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Arizona tops in guaranteeing private prisons new customers

This piece originally appeared in the Arizona Sonora News


Arizona leads all other states in deals crafted for the private prison industry by guaranteeing 90 to 100 percent of prison beds will be filled in all six state-level private prison facilities.

Private prison companies lock states into contracts to fill a certain percentage of prison beds or pay regardless, which ensures profits and revenues but at the cost of taxpayers.

Arizona trumps all states’ inmates quotas with three private prison facilities requiring 100 percent occupancy. Critics argue that this provides incentives to keep prison beds full, running counter to many states’ trend of reducing prison populations, sentencing lengths and corrections spending.

Arizona, Louisiana, Oklahoma and Virginia are the only states with quotas higher than 90 percent.

Infographic from In the Public Interest

Infographic from the In the Public Interest report titled “How Lockup Quotas and ‘Low-Crime Taxes’ Guarantee Profits for Private Prison Corporations.”

Private prisons operate in 33 states, and 65 percent of county- and state-level private prison facilities require occupancy guarantee clauses, according to a report from In The Public Interest, an anti-privatization group.

Andrew Wilder, Arizona Department of Correction public information officer, said the purpose of the contracts are to enable private companies to recover upfront capital investment needed to create the beds.

“Private bed contacts are for 10 years with two 5-year renewal options, after which the state owns the facility,” Wilder said. “Use of these contractual arrangements allows the state to fund the capital construction cost of new facilities over time and avoids the burden of direct financing or upfront construction costs.”

The most recent contract is for 20 years and includes 1,000 new medium security beds with a 90 percent occupancy clause at the Red Rock Detention Correctional Center, which is operated by the Correction Corporation of America, the nation’s largest private prison company.

It requires the state to appropriate $17.6 million to create the 1,000 new beds. In addition, it costs $24 million annually to operate and maintain those beds.

Arizona’s private prisons house 13 percent of the total prison population, which is the 12th-highest percentage in the country.

Paul Ashton of the Justice Policy Institute, a nonprofit organization dedicated to reducing incarceration times, called Arizona a “ripe breeding ground for prison privatization.”

Arizona incarcerates more residents per capita — 589 per 100,000 residents — than any Western state, only following five other states in the south. The Arizona Department of Corrections projects Arizona’s prison population to grow annually by 900 inmates.

Daniel Scarpinato, spokesman for Gov. Doug Ducey, said the governor wants to change the trend line of prison population growth, but the latest budget proposal calls for adding 1,000 more prison beds each year till 2019.

Scarpinato said the contracts are cost-saving alternatives to creating an entirely new prison facility to house Arizona’s increasing inmate population, which could cost in the hundreds of millions of dollars.

“We want to make sure we are protecting public safety and taxpayers,” Scarpinato said.

One factor for the projected growth is attributed to Arizona being one of three states fully implementing the “Truth in Sentencing Law,” which requires all inmates serve a minimum of 85 percent of their sentences. Arizona also ranks among the highest in the nation for length of sentences for nonviolent crimes.

As a result of these sentencing policies, more people are being incarcerated than released.

Ashton said the Justice Policy opposes private prison occupancy guarantee clauses because it is using taxpayer money to fund a private entity that profits by increased incarceration.

“The only way their [private prison companies] revenue model is successful is adding more people to prison and having them stay in prison,” which creates an adverse incentive for lawmakers to reduce the number of people incarcerated because the state is paying for the beds regardless, Ashton said.

“It’s a unique strategy private prison companies are able to employ to ensure that their revenue stays stable,” he added.

The Sentencing Project, a group researching and advocating for criminal justice reform, reported in the last two decades that CCA, operator of six private prisons in Arizona, experienced a revenue increase of more than 500 percent.

CCA 2015 full year financial report states a total revenue of $1.79 billion last year, compared to $1.65 billion in 2014.

Ashton said the national private prison boom occurred in the 1980s as a result of the crack cocaine epidemic and President Reagan’s advocacy for privatization.

The question became, where does the U.S. put all the new prisoners and how does it pay for them, Ashton said.

The argument was private companies can do it better and cheaper than the state, explained Ashton, but, “30 years later, there still is no conclusive body of research that says they do it better and cheaper than state facilities.”

Ashton added: “In order for these companies to cut costs and increase revenue, they often don’t provide the same level of services as state prisons,” such as addiction treatment or educational opportunities.

Caroline Isaacs from American Friends Service Committee, an organization committed to social, justice, peace and humanitarian service, cited a 2012 study that reported, “Arizona wasted over $10 million on private prison” between 2008 and 2010.

The report also identified a cost comparison by the Arizona Department of Corrections that found in many cases, private prisons cost more than their public equivalent.

“The argument,” Ashton said, “comes down to we are creating a private business by incarcerating people,” which he said comes at the expense of state taxpayers.

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This piece originally appeared in the Arizona Sonora News

You can follow David McGlothlin on twitter at @mc_glothlin and Paul Ashton at @PDAshton.

Posted in JPI in the News, Criminal Justice News

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