RENEE MONTAGNE, host:
The U.S. has the highest incarceration rate in the world, and that's been seen as a business opportunity. This morning, we bring you the second half of an NPR investigation into a $3 billion private prison industry.
LINDA WERTHEIMER, host:
Texas, where law and order meet free enterprise, has more for-profit prisons than any other state. But because of an inmate shortage, some private jails cannot fill their empty cells, and some towns wish they'd never gotten into the business of prisons.
NPR's John Burnett reports.
JOHN BURNETT: It seemed like a good idea at the time. The West Texas farming town of Littlefield needed jobs to keep its young people from moving to Lubbock or Dallas. In 2000, the town borrowed $10 million and built the Bill Clayton Detention Center, a charmless steel-and-cement-block building in a cotton field south of town.
For eight years, the prison was a good employer. Idaho and Wyoming paid for prisoners to serve time here. Today, the facility is empty, and a reporter's visit is an opportunity for a free classified ad.
(Soundbite of laughter)
Mr. DANNY DAVIS (City Manager, Littlefield, Texas): I don't know. Maybe this'll be an advertisement, where he'll help us to find somebody.
BURNETT: Littlefield City Manager Danny Davis is looking for someone to run this 372-bed, medium-security prison with double security fences, state-of-the-art control room, a gymnasium, law library and five living pods.
Mr. DAVIS: Each cell will house two inmates. You can see the facility here. Pretty austere.
BURNETT: Two years ago. Idaho pulled out all of its contract inmates. Shortly afterwards, the for-profit operator, GEO Group, gave notice that it was leaving, too. A hundred prison jobs disappeared. Today, Littlefield has to come up with $65,000 every month to pay the note on the prison. That's $10 for every resident of this little city.
Is this empty prison a big white elephant for the city of Littlefield?
Mr. DAVIS: Is it something we have that we would rather not have? Well, today, that would probably be the case.
BURNETT: To avoid default, Littlefield has raised property taxes, increased water and sewer fees, and laid off city employees. Still, the city's bond rating has tanked. The village elders drinking coffee at the White Kitchen Cafe are not happy about the way things have turned out.
Mr. CARL ENLOE: It was never voted on by the citizens of Littlefield - is stuck in their craw. They're going to have to pay for it. And the people that got it going is all left here and gone, and they left us with...
Mr. TOMMY KELTON: Left us holding the bag. They sure did.
BURNETT: This observation by Carl Enloe and Tommy Kelton, both retired from Atmos Energy, could be made all across Texas. For 20 years, it seemed like every small town wanted to be a prison town. But the building boom is over, and now there are too many prisons in Texas. Some corrections facilities are struggling outside the state, too. The city of Hardin, Montana, cannot find enough inmates, and it defaulted on its prison bond payments. And a private prison in Huerfano County, Colorado, is looking everywhere for convicts.
According to the Bureau of Justice Statistics, the total correctional population in the United States is declining for the first time in three decades. The reasons? The crime rate is falling. Sentencing alternatives mean fewer felons doing hard time, and states everywhere are slashing budgets.
In Texas today, more than half of all privately operated county jail beds are empty, according to the Texas Commission on Jail Standards. Shannon Herklotz is an assistant director.
Mr. SHANNON HERKLOTZ (Assistant Director, Texas Commission on Jail Standards): Too many times, we've seen jails that have got into it and tried to make it a profitable business to make money off of it, and they end up falling on their face.
BURNETT: The packages look sweet. A town gets a new detention center with no tax dollars. The private operator finances, constructs and operates it, then the prisoners pay off the debt and generate revenue. The economic model works fine until they can't find inmates.
In Waco, the county borrowed nearly $50 million to build an oversized jail. But today, because of the convict shortage, the fortress east of town remains more than half empty. Former McLennan County Deputy Rick White, who opposed the jail, had this to say about the prison developers who put the deal together.
Mr. RICK WHITE (Former McLennan County Deputy): They get the corporations formed, they get the bonds sold, they get the facility built, their money is front-loaded, they take their money out. And then there's no reason for them to support the success of the facility.
BURNETT: Two of Texas's busiest private prison consultants - James Parkay and Herb Bristow - declined repeated requests for interviews. Private prison companies insist their future is sunny. GEO declined to comment on the Littlefield prison, but the company highlighted new inmate contracts and prison expansions across the country. Corrections Corporation of America says the demand for its facilities remains strong, particularly for federal immigration detainees. New Jersey-based Community Education Centers has lately been pulling out of unprofitable jails all across Texas. The company released a statement that the current population fluctuation is cyclical.
With the paucity of inmates, more and more county officials find themselves in the odd position of looking for jailbirds to lock up.
Judge STEVE SHARP (Falls County, Texas): If somebody is out there charging $30 a day for an inmate, we need to charge 28. We really don't have a choice of not filling those beds.
BURNETT: Falls County Judge Steve Sharp, in Central Texas, is trying to hustle up inmates to fill the for-profit addition on his jail. Over in the West Texas town of Anson, Jones County Judge Dale Spurgin has a brand-new $34 million prison and an $8 million county jail, both of which sit empty. The state prison system reneged on a contract and left his county in the lurch.
Judge DALE SPURGIN (Jones County, Texas): The market certainly has changed nationwide in the course of maybe the last 18 months or two years. It's certainly a different picture than when we started this project.
BURNETT: Grayson County, north of Dallas, said no to privatizing its jail. Two years ago, they were all set to build a $30 million, 750-bed behemoth twice as big as they needed. But the public got queasy, and county officials scuttled the deal. A leading opponent, Bill Magers, mayor of the county seat of Sherman, said it just felt wrong.
Mayor BILL MAGERS (Sherman, Texas): When you put the profit motive into a private jail, by design, in order to increase your dollars, your revenues, your profits, you need more folks in there, and they need to stay longer.
Unidentified Man #1: Crawford. Let's go, Crawford. Charles. Face the wall for me...
BURNETT: When the supply of prison beds exceeds the demand, there are winners. The overcrowded Harris County Jail in Houston - the nation's third largest -farms out about 1,000 prisoners to private jails. Littlefield and most other under-occupied facilities in Texas have been in touch with Houston. Captain Robin Konetzke is in charge of inmate processing.
Captain ROBIN KONETZKE (Inmate Processing, Harris County Jail): It really is a buyer's market right now, especially a county of our size. They're really wanting to get our business. So we're getting good deals.
BURNETT: Nearby, disheveled and unsmiling men are brought from a holding cell to stand before a booking officer...
Unidentified Man #2: How much do you weigh, sir?
Unidentified Man #3: One-sixty-five.
Unidentified Man #2: Married, single, divorced, separated?
Unidentified Man #3: Single.
Unidentified Man #2: Any tattoos?
Unidentified Man #3: Three.
BURNETT: They are unaware that they may soon become the newest commodities in the inmate market.
John Burnett, NPR News, Austin.
WERTHEIMER: You can read related stories about the GEO Group and what's happening in a Mississippi town that has become reliant on profits from a troubled youth prison. That's at npr.org.