Legislature(1997 - 1998)
03/10/1997 01:20 PM House JUD
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* first hearing in first committee of referral
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+ teleconferenced
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HB 53 - LEASE-PURCHASE CORRECTIONAL FACILITY The next item on the agenda was consideration of House Bill No. 53, "An Act relating to the authority of the Department of Corrections to contract for facilities for the confinement and care of prisoners, and annulling a regulation of the Department of Corrections that limits the purposes for which an agreement with a private agency may be entered into; authorizing an agreement by which the Department of Corrections may, for the benefit of the state, enter into one lease of, or similar agreement to use, space within a correctional facility that is operated by a private contractor, and setting conditions on the operation of the correctional facility affected by the lease or use agreement; and giving notice of and approving a lease-purchase agreement or similar use-purchase agreement for the design, construction, and operation of a correctional facility, and setting conditions and limitations on the facility's design, construction, and operation." Number 1258 REPRESENTATIVE ELDON MULDER, Prime Sponsor, advised members that the proposed legislation addressed the problem of overcrowding in Alaska prisons. A chart was provided to committee members that graphically demonstrated the problem at hand. He pointed out that in June 1995, the emergency capacity had been reached primarily in the 6th Avenue Jail, Yukon-Kuskokwim Correctional Center and the Mat-Su Pretrial facility. He noted that a year later, in September 1996, the chart reflected the Anvil Mountain Correctional Center at capacity, Wildwood Correctional Center within capacity at times, and the Meadow Creek Correctional Center within maximum capacity, occasionally. REPRESENTATIVE MULDER expressed that when entering 1997, the issue was red, at emergency capacity. He noted that the Palmer Correctional Center and the Wildwood Pretrial Correctional Center fell within capacity, Highland Mountain Correctional Center and Meadow Creek occasionally fell within maximum capacity thresholds; however, the state was constantly in excess of emergency capacity thresholds within all state facilities. Representative Mulder stressed that the state had a problem. REPRESENTATIVE MULDER stated that there were other unique problems faced by the system, of which one involved the insistence of the courts upon the Department of Corrections to provide adequate facilities for female inmates. He noted that the court had been pressuring, and working with the department to try and provide for a female correctional center. REPRESENTATIVE MULDER advised members that there was a desire, by the people in Anchorage, to return the 6th Avenue Jail back to the community and allow it to be expanded into a museum, which would result in the need for additional bed space within the municipality of Anchorage. REPRESENTATIVE MULDER advised members that HB 53 was an attempt to provide the least expensive alternative when addressing prison problems in the state. He stated that it was a fact that the state would spend more money on corrections in the future, and there was no way getting around that. Representative Mulder pointed out that currently, the state spent $107 per day to incarcerate a prisoner in the state of Alaska. To him, that figure was unacceptable, and in large part, was driven by the fact that the state had small, remote, expensive correctional facilities scattered throughout the state of Alaska. Number 1586 REPRESENTATIVE MULDER stated that to try and accomplish cost savings within the system, HB 53 focused on a large, centralized facility, built and run by a private contractor. He noted that HB 53 was different than the previous year's proposed legislation, and allowed for the facility to be a straight lease, or a lease/purchase option. Representative Mulder pointed out that the bill was not area specific, as it allowed the commissioner the maximum latitude necessary to make the best decision for the state of Alaska. It would allow the commissioner to locate the facility wherever savings could be attained. The bill did specify that the facility would be constructed and operated by a private contractor. REPRESENTATIVE MULDER expressed there was true logic of having the facility built and operated by a private contractor, and the proposed legislation stipulated that the facility be built and operated by the same entity for the first five years. He noted that that would pertain to IRS codes in relation to tax guidelines; however, beyond that, the reason was that in the past the state had had problems with the Spring Creek Correctional Center. Representative Mulder pointed out that the facility was built on top of a river, which presented flooding problems. He stated that he felt those problems were driven by the fact that people who design and build facilities do not have to operate them. Representative Mulder pointed out that if someone were forced to operate a facility, they would be far more sensitive to the fine details of what would make sense, economically, and what would not. REPRESENTATIVE MULDER advised members that the state spent over $5 million a year employing people in Arizona. He advised members that the state was relieving its overcrowding problem by sending more inmates to a private facility in Arizona. Representative Mulder expressed that he would be proposing to increase the Department of Correction's budget, this year, to allow for the full utilization of the 250 Arizona beds which had been allotted for the state of Alaska. REPRESENTATIVE MULDER felt that if they were using state dollars, the state should employ Alaskans, rather than Arizonans. He felt that was especially true in a time when Alyeska was laying people off, and major oil companies and other groups were looking at streamlining their operations and reducing the number of jobs in the state. Representative Mulder advised members that HB 53 would present an opportunity to bring jobs to Alaska, and employ Alaskans. REPRESENTATIVE MULDER felt that money could be saved by private construction of the facility. He noted that there had been an alternative presented by the Governor last year, which would expand the regional correctional facilities, with an original price tag of approximately $150 million. Representative Mulder believed that private contractors had demonstrated that they could build those facilities for much less than their public counterparts. Representative Mulder pointed out that he believed it would be appropriate to say it would cost the state 25 percent more to build the facility than it would cost the private sector. REPRESENTATIVE MULDER advised members that another valuable asset of having a private contractor build the facility was the fact that the state did not have a large surplus of cash in the state's general fund. He informed members that it cost the state $59 a day, per inmate, in the Arizona facility. Representative Mulder pointed out that that figure not only covered the operation costs of the facility, but more than covered their costs of amortization and included a profit margin. He felt similar savings could be achieved to a per day cost in the state of Alaska if a large, centralized facility was built and operated by a private contractor. REPRESENTATIVE MULDER commended the commissioner of the Department of Corrections, who, at times, had taken steps to try and rein in the cost of corrections. He pointed out that she was currently being pushed to expand her utilization of soft beds for the purpose of relieving the overcrowding problem. Representative Mulder pointed out that it would be two years before a new facility could be brought on line. He felt that by the time the facility was built, it would be full and the state would be looking towards the need to build another facility. Representative Mulder explained that the state was currently experiencing 8 percent growth in inmate population. Number 2032 CHAIRMAN GREEN referenced the chart provided by Representative Mulder and asked what percentage involved misdemeanants. He expressed that he was with the understanding that approximately 20 percent were misdemeanants. REPRESENTATIVE MULDER felt that was probably a fair reflection of misdemeanants occupying hard beds, adding that that was in DOC's budget analysis; however, he did not have the specifics in front of him. CHAIRMAN GREEN asked if there were soft beds, or the electronic device alternative would be available for the misdemeanants, so hard beds could be freed up during the process of building a new facility in the state, from the bid process through completion. REPRESENTATIVE MULDER expanded his previous testimony prior to responding to Chairman Green's question regarding misdemeanants. Representative Mulder stated that there were those who believed, that when the bill was put forward the previous session, that it was directed or intended towards a particular site and a particular vendor. He expressed that that bill allowed the commissioner the flexibility to negotiate the best deal possible; there was no directive regarding the location, or the vendor. Representative Mulder stated that he believed the whole discussion that he raised, public versus private, had been hurt because of a location issue. Representative Mulder advised members that the bill before them was silent regarding the location of the facility. He noted that whatever the Municipality of Anchorage, the Mat-Su Borough, Seward, Greely [Ph], Delta Junction, et cetera, decided was fine, but the commissioner would have to be driven by cost in relation to making that determination. REPRESENTATIVE MULDER stated with regard to the removal of misdemeanants from hard beds, that yes, the state could do that; however, it would be a very temporary fix. He stated that they were directing the department, or intend to through the budget process, to utilize more soft beds and increase, only incrementally, the amount of risk to the population. Representative Mulder pointed out that that would only be effective for a couple of years when considering the 8 percent prison growth factor. TAPE 97-36, SIDE A Number 000 REPRESENTATIVE CROFT advised members that he was curious as to whether the numbers that related to emergency and maximum capacity, reflected on the chart, were Cleary numbers, and how the state would be impacted by going to the federal standard, either in the numbers or cost. He also asked for an explanation of what the "10 day, 30 - 90" reflected on the chart. REPRESENTATIVE MULDER advised members that the chart did relate back to the Cleary Settlement numbers. He stated, for example, the Anvil Mountain Correctional Center's maximum capacity was 102 inmates, and the emergency capacity was 104 inmates, as determined by Cleary, and on February 1, 1997, that facility housed 116 inmates. Representative Mulder expressed that the court had determined a fee ratio of approximately $50 or $75 a day, per institution, plus an X number of dollars per day system-wide, if out of compliance, and that would be assessed throughout the course of a year. He pointed out that the supplemental budget reflected an amount of over $2 million owed by the state because of prison overcrowding. REPRESENTATIVE MULDER could not respond to the question Representative Croft presented regarding the 10 day, 30 - 90. REPRESENTATIVE ROKEBERG felt it would be helpful to have a projection of future occupancy uses and needs in the state for a 10 year plus period, and attempt to put together a legislative strategic plan that related to facility needs in the state. Number 288 REPRESENTATIVE MULDER pointed out that the chart reflected a guesstimate of inmate population from 1984 through 1999, and was fairly close to tracking where the state might be, and where it actually was. REPRESENTATIVE ROKEBERG asked if Representative Mulder was aware if the state had any type of a strategic plan, or idea in the long range capital plans, for facilities in the state of Alaska. REPRESENTATIVE MULDER's response was no. REPRESENTATIVE ROKEBERG stated with regard to the problem of prisoner classification, he felt it was important that the people of the state, and members of the committee, understand the need for the Department of Corrections to review their classification process. He pointed out that the Lemon Creek Correctional Center in Juneau, housed all classification levels, and with that in mind, he felt it was important, and particularly as it related to any award of any type of contract for the construction of private facilities, that the people in the site affected areas understand that differential. REPRESENTATIVE ROKEBERG felt the facility needs in the Anchorage area related to pre-sentenced individuals, and other facilities as related to the obsolete condition of the 6th Avenue Jail. Number 466 REPRESENTATIVE MULDER advised members that growth in the Anchorage area was at the pre-trial and misdemeanant level. He stated that because they were attempting to accomplish several different functions with one facility, they visited with private contractors regarding the ability to do that. Representative Mulder expressed that when asked if a facility could house medium, pre-trial and female inmates, the response was that, certainly, that it only depended on how the facility was configured. REPRESENTATIVE MULDER stated with respect to the issue of prisoner classification, that for a number of years the correctional budget had been high profile and high discussion. He advised members that was largely due to the fact that there was significant upward pressure on the department's budget. Representative Mulder stated that as republicans, they had attempted to keep the lid on it as much as possible; however, expressed that there was point when the physical capacity, was the physical capacity, and they were looking at that threshold in the very near future. Representative Mulder advised members that the department's classification system was one of the more aggressive ones in the country that provided a low threshold of risk to the Alaska population, but that low threshold of risk had a high cost. REPRESENTATIVE ROKEBERG referenced the necessity in the Anchorage area for what he termed "jail beds", versus "prison beds", and the differential there, and stated that with the majority of judicial proceedings taking place in the Anchorage area, there was a physical necessity to have a larger number of beds, in hard beds, in the Anchorage area, notwithstanding what the public opinion was relating to the location of the facilities. He expressed that they were stuck with the need to have more beds in the Anchorage area whether they liked it or not, and felt that was a necessary point to make. REPRESENTATIVE ROKEBERG advised members that HB 53 only provided for one facility, and he was concerned about the fact that the state needed a separate, discreet, women's facility in the state of Alaska. He asked if Representative Mulder would be adverse to broadening the scope of the bill to provide the commissioner the flexibility to provide for more than one facility inside the scope of the bill. REPRESENTATIVE MULDER believed the commissioner was currently reviewing plans to convert Highland Mountain from a male facility to a female facility, and was entertaining discussions with the community to do that. Representative Mulder stated that before a new facility was on-line, the state would again be facing prison overcrowding problems. REPRESENTATIVE MULDER advised members that when dealing with pre- trial inmates, a high level of security would be necessary, as well as the location being feasible. REPRESENTATIVE ROKEBERG went on record in support of a discreet women's facility in the state of Alaska. He noted that there was some severe opposition in the Eagle River area to the conversion of the Highland Mountain facility. Representative Rokeberg pointed out that the Highland Mountain facility was designed, in large part, for specific programs, primarily the sex offender program, which had proven relatively successful, as he understood it. He noted that part of the success of the program was the physical makeup of the facility. Representative Rokeberg was concerned with the cost effectiveness of converting that prison to a women's facility, versus building another discreet women's facility, which could be part of a larger complex within the same complex of any new facility. Number 1046 CHAIRMAN GREEN asked where female prisoners were currently being housed, and at what percent the women prison population was increasing. REPRESENTATIVE MULDER advised members that regarding the percentage of the misdemeanant population, that as of today's count, there were 3,029 inmates in hard beds, and of those 2,580 were felons, or 85 percent, and 449 were misdemeanants, which was 15 percent. REPRESENTATIVE MULDER stated with respect to where female inmates were currently housed, that it was his understanding they were more or less spread throughout the system. He advised members that there were women prisoners housed at the Lemon Creek facility in Juneau, and according to the Superintendent there, Dan Carothers, they converted a portion of that facility without additional funds, to become a partial female facility. Representative Mulder pointed out that the Meadow Creek facility housed female inmates, as well as the Fairbanks facility. He noted that the 6th Avenue facility housed some female inmates, as did the Wildwood Pre-Trial and the Mat-Su pre-trial facilities. CHAIRMAN GREEN asked if they converted a facility to a women's facility, and began to bring the state's female prisoners into a centralized facility, would they be faced with the need for additional space for females in two years, as was the projection for male prisoners. REPRESENTATIVE MULDER expressed that he did not have a breakdown of the number of female prisoners in the state; however, would get that information and provide it to the committee. Number 1240 CHAIRMAN GREEN noted that there were many members of the public wishing to testify via teleconference, and proceeded with that portion of the meeting. Number 1323 DOUG PERKINS, with the Bayshore/Klatt Community Council, testified via teleconference from Anchorage, Alaska. He advised members that the community council had not, and in all likelihood, would not take a position on whether prisons ought to be privatized or not. MR. PERKINS noted that the proposed legislation suggested that if prisons were privatized that they should be built by the operator. He expressed that he could not find that language in the bill, and pointed out that it could be quite difficult to find a person experienced in both operating a prison, and constructing one. Mr. Perkins felt that the Department of Corrections was sufficiently experienced to have oversight on where a prison ought to be built. MR. PERKINS stated that the remainder of his comments were mainly directed towards the amendments Chairman Green would be offering. He stated that amendment 1 would provide that there had to be some minimal standards incorporated into a private prison bill. Mr. Perkins did not feel it was asking too much to insist that the operator of something as serious and significant as a correctional facility, have experience operating one. He stated that, similarly, the employees hired should have some minimal level of qualifications, and paid a prevailing wage to attract and keep qualified personnel. MR. PERKINS reiterated that they would support Chairman Green's amendment when offered. He reiterated that if the state was going to entrust a private company to run something as critical as a correctional institution, they should be required to provide for a performance bond guaranteeing their performance. Mr. Perkins noted that because of the escape that took place at the Arizona facility, they were in the process of having another bill to cover the costs of escape. MR. PERKINS agreed with Chairman Green's language that would require a bond or certificate of insurance sufficient to defend and indemnify the state and local governments against claims, or liability, arising from the operation of the correctional facility, as well as a performance bond. MR. PERKINS advised members they would also support Amendment 3, when offered by the Chairman, which called for a meaningful site selection process. He stated that he felt it was clear from the language of Representative Mulder's bill, that the bill was limited to the housing of Alaska prisoners; i.e., charged and convicted under Alaska law, which he agreed with, although he thought that language could be fine tuned. Number 1515 STEVE LARSON, employed by the American Federation of State, County and Municipal Employees, went on record as opposing HB 53. He stated that the proposed legislation was extremely speculative. Mr. Larson advised members there were numerous low cost alternatives, such as HB 150, that could be used to address the problem of prison overcrowding. MR. LARSON advised members that prison privatization had serious public policy implications, and to his knowledge, that had not been addressed in any fashion. He pointed out that there was no documented evidence that private interests could operate a prison cheaper, or more efficiently than their public counterparts, and suggested that HB 53 would cause cost shifting, rather than cost savings. Mr. Larson stated that he felt the primary reason for his opposition to the proposed legislation, and hoped it would not move out of committee, was because the majority of Alaskans did not support the concept. He noted that he had attended public hearings on numerous occasions, and not once had he heard a member of the public speak in support of the bill. MR. LARSON pointed out that they conducted a poll in Representative Rokeberg's district, and the majority of the people in that district did not support the proposed legislation. He expressed that he was aware of upcoming proposed amendments that might soften the impact of the bill on the public, but there was no guarantee that those amendments would survive the legislative process. Mr. Larson pointed out that the next committee of referral, the House Finance Committee, was the sponsor's own committee. Mr. Larson asked that the committee form a broad public commission, made up of neighborhood groups, legislators, corrections employees and city government to thoroughly study the issue of the need for private prisons, and to also consider the overall corrections needs for the state of Alaska. That body could provide judgments to the House Judiciary Committee to really address the issue, rather than speculate on spending $150 million, and what he considered an experiment with public safety in the state of Alaska. Number 1638 BARBARA WEINIG, President, Rabbit Creek Community Council, advised members that the community council did not support HB 53. She pointed out that most members of the council did not feel there would be any amendments that would make the bill better. MS. WEINIG noted that she would address one of Representative Mulder's points, which was that the Spring Creek Correctional Center was built over a creek and caused flooding in the facility. She felt members could expect the same type of problem with a bill such as HB 53, which she stated was crafted for the benefit of one provider who already had a parcel of land, which happened to be wetlands. Ms. Weinig expressed the need to conduct a very intensive site selection process, and take into consideration what the use of the land was, and how it would look in a few years, because she felt it would make that section of town wither. Ms. Weinig expressed that a site selection process was required for all state facilities, and should also be required for a state lease/purchase facility. Number 1734 REPRESENTATIVE MULDER recognized Ms. Weinig's healthy amount of skepticism; however, advised members that he would challenge her to find, anywhere in the bill, that makes it site specific. He acknowledged that that was the fear, but reiterated there was nothing in the bill that was site specific. Representative Mulder pointed out that it was totally the commissioner's responsibility to determine an appropriate location. CHAIRMAN GREEN took testimony from Fairbanks, Alaska. Number 1763 CRAIG PERSSON, Vice President, Public Safety Employees Association, representing state troopers, Corps Service Officers and airport safety officers around the state, advised members he would like to commend Representative Mulder for attempting to solve the problem of overcrowded prisons in the state. However, he did not feel the situation would get any better with more crime laws being passed by the legislature, and an increase in state population. MR. PERSSON advised members the proposed legislation presented a public safety concern. He noted that there was already a high turnover of correctional officers in state facilities. Mr. Persson expressed that those officers were paid a fairly decent wage, but the Association believed that if a lower wage was paid there would be a higher turnover rate, which could lead to moral problems, as well as short cuts being taken and staffing level problems. MR. PERSSON advised members that another problem involved a cost concern. He agreed with previous testimony that there was real concern of a private contractor not meeting minimum standards and qualifications, and if those folks were paid a higher wage, it might not be financially feasible. Mr. Persson explained that it could end up costing the state of Alaska more money in the long run. He pointed out that there was a study conducted in April 1996, of a private correctional center in the state of Florida, where per diem costs per inmate were actually higher than a comparable state facility located in the same region. Mr. Larson stated that there was also a 6 percent annual increase tacked on to that rate for the foreseeable future. MR. PERSSON advised members the Association was also concerned about the liability. He pointed out that the state would not be shielded from liability, that a deep pocket for law suits would arise from the contractor being negligent, or not adhering to regulations; prisoner rights, et cetera. Mr. Persson expressed that the state might not have much control, or oversight, to make sure the correctional facility was being operated in a safe and legal manner. MR. PERSSON pointed out that the main concern, regarding costs for employees, was that they could unionize and have the right to strike. He believed that would run the costs up even more. Number 1908 REPRESENTATIVE CROFT asked if prison guards could not strike at the present time. MR. PERSSON advised members they could organize, and under the Public Employee Relations Act, correctional officers were Class 1 employees and were exempt from striking. REPRESENTATIVE CROFT asked if it consisted then, of mandatory arbitration. MR. PERSSON advised members that would be correct, they had binding arbitration. Number 1930 REPRESENTATIVE JAMES stated with respect to unionizing, that the state was currently considering whether or not people had to be paid overtime rates for hours worked over 8 hours. It was her understanding that state correctional officers worked 12 hours a day, seven days a week. She pointed out that a private prison would not involve public employees, and would be subject to overtime over 8 hours. MR. PERSSON agreed that they would be entitled to overtime pay for hours worked over 8 hours a day. CHAIRMAN GREEN accepted testimony from Kenai, Alaska. JOAN BENNETT-SCHRADER CLUW, Mt. Redoubt Alaska Chapter of Coalition of Labor Union Women, advised members that last year during the numerous discussions on privatizing prisons in the state of Alaska, the coalition wanted to be reassured that the state of Alaska would be held harmless if prisoners would be incarcerated in private prisons. She stated that she could not find that reassurance any where in the proposed legislation, HB 53, and asked if the House Judiciary Committee would address that issue. MS. CLUW pointed out that there was another matter they would like to bring to the attention of the committee. She advised members they had great concern of the department's classification system, and felt that there could be some inadvertent misuse of the system. Ms. Cluw explained with regard to the Spring Creek Correctional Center, the state's maximum security prison, that inmates are kept in that facility the last six months of their incarceration. Ms. Cluw advised members that was not good business. She felt the proposed amendments might assist the intent of the bill; however, asked when the communities would have access to them in order to make appropriate comments. CHAIRMAN GREEN expressed that the committee was not considering the amendments at this meeting, and he would make the proposed amendments available to the LIO offices. JOHN YARBOR advised members he was employed by Alaska State Employees, American Federation of State, County and Municipal Employees, Local 52. He stated that they opposed HB 53. Mr. Yarbor noted that it was the second year the legislation had been considered by the legislature. Mr. Yarbor pointed out that the bill had been amended time and time again, and agreed with Mr. Larson's request that the House Judiciary Committee appoint a commission to conduct a thorough study on the issue of private prisons. MR. YARBOR referred to the testimony of Representative Mulder who expressed the facility was not site specific, or directed at one contractor. Mr. Yarbor pointed out that it was his understanding there was only one company in the state of Alaska that would bid on the project. Mr. Yarbor stated that due to the fact there was a problem with the way the site proposal was handled by the Anchorage Planning Commission, it was going before the voters to be corrected. Mr. Yarbor was hopeful the committee would hold the proposed legislation for further study purposes. MR. YARBOR advised members he had been a DOC employee for 20 years and had just retired. He felt that with a study, it could be shown that some of Representative Mulder's facts were off and needed correcting. Mr. Yarbor expressed that in 1977 the state's correctional facilities were overcrowded, as well as in 1979 and 1980. He pointed out that overcrowding was something that was inherent with corrections, and it was the state who had to deal with it. Mr. Yarbor emphasized that it was the state's responsibility, and that responsibility could not be legislated away. MR. YARBOR pointed out that with a thorough study, and a legislature that was sincere in looking at ways to handle the situation; unlike other states, such as Texas who had many private prisons, and a very large problem, the state of Alaska would have the opportunity to study and draw from all the states who had experience in the private prison industry. He felt that the state would come out far ahead if the time was taken to do that. JULIE OLSON, President, Oceanview/Old Seward Community Council, advised members that the council opposed HB 53 for three reasons. They believed that public involvement of the process should be a requirement, and provisions that would ensure public safety should be included in the proposed legislation, such as requiring minimal staff qualifications, some requirement of inmate and staff ratios, as well as ACA accreditation. MS. OLSON pointed out that there was no cost savings to the state required in the proposed legislation. She noted that generally, privatization was thought to bring the forces of a free market economy to the public sector. Ms. Olson advised members that turning over, what were historically public facilities, was supposed to result in more efficiency, lower costs and better solutions or values. She noted that competition, many times, did provide those benefits. Ms. Olson advised members that HB 53 was worded so narrowly that it virtually eliminated most of the possible competition in that market. MS. OLSON expressed that HB 53 did not allow the professionals in the corrections field to evaluate all the options available to make the best possible decision for the state. She pointed out that other states, who were facing overcrowding in their prisons, were considering a variety of options to relieve the overcrowding problem, that included such things as electronic monitoring, or boot camps, which she felt were options the state and DOC should consider. MS. OLSON referenced Section 3, and stated that it was so specific in its wording that it limited the ability of DOC to seek solutions for the prison overcrowding problem. She stated that the section stated that DOC would have no more than one agreement. Ms. Olson advised members that in order to promote competition, and better programs, she felt DOC should be allowed to contract with one or more providers. MS. OLSON pointed out that Section 3(c), (1) required a inmate population of 500 to 800 prisoners. She advised members that to specify the prison population limited the possible choices available to the DOC. Ms. Olson pointed out that none of the state facilities housed more than 500 inmates at the present time, and questioned whether that population would increase efficiencies. Ms. Olson felt that existing facilities could be increased in size, in order that they could gain those same economies of scale that Representative Mulder believed was available to the private sector. Number 2300 REPRESENTATIVE MULDER pointed out that there had been several statements about the fact that the so-called, rent-a-cops, or people who would be employed in the private facility would be less skilled than their public counterparts. He referred to page 6, Section 4(e), lines 23 through 25, which stated, "the Department of Administration shall require that persons employed by the contractor as correctional officers in the facility meet the requirements of AS 18.65.130 through AS 18.65.290 that are applicable to correctional officers.", and pointed out that those were the standards and levels of training that would be required of the public counterparts. Representative Mulder explained that private, correctional officers would be required to have the same level of training, skills and ability as their public counterparts. Number 2341 B.K. POWELL, Spokesperson for the South Anchorage Coalition, advised members that they were in support of the amendments that would be put forth by Chairman Green. He referred to Representative Mulder's statement that the intended facility was not site specific. Mr. Powell advised members that they felt it was site specific, or municipality specific. He referred to Section 2(a), noting that the word "municipality" came into play. Mr. Powell stated that being a citizen of the state of Alaska, he did not know how many municipalities there were in the state; however, felt there were very few, and to him that was very site specific. Mr. Powell suggested that the words "political subgroups or communities" would provide for more of a broad based interpretation. MR. POWELL felt that HB 53 did not clearly address operational guidelines, and as a resident of South Anchorage, he believed there would be safety concerns. He pointed out that the bill did not address a balanced site selection public process, again referring to "municipality". Mr. Power expressed that Representative Mulder stated that a pre-trial facility would not be appropriate in Delta. Mr. Power clarified that he was referring to prisons, not pre-trial facilities, or jails. MR. POWELL reiterated that there were no conclusions relating to cost savings in the proposed legislation. He stated, also, that there was little information on correctional philosophy; i.e., economic factors to add inmate population characteristics. Mr. Powell expressed that charts and graphs were okay, but added that there had been a presidential candidate who used charts and graphs, and members knew what happened to him. MR. POWELL stated that there were examples across the country where new prisons were sited next to existing facilities for cost saving purposes. He pointed out that one reason for that was that the support services, and the philosophy and any other philosophical concerns one may have about the operation of the prison, would already be in place. Mr. Powell noted that that was not an "Anchorage" definition. MR. POWELL pointed out there were 58,000 prisoners housed in private facilities throughout the United States; that equated to 1160 private prisoners per state. He expressed that most of the private facilities were located in the southern tier of the United States, and operate fairly well if they follow certain guidelines, and he did not feel HB 53 considered, that it was, more or less, a "cart before the horse" syndrome in the state of Alaska. MR. POWELL concluded his testimony with the question, "Does the state want to experiment with a private prison process?" TAPE 97-36, SIDE B Number 000 ED EARNHART advised members that through two community council meetings, it was found that most of the people were opposed to even the idea of having private prison facilities. Mr. Earnhart stated with respect to the state's needs, that the state was making changes in the juvenile system, and changes in education, and that there was a lot in play within the state and nationally, that was reducing crime rates. Mr. Earnhart could not understand the apparent urgency to build new prisons because the state felt the space would be necessary some time down the road. He pointed out that there was no sound evidence to that effect, and referenced prior testimony which reflected that the state had always been faced with the problem of overcrowded prisons. Mr. Earnhart stated that that was not healthy, but it had not done the state in, and he could not understand why the proposed legislation stated that there had to be a 750 to 1000 bed facility, and do it as soon as possible. MR. EARNHART advised members that many people had pointed out that there was room to expand existing facilities, and he did not feel any bill should pass, at this time, directed at the construction and private operation of a prison facility in the state of Alaska. CHARLES O'CONNELL, Business Manager, Alaska State Employees Association, advised members he was opposed to HB 53. He stated that Representative Mulder, when he introduced the bill and explained it's intent, used the terms "economies of scale". Mr. O'Connell expressed that economies of scale, in corrections, was very real. He stated that the per bed costs go down with a larger facility. Mr. O'Connell pointed out that costs of operating the Anvil Mountain Correctional Center and the Ketchikan Correctional Center was much higher than it was at Cook Inlet, Spring Creek, Palmer Correctional Center or the Wildwood Correctional Center. It was Mr. O'Connell's understanding that the costs at those four facilities, on a per day basis, was approximately $61 a day. MR. O'CONNELL stated that it was also his understanding that the Arizona contract, at the present time, was $60.47 per day. He advised members that those inmates could be housed in the state of Alaska just as cheaply as they were being housed in Arizona currently. MR. O'CONNELL pointed out that the approach of building a "best deal" that would hold up to 800 or more inmates, would not meet the prison needs of the state. He noted testimony relating to jail beds and prison beds, and advised members that building one huge, centrally located prison facility, would not improve overcrowding problems in other areas of the state. Mr. O'Connell stressed that the need of the Department of Corrections was not solely a south central need, but a statewide need. MR. O'CONNELL pointed out that members were talking about public safety. He stated that the Department of Corrections in Alaska, using public facilities and public employees, had never had an inmate murdered, never had a prison guard murdered, and that no other state in the United States of America could say that. Mr. O'Connell expressed that the state had a system that was safe, and although there had been a few attempted escapes, there had never been an escape where the inmate was not subsequently apprehended. MR. O'CONNELL expressed that the final point he would make related to being a professional negotiator. He stated that what was being done, by creating a sole source contract, would be the creation, in effect, of creating a monopoly. Mr. O'Connell stated that the state would be paying a private contractor to construct a 800 bed facility, and all that contractor would have to do to get the price that they demand, was to say to the state, "take the inmates back, or pay my price." Mr. O'Connell pointed out that the state would not have beds available to take the inmates back. He advised members that it was a very bad economic move to take the path of the proposed legislation. Mr. O'Connell encouraged that members consider HB 53 fairly, and hoped that it would never see the light of day. Number 282 REPRESENTATIVE MULDER referred to Mr. O'Connell's statement regarding a "sole source contract", and pointed out that it was anything but a "sole source" contract, unless the Department of Administration determined that that was how they wanted to write it. He stated that the bill provided authority to the DOC, through the Department of Administration, to put the project out to competitive bid for the services stipulated, the prevailing bid would be awarded, established, and guaranteed for the life of the contract. CHAIRMAN GREEN asked that Forrest Browne, with the Department of Revenue, and Margot Knuth, with the Department of Law step forward and provide testimony on HB 53. Number 325 MARGOT KNUTH, Assistant Attorney General, Department of Law, advised members she was working with the Department of Corrections, and the Governor's Cabinet on Youth and Justice this legislative session. She expressed that she had taken a crash course on the state's correctional system, and had learned quite a bit. MS. KNUTH advised members that she had prepared a chart, for the Department of Corrections, that reflected all of the correctional facilities in the state; how many prisoners the facilities were originally built for, the maximum capacity, emergency capacities, and what their expansion capabilities were. The chart would also reflect the costs of expansion, how many beds would be provided at that cost, and what it amounted to on a per bed basis. CHAIRMAN GREEN felt that would be very helpful and educational for the committee, and asked Ms. Knuth if she could have that available at the next committee meeting. MS. KNUTH advised members she would be available to present that at the next hearing, and agreed that it would be enlightening and make it easier for members to follow along on some of the questions. She pointed out that the state had definite needs for additional correctional facility hard beds. Ms. Knuth expressed that the fundamental plan required three things; an attempt to reduce the number of prisoners going to hard beds, in accordance with public safety, and to try to get people out of hard beds as soon as possible. Ms. Knuth pointed out that the third component was the need to expand the number of hard beds in the state. MS. KNUTH pointed out that the administration's plan called for between 1000 and 1300 new beds in the next six years. Number 440 REPRESENTATIVE JAMES asked if the private industry provided all the soft beds in the state. MS. KNUTH did not know for sure, but thought that all the halfway houses in the state were privately owned and operated. An unidentified speaker stated that that was not so. REPRESENTATIVE JAMES pointed out that if soft bed inmates were taking up so much space in the hard bed facilities, and soft beds were being provided by private industry, why were they not building more soft bed facilities for inmates taking up hard bed space. MS. KNUTH advised members that she understood there were 75 soft beds that had been made available; however, the state had not bought those beds yet. She expressed that the hard part was juggling everything together in order that there would be a place for everyone. REPRESENTATIVE JAMES pointed out that the bottom line of the "hard part" was where, because the public did not want the correctional facilities built close to them, that it was even hard to find a place to locate a soft bed facility. MS. KNUTH pointed out that there were communities who were interested in having facilities built in their area. She advised members that the administration had sort of a five prong test for where to expand, of which one of them was working with the communities. Ms. Knuth expressed that the city of Seward was interested in expanding the Spring Creek facility, which was not at the top of the Department of Corrections' list for places to expand; however, it was necessary to factor that in, and suddenly it moved up, in terms of the department's priorities, because the city wanted it and were willing to cooperate in the expansion process. MS. KNUTH advised members that safety was a factor, as well as cost effectiveness. She pointed out that the state owned land near Palmer, Alaska, and that there was a desperate need for medium beds in the state. Those beds could be provided in Palmer at the cheapest rate because a core facility already existed, and ready for expansion. Ms. Knuth stated that, normally, they consider close to $100,000 to $150,000 per bed; however, could expand the Palmer facility for less than $60,000 per bed. CHAIRMAN GREEN asked that Ms. Knuth and Forrest Browne be available for the next hearing, and closed public testimony on HB 53, except for their comments which would be taken at that time.
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