Private Prison Corporations Bet on Increased Profits from Immigrant Detention and Re-entry Contracts

February 24, 2015

Austin, TX (February 23, 2015) -- Private prison corporations Corrections Corporation of America (CCA) and the GEO Group have released their fourth quarter 2014 earnings. Both companies are predicting more contracts with state and federal agencies in 2015, and both companies bet on increased profits from the detention of immigrants - including immigrant women and children - and re-entry services to boost their bottom line.  .

Immigratio

n and detention facilities continue to be an on-going source of profits for both CCA and GEO Group.  Both companies said that ongoing detention of immigrant families - including small children - would be boost profits in 2015.

Corrections Corporation of America noted that its massive new family detention center in Dilley, Texas had already generated $21 million in revenue in the last quarter of 2014.  The facility is expected to expand to 2,400 beds by May of 2015 from 480 beds today.  Similarly, GEO Group reported that its  $36 million expansion to the Karnes County Family Residential Center to a total of 1158 beds for asylum-seeking families would bring in  $21 million in profits this year.

“Locking up refugee families and children continues to be a revenue generating tactic for both CCA and GEO Group,” says Cristina Parker, Immigration Programs Director at Grassroots Leadership. “While the rest of the country was shocked and concerned by the humanitarian crisis at the border this summer, CCA and GEO were giddy.”

GEO Group, touting its “GEO Continuum of Care” and “incrementally profitable” investments also recently acquired LCS Corrections Corporation. With the acquisition, GEO Group increased its total bed number to 85,500 beds across the United States.

The corporation also stated that it would like to become the leading provider of rehabilitation and work on reducing recidivism rates. In fact, GEO Care - the company’s subsidiary charged with re-entry services - asserted that they continue to find revenue generating opportunities despite criminal justice reforms at the federal level and will make additional annual investments of $5 million dollars to their “continuum of care” projects. Ann Schlarb, Senior Vice President and President of GEO Care announced that

“During 2014, we activated six new day reporting centers in Pennsylvania, which are expected to generate more than $5 million in annualized revenues. With respect to our residential reentry centers, we recently activated a new company-leased 240-bed residential reentry center in Newark under contract with the State of New Jersey, which is expected to generate approximately $5.5 million in annualized revenues. “

Those profits were in addition to the $5 million dollar expected revenues from new federal electronic monitoring contracts. CCA CEO Damon Hinginger echoed GEO Group’s prioritization on new rehabilitation and re-entry services. He claimed that reducing recidivism and rehabilitation is “right in [their] wheelhouse” but did not provide any specific examples.

Despite their claims of investments in rehabilitation services, both private prison companies rejected shareholder resolutions last year to invest 5% of their net income in rehabilitation services

“Private prison companies are expanding their markets and moving into the arena of community corrections and rehabilitation,” says Eshe Cole, Mental Health and Criminal Justice Coordinator at Grassroots Leadership. “Even with changing criminal justice reforms, these troubled corporations are continuing to find ways to to profit off of people’s confinement.”

 

Contact: 

Eshe Cole, Grassroots Leadership,  ecole@grassrootsleadership.org, (512) 499-8111

Emma Randles, Grassroots Leadership, erandles@grassrootsleadership.org, (512) 499-8111