are comparable to those of the department in compliance with con- tractual obligations and ACA standards. 6. Food Services: Food services provided for inmates include a master menu schedule, special diets meeting medical or religious require- ments, and three meals served daily at regular times during each 24- hour period with no more than 14 hours between the evening and morning meals. 7. Property: The property matrix of the Department of Corrections (DOC) is utilized. The facility will provide for the secure storage of inmate property. If the property is lost or damaged while under the care of the␣ facility, inmates can use the facility’s grievance process to seek reimbursement for the lost or damaged property. 8. Inmate Services: Laundry services are available to inmates and the facility provides a commissary for inmates comparable in goods and prices to DOC facilities. Inmates are allowed correspondence and mail delivery services in accordance with policy; telecommunication costs for inmates are comparable to those in DOC-operated facilities; and visiting policies and practices enable inmates to maintain ties with families. 9. Grievance Procedures: Inmates are afforded access to a reasonable, impartial, and nondiscriminatory procedure, which includes a final level of appeal to the state. The facility is responsible for responding to grievances on matters occurring during the inmates’ incarceration in the facility except during sentence administration and classification to a␣ higher or lower security facility. 10.Disciplinary Procedures: The facility follows DOC’s disciplinary policy, or one comparable with disciplinary action and reasonable sanctions proportionate in relation to the violation. The facility provides complete, accurate, and detailed reports to the contract monitor within 7 working days of the finalized disciplinary action. 11. Inmate Activity: A minimum of 80 percent of eligible inmates are productively occupied outside their cells for at least 6 hours per day or␣ 30 hours a week in work, educational, vocational, or rehabilitative programs. Inmate labor may be used for facility operations and maintenance but not for the personal benefit of any employee. 12.Inmate Programs: The facility offers at least basic literacy education, adult basic education, and general educational development; substance abuse programs with cognitive approaches and self-help programs; opportunities for vocational program participation; and other programs as specified in the contract. 79 Emerging Issues on Privatized Prisons 13. Security and Control: The facility provides security and control in accordance with accepted operating standards. Security measures are reviewed on a monthly basis to include tool and key control, internal and external security, search and seizure practices, and emergency procedures. 14. Use of Force: The facility follows DOC’s use-of-force policy, reports all incidents according to policy, and provides written reports in a timely manner as followup through the contract monitor. 15. Access to Courts: Inmates are afforded access to the courts through the use of legal materials or a person trained in law or a combina- tion of both. The law library, where applicable, contains the required legal materials. 16. Case Management: Inmates receive orientation services and meet with their case managers within the first 10 days to be assigned an earned credit level and are reviewed every 120 days for adjustment of the level of earned credit. Case managers have regular contact with inmates and handle requests for staff and grievances when possible. 17. Inmate Records and Reports: The facility maintains records on individual inmates. A case manager maintains individual files documenting each inmate’s program goals, employment, earned credit, disciplinary records, programmatic involvement, and other significant information. Inmate records and time calculations are monitored/audited by a sentence administration unit. 18. Racial Balance: Racial balance is maintained in accordance with DOC policy in housing, programs, and job assignments. 19. Urinalysis Testing: Five percent of the inmates are randomly tested for drug use monthly. 81 Emerging Issues on Privatized Prisons Resources for Appendix Archambeault, William G., and Donald R. Deis (1996). Cost Effectiveness Comparisons of Private Versus Public Prisons in Louisiana: A Comprehen- sive Analysis of Allen, Avoyelles, and Winn Correc- tional Centers. Baton Rouge, LA: Louisiana State University School of Social Work. Bates, Eric (1998). “Private Prisons.” The Nation January 5. Camp, George, and Camille Camp (1997). The 1997 Corrections Yearbook. South Salem, NY: Criminal Justice Institute. Culp, Richard (1997). The Privatization of Prisons: The Public Policy Debate. New York, NY: The City University of New York. Gilbert, M.J. (1996). “Private Confinement and the Role of Government in a Civil Society.” G.L. Mays and T. Gray (eds.) Privatization and the Pro- vision of Correctional Services: Context and Conse- quences. Cincinnati, OH: Anderson Publishing Company. Gold, Martin E. (1996). “The Privatization of Prisons.” The Urban Lawyer: The National Quar- terly on Local Government Law 28(3): 359–399. Greene, Judith (1998). Privatization of Correctional Services: Critical Issues for State Policy Makers. Minneapolis, MN: Institute of Criminal Justice, University of Minnesota Law School. May. Hackett, Judith, Harry P. Hatry, Robert B. Levinson, Joan Allen, Keon Chi, and Edward D. Feigenbaum (1987). Issues in Contracting for the Private Operations of Prisons and Jails. Washing- ton, DC: U.S. Department of Justice, Office of Justice Programs, National Institute of Justice. Little Hoover Commission Reports on Crime (January 1998). Beyond Bars: Correctional Reforms to Lower Prison Costs and Reduce Crime. Report #144. Sacramento, CA. Logan, Charles H. (1991). Well Kept: Comparing Quality of Confinement in a Public and Private Prison. Washington, DC: U.S. Department of Justice, Office of Justice Programs, National Institute of Justice. McDonald, Douglas C. (1992). Private Penal Insti- tutions. Chicago, IL: University of Chicago Press. McDonald, Douglas C. (1994). Private Prisons by Private Means. Oxford, UK: Clarenden Press. National Institute of Justice (1987). Issues in Con- tracting for the Private Operations of Prisons and Jails. Washington, DC: U.S. Department of Jus- tice, Office of Justice Programs. Private Prison Administration (November 1997). Public Strategies for Private Prisons. Conference Evaluation Summary. Oklahoma City, OK: Pri- vate Prison Administration. Richardson v. McKnight. Supreme Court decision June 23, 1997. Ithaca, NY: Legal Information In- stitute and Project Hermes, Cornell Law School. html/96-318.ZS.html. Sellers, Martin P. (1989). “Private and Public Prisons: A Comparison of Costs, Programs and Facilities.” International Journal of Offender Therapy and Comparative Criminology 33: 241–256. Thomas, Charles W., Dianne Bolinger, and John Badalamenti (1997). Private Adult Correctional Fa- cility Census, 10th edition. Gainesville, FL: Pri- vate Corrections Project, University of Florida. 82 Bureau of Justice Assistance U.S. General Accounting Office (1996). Private and Public Prisons: Studies Comparing Operational Costs and/or Quality of Services. Washington, DC. Washington State Joint Legislative Audit and Re- view Committee (1996). Legislative Budget Commit- tee, State of Washington Department of Corrections Privatization Feasibility Study, Report 96–2. Olym- pia, WA: Legislative Budget Committee. Wilson, Tim (July 1996). “The United Kingdom Experience.” Unpublished paper presented at the Privatization of Correctional Services Con- ference, Toronto, Canada. 83 Emerging Issues on Privatized Prisons Sources for Further Information For more information on privatized prisons, contact: Oklahoma Office of the Attorney General, Oklahoma Public Legal Research System World Wide Web: Oklahoma Department of Corrections 3400 Martin Luther King Avenue Oklahoma City, OK 73111 405–962–6080 American Law Sources World Wide Web: For more information on correctional services and issues, contact: Bureau of Justice Assistance 810 Seventh Street NW. Washington, DC 20531 202–514–6278 World Wide Web: Bureau of Justice Assistance Clearinghouse P.O. Box 6000 Rockville, MD 20849–6000 1–800–688–4252 World Wide Web: Clearinghouse staff are available Monday through Friday, 8:30 a.m. to 7 p.m. eastern time. Ask to be placed on the BJA mailing list. U.S. Department of Justice Response Center 1–800–421–6770 or 202–307–1480 Response Center staff are available Monday through Friday, 9 a.m. to 5 p.m. eastern time. Bureau of Justice Assistance Information General Information Callers may contact the U.S. Department of Justice Response Center for general information or specific needs, such as assistance in submitting grant applications and information on training. To contact the Response Center, call 1–800–421–6770 or write to 1100 Vermont Avenue NW., Washington, DC 20005. Indepth Information For more indepth information about BJA, its programs, and its funding opportunities, requesters can call the BJA Clearinghouse. The BJA Clearinghouse, a component of the National Criminal Justice Reference Service (NCJRS), shares BJA program information with state and local agencies and community groups across the country. Information specialists are available to provide reference and referral services, publication distribu- tion, participation and support for conferences, and other networking and outreach activities. The Clearing- house can be reached by: ❒ Mail P.O. Box 6000 Rockville, MD 20849–6000 ❒ Visit 2277 Research Boulevard Rockville, MD 20850 ❒ Telephone 1–800–688–4252 Monday through Friday 8:30 a.m. to 7 p.m. eastern time ❒ Fax 301–519–5212 ❒ Fax on Demand 1–800–688–4252 ❒ BJA Home Page ❒ NCJRS World Wide Web ❒ E-mail [email protected] ❒ JUSTINFO Newsletter E-mail to [email protected] Leave the subject line blank In the body of the message, type: subscribe justinfo [your name] U.S. Department of Justice Office of Justice Programs Bureau of Justice Assistance Washington, DC 20531 Official Business Penalty for Private Use $300 BJA World Wide Web Address For a copy of this document online, as well as more information on BJA, check the BJA Home Page at PRESORTED STANDARD POSTAGE & FEES PAID DOJ/BJA PERMIT NO. G–91

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