A New Mindset for Prison Operator
GEO Group's move into mental health has some lessons for future privatization efforts.
GEO Care is providing an increasing share of the GEO Group’s annual revenue. In 2005, GEO Care made $32.6 million, or 5.3% of the company’s revenue. In 2006, revenue increased 115% to $70.4 million and accounted for 8.2% of GEO Group’s total revenue. Revenue from GEO’s corrections division increased 29.5% between 2005 and 2006 to $485 million.
GEO Care's Bottm Line
|Source: GEO Group annual reports filed with the Securities and Exchange Commission|
By contrast, GEO Group’s prison operations haven’t been models of good performance — particularly in states where government monitoring has been poor. In October, the Texas Youth Commission abruptly canceled its $8-million annual contract with the GEO Group after Texas Youth Commission inspectors found fetid conditions, including feces-smeared cells and insect infestations throughout the Coke County Juvenile Justice Center. The commission subsequently fired four state-paid monitors, whom a newspaper investigation revealed had previously worked for GEO.
Similar problems have been reported at other GEO-run correctional facilities in Texas, including the Dickens County facility in Spur. And youth prisons that GEO Group ran in Louisiana and Michigan were closed in 2000 and 2005, respectively, amid allegations of abuse and neglect. And at a recent congressional hearing, the GEO Group came under fire for not offering substantive drug treatment and vocational training programs for the federal prisoners it houses at the Rivers Correctional Institution in Winton, N.C.
While GEO’s operation of three Florida prisons hasn’t been an issue, a state inspector general’s report concluded in 2005 that GEO Group and another private prison operator had received $6.7 million in alleged overpayments from the state for vacant jobs and other questionable expenses. The audit report attributed the overpayments to the failure of the now-defunct Correctional Private Commission to properly enforce contract provisions. GEO, which was absolved of criminal wrongdoing, eventually reached a $290,952 settlement with the state and the Department of Management Services, which now oversees the state’s private correctional facilities.
Treating sexual predators
GEO Care’s sternest test in the mental health services market lies ahead: Along with the contracts in south Florida, the company has a $18.9-million contract to take over operation of the Florida Civil Commitment Center, a former prison in Arcadia now used as a treatment facility for offenders designated “sexually violent predators” under the state’s Jimmy Ryce Act. That 1998 law allows the state to hold those who have been convicted of a sexually violent offense and who are considered likely to re-offend at a secure facility for long-term control, care and treatment.
The state DCF, which had hired Pennsylvania-based Liberty Behavioral Healthcare Corp., to run the facility, didn’t renew that company’s contract after the Miami Herald published a report last year depicting chaos and mismanagement inside the 14-acre compound, including violence, drug abuse and alleged sex among both inmates and staff.
Aside from cleaning up operations at the center, GEO faces the task of determining what kind of programs can be used to treat sexual predators — it’s unclear whether such offenders can in fact be rehabilitated. The company has assembled a consulting team that includes several board members of the Association for the Treatment of Sexual Abusers. GEO has broken ground on a facility that will increase the center’s capacity from 600 to 720 and should be finished by spring 2009.
With 17 states now operating post-incarceration civil commitment programs for sex offenders, there’s market potential for GEO if it can turn around the Florida Civil Commitment Center. “We want to become a national model because it is evolving, and other states don’t know exactly what they’re doing with this population either,” says Frick.