ICE private-prison contract may be just the beginning

It is telling that a day after Republican Donald J. Trump won the Nov. 8 presidential election, CoreCivic Inc. saw the biggest percentage gain on the New York Stock Exchange with shares climbing 43 percent. CoreCivic, formerly known as Corrections Corp. of America, is the world’s largest private-prison company.

It is also telling that just over a month after the election, the U.S. Immigration and Customs Enforcement agency awarded CoreCivic’s Northeast Ohio Correctional Center on Youngstown’s East Side a new contract.

Why telling?

Here’s what Trump, the New York City billionaire businessman who defied conventional political wisdom with his victory, said in a postelection interview with CBS’ “60 Minutes” about his plans to deport or detain millions of undocumented immigrants:

“What we are going to do is get the people that are criminal and have criminal records, gang members, drug dealers, we have a lot of these people, probably 2 million, it could be even 3 million, we are getting them out of our country or we are going to incarcerate.”

The incarceration will occur in the nation’s private prisons. Hence, the skyrocketing of Nashville, Tenn.-based CoreCivic’s stock value, and that of its main competitor, GEO Group of Boca Raton, Fla., whose stock jumped 21 percent.

The announcement last week of the new federal ICE contract for the Youngstown private prison will help cushion the financial blow from last year’s loss of a U.S. Bureau of Prisons contract that resulted in 185 employees being laid off.

The new pact, which will be in effect until March 31 and could then be renewed by ICE for four six-month periods, will result in about 200 employees being hired.

The Northeast Ohio Correctional Center on Hubbard Road now houses 600 inmates from the U.S. Marshals Service and can accommodate up to 500 more detainees over the next several months.

But the big influx of inmates should come within the first 100 days of the Trump administration – if the new president keeps his word.

While the administration of Democratic President Barack Obama moved away from using private prisons to house federal prisoners, saying private facilities have more safety and security problems than government-run lockups, Trump sees things differently.

“I do think we can do a lot of privatizations and private prisons,” the president-elect told MSNBC in March.

Immigration and Customs Enforcement holds up to 34,000 immigrants awaiting deportation. Forty-six of the roughly 180 facilities in which ICE houses those immigrants are privately run. About 73 percent of all the detainees are in the private facilities.

Trump’s immigration policy should be a boon for NOCC in Youngstown because immigration detention centers command a higher rate for each inmate bed.

“Trump was saying during his 100-day plan that mandatory minimums for people re-entering the country would be set at two years – that’s going to require a longer-term need for beds,” Michael Kodesch, a senior associate with financial service firm Canaccord Genuity Inc., told the Associated Press.


But it isn’t just the new federal contract that is giving Youngstown officials reason to celebrate after last year’s loss of federal Bureau of Prisons inmates.

Earlier this month, the Ohio General Assembly approved legislation that will pave the way for the Ohio Department of Corrections and Rehabilitation to contract with private prisons to house inmates who would otherwise be sent to state-owned correctional facilities.

Gov. John R. Kasich signed the legislation into law Monday , which means that the 20-year-old East Side prison will be on the state’s radar.

This is an opportunity for CoreCivic and Youngstown city officials to develop a long-range plan for the prison industry in the region.

To be sure, there are critics of this nation’s criminal justice system who argue that the incarceration rate is too high. However, so long as the federal and state governments embrace a policy of time behind bars for certain crimes, the need for beds will continue to grow.

Ohio has long had a prison overcrowding problem, which is why the General Assembly decided to let the department of corrections use private prisons to take the pressure off the state facilities.

Youngstown’s NOCC is well positioned to benefit from these developments.

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