Prison bust handcuffing rural areas that borrowed money to have county-owned facilities

The prison boom that created jobs and improved local economies in rural Texas has gone bust, leaving rural areas in a financial hole they can't crawl out of, John MacCormack reports for the San Antonio Express-News. In the 1980s, promoters hit rural Texas, selling the idea that a "detention facility built for federal inmates would create local jobs, a steady cash flow for the county and, once the bonds were paid off, a county-owned prison. And by using a public facilities corporation to borrow the money, taxpayers would be shielded if anything went wrong." (Express photo by Kin Man Hui: La Salle County Detention Center in Encinal is at about half capacity and losing money.)

"It was an easy money pitch often heard in rural Texas during an era that made the state the private prison capital of the country as companies built more than 50 facilities with as many as 60,000 beds," MacCormack writes. "Three decades later, the boom is over. And as the public sector's need for private prison beds has diminished, the tally of failing prisons in Texas is increasing, with some already vacant for years."

"The bust is evident on a rural tour of the state, where more than a dozen once-profitable facilities have failed," MacCormack writes. "At least seven of them, which together borrowed nearly $200 million, are in arrears on bond payments, figures from Municipal Market Analytics, a bond-research firm, show."

"When the nation's prison overcrowding problem was acute, private facilities and county jails in Texas were in high clover, renting beds for inmates from such distant locales as Hawaii, Montana and the District of Columbia, in addition to housing surplus federal, state and local prisoners," MacCormack writes. "But various factors—including shifts in federal immigration policy leading to fewer detentions, changes in criminal justice philosophy away from long sentences and incarceration for minor offenses, and a huge expansion in public prison systems—have dented the need for private beds."

In June, Texas jails had around 94,000 beds and were operating at 70 percent capacity, with 19,870 beds available, compared to 1995, when jails had 64,000 beds, operating at 80 percent capacity, with 7,775 beds available, MacCormack writes. Another factor has been the drop in illegal immigrants apprehended by the U.S. Border Patrol. In 2014, fewer than 487,000 people were apprehended, down from 1.67 million in 2000. Another problem has been allegations of mistreatment—including lack of medical care and contaminated food—which has led to lawsuits, riots and escapes. (Read more)