Legislature(2003 - 2004)
03/13/2003 08:00 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
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+ teleconferenced
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HB 55-CORRECTIONAL FACILITIES Number 2979 CHAIR WEYHRAUCH announced that the next order of business was SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 55, "An Act expressing legislative intent regarding privately operated correctional facility space and services; relating to the development and financing of privately operated correctional facility space and services; authorizing the Department of Corrections to enter into an agreement for the confinement and care of prisoners in privately operated correctional facility space; authorizing the Department of Corrections to enter into agreements with municipalities to expand existing correctional facilities; and providing for an effective date." TAPE 03-25, SIDE B Number 2982 REPRESENTATIVE MIKE HAWKER, Alaska State Legislature, one of two sponsors of SSHB 55, told the committee Alaska has had inadequate prison bed space for some time, and has found itself in the position of contracting with a private prison contractor in Arizona. That facility currently holds 600-700 of Alaska's inmates, and has held as high as 800. Thus SSHB 55 authorizes the City of Whittier to contract with the Department of Corrections (DOC) to provide, staff, and operate eight prison facilities. Conditions being imposed on the City of Whittier to provide what an approximately 400-bed facility include that the city contract with an outside third-party provider "of this sort of service" and acquire that relationship in compliance with competitive procurement requirements. REPRESENTATIVE HAWKER said the authorization given in SSHB 55 has further constraints. The most important is that the per- diem cost of the facility shall not exceed $94 [per inmate a day]. The largest difference between SSHB 55 and similar bills in previous sessions is that SSHB 55 makes a firm constraint upon the City of Whittier - the folks that it elects to do business with - to present this project. Number 2827 REPRESENTATIVE HAWKER highlighted two matters of public policy for members to consider: whether to treat Alaskan offenders in state versus out of state, which is what is currently happening; and whether to have those corrections services performed by a private contractor, which can be done at significantly less cost than government can perform the same services. He asked the committee to bear with him as the facts regarding the issue are revealed. Representative Hawker pointed out that whereas other communities have voted down private prison projects, 80 percent of Whittier voters support this project. Thus he asked the committee to keep separate the objections that other communities may have raised about siting a prison in their own communities. Number 2679 REPRESENTATIVE HAWKER indicated there is a tremendous amount information in support his position that private prisons cost less. For example, the Mackinac Center [for] Public Policy in Michigan looked at a private-contract 450-bed facility for men under the age of 20; in contrast to the varying facilities within Michigan, that 450-bed facility resulted in a $2.5 to $6.9 million annual savings, and the study concluded that those savings are not uncommon. Representative Hawker said 28 separate studies of private prison facilities have shown that virtually all these prisons have saved the community money. He noted that a Harvard Law Review article [Vol. 115, June 2002, No. 7, included in the committee packet] concluded that savings were incurred with no decrease in the quality of services; he asked that anyone desiring to make a thorough evaluation study this report. Number 2532 REPRESENTATIVE HOLM read from the first paragraph of the sponsor statement, which stated [original punctuation provided]: House Bill 55 authorizes the Department of Corrections to enter into agreement with the City of Whittier for a 1,200-bed medium security correctional facility and services for a period of 25 years. The facility shall be constructed and operated by third-party contractors procured through a competitive bid process. If the authorization is granted, the daily per diem costs may not exceed $94 an inmate a day or 85 percent of the inmate cost per day to the state for the construction and operation by the state of equivalent facilities. REPRESENTATIVE HOLM asked Representative Hawker to explain how [85 percent] is less than $94 a day. REPRESENTATIVE HAWKER responded as follows: If we have a total per-diem cost and comparable, equivalent facilities here that we could determine ... could be provided by the State of Alaska or, in this case, that ... in order for this proposal to go forward, the contractor must be able to provide the services at no more than 85 percent of that contractor's rate, or $94 a day -- so ... hypothetically it's a "lesser than." ... It becomes a lesser of $94 a day or the 84 percent of inmate cost. Number 2439 REPRESENTATIVE BERKOWITZ said one concern is that private prisons could "cherry pick" the easier, less expensive prisoners, which would drive up the cost to the state. REPRESENTATIVE HAWKER replied that the proposed facility [for Whittier] is a medium-low security facility, largely designed to house the bulk of Alaska's prisoners. A maximum-security facility is not proposed because the expansion that is needed is in the medium and lesser-secured facilities. He mentioned the choice of looking at expanding services out of state, expanding existing facilities in state, or looking at a large, concentrated facility "here." He mentioned an option to expand some of the isolated remote facilities. REPRESENTATIVE HAWKER said SSHB 55 really attempts to be a more comprehensive solution to the state's dilemma, and does authorize the expansion of existing state-owned facilities in Fairbanks, the Matanuska-Susitna Borough, Bethel, and Seward, specifically looking at being able to provide for the variety and spreading the demographic burden of Alaska's prison base. Number 2336 REPRESENTATIVE BERKOWITZ requested information as to the current per-bed costs. Noting that there is no sunset provision, he asked if that is deliberate or an oversight. In response to a question by Representative Hawker, he confirmed that he is referring to a sunset provision which requires that construction begin within a certain period of time or else the authority would expire. REPRESENTATIVE HAWKER said that is something he'd be willing to negotiate. REPRESENTATIVE HAWKER, in response to a query by Representative Gruenberg, noted that there is an executive summary of the project in the committee packet. Number 2267 REPRESENTATIVE GRUENBERG referred to Representative Holm's previous question. He said he'd read [page 2] lines 27-28 as saying "whichever is greater." He suggested that the phrase "whichever is less" be added in order to avoid confusion. REPRESENTATIVE HAWKER indicated he'd already considered that and opined that it is clearest as is. REPRESENTATIVE GRUENBERG expressed concern about misinterpretation. He referred to Section 3, which addresses the authorization [of certain municipalities] and asked if there is a reason that Anchorage, for example, is not included. REPRESENTATIVE HAWKER responded that SSHB 55 resulted from a merger of two bills last year. The facilities [listed in SSHB 55] were those identified in the alternate bill that was merged to create this year's vehicle. He commented that once constructive involvement is received from DOC, there will certainly be room to examine whether the facilities listed are, in fact, the most appropriate ones to accommodate the mission of the bill, which is to provide a comprehensive solution. He added, "We're very open to continued dialogue if this bill progresses." Number 2124 REPRESENTATIVE SEATON referred to page 3, beginning on line 29, regarding the authorization to lease correctional facility space with municipalities. He asked whether those are to be operated by Cornell Companies under this bill. REPRESENTATIVE HAWKER answered that they'd continue to be operated by whatever operator was currently operating them. He said presumably that would be a continuation of state operation. Number 2080 CHAIR WEYHRAUCH asked if there is no authorization currently under law for the Department of Corrections to enter into agreements with municipalities for expanding correctional facilities. REPRESENTATIVE HAWKER said that is a point of law he isn't qualified to address. Number 2020 REPRESENTATIVE BERKOWITZ asked if the City of Whittier had given any thought to bonding itself and building the prison [on its own, without the help of the state]. REPRESENTATIVE HAWKER answered that municipal bonding, particularly for the City of Whittier, which is in the "unorganized borough," would ultimately involve a collateralization with a state lease agreement. He added, "The strong preference of the folks involved in those things in the State of Alaska is that the state is involved in the bonding process." He said the point of SSHB 55 is to authorize DOC and Whittier to go forward to ascertain if this project can be put together with the criteria set out. Representative Hawker opined that legislators sit as the assembly to unorganized boroughs; therefore, it is appropriate for them to work with the city and not ask it to approach this as a "free-enterprise, speculative venture." Number 1925 REPRESENTATIVE GRUENBERG asked if there would be as much need for state involvement if the City of Whittier were within a borough. REPRESENTATIVE HAWKER said he didn't know. Number 1872 FRANK PRUITT, Consultant, Cornell Companies, informed the committee that he'd been commissioner of DOC under Governor Hickel; deputy commissioner under Governor Cowper; and legal counsel under Governor Sheffield. He noted that in the past seven years he has had the privilege of traveling to Fairbanks, North Pole, Delta Junction, Nenana, Kenai, Ketchikan, Wrangell, Eklutna, Nome, and Palmer; on each occasion, he was invited by public officials, chambers of commerce, and Native corporations, all interested in the economic development and stable jobs that are associated with hosting a correctional facility, and he'd been representing an in-state or out-of-state private corrections company or a development group. MR. PRUITT reported that some communities had rejected the idea immediately; some found the idea economically infeasible in a remote community; one won overwhelming public support through two votes and then changed directions; and another "got the horse of legislation ahead of the cart of public support." All have the same goal, however, which is economic development. He continued as follows: We're here representing a community that saw an opportunity to deliver these services. They secured overwhelming public support, they've passed enabling ordinances, they've gone through procurement process, and they've secured a highly competent company to develop this plan. The plan is one of two plans that are before you ... today. One of the proposals is to build a 1,200-bed prison in Sutton. The Whittier proposal is to build a 1,200-bed prison in Whittier. In my experience, both ... the Sutton proposal and the Whittier proposal are based on sound correctional practice. I've analyzed them both, been involved in both, [and there's] no question in my mind. Both are located near Alaska's center of population and, unfortunately, center of crime. Both capture efficiencies through their design, and through the ... 1,200 beds, rather than 600 beds or 200 beds. Both of these are located where construction costs are the lowest in the state. Indeed, Whittier is a deepwater port, where the construction materials come right to the site. Both are located where wages and benefits are the lowest, and both are located roughly 50 miles from the most sophisticated, plentiful, fire, life, safety, program housing, and human resources in the state. Number 1595 MR. PRUITT continued: The substantive difference between the two plans is management and cost. The Whittier prison will be managed by a private company; Sutton will be state operated. The total capital and operating cost at Sutton - that the Department of Corrections has testified to in the Senate - is $110 per day per prisoner. The total cost for the Whittier prison is $94 per day per prisoner, which is a cap that was just discussed. And on this point I want to be perfectly clear that the $94 per diem covers the total projected operating and capital cost for the prison, including major medical, including inmate programs, including staff recruiting, training, equipment, facility maintenance, and even the liability of failed expectations. This project will deliver the same quality service as the State of Alaska does in its own correctional services, and that quality will be ensured through a contract with the state. The only cost above the $94 should be the cost of bringing the prisoners to the door, and the cost of monitoring the contract. Those are the expenses that we would anticipate above the $94. There's a perception that the Whittier bill and the Sutton bill ... are competing plans, and this perception's entirely wrong. And what it's doing is it's diverting attention from the real problems here. The real problem is that neither one of these bills standing alone is going to solve the state's prison bed shortage. In your packets you have a handout on the Whittier prison. On the inside cover there's a graph; the graph goes up. This graph is taken from the Department of Correction's web site, which has its demographic materials. The Department of Correction's inmate population has grown over the last 20 years at an average rate of 5 percent a year. We're not aware of any demographic changes that (indisc.) from the State of Alaska or any legislation that's being proposed before this body that is likely to stop that growth rate. The growth rate equates between 160-200 prisoners a year, depending on whether it's a 4 percent year or a 7 percent year. Number 1403 MR. PRUITT referred to the document labeled "State of Alaska Projected Prison Bed Demand & Cost Analysis," an independent analysis [copy in packets] which indicates that by 2006, DOC will need 1,600 prison beds; by 2,010, another 1,000 to 1,200 beds will be needed. He said although the Whittier prison would satisfy current needs, there is room in the state for another project of equal size in order to meet long-term demand. If the Whittier prison is authorized this year, people would be employed immediately, construction would begin, and the doors would open in two years. He said if the Sutton facility is authorized this year, the state has testified that the doors will open in four to five years. The two projects wouldn't compete because Whittier's would be a short-term solution, whereas Sutton's would satisfy long-term needs of the state. MR. PRUITT noted that Governor Frank Murkowski has said the mission of his administration is good-paying jobs and reducing government spending and growth. Mr. Pruitt opined that the Whittier prison would accomplish these goals. He added, "I'm not aware of any project before this legislature that has such immediate and far-reaching impact in terms of the stimulation of jobs and economic development." MR. PRUITT referred to the third tabbed section [of the analysis], which is titled, "Whittier Prison Project Economic Impact" and was prepared by David Reaume in the last week; it says returning prisoners to Alaska is good business because even though the cost will be more, [the state] will get "the multiplier effect of stimulating jobs" and the positive impact of purchasing goods and services in Alaska. Number 1218 CHAIR WEYHRAUCH referred to Representative Hawker's mention of a contract with an Arizona company to house 600-800 inmates. The proposed legislation, he noted, would require construction of a 1,200-bed prison facility. He asked if that is what is immediately needed, or if that is a projected number. MR. PRUITT reiterated that the projected demand by 2006 is 1,600 [beds]; Whittier is projected at 1,200, based upon the "sentenced prison population." Corrections is a unified system that has facilities that deliver both prison services and jail services throughout the state. The notion, he explained, is to provide a larger, centralized facility, and "move those sentenced prisoners out to make room in the jails for jail-type offenders." He remarked that there are communities that are "full to the gills" with pre-sentence and pre-trial offenders, and it could need expansion. Number 1117 REPRESENTATIVE SEATON referred to Section 2 of SSHB 55, beginning on line 25. He said it appears that the per-diem costs are one cost and that there will be another, separate item [under subparagraph] (B) to cover capital costs. MR. PRUITT said he hopes a clear reading of SSHB 55 would show that the $94 per diem includes operating and capital costs combined. REPRESENTATIVE SEATON remarked that it reads as two separate, parallel [costs]. Number 1019 REPRESENTATIVE HAWKER said it includes the cost of capital construction and operation. REPRESENTATIVE SEATON said he'd like to ask for an amendment at some point to include [the language regarding the capital costs] under subparagraph (A), instead of having it be listed separately. Number 0990 REPRESENTATIVE DAHLSTROM referred to Mr. Pruitt's previous statement regarding the only two costs not included [in the per- diem cost]. She recalled that one was bringing the business to the door. MR. PRUITT said the second would be the cost of overseeing the contract. He explained that DOC should have a monitoring function. REPRESENTATIVE DAHLSTROM asked Mr. Pruitt if he could offer insight regarding the cost of that oversight and who would pay. MR. PRUITT replied that the question would probably be better directed to DOC; however, based on what he had seen of [DOC's] budget, it appears the cost of overseeing that contract, including transportation, as with [the current facility in] Arizona, is about $1.89 a day per prisoner. Number 0895 REPRESENTATIVE HOLM asked what the prisoner-to-guard ration would be. MR. PRUITT deferred to Mr. Wiebe. Number 0753 MARVIN WIEBE, Senior Vice-President, Cornell Companies, told the committee [his company] has a basic design concept for the Whittier prison site, but part of that process is to get input through dialogue with representatives of DOC. He said an intergovernmental agreement between DOC and the City of Whittier, as well as an agreement between the City of Whittier and Cornell Companies, is anticipated and will help define some of the specifics. He emphasized that Cornell Companies is confident it can deliver the project for $94 a day [per inmate]. MARVIN WIEBE reported that there will be a staffing ratio "on the security side" of 6:1, inmates to staff. He noted that [Cornell Companies] is proposing more segregated beds than in the design for Sutton. In the end, there will be a discussion as to whether that many beds will be needed; after negotiation, there will be a final design plan that will be firmly adjusted, and the staffing will have to conform to that requirement. Regardless, he added, it will not change [Cornell Companies'] commitment to not exceed $94 to do that job. Number 0619 REPRESENTATIVE HOLM referred to testimony that it takes two years to build a private prison. He asked why it would take four to five years to build a public one. MR. WIEBE said there is no question [Cornell Companies] has a more flexible approach toward procurement. The company still has laws to comply with, but internally it can make decisions quickly because it is a private business. He said the company is motivated to produce timely results; its drive for efficiency and to meet its deadlines causes the company to use a procurement process that's flexible and "just gets things done." He opined that almost universally agreed upon is this: private operators are one of the single largest advantages to privatization of correctional facilities because they have historically been able to put up facilities more quickly than government can. Number 0468 REPRESENTATIVE HOLM asked why, if statistics show that by a certain year [Alaska] will need 2,600 beds, a 2,400-bed facility isn't being built. MR. WIEBE stated his understanding that, generally, the government wants to match the cost with the actual need. If a 2,600-bed facility were built now, those beds would be sitting empty for several years, and yet all the capital expenditure will have been put in the system. REPRESENTATIVE HOLM remarked that he doesn't like short-term solutions to long-term problems. He asked if the Whittier prison, for example, would be expandable at some point. Number 0281 MR. WIEBE responded that every time [the company] designs a prison, it considers the potential for expansion. He noted that the current "footprint" [for Whittier] is 15 acres, which sets some limitations [towards expansion], but doesn't preclude the company from considering ways to add another 200 to 400 beds to the site. Number 0197 BEN BUTLER, Council Member, City of Whittier, noted that he also the former mayor of Whittier and offered to answer questions. REPRESENTATIVE GRUENBERG asked if the state would have to have as much involvement if the City of Whittier were in a borough. MR. BUTLER said he didn't know. He suggested the attorney for the City of Whittier may be able to answer that. Number 0104 MR. PRUITT proffered that the structure of SSHB 55 is similar to the structure that enabled the Kenai Peninsula Borough to deliver correctional services in Kenai. He said he doesn't see any distinction between a municipal entity that's in an unorganized borough or a borough itself; they both use the same process. In response to a follow-up question by Representative Gruenberg, he said the City of Whittier is a second-class city. REPRESENTATIVE GRUENBERG asked Mr. Pruitt if there is anything that [the City of Whittier] could do to reduce state involvement. MR. PRUITT replied, "Perhaps ... the farming capacity." He deferred further comment to Mr. Wiebe. MR. WIEBE responded that he has no expertise in the area of the issues regarding the classification of cities in Alaska. However, he indicated he could offer his experience regarding this kind of a financing structure. TAPE 03-26, SIDE A Number 0001 MR. WIEBE indicated a municipality has less expensive ways "to do that" because of the tax codes and the ability to use some tax-exempt financing. He said regardless of a city's size, many times "those kinds of structures" are based essentially on revenue stream. He said annual appropriation is the major foundation on which that financing is predicated. CHAIR WEYHRAUCH asked Mr. Butler how many bids from private prison companies the City of Whittier foresees regarding this project. MR. BUTLER answered that originally, when the city put out five requests for proposals (RFPs), three companies responded. He noted that the law firm of Perkins, Coie, and Ginhart (ph) set up the procurement methods and followed it through. He indicated a committee selected one out of the three responses, which was Cornell Companies. In response to a follow-up question, he confirmed that the City of Whittier worked on the drafting of SSHB 55 with the help of [Representative Hawker]. Number 0215 REPRESENTATIVE HAWKER explained that the bill was drafted by his staff while working with representatives of the City of Whittier and representatives of Cornell [Companies]. In regard to one of Chair Weyhrauch's previous questions, he noted that last year there was expert testimony before both the House and the Senate that the Whittier procurement process satisfied the competitive requirements under the State of Alaska procurement code. [Lieutenant Dan Lowden of the Alaska State Troopers, Department of Public Safety, representing Judicial Services in Anchorage, offered to answer questions.] Number 0457 MARY BOWERY told the committee she is from Tennessee, a state that was involved officially with private prisons several years ago; Tennessee had worked with a private prison corporation other than Cornell Companies. She said the prison she worked in at that time was involved in a three-year federal study regarding public-versus-private prisons. One result of that study showed that the cost difference was only 38 cents per day per inmate. The company that the State of Tennessee worked with had in its contract that it wouldn't accept inmates with HIV [human immunodeficiency virus], AIDS [acquired immunodeficiency syndrome], cancer, tuberculosis, or hepatitis C. The company also put a $4,000 medical cap on each inmate per year, which she said "took us by surprise." MS. BOWERY reported that some other things learned were that the state was responsible for the cost of any inmates who escaped from the private prison because the company didn't have the legal jurisdiction; that any empty beds which were part of the private prison could be filled with inmates from other states; that if an assault or other major crime occurred within the prison, the State of Tennessee had to bear the cost of the prosecution as well as pick up the cost for any of its own inmates who were injured; and that the private prison only provided minimal programs to meet the contract, and had minimal work crews. She mentioned a study that showed work crews in public [prisons] put in over 17 times as much work time as the private prison crews. Furthermore, private prisons would only house "medium- or less-custody inmates," whereas the public prison had to house maximum-security inmates, for example, which is more expensive. Number 0687 CHAIR WEYHRAUCH stated his understanding that the private prison in Arizona will offer additional programs if the State of Alaska requests them and is willing to pay for them; it is a function of contract, and not at the discretion of the facility. MS. BOWERY said her concern is that Alaska get what it pays for. She went on to say that most correctional standards require a team that can respond within about a 15-minute time limit in case of a natural disaster, for example. She voiced concern that there may not be an adequate workforce in the immediate area [in Whittier] that could respond. She noted that the prison where she worked has close to 2,000 inmates, and part of it had to be evacuated during a flashflood. She said it concerns her that people may have to travel from Anchorage during an emergency. MS. BOWERY mentioned dealing with people's freedom and their lack of civil rights. She cautioned the state to be careful about placing that responsibility into the hands of the lowest bidder. In response to a question by Chair Weyhrauch, she said she lived in northeast Tennessee, and the prison at which she worked was fully accredited and recognized as one of the best prisons in the country. She added, "I'm very proud of it." Number 0888 MAKO HAGGERTY stated opposition to SSHB 55. He commended Ms. Bowery for a fine job of representing all the downfalls of the private prison industry. He said the private prison experiment has basically failed in every state that has conducted it. He related his belief that incarceration and imprisonment of criminals is one of the few real obligations of the state, and shouldn't be farmed out to the private sector. Mr. Haggerty told the committee that he has no financial interest in the issue; he isn't a prisoner and doesn't own stock in a private prison company. He opined that there must be a lot of money in the private prison industry, because "these guys keep coming back." He said the communities that have been offered the private prison proposal have rejected it. He reminded the committee that the Kenai Peninsula voted on whether to have a private prison and the proposal was rejected 3 to 1, "after being outspent by the proponents of the private prison industry of about 4 to 1." CHAIR WEYHRAUCH asked Mr. Haggerty to provide information to the committee supporting his previous statement that all the communities that have been offered the private prison proposal have rejected it. He also asked if the City of Whittier has voted on the proposal. REPRESENTATIVE HAWKER responded that there has not been a balloted vote; however, there is a signature petition representing approximately 80 percent of the registered voters in the City of Whittier. MR. HAGGERTY said a private [prison company] took [the State of] Mississippi to court because the state couldn't keep enough criminals in the prison to keep its beds full. He said the only good thing he could see about SSHB 55 is that it acknowledges the need to expand existing regional facilities. Number 1218 FRANK SMITH testified that he is a citizen activist who has been involved in criminal justice research in service provision, and his education was focused on corrections. He said he has "been involved for 32 years," and used to provide substance abuse services at Sutton, at the maximum and pre-trial prisons, on contract with the state. He noted that he has published works, including a chapter published in a book regarding Native Americans inside of prisons. He has visited prisons all over the world, he said, including the prison where Alaskans are held in Arizona and the Cornell [Companies] prison in Baker, California; the latter had been closed at the time of his visit because the state had pulled the contract. MR. SMITH noted that the contract being considered now is for $1 billion. He remarked, "People will say and present interesting things if they're ... trying to hook a billion-dollar fish." He referred to Mr. Mako's statement that private prisons have been a failed experiment. He said Charles Campbell, the former director in DOC, a Cleary monitor and a warden of many federal prisons, had testified a number of times last year on the private prison bill. He mentioned Mr. Campbell's work regarding private prisons in England from the Revolutionary War until about the 1850s. MR. SMITH said there are failed prisons. One, he noted, was a CCA [Corrections Corporation of America] prison built in Youngstown, Ohio, and closed after enormous tax "give-backs" and infrastructure provided by a community that was financially distressed because of the loss of steel-working industries. He said, "That's kind of the poster child for awful management of prisons - escapes, murders, things like that." He said CCA has built a private prison with the clear understanding of everyone involved in the legislature that it wouldn't import out-of-state prisoners, and now it is trying to do just that. He listed other prisons that have been an absolute disaster, including eight prisons put up by one operator in Texas that failed. The municipalities had bonded them and, because of the failures, were left holding the tab. He added that the State of Texas eventually bought them back at half price. Number 1436 MR. SMITH said he thinks Whittier is virtually unacceptable for the proposed project. In the last census [2000], it had a population of 182, many of them children and retired people. He said he thinks if the prison were to be built there, they could expect a maximum of 10 jobs. He noted that there are only eight families receiving any kind of public assistance there. MR. SMITH concluded by suggesting that the committee ask about lawsuits that Cornell Companies has been involved in. He gave some examples. He also suggested that the committee investigate regarding the difficulties [Cornell Companies] has had with the Native corporations. He particularly recommended that the committee ask Mr. Wiebe about New Morgan, a closed facility where the contracts were lost to Cornell Companies in a juvenile facility "for chronic sexual abuse of prisoners." Number 1639 WILLARD DUNHAM, Member, City Council, City of Seward, testified that the good part of the bill is that it finally recognizes the need for the Spring Creek [Correctional Center] ("Spring Creek") to be expanded. He said he questions why it has taken so long to do something about finishing Spring Creek, which was started in 1982 and was supposed to have been a 700-bed facility; however, the legislature and DOC didn't want it to be that big, so it was cut back to 320 beds. He noted that the city made the footprint and perimeter large enough to accommodate the original plans; therefore, only half the building was built on it. Because of the preparation work that the city did, Mr. Dunham estimated that "it has to be cheaper to build than any of the rest of them." Mentioning a bill proposed last year that relates to a youth program and an educational program, he said the youth program is currently in operation, and it is being studied by other states because of its great success. MR. DUNHAM stated, "I'm not happy about our bill being tied to a private prison, I would have ... hoped that maybe the Crawford bill would have been better suited for the type of expansion of the rural areas that you have." He said his key point is that the facility [in Seward] has to be the cheapest to do. He opined that when there are close to 500 people in a 320- to 350- bed facility, something's wrong with the system. He added, "This facility here will be paid off in September 2006 on the bonds that the City of Seward made to put it in there." He explained that he just doesn't understand the hesitancy to complete the facility. Number 1890 REPRESENTATIVE HAWKER commented, "In the public testimony there were substantial gratuitous assertions and claims made that reflect personally on a number of the people involved in this project, as well as on the corporate reputation of the participants." He requested that those testifiers submit those issues in writing, and that the recipients of those assertions be allowed to respond. [SSHB 55 was held over.]
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