Obama Administration Gave Nation’s Largest Private Prison Company a No-Bid, $1 Billion Contract

The Obama administration skipped the standard public process of bidding and offered the nation’s largest prison company a generous deal to build a massive detention facility for women and children seeking asylum.

Chico Harlan reports at The Washington Post:

The four-year, $1 billion contract — details of which have not been previously disclosed — has been a boon for CCA, which, in an unusual arrangement, gets the money regardless of how many people are detained at the facility. Critics say the government’s policy has been expensive but ineffective. Arrivals of Central American families at the border have continued unabated while court rulings have forced the administration to step back from its original approach to the border surge.

In hundreds of other detention contracts given out by the U.S. Immigration and Customs Enforcement agency, federal payouts rise and fall in step with the percentage of beds being occupied. But in this case, CCA is paid for 100 percent capacity even if the facility is, say, half full, as it has been in recent months. An ICE spokeswoman, Jennifer Elzea, said that the contracts for the 2,400-bed facility in Dilley and one for a 532-bed family detention center in Karnes City, Tex., given to another company, are “unique” in their payment structures because they provide “a fixed monthly fee for use of the entire facility regardless of the number of residents.”

The rewards for CCA have been enormous: In 2015, the first full year in which the South Texas Family Residential Center was operating, CCA — which operates 74 facilities — made 14 percent of its revenue from that one center while recording record profit. CCA declined to specify the costs of operating the center.

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—Posted by Alexander Reed Kelly.