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Texas: Letter to the editor.
Privatizing prisons won't fix Texas' budget problems
Saturday, May 10, 2003

In March, certain legislators floated the possibility of privatizing up to 25,000 prison beds in Texas.

Many long-term observers of the state's experiences with private prisons and jails think this is a bad idea. They said, "Private prisons have a terrible track record in Texas and nationwide on escapes, abuse of prisoners, violence against inmates and guards and riots. What's more, they make their money by paying guards such minimal wages that turnover in some private facilities is more than 80 percent annually. This is not a system we want to expand. In fact, the use of private prisons is on the decline across the country. States have been withdrawing their contracts after realizing that the privatization experiment never lived up to its promises."

"But, wait," legislators said. "We think that privatization offers the promise of up to $120 million in savings -- something we have to consider in this budget crisis. Let's investigate. If the savings aren't there, we won't pursue this."

A working group of the state's top budget people checked the numbers, and the potential savings shrunk to about a seventh of the initial figure. Experts warned that the revised figure didn't factor in hidden costs for the state, such as long-term liability costs, because of all the problems in private facilities. When apples were compared with apples, it began to look like privatization at best offered minimal savings that would be far outweighed by the downsides -- including the impact on state employees whose pay and benefits would be cut.

That should have ended matters, but it didn't. Those same legislators who said they wouldn't pursue this for negligible savings moved forward with their proposal anyway. It got worse. To make up for the minimal savings associated with each bed that might be privatized, they decided to increase the number of private beds. They started talking about privatizing the entire system of state jails and creating opportunities for limitless expansion of private prisons.

Austin readers remember Travis County's experiment with privatizing its state jail: All the initial excitement about a community-oriented facility run by Wackenhut rapidly disappeared when 11 officers were indicted for sexually assaulting inmates. The state had to take over the facility.

In later versions of the bill, the cost-savings principle was compromised even further. Today, a prison can't be privatized unless privatization yields a 10 percent savings over public facilities. But the pending bill reduces the necessary cost savings to only five percent. Programs that generate revenue in private facilities currently return all profits to the state. But under the new bill, the state can negotiate away those profits and kick them all back to private providers. Not only is that giving away the state's money, it also means the providers make up for any losses they have from coming in at five percent below the state's costs.

Each version of the bill brings a new revelation about how unimportant cost savings for the state really are. In fact, the bill would now create an entirely new state agency to oversee private prisons, with all the associated start-up costs and duplication of services, when the Texas Department of Criminal Justice has been handling that function effectively and appropriately for 16 years.

This is a radical proposal that will leave us with a massive expansion of private prisons, operating virtually without accountability. Its legal and practical implications have not been thought through. Let our legislators know that this is unacceptable.
Michele Deitch is an Austin-based attorney and criminal justice policy consultant, as well as director of the Center for Criminal Justice Initiatives.

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