Closure of Pa. prison leaves unanswered questions for region
The closure of the prison that employs nearly 300 people is "the worst economic news" for the region, an official said
By Bret Pallotto
Centre Daily Times
CLEARFIELD COUNTY, Pa. — The future of a privately operated federal prison scheduled to close by the end of March remains unclear, leaving unanswered one of the biggest economic questions facing the Moshannon Valley in decades.
The federal Bureau of Prisons declined to renew its contract with the Moshannon Valley Correctional Center. The pact expires March 31.
The pending closure of the prison that employs about 280 people is "the worst economic news that we have received in our region in over twenty years," Moshannon Valley Economic Development Partnership President Bryan Bennett said in a statement.
The effort to phase out the Department of Justice's use of private prisons began under former President Barack Obama, but the policy was later axed by former President Donald Trump.
President Joe Biden followed in Obama's footsteps by signing an executive order in January to eliminate the use of privately operated federal prisons.
Biden's signature made good on one of his campaign promises to Black voters, who were integral in securing a win over his predecessor.
"This is the first step to stop corporations from profiting off incarceration," Biden said in January.
The federal government exited its contract with the GEO Group as soon as it could have. The agreement included a five-year base term that began in March 2016, along with annual options for the next five years.
The more than 12,000 federal inmates detained at privately-managed facilities represent a fraction of the nearly 152,000 incarcerated inmates as of Thursday.
"To just unilaterally end those contracts without analyzing the costs and benefits of each individual facility is a huge mistake," U.S. Rep. Glenn Thompson, R- Howard, said in a statement. "With the change in the administration, we knew that the termination of the contracts was inevitable."
GEO Group Public Policy Executive Vice President Adam Hasner conceded "it will not be easy" to redevelop the Clearfield County-based facility.
The company initially said it planned to market the property to state and other federal agencies, but scaled that back to just the latter in a statement released Wednesday.
Pennsylvania Senate President Pro Tempore Jake Corman, R- Benner Township, said a new state law would have to be enacted if there is a plan to detain non-federal inmates at the facility.
The state Department of Corrections did not consider purchasing or contracting with the facility, a spokesperson said in January.
The closure will likely cause hardship on the Philipsburg-Osceola Area School District. The GEO Group is the top taxpayer in the district, pouring in nearly $475,000 annually.
Superintendent Gregg Paladina sounded the alarm in January, saying the decision would "rock us to our core" and would essentially guarantee job cuts if a similarly sized company did not step in.
He wasn't more optimistic Wednesday.
"I really don't have the full answer right now. We have been doing some cost-saving measures for the past few years, and we are hopeful that it will pay dividends," Paladina said. "We've been good stewards of the district's money and we've reduced positions whenever possible. We aren't going to reduce more positions just to do it. The changes will take a few years to play out fully."
Thompson, Corman, the state Department of Labor and Industry, and Centre County commissioners Michael Pipe, Mark Higgins and Steve Dershem were among those who discussed the future of the facility in a meeting earlier this month.
About 200 workers attended six meetings organized by the state, which covered unemployment compensation, retirement benefits, new employment opportunities and more, a spokesperson said.
They were joined by members of the Moshannon Valley Economic Development Partnership, which played a fundamental role in bringing the facility to the region.
"We have always known that our federal government could end its contracts with private corrections companies like GEO Group, but we never thought that we would lose this local asset," Executive Director Stan LaFuria said in a statement. "... We were dedicated to securing this facility for our area back then, and we are dedicated now to assisting GEO Group with their efforts to determine whether there are any reuse opportunities."
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