Jail And Prison Privatization Issue May Still Have Life

Corrections Corporation of America and The GEO Group – private companies that manage correction facilities – don’t agree on much, but they do agree on this: privatizing the Shelby County Corrections Center and the Shelby County Jail fell prey to political considerations.

Meanwhile, supporters of Shelby County Commissioner Bruce Thompson – who has announced that he will not seek re-election – complain that as a result of Sheriff Mark Luttrell and Mayor A C Wharton bringing a whiplash halt to the consideration of privatization, Commissioner Thompson was left alone way out on a high political limb.

Commissioner Thompson’s friends point to the sense of betrayal felt by him as a major reason that he is abandoning public life, and whether you agreed with his position in favor of privatization or not, it’s hard to disagree with his position that all information on the proposals should be made public and that a full airing of them is needed.

With only six months remaining in office and no election looming, Commissioner Thompson, who’ll be missed in county government, can focus on his quest to find out why the political winds suddenly shifted and why the report opposing privatization felt mandated from above.

All in all, the issue of privatizing the county correctional facilities has all the trappings of a political Gothic novel for which county government is legend. And yet, lost in the politics of the issue is the need for someone to weigh the pluses and minuses of privatization in a nonpolitical, objective way.

We say this despite having no real opinion on the proposals by CCA and GEO; however, we do have the opinion that all information about the proposals should be made public so that the citizens who foot the bills for these costly facilities can read it themselves and make their own decisions.

There’s no question that privatization is not always the answer to increasing efficiencies and cutting budgets. There’s a reason some services are public, and when turned over the private sector, the results can sometimes be politically unpalatable to the citizens paying for them.

A case in point is Shelby County’s outsourcing of the management of its nursing homes in 1996. At that time, the now-defunct, but then politically connected, Diversified Health Services got a contract to manage county nursing homes, and promptly fired 130 employees. After all, they had little choice. The company’s contract called for the company to be paid a fee based on a percentage of savings, and since more than 60 percent of county budgets are for personnel, that’s the first priority.

It may have made good business sense, but it made for awful health care.

Within months, state inspectors cited the nursing homes for poor quality of care and eventually, there were a number of lawsuits filed for the neglect of patients and by the family of a patient who wandered away from the nursing home unnoticed and was found dead on the side of the road.

Unfortunately, the motivation for the outsourcing was political, rather than for improving operations. Faced with reducing costs or not getting paid, the only real option was to make changes that affected the level of care.

Consistent with the politics that inspired the contract, there was considerable manipulation of the facts. To obtain their approval, commissioners were told that the privatization would save county government $400,000 a year. In fact, records at the end of the first year showed that instead of a savings, the contract had actually cost $1 million. No one ever returned to the board of commissioners to report these facts and the contract remained in place until the care of the nursing home residents became so bad that county government was left with no choice but to sever ties.

Because of this negative brush with privatization, proponents of privatization had some high hurdles to clear if they were to implement it for the jail and prison. The issue became such a political hot potato that as elections approached, Commissioner Thompson seemed to be the only person left standing on the issue, asking for complete disclosure of all proposals and for an independent evaluation of them.

That followed the announcement by Mayor Wharton and Sheriff Luttrell that “based on a review of the information received in the best and final offers,” they were rejecting both proposals for privatization.

Mayor Wharton said neither offered substantial savings in the operation of the prison – the facility under his control. Meanwhile, Sheriff Luttrell said that improvements had already been made to the jail – the facility under his control – and that the true costs of operations were unclear, because both proposals called for construction of a new jail.

Following the announcement, both companies weighed in with separate complaints about the evaluation process. CCA, which operates 63 facilities nationwide with 16,000 employees, said the report by the mayor and the sheriff was filled with inconsistencies and misinterpretations of their proposals.

In an obvious slap at the county, the company wrote that it would “take this (financial) matter up with the State of Tennessee who better understands the issues and has more to gain than Shelby County.” Also, the firm called for an independent evaluation.

A few days later, GEO mailed its own letter, saying that the “process…is in need of careful reconsideration.” Its suggestion was for the sheriff to pick one firm and to proceed with further conversations to determine if an agreement could be reached. It mentioned the value of public workshops.

Despite the companies’ protestations, it’s unlikely that county officials are going to reopen this controversial issue so close to their election, particularly in light of the highly effective grassroots opposition run by the officers at the corrections center and jail (complete with yard signs and phone banks).

Conventional wisdom suggested that CCA, with roots running deeply into Tennessee political soil, had the upper hand in the competition, but it never seemed to address the underground campaign against it, a campaign that cited the fact that one of the worst prison riots in the U.S. was at a CCA-operated Colorado prison. In an extensive assessment of the riot, Colorado corrections officials criticized CCA for failing to adequately train its staff, for failing to prepare an emergency response team and for failing to follow “fundamental security measures.”

In addition, CCA managed an Eastern Kentucky prison that was the scene of a major prisoner riot in 2004 amid allegations of abuse, mistreatment and a reduction of visits from families. A contributing factor in the riot was the fact that the prison was admitting inmates from Vermont, because that state paid a higher “pre diem” than Kentucky.

In his last six months in office, the privatization issue may not be reopened, but here’s guessing that Commissioner Thompson can keep in on the front pages.