Overbuilt Texas county jails turned private prison boom into bust

John MacCormack at the SA Express-News described in this morning's paper massive overbuilding at Texas county jails which has mostly gone unnoticed by the press and the public:

In June 1995, Texas jails had 64,000 beds, and were operating at 80 percent capacity, with 7,775 beds available. In June 2015, having added nearly 30,000 beds, they were operating at 70 percent capacity, and had 19,870 available beds.

The number of federal and contract prisoners in county jails has declined in recent years, due in part to changes in federal policy.

Where in 2000, the U.S. Border Patrol apprehended 1.67 million people, by 2014 the figure had dropped to fewer than 487,000, and has stayed low since. Detentions by Immigration and Customs Enforcement also recently have dipped after a longtime rise.

The story describes a phenomenon with which Grits readers should be familiar, in which private prison companies and local politicians carrying their water would argue 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.

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.

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. 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.

"Twenty years ago, everyone was bringing prisoners and everyone was making money. Then the state and federal governments figured out it cost too much to hold these guys, so they started looking at other means," Maverick County Sheriff Tom Schmerber said during a recent visit to the detention center there.

I must admit, it's particularly odd to see the story of the prison unit in Littlefield being considered a success story, though that's how it's being portrayed.

One of the few bright spots among the communities stuck with empty facilities is Littlefield, a city of 6,500 an hour northwest of Lubbock. There, a 300-bed, city-owned prison that has been vacant for more than five years is about to reopen.

"We have not been in arrears. We have made payments twice a year since it opened in 2000. With utilities and other costs, it's about $1 million a year, which is 13 percent of my budget," said City Manager Mike Arismendez, who announced his resignation last week.

Originally built for the Texas Youth Commission, the prison later held inmates from Idaho and Wyoming before closing.

Recently, Arismendez said, after years of futile searching, the city landed a new tenant, although it is not one that would be welcome everywhere. The Texas inmates will be violent sex offenders who require additional treatment before being released.

"The public seems to be very happy that we're going to reopen the facility and have jobs," he said. 

MORE: See AP's version of the story, the lede of which pithily declared, "More than a dozen once-profitable private prisons in Texas have failed, including one this month in South Texas, and records from a bond research firm examined by the San Antonio Express-News show at least seven are in arrears in payments on nearly $200 million in bonds."