The Private Prison Boom Goes Bust In Texas; A Dozen Failures


Texas once was the nation’s private prison capital, as companies built more than 50 facilities with 60,000 beds. Three decades later, the boom is over, reports the San Antonio Express-News. As the public sector's need for private prison beds has diminished, the tally of failing prisons in Texas is increasing, with some 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, says Municipal Market Analytics, a bond-research firm.

“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,” said. Maverick County Sheriff Tom Schmerber. 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. 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.

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