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Privatization Watch

Corrections Corporation of America (CCA) is no stranger to AFSCME corrections officers. The union has defeated numerous CCA attempts to privatize our members’ jobs across the country.

The Tennessee-based company is the largest developer and manager of private correctional and detention facilities in the world. It manages approximately half of all private adult correctional facilities in the United States, employs more than 10,000 workers worldwide in more than 60 prisons, and generated close to $300 million in revenue in 1996. The company’s facilities are located in 17 states, Washington, D.C., Puerto Rico, Australia and the United Kingdom.

We expect the battle against privatization to continue in 1998 and, in preparation, have compiled some highlights from CCA’s 1997 track record — so our readers can help keep local decision makers up-to-date.

1997 Rap Sheet

FEBRUARY: South Carolina took over its CCA-run juvenile prison in the wake of security problems and abuse claims. Gov. David Beasley (R) said "the company failed to meet the state’s expectations."

MARCH: The District of Columbia backed out of a $172 million contract to provide inmates to a CCA-run facility in Ohio after District officials realized the contract had the "appearance of impropriety." The city had never opened up the bidding to other companies, and had accepted a contract containing a $142.7 million "cancellation ceiling" — meaning that if the District were to cancel the contract, it would have to reimburse CCA for its costs, up to the ceiling amount. After making changes to the contract — including putting it out for multiple bids — the city ended up signing with CCA.

A news story revealed that Tennessee inmates infected with HIV or AIDS were being routinely transferred from CCA-run facilities to state facilities. "The contract negotiated [with] CCA would have been too expensive [if it had covered inmates with HIV or AIDS]," said Bill Dalton, an assistant corrections commissioner. "We’re saving stockholders money, but not saving taxpayers money," countered State Rep. John Windle (D).

MAY: At CCA-operated Silverdale Workhouse in Chattanooga, Tenn., five employees were charged with bringing drugs into the county jail or allowing drugs to be distributed there.

A former CCA lobbyist filed a lawsuit charging CCA officials with wiretapping an employee and conspiring to violate drug laws. This same lobbyist had testified before a 1992 federal grand jury about the cozy ties between the company and politicians.

JUNE: In perhaps the most significant legal development to date in this country regarding prison privatization, the U.S. Supreme Court ruled that private corrections officers are not entitled to the "qualified immunity" granted to state and local corrections officers. Qualified immunity protects COs from lawsuits resulting from actions taken in the course of performing their duties. The decision stemmed from a suit by a prisoner that CCA employees used bodily restraints that were too tight.

JULY: Dr. Charles Thomas — who is frequently called upon by government agencies, legislatures and investment banking firms as an unbiased expert on prison privatization — was discredited when a Florida union filed a complaint with the state Commission on Ethics. The complaint pointed out that, since 1990, CCA and other private prison companies have financed Thomas’ Private Prisons Project at the University of Florida. It also pointed out that CCA Realty appointed Thomas to its board. Compensation includes a $12,000 annual salary, as well as valuable stock options.

AUGUST: Gov. Gary Johnson’s (R) administration accused CCA of overcharging the state more than $2 million for running the New Mexico women’s prison in Grants. Rob Perry, the state’s appointed secretary of corrections, called the enormous bill "absurd."

Inmates from Washington, D.C., at the Northeast Ohio Correctional Center in Youngstown filed a federal class-action lawsuit against CCA for excessive force. CCA has a five-year operating contract at the facility.

A riot at a CCA-run facility in Puerto Rico left one employee injured and caused at least $1 million in damages. Prisoners set fires to mattresses, broke walls and took 13 hostages before the standoff ended.

OCTOBER: Broward County, Fla., rejected bids from CCA and Wackenhut Corrections to build and operate a jail in Southwest Broward. "There is simply no reason to [privatize]. The numbers are simply too high," Commissioner Lori Parrish said.

Genesis Merchant Group Securities lowered its 1998 earnings per share estimate for CCA following the company’s disappointing 1997 third quarter results. Analysts noted that several factors drove the earnings below expectations, including high employee turnover.

A guard at the CCA-run Hardeman County, Tenn., prison was arrested for smuggling drugs into the prison. State prison employees have accused CCA of refusing to report drug and weapons smuggling by their employees.

NOVEMBER: A federal prisoner escaped from the CCA-run Liberty County Jail in Texas. He was recaptured over 50 days later — by U.S. Marshals.

Sources: AP; UPI; PR Newswire; Prison Privatization Report International; The Nashville Banner; AIDS Weekly Plus; The Washington Post; Corrections Professional; The Santa Fe New Mexican; The (Fort Lauderdale, Fla.) Sun-Sentinel.

 

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