CCA Renaming Itself CoreCivic As It Diversifies

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The private prison firm Corrections Corporation of America (CCA)  is renaming itself CoreCivic as it seeks to diversify into prisoner re-entry programs, building jails, and maintaining them, rather than just guarding and operating the facilities, the Wall Street Journal reports. CEO Damon Hiniger called the rebranding an “emotional decision,” but one that fits with “how the business has changed and how we have diversified.’’ The move comes amid a public debate about whether federal, state and local governments should use private facilities to hold convicted criminals, suspects awaiting trial, and immigrants awaiting deportation. Privatization surged in the 1990s as an efficiency and cost measure to deal with rising inmate populations, but more recently questions have arisen about the effectiveness of privately run prisons.

In August, the Justice Department’s Bureau of Prisons said it would seek to end its use of private prisons because their prisoner population was falling and because private prisons didn’t provide the same level of services as federal facilities. The announcement caused CCA stock to plunge by 35 percent, even though Bureau of Prisons contracts represent only about 7 percent of the firm’s business. The stock has yet to recover from that slide, but Hininger said the renaming decision was made before the Justice Department’s announcement. The CoreCivic rebranding comes as the company is trying to make new gains in prison contracts by building and maintaining facilities that would then be staffed and guarded by government employees. The company believes that will give them access to new markets in states like California that have previously resisted using private-prison firms. The company plans to operate more of its business as a real estate management company than a corrections services firm.

 

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