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Mt. to explore buying private prison in Shelby

The state has the option to either buy the Crossroads Correctional Center or extend CCA’s contract for another five to 10 years

By Matt Volz
Associated Press

HELENA, Mont. — Montana lawmakers on Thursday began exploring whether to purchase a private prison in Shelby when the state’s 20-year contract with Corrections Corporation of America is up in 2019.

The state has the option to either buy the Crossroads Correctional Center or extend CCA’s contract for another five to 10 years. The Legislative Finance Committee plans to identify the costs involved and the time needed to conduct the necessary studies, appraisals and negotiations, if it gets to that point.

A key issue will be whether buying Crossroads makes economic sense. Taking over the prison would mean losing the property taxes and corporate income taxes that CCA pays, and the state would have to take on the prison’s operating and staffing costs, Greg DeWitt of the Legislative Fiscal Division told the panel.

Former state Sen. Terry Murphy, R-Cardwell, told The Associated Press on Thursday that prisons need to be owned by governments, so that taxpayers and elected officials can make decisions about human services provided in the penal system. He described complaints he heard while a member of the state Law and Justice Interim Committee about chronic understaffing and poor medical care at Crossroads.

“It appears to me there is an inherent conflict between the profit motive of a private corporation, and the real needs of a penal institution whose job is to rehabilitate offenders and return them to productive life outside the walls,” Murphy said.

CCA spokesman Jonathan Burns said in a prepared statement to the AP that the prison is accredited by the American Correctional Association and the company provides safe, secure housing with quality rehabilitation and re-entry programs.

There are 83-full-time correctional officers at the prison, and one vacant position currently, he said. CCA pays more than $7 million in payroll, utilities and other fees, along with $475,000 in annual property taxes, he said.

“We welcome this discussion because we believe it will highlight the benefits our ownership provides to our partners at the state level as well as stakeholders in the community,” Burns said.

CCA previously agreed to pay Idaho $1 million to settle claims of staffing shortages at the Idaho Correctional Center, and the state has taken over prison operations. An FBI investigation into whether CCA understaffed that prison and faked records for financial gain did not find evidence of criminal fraud.

A 2011 audit found that the Shelby prison was in compliance with its state contract, but the complaints from former staff, inmates, relatives and advocacy groups have continued, state Sen. Robyn Driscoll, D-Billings, said when she presented legislation in March that called for a study of Crossroads’ operations.

The legislation died in a House committee.

If Montana chooses to buy the prison, it would pay the fair market value - to be determined by negotiations or by appraisal - minus how much the state has already paid CCA in fees under the prison’s facility development contract.

As of June, those fees amounted to nearly $25 million.

The prison opened in 1999 and is the only privately owned and operated prison in Montana. It is meant to house a maximum of 550 state inmates. As of Wednesday, 599 state inmates were in Crossroads, according to the Montana Department of Corrections daily population report.

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