In a document filed with the Securities and Exchange Commission, the GEO Group, the country’s second largest private prison operator, provided a fascinating glimpse into its business operations. SEC Form S-4, The GEO Group, Inc. (Nov. 7, 2013). In SEC Form S-4, the company detailed its worldwide reach. According to the filing, GEO operates in the United States, Australia, South Africa, the United Kingdom, and Canada. Overall it manages approximately 72,000 beds and tracks more than 70,000 people in community-based supervision programs. Id. at 1. Within the USA, it currently operates in 33 states in addition to holding extensive contracts with various units of the federal government. Id. at 2.
Business worldwide and in the United States appears to be thriving. Globally, the company brought in just shy of $1.5 billion ($1,479,062,000) in revenue during 2012. Id. at 14. Of this, $975,445,000 came from a category it calls “U.S. Corrections & Detention” and another $291,891,000 came from its GEO Community Services unit. As I wrote previously, GEO Community Services includes the electronic monitoring service that it provides to ICE, among other products.
Among the most remarkable bits of information was the extent to which GEO relies on immigration detention to boost its sizable bottom line. The company reported that 17.3% of its revenue comes from contracts with ICE. Id. at 32. Another 17.0% of its revenue comes from the Federal Bureau of Prisons and 11.4% of its revenue from the U.S. Marshals Service. While the BOP and USMS are responsible for detaining individuals charged with or convicted of all types of federal crimes, immigration offenses have been at or near the top of the list of most commonly prosecuted federal crimes in recent years so a sizable percentage of the money GEO earns from the BOP and USMS is likely attributable to the federal government’s criminalization of immigration activity. Indeed, a different document submitted to the SEC recently (a Schedule 14A) states that the company signed a contract in October 2012 with the USMS “for the housing of up to 320 federal detainees at our Aurora Detention Facility.” According to GEO’s web site, the Aurora facility houses immigration detainees.
Interestingly, GEO openly acknowledged that legal reforms may adversely affect their business success. The company noted that “[i]mmigration reform laws which are currently a focus for legislators and politicians at the federal, state and local level also could materially adversely impact us.” Id. at 32. Likewise, it explained that “amending criminal laws and regulations to reduce prisoner headcount by reducing or eliminating mandatory minimum sentencing guidelines, especially those relating to non-violent drug possession or technical parole violations” “could have adverse effects on our industry.” Id. at 6.
To be fair, the company did not suggest that it opposes liberalization of immigration or criminal laws. Of course, according to a report in the Columbia Journalism Review, the private prison industry collectively is heavily involved in lobbying key legislators.
Moreover, to protect itself from possible reductions in prison populations, the company recently becoming heavily involved in providing electronic monitoring services sought by government agencies operating alternatives to detention (ATD). The company expects this line of business to grow, Id. at 7, and is positioning itself to capitalize on this growth. Indeed, as I reported in August, GEO has a $3.3 million contract with ICE to provide monitoring services for its ATD programs.