Majority of private prison contracts demand taxpayer-backed lockup quotas - report

The majority of contracts between local US governments and for-profit prisons require “lockup quotas” and “low crime taxes,” according to a new report.

The report, which was released by In the Public Interest, states that 62 percent of private prison contracts studied by the group require states to keep 80 to 100 percent of prison beds occupied. It also revealed that taxpayers compensate the private companies if the number of prisoners falls below the quota – a policy which guarantees profit within the mass incarceration industry.

For instance, when Colorado did not meet its lockup quotas due to dropping crime rates, the state had to pay $2mn based on its contract with the Corrections Corporation of America (CCA) - one of America’s largest private prison companies.

A 90 percent lockup quota at the Lake Erie Correctional Institution in Ohio led to “cutting corners on safety, including overcrowding, areas without secure doors, and an increase in crime both inside the prison and the surrounding community.” The facility is run by CCA.

The report found that Arizona, Louisiana, Oklahoma, and Virginia have the highest lockup quotas in the nation, requiring 95 to 100 percent occupancy.

The private prison industry claims that their services offer states opportunities to save money. However, the report says that “numerous studies and audits have shown these claims of cost savings to be illusory, and bed occupancy requirements are one way that private prison companies lock in inflated costs after the contract is signed.”

“These provisions guarantee prison companies a consistent and regular revenue stream, insulating them from ordinary business risks,” the report states.