.. ' .

PRIVATE CORRECTIONS INDUSTRY

NEWS BULLETIN
Vol. 2 - No.4

Reportillg 011 Prisoll Privatization and Related Issues

April 1999

Poor Monitoring of Colorado Contractors
An audit of the Colorado Division of Youth Corrections (DYC)
has revealed serious shortcomings in
the state's oversight of private contract juvenile facilities.
The audit found that the DYC
failed to conduct one or more quarterly inspections of oS3 of 57 contractors during a 15-month period
in 1997-98. Thirty-eight suicide attempts, 62 escapes, 95 assaults and
16 sexual assaults occurred at privately-operated juvenile facilities in
the same period of time.
Although Colorado has almost
doubled the number of juvenile offenders placed in privately-operated

facilities over the past five years, the
state bas not hired additional inspectors to monitor them.
Dye employees failed to verify that youths were receiving their
prescribed treatment, failed to ask
them if they were in a safe environment, and failed to interview them
alone so they would not be intimidated or influenced by private contract facility staff.
The audit reported that education and treatment programs at
contract facilities were often inadequate and concluded there was "no
rational basis" for the large fees paid
to private contractors. The audit also

cited deficiencies at the privatelyoperated Glen Mills School in Pennsylvania, where 45 Colorado youths
are housed.
The highly critical DYC audit
comes less than a year after the High
Plains Youth Center in Brush, Colorado operated by Rebound, Inc. was
closed following a state inspection
that documented physical and sexual
abuse, high employee turnover, and
mismanagement by company staff.
Rebound's license to operate the facility was revoked in April 1998. 0
Sources: PPRl, March 1999; The

Denver Post, April 26, 1998.

UKDS Staff Not Cbarged in Prisoner's Death
Seven u.K. Detention Services
(UKDS) staff members suspended
since March '98 in connection with
the death of inmate Alton Manning
will not face criminal charges. UKDS
is a subsidiary of CCA based in England.
Manning, 33, died on Dec. 8,
1995 at HM Prison Blakenhurst after

being restrained by UKDS staff during a search for drugs. According to
a forensic pathologist his death was
caused by respiratory impairment resulting in asphyxiation.
An autopsy revealed that Manning had bruises on his neck and
back, eight visible injuries to his face,
blood spots in his eycs and abrasions

on his arms and legs. No drugs or alcohol was found in his body.
Although the seven UKDS employees involved in Manning's death
will not be charged, they still face an
inquiry by the Prison Service into
their conduct. 0
Source: PPRl, March 1999.

co 1999 - p.e.!. News Bulletin, 3193-A Parthenon Avenue, Nashville, TN 37203

P.C.I. News Bulletin

ADMINlSTRIVlA
The P.C.I. News Bulletin (PCINB) is
a monthly pUblication that reports on
prison privatization and related issues,
primarily within the United States.

Copyright
PCINB is copyright Q 1999. Non-profit
organizations and individuals acting on
their behalf are granted pennission to
reprint or copy any materials included
in PCINB provided that source credit is
given and that such copies are for noncommercial purposes only - all other
persons are required to obtain written
permission from PCINB before any reprints or copies legally can be made.
PCINB will bappily and enthusiastically
pursue legal action against copyright
violators, and will provide a reward to
persons who report copyright violations
that resu1t in successful litigation or
settlements, as determined by PCINB.

Address
P.C.I. News Bul/etln, 3193-A Parthenon
Avenue, Nashville, Tennessee 37203.
Legal Stuff
The infonnation presented in this publication is not intended to supplant the
services I advice of legal or correctionsrelated professionals. The editors of and
contributors to PCINB disclaim any liability, loss or risk, personal or otherwise,
incurred as a direct or indirect consequence of the use and application of any of
the contents of this newsletter. So there.

WANTED
Articles, clippings and news reports
regarding the private corrections industry - please include the source
and date of all materials submitted.

2

April 1999

OK Sheriff Challenges
Jail Privatization

Wisconsin May Lease
Private Prison

In Aug. 1998 PCINB reported
that Tulsa Co., Oklahoma had contracted with CCA to operate a 1440bed jai~ and that the sheriff had filed
a lawsuit against the privatization
plan. The legal battle is now headed
to Oklahoma's supreme court.
Tulsa County Sheriff Stanley
Glanz is challenging the concept of
privatizing correctional services on
Constitutional grounds. "Our real issue," said Glanz, "is that people in
jails have Constitutional rights. When
they delegate the keeping of the jail
to a private company . . . you as an
inmate will lose your Constitutional
freedoms, things that are guaranteed
to you."
Glanz contends that privatization of correctional services "is tetally alien to the fundamental tenets
of democracy," and is a violation of
the scparation-of-powers doctrine set
forth in the Constitution.
Glanz received a favorable ruling in District Court but the decision
was reversed on appeal; he has received support from the Tulsa Co.
Fraternal Order of Police, the Oklahoma Sheriff's Association and the
National Sheriff's Association.
Tulsa County Commissioners
formed the Tulsa County Criminal
Justice Authority in 1995 to build
and administer a new jail; in 1997 the
Authority negotiated a contract with
CCA, which had been heavily lobbying in Oklahoma. Sheriff Glanz was
excluded from the Authority; under
the contract with CCA, the sheriff's
office would have no control over the
privately-operated jail. 0

On March 16, Wisconsin Corrections Secretary Jon Litscher told
the legislative Joint Finance Committee that he had spoken with a
private company building a 1,200bed prison in Stanley but had not
discussed leasing the facility.
State law bars state prisoners
from being housed in privately-operated prisons in Wisconsin, though
legislation has been introduced that
would lift that restriction to alleviate
the need to send prisoners to contract facilities in other jurisdictions.
Wisconsin houses about 2,600 inmates in out-of-state facilities. The
state's proposed 1999-2001 corrections budget includes fimding for
over 9,000 contract prison beds.
The private prison in Stanley
is being built by the Oklahomabased Dominion Group. Litscher infonned the Joint Finance Committee
that he had exchanged information
with Dominion - including staffing
patterns at state prisons - and that
company officials had visited at least
one Wisconsin facility.
Litscher has raised the possibility of leasing the Dominion prison and staffmg it with state employees. He acknowledged, however,
that there are no definite plans to
do so. Litscher told the committee
members that leasing or buying the
facility was "purely speculative."
Sen. Bob Jauch observed it
makes little sense for Wisconsin to
send inmates to contract facilities
in other jurisdictions when a private
prison is under construction within
the state. 0

Source: The New Federalist, Feb. IS,
1999.

Source: Milwaukee Journal Sentinel,
March 17, 1999.

p.e.!. News Bulletin

Other Private Corrections
Industry Resources
Corrections and Criminal Justice
Coalition (CCJC), Route 2, Box
1144, Harpers Fcny, WV 25425
(888) 315.8784; www.ccjc.com.
A consortiwn of anti·privalizalion
corrections employees' unions.
Corrections USA (CUSA), P.O.
Box 394, Newton, NH 03858
(603) 382·9707; www.cusa.org.
A professional association of pub·
lic corrections employees opposed
to prison privatization.
Prison Reform Trust, 15 North·
burgh Street, 2nd Floor, London,
EC 1V OJR England; phone: 0 II·
44-171·251-5070; ~mail: prt@
prisonrefonn.demon.co.uk. Publishes
tl1ePrison Privatisation Report Int'l
(PPRI), which covers news about
the private corrections industry in
the U.S. and -abroad
Private Corrections Project, Center
for Studies in Criminology and
Law, Univ. of Florida, Gainesville,
FL 32611 (352) 392-1025; web
site: web.crim.ufi.edIpcp. Conducts
research into prison privatization.
Note that the Project receives funding from the private corrections industry; Prof. Charles W. Thomas,
director of the Project, is also a dir·
ector of Prison Realty Corp.
Reason Foundation, 3415 S. Sep·
ulveda Blvd. ##400, Los Angeles,
CA 90034 (310) 391-2245; www.
reason.org. A libertarian.ariented
think-tank that favors prison privatization. Note that the Foundation
receives funding from Wackcnhut,
Securicor and U.S. Corrections.

April 1999

3

CCA Loses Motion to
Dismiss Lawsuit

CCA to Pay 54.5 Million
in Attorney Fees

On June 4, 1997, Richard W.
Marshall, currently incarcerated at a
federal prison in Lompoc, California,
filed suit against CCA and various
CCA employees due to events that
occurred while he was being held at
the CCA.aperated Central Arizona
Detention Center (CADC).
Marshall stated in his lawsuit
that he suffered a broken rib when
he was arrested and bad requested
medical attention after arriving at the
CADC. Marshall said that although
his injwy was documented by med·
ical staff he received only Advil and
Tylenol, was not X-rayed for 10 days
and was not seen by a doctor.
In addition to raising a claim
of delay of adequate medical care,
Marshall also contended that CCA
has a policy and custom of allowing
RNs and LPNs to diagnose medical
conditions and order treatment, that
CCA security staff are inadequately
trained in regard to medical needs
of prisoners, and that "sick call" and
"pill call" procedures at the CADC
result in delayed access to health
care services. He alleged that these
deficiencies stem from cost cutting
measures intended to reduce medical
expenses at the facility.
CCA refuted Marshall's allegations, objected to his attempt to file
an amended complaint, and in April
1998 moved to dismiss the suit.
On Jan. 28, 1999 U.S. District
Judge Earl H. Carroll denied CCA's
motion, describing the defendants'
arguments as being "disingenuous."
The case was remanded to a magistrate judge for further proceedings. 0

At least nine CCA shareholders
sued the company in April '98 after
CCA announced plans to merge with
Prison Realty nust, claiming the merger wasn't in their best interests.
The suits were consolidated in
Davidson County Chancery Court
in Tennessee, and were settled last
December when CCA made certain
adjustments to the merger. The merger was approved by shareholders
in both companies and became effective on Jan. 1, 1999 (see PCINB,
Dec. 1998, pg. 7).
In a related settlement, CCA
agreed on March 18, 1999 to pay
54.S million to attorneys representing the shareholders who filed suit.
The attorneys, including the Nashville law fmn of Barrett, Johnson &
Parslcy, bad requested a contingency
fee of $9.5 million; they were awarded $4 million in fees and $480,007
in expenses.
The CCA-Prison Realty Trust
merger resulted in a combined company, the Prison Realty Corp., which
trades on the New York Stock Exchange under the symbol PZN. 0

Source: Marshall v. Crandel. et 0/.,
U.S.D.C. Case No. 97-1 194-PHX.

Source: The Tennessean, March 19,
1999.

CORRECfION
PCINB reported in March that Wash-

inglon inmates transferred to a CCA
facility in Olney Springs, Colorado
were involved in a disturbance two
days after their arrival. The prison the Crowley Co. Corr. Facility - is
operated by Correctional Services
Corp., not CCA. We regret the error.

p.e.l. News Bulletin

April 1999

4

CCA Faces Opportunity, Opposition in D.C.
In the News
Prison Realty Corp. is building a
1,524-bed mediwn-security prison
in Millen, Georgia. The 545 million
facility will be leased to CCA and is
expected to house state and county
inmates; it is scheduled to open in
July 2000. The prison is being built
on 100 acres purchased from the
county for 5100,000. Sources: The
Tennessean, March 31, 1999; USA
Today, April 2, 1999.
The Colwnbia Care Center, a private medical prison in Colwnbia.
South Carolina operated by Just
Care, Inc., has treated 12 inmate
patients since it opened six months
ago. Warden Bill Davis says the
facility needs at least 100 patients
a day to break even. Source: USA
Today, March 24,1999.
A fonner inmate at the Wackenhutoperated Coke Co. Juvenile Justice
Facility in Bronte, Texas has med
a lawsuit claiming she was sexually
and emotionally abused at the facility. She accuses the company of
negligently allowing the abuse to
occur. Source: USA Today, March
23,1999.
The City COWlcil in Delta Junclion, Alaska has reached a settlement with Allvest, Inc. to build
and operate an 800- to IOSO-bed
prison at Fort Greely. The settlement rules out competitive bidding
on the projcct; Allvest will operate the prison for five years before
the contract is rebid. Source: USA
Today, April I, 1999.

PCINB has previously reported
CCA's efforts to win a Federal Bureau of Prisons contract to house
Washington D.C inmates in a facility
the company plans to build in Ward
8, the District's poorest community
(see peINB, Nov. 1998, pg. 5).
The Bureau of Prisons' initial
contract bid was for a single 2,200bed facility, but the agency changed
the bid last year due to "several serious incidents in various privately
operated correctional facilities." The
new contract proposal calls for two
smaller prisons.
Congress, which has oversight
of the District's corrections system,
has mandated that D.C. prisoners
be housed in privately-operated facilities. At least 2,000 District inmates must be transferred to private
prisons by the end of 1999.
Hoping to cash in on this opportunity, CCA has hired seyeral
influential D.C. lobbyists and CCA
executives have been making cam-

paign donations to District politicians. The company also has offered
to hire fanner D.C. mayor Marion
Barry to give motivational speeches
to inmates. Bany was instrumental
in implementing prison privatization
in the District, including a 1997 contract with CCA to operate the D.C.
Correctional Treatment Facility.
However, CCA faces opposition from a coalition of community
and environmental groups that is
fighting the company's plans to build
a 1,280-bed prison in Ward 8 - the
coalition has demanded an alternative strategy for improving the ec0nomically depressed area that does
not rely on a prison. A rally against
the CCA facility was held Feb. 27.
The D.C. Zoning Commission
will consider CCA's proposal to rezone its Ward 8 property for a prison
at a public hearing scheduled to take
place on April IS. []
Source: PPRl, March 1999.

Wackenhut Reports 1998 Earnings
On Feb. 18, 1999 Wackenhut
Corrections Corp. reported annual
revenue of 5311.8 million in 1998, a
51 % increase over the previous year.
Wackenhut's net income for 1998
was 517.2 million - up 45% from
511.9 million in 1997.
The earnings data was exclusive of a change in accounting policy
for start-up costs adopted by the
American Institute of Certified Public Accounting late last year that affects aU private prison companies.
Wackenhut's 1998 nct income after
the change in accounting policy was

5S.3 million.
Wackenhut vice-chainnan and
C.E.Q. George C. Zoley boasted the
company won over SO% of the competitive bids in the private corrections
industry in 1998. Wackenhut and its
subsidiaries operate 41 correctional
and detention facilities in the U.S.,
United Kingdom and Australia with
a combined capacity of 28,ISI beds;
thirteen other facilities are Wlder development. []
Source: Wackenhut press release,
Feb. 18, 1999.

P.C.I. News Bulletin

5

April 1999

FEA Van Accident Update
In the News
Mark Donatelli, an inmate advocate,
has called for increased state supervision of the Wackenhut-run Lea
Co. Corr. Facility in Hobbs, New
Mexico following a disturbance in
which 150-170 inmates ransacked
the prison's kitchen and dining
areas. Thirteen guards were injured
in the melee. Source: USA. Today,
April 9, 1999.
Colorado state senator Ed Perlmutter recently introduced legislation
that would have barred private prisons operating within the state from
housing inmates from other jurisdictions. His proposed legislation
was rejected. Source: Denver Rocl.y
Mountain News, April 10, 1999.
On Jan. 29, 1999 Public Benefit
Corp. contacted CCA and District
of Columbia officials, claiming that
CCA owed over $1.52 million for
more than a year's worth of utilities.
Public Benefit owns D.C. General
Hospital, which supplies the CCAoperated Correctional Treatment
Facility with heat and hot water.
Public Benefit Corp. threatened to
cut off the utilities and initiate legal
proceedings if CCA failed to pay
its outstanding bill. Source: PPRl,
March 1999.
Shareholders in Correctional Services Corp. and Youth Services International, one of the nation' s leading
juvenile justice service providers,
approved a proposed merger of the
two companies on March 30, 1999.
Source: PPRl, March 1999.

On April 3, 1997 a van operated by an inmate transportation service caught fire on 1-40 near Dickson,
Tennessee, immolating six prisoners
locked in a wire-mesh cage in the
back of the vehicle. The van belonged
to the Memphis-based Federal Extradition Agency (FEA), which despite
its official-sounding name is a private
company owned by former bounty
hunter Clyde Gunter.
Families of the inmates burned
alive in the accident filed a wrongful
death and negligence lawsuit against
FEA, and recent developments in the
suit have provided additional information about the fatal incident
The two drivers of the van, Anthony Wilson and Oliver Harvey, said
they had notified company officials
about strange noises the vehicle was
making the same day of the accident
"FEA told them to keep driving," said
Tim Maloney, an attorney representing the families of the prisoners who
died.
"This case is taking a pretty
sinister tum as far as what really happened," stated Maloney. "We've got
a real comedy of errors, and what we
arc fmding out is that the defendants

are all pointing fingers at each other."
FEA officials did not comment on the
pending lawsuit.
An investigation following the
accident found that a faulty universal
joint had caused the van's drive shaft
to fall out, puncturing the gas tank
and sparking an intense fire. The \'an
had logged over 260,000 miles.
Debra Raper, a prisoner who
had been dropped off in Memphis
just hours before the fatal accident,
said she and other inmates had complained to the drivers about knocking
noises coming from the van. Maloney
observed that a third FEA driver not
present during the accident had asked
to be taken home because "he dido't
want to ride in that van anymore."
Richard I. King, John Cannon,
Monty B. Crain, Steven Hicks. David
Speakman and James V. Catalano, all
inmates being transported to Florida
for parole and probation violations,
died in the 1997 accident
No criminal charges have been
brought against FEA or any of the
company's employees. 0
Sources: The Jackson Sun, April 10,
1999; The Tennessean, April 9, 1999.

Riot at esc Juvenile Facility
Youthful offenders at the Correctional Services Corp.'s Bayamon
Juvenile Detention Center in San
Juan, Puerto Rico rioted on Feb. 23,
1999 and held seven staff members
hostage for 14 hours.
Almost fifty detainees took
control of four buildings; they set
fires, destroyed securily eameras and
damaged other property at the 120-

bed detention center. At least ten inmates and seven employees were injured during the disturbance.
The rioters surrendered after
CSC staff agreed to move some of
the detainees to another facility and
to discuss complaints about medical
care and recreation services. CI
Source: PPRl, March 1999.