The nation’s two largest private prison companies released information last week indicating that they continue to do quite well by contracting with ICE and other federal government agencies responsible for detaining migrants. Corrections Corporation of America (CCA) and GEO Group, respectively the largest and second-largest private prison companies operating in the United States, have long been involved in immigration imprisonment. That trend does not appear to be abating, but they are diversifying their business operations.
CCA is huge. During the quarter that ended June 30, 2104, it brought in roughly $350 million in revenue. Corrections Corporation of America, Second Quarter 2014 Investor Presentation A-4 (Aug. 2014). As the owner or operator of 64 facilities in 19 states and a 41% share of all private prison beds in the United States, it describes itself as the fifth largest correctional system in the country. Id. at 6. According to CCA, GEO has roughly 32% of the private corrections market. Id. at 7.
CCA’s revenue sources are a mix of federal agencies and state correctional departments, but its largest customers reveal the company’s involvement in immigration imprisonment stemming from civil and criminal immigration prosecutions. Three of CCA’s four largest sources of revenue during the first half of 2014 were the U.S. Marshals Service (17.4%), Federal Bureau of Prisons (13.3%), and ICE (12.2%). ICE’s detention operations are clearly devoted exclusively to migrants facing removal.
The USMS and BOP, however, are increasingly in the immigration imprisonment business as well. The USMS, the agency responsible for housing defendants in federal criminal prosecutions while charges are pending, expects about half of the people it books into custody in fiscal year 2015 to be there on immigration charges. U.S. Marshals Service, FY 2015 Performance Budget, President’s Budget Submission: Federal Prisoner Detention Appropriation 7, 8 (2014). After conviction, federal offenders are transferred into BOP custody. “In recent years,” as I write in an article that will appear in the California Law Review, “roughly eleven to twelve percent of BOP inmates were convicted of an immigration crime.” César Cuauhtémoc García Hernández, Naturalizing Immigration Imprisonment, 103 California Law Review — (forthcoming 2015) (discussing E. Ann Carson & Daniela Golinelli, Prisoners in 2012: Trends in Admissions and Releases, 1991-2012, at 43 appx. tbl. 11 (2013)).
The company doesn’t expect to see its government revenue streams run dry anytime soon. Approximately 90% of its contracts are renewed. CCA, Investor Presentation, at 15. Still, it sees an opportunity in alternatives to prisons, including residential reentry facilities and “[o]ther complimentary business acquisitions.” Id. at 26. To that end, it purchased Correctional Alternatives, Incorporated in 2013, a company that operates parole services.
For guidance, it can turn to GEO. Itself an enormous prison operator, GEO has developed its detention alternatives in recent years. Since buying BI Incorporated at the end of 2010, GEO has had a major stake in ICE’s alternatives to detention program. Indeed, BI has the exclusive contract to run ICE’s Intensive Supervision and Appearance Program. Its acquisition of BI means that GEO earns money whether the federal government chooses to imprison migrants facing removal or simply slap ankle bracelets on them. Either is a lucrative proposition for GEO. Last week it reported that ICE had renewed BI’s contract to run ISAP. “The contract will have a term of five years, inclusive of option periods, effective September 8, 2014,” the company’s press release announced,“and is expected to generate approximately $47 million in annualized revenues.”
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