Idaho will take over the operation of its largest prison from one of the nation's biggest corrections contractors, abruptly ending an experiment with privatization at a facility that has been plagued by understaffing, multiple lawsuits and allegations of contract fraud.
The state plans to begin running the 2,080-bed Idaho Correctional Center, located just outside Boise, over the next several months, as its $29 million-a-year contract with the Corrections Corporation of America expires on June 30
"In recognition of what's happened, what's happening, it's necessary. It's the right thing to do," said Gov. C.L. "Butch" Otter, a longtime proponent of privatization who added: "It's disappointing because I am a champion of privatization."
CCA said that while there were "challenges" at the prison, it has and will continue to be responsive to the state's concerns. It said, "despite reported issues, there are overwhelmingly more positive things that have occurred at the facility during our partnership."
The move to end the contract comes months after an Associated Press report raised questions about how the Nashville, Tenn.,-based company was staffing the prison, and is part of a larger debate over whether prison privatization works.
Studies have arrived at differing conclusions, focusing on whether privatization saves money to whether the companies do a better job of helping reduce the chances that inmates who are housed in the facilities will go on to commit crimes.
The private prison contractors over the last several decades have been brought in to run prisons, federal lockups and county-level jails. The number of inmates housed in the facilities grew from 85,500 in 2000 to more than 128,000 in 2012, according to federal statistics.
California officials are expanding their use of private prisons to meet a court order to reduce overcrowding. There's also been some pushback, with Oklahoma's corrections director resigning last year in a dispute over the growing use of prison privatization.
CCA notes on its website that it operates the fifth largest corrections system in the country, housing nearly 80,000 inmates at more than 60 facilities. The majority, it said, are company-owned complexes, and that it has contracts with the federal government.
The company has contracted with Idaho to run the prison since it was built in 1997 in a rural stretch where the state has also built several other corrections facilities. The ICC holds about one-quarter of the state's roughly 8,000 inmates.
The prison has been the subject of multiple lawsuits alleging rampant violence, understaffing, gang activity and contract fraud, and some of the lawsuits have resulted in federal court orders to improve conditions.
Early last year, an AP investigation examining overtime records and staffing reports from the prison showed some of CCA's reports to the state erroneously showed guards working shifts that were actually left vacant. CCA said last year that there were falsified staffing reports.
In response, the state corrections department asked the Idaho State Police to investigate possible contract fraud.
CCA officials have acknowledged that at about 4,800 hours of guard posts were left unstaffed despite reports showing otherwise, and CCA leaders have promised to cooperate with the investigation and make taxpayers whole for any unverified hours.
Last fall, CCA announced that it wouldn't bid on the next contract to run the prison when its current contract expires.
Another major private prison corporation, GEO Group, has also informed the state that it won't bid on the contract. That narrowed the field of potential private managers dramatically, but the Idaho Board of Correction continued to weigh whether to keep the prison private.
For years, Otter has pushed for privatizing certain sectors of government, including prisons.
In 2008, he floated legislation to change state laws to allow private companies to build and operate prisons in Idaho and import out-of-state inmates. In 2008, he suggested privatizing the 500-bed state-run Idaho Correctional Institution-Orofino.
While he noted his disappointment, Otter said, "you will see ... I'm asking the Board (of Correction) to also engage in listing those non-custodial duties at the prison that could be privatized, such as food, education and outreach.
It's a dramatic turn-around for the state.
IDOC Director Brent Reinke has lobbied a few times in recent years to allow the agency to put together its own proposal and cost analysis for running the prison. Each time, however, Reinke and his staff have been rebuffed by the state Board of Correction.
Recently, the chairwoman said she opposed the idea because she didn't want to grow state government.
An AP analysis of the costs to run the prison in 2012 found that any savings compared to state-run prisons were more than offset by other factors, including contract oversight costs and the fact that inmates with chronic medical or mental health needs are barred from the facility.
That allows it to have a higher staff-to-inmate ratio than state lockups that take all prisoners.
Associated Press writer Travis Loller in Nashville, Tenn., contributed to this report.