By Alan Johnson
The Columbus Dispatch
COLUMBUS, Ohio -- While Gov. John Kasich’s plan to sell four prisons promises to raise much-needed cash for the state, the news isn’t so good for affected employees who could see their pay cut by one-third and lose paid health-care benefits.
Kasich is expected to propose selling the prisons, plus the closed Marion Juvenile Correctional Facility, in his two-year budget plan to be unveiled today.
That budget is expected to include few gimmicks but a wide variety of cuts, including a significant whack to local governments, both in the direct local-government funding and in reimbursements for the eliminated tangible personal-property tax. And while grades K-12 and universities are going to see cuts because of the loss of federal stimulus money, sources say they are not expected to be as dire as some have predicted.
Kasich is expected to focus on government reform today when he officially rolls out his two-year plan, stressing ways for government to do things differently, and with less money. He is expected to introduce a plan to privatize Ohio’s liquor-sales operation to help fund JobsOhio, his new public-private entity that is taking over the state’s economic-development efforts. The introduced version of the budget is not expected to include a leasing of the Ohio Turnpike, but the idea is likely to get continued discussion. Same goes for an elimination of the estate tax, which is under debate in the legislature.
If approved by the General Assembly in the budget process, the prison sales would produce an estimated $200 million for state coffers. In addition, there would be annual savings on operating costs, probably a minimum of 5 percent as required by current state law. The state would contract with the new owner-operator to house and care for inmates.
It also would mean that about 800 employees, including 475 corrections officers, would lose state jobs. Sources said employees would receive hiring “preference,” but not guarantees, from the new owners.
The silver lining for the communities could be new property-tax revenue when prisons go from tax-exempt state ownership to taxable private ownership. One source estimated that to be from $400,000 to $1 million per year for each institution.
The administration refused to confirm the deal, but sources said for-sale signs will go up on the North Central Correctional Institution in Marion and the Grafton Correctional Institution in Lorain County, both state-owned, and the Lake Erie Correctional Institution in Conneaut, in Ashtabula County, and North Coast Correctional Treatment Facility in Grafton. The latter two are operated by Management & Training Corp. of Centerville, Utah.
Ohio Civil Service Employees Association officials said yesterday that pay at two private prisons averages about one-third less than comparable jobs at state prisons. Salary schedules aren’t available from the private company, but the union obtained some details from public-records requests. For example, a state corrections captain earns about $30 an hour compared with $20 at private prisons.
In addition, the state pays 85 percent of employees’ health-care costs. MTC offers health-care coverage but does not pick up the cost.
Prison employees are “absolutely scared,” said Tim Shafer, union operations director and a former corrections officer. “They’re concerned about their families and their communities.”
The community impact of the sales could be mixed, said Marion Mayor Scott Schertzer, who acknowledged that he doesn’t know final details.
“It doesn’t look like Marion is going to lose jobs, but they could be lower-paying jobs,” Schertzer said. “But jobs may be added at the juvenile facility, which is a plus.”
The prisons and juvenile facility would be sold to the highest, qualified bidder, a process that would narrow the field considerably to existing companies with the money to buy and operate the institutions. The largest private-prison operators, in addition to MTC, are Corrections Corporation of America, of Nashville, Tenn., and the GEO Group, of Boca Raton, Fla.
Copyright 2011 The Columbus Dispatch
All Rights Reserved