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PDFFrom PrivatizationWatch:
As state governments wrestle with massive budget shortfalls, a Wall Street giant is offering a solution: cash in exchange for state property. Prisons, to be exact. Corrections Corporation of America, the nation’s largest operator of for-profit prisons, has sent letters recently to 48 states offering to buy up their prisons as a remedy for “challenging corrections budgets.” In exchange, the company is asking for a 20-year management contract, plus an assurance that the prison would remain at least 90 percent full, according to a copy of the letter obtained by The Huffington Post.
The move reflects a significant shift in strategy for the private prison industry, which until now has expanded by building prisons of its own or managing state-controlled prisons. It also represents an unprecedented bid for more control of state prison systems….But estimated savings often come down to how those calculations are made, and outside researchers have questioned the numbers.
In Arizona, for example, a 2010 report from the state’s auditor general showed that it cost the state more to house prisoners in private facilities than public prisons after factoring in administrative costs and adjusting for the types of medical care provided to less healthy inmates who tended to be housed in public facilities. And in Florida, where lawmakers this week could decide whether to privatize more than two dozen state prisons, reports about private prisons from the state’s legislative research office note, “cost savings estimates are subject to caveats and should be evaluated cautiously.
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