Private prison corporations tell shareholders that family detention centers drove increase in revenue

May 9, 2016

Corrections Corp. of America and GEO Group continue to profit from locking up children as Texas faces lawsuit over granting child care licenses to Karnes and Dilley detention camps

(AUSTIN, Texas) —  Corrections Corporation of America (CCA) and GEO Group reported their first quarter earnings for 2016 on their conference calls for shareholders on Thursday May 5 and Thursday April 28, respectively.

CCA executives attributed major revenue increases over last year’s first quarter revenue to the South Texas Family Residential Center in Dilley, Texas. "We are pleased with our first quarter financial performance, which exceeded our first quarter guidance," said CCA chief executive officer Damon Hininger. A CCA press release stated that revenue generated from the Dilley family detention camp nearly doubled when compared to last year’s first quarter. “The increase in revenue was primarily attributable to a contract at the South Texas Family Residential Center, which commenced during the fourth quarter of 2014.  This facility generated approximately $70.8 million in revenue during the first quarter of 2016, compared with $36.0 million in the first quarter of 2015, as the facility was still under construction in the prior year quarter.”

The CCA press release also said, “Total revenue for the first quarter of 2016 was $447.4 million compared to $426.0 million in the first quarter of 2015.”  

GEO Group also named “the activation of the 626-bed expansion of the Karnes residential center in December 2015” as one of a few major reasons that its “revenues for the first quarter 2016 increased to approximately $510 million from $427 million a year ago.”

“It’s sickening to hear CCA and GEO brag about their profitable quarter to shareholders,” said Cristina Parker, immigration programs director at Grassroots Leadership. “That money is made off the suffering of mothers and children who came to the U.S. for refuge.”

CCA executives addressed the temporary restraining order issued by state court Judge Karin Crump following a lawsuit by detained mothers and Grassroots Leadership. GEO CEO Damon Hininger  told shareholders, “Like last fall the state has again encountered legal challenges this week to their authority to license family residential centers with the state receiving a 14 day restraining order yesterday which prevents any issuance of the license during that period of time. Finally, we believe successful license to the facilities fully consistent with this mission for this South Texas facility and will enhance the facility ability to address the diverse needs of migrants apprehended at the southern border.”

What CCA shareholders didn’t hear about were revelations from Texas Department of Family and Protective Services (DFPS) inspections that the Dilley family detention camp had 12 violations of DFPS standards, even after the state passed a rule lowering the licensing standards to permit the licensing. These violations include: a child being made ill because his gluten allergy was ignored, expired fruit juice, inadequate staff training, medical supplies not being locked away and worn surfaces in the playgrounds.

In a April 28 press release, GEO executives told shareholders, “We submitted our license application in early March and are hopeful to complete the process within the next month” The following day, the Karnes County Residential Center received its license despite a series of deficiencies found during an inspection. These include a child found in a bedroom without his or her mother or a staff member present, an employee not qualified for his or her position, failure to clearly list a child’s allergies and chronic health conditions in a health file, and failure to clearly state the right for a child not to be threatened with the loss of shelter as punishment.

A hearing on whether DFPS had the legal authority to change standards to issue this license will take place on May 13.

“CCA and GEO Group are profiting massively from family detention,” said Bob Libal, executive director at Grassroots Leadership. “It’s shameful that DFPS is more invested in protecting these corporations’ profits and excessive federal immigration enforcement policy over the well-being of children.”

 

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Grassroots Leadership is an Austin, Texas-based national organization that works to end prison profiteering and reduce reliance on criminalization and detention through direct action, organizing, research, and public education.

Contact: 

Cristina Parker, cparker@grassrootsleadership.org, 512-499-8111