October 10, 2016

For-profit Prisons Update

DOJ’s decision to phase out its contracts with private prison operators could face a legal challenge from the industry. On October 3, private prison contractor GEO Group filed a letter of protest with the GAO asking the office to reverse the Bureau of Prison’s decision to dramatically reduce a contract solicitation with prison operators.

In the letter, GEO Group alleges the government unlawfully amended its solicitation after receiving bids by reducing a request for 10,800 prisoner beds to 3,600 beds, and by reducing the contract’s duration—all part of DOJ’s plan to phase out use of private prisons.

The company argues that the revised solicitation “included changes so substantial that it required the Agency to issue a new Solicitation.” More broadly, GEO Group attacked DOJ’s inspector general report on private prisons and the decision to phase them out as “illogical” and based on faulty data and erroneous conclusions. The company asks the accountability office to restore the original solicitation. The official letter of protest is likely the first step before filing a lawsuit.

The protest letter could be a sign of desperation by GEO Group, as DOJ’s decision—if followed by a decision by the Department Homeland Security to phase out its use of private detention centers for immigrants—would likely prove devastating to the industry. A lawsuit against the government’s decision could explore larger existential questions about the use of private prisons. Industry arguments that they provide cost savings and quality services would likely face a challenge by the government. Evidence could include not only DOJ’s Office of the Inspector General report that found more safety and security incidents per capita at privately operated prisons, but also in-depth research about quality and cost issues.

In a recent article for Prison Legal News, Alex Friedmann, the publication’s managing editor and a prisoner’s advocate, detailed research that showed private prisons can cost governments more than publicly operated prisons. He also enumerated ways in which private prisons have shifted costs to the public sector, including through security, capping medical costs, and maintaining profit guarantees in their contracts. Further, Friedmann contends that quality also suffers at private prisons, which can be seen in the high violence and recidivism levels, as well as staff turnover.

A legal challenge by the industry is not likely to stop the political push to end the use of for-profit prison facilities. But, as Friedmann said in an interview with The Capitol Forum, the willingness of executive agencies to end their use of privately operated jails and facilities could depend on their specific, immediate needs for capacity, or “beds,” for prisoners. As he notes, the bed space needs for the Bureau of Prisons has declined in recent years, giving the agency flexibility to phase out contracts with private operators.

The U.S. Immigration and Customs Enforcement (ICE), on the other hand, operates under a congressional directive known as the “bed mandate” that requires ICE to maintain a level of detention beds for daily immigrant operations. The bed mandate is a provision in the DHS Appropriations Act. Accordingly, continuing resolutions provide no opportunity to phase out the bed mandate. Without a Congressional change in the bed mandate or a strong reversal in policy from the executive branch—something that Hillary Clinton has identified as part of her platform—DHS and ICE might claim their hands are tied in reducing their dependency on private prisons. But, according to Friedmann, ICE could pursue a leasing model, wherein it could meet its capacity needs by renting private facilities and staffing those facilities with government workers.