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Pennsylvania County Pays U.S. INS $16 Million for Detainee Housing Overcharges

by John E. Dannenberg

On October 25, 2006, York County, Pennsylvania agreed to pay the U.S. Immigration and Naturalization Services (INS) $16 million to settle a dispute over alleged overcharges for INS detainees who were housed in the York County Prison (York) between October 1999 and March 2003.

York County subsidized its county prison costs with income from a substantial number of federal detainees. This contract was the subject of a recent audit by the U.S. Office of the Inspector General (OIG), for the period from January 1 through December 31, 2000. During that time, the York County Prison alone housed approximately 1,544 prisoners, including an average of 729 INS detainees, 29 U.S. Marshals Service (USMS) detainees and 0.4 BOP prisoners. The three federal agencies paid York a total of $16.3 million for housing the detainees, plus $872,600 for translators and outside medical care. The audit showed that York?s total operating cost for that year was $24.6 million. In its billing justification, however, York had told the federal agencies that its overall (1999) population basis was only 996 prisoners, not the actual 1,544 number it reported to the state. As a result of this inflated per-capita cost basis, federal payments augured suspiciously to 70% of York?s income while federal detainees accounted for only 44% of York?s FY 2000 population.

Based on proper numbers, the OIG determined in June 2001 that York?s daily per-prisoner cost was $37 per day, not the $60/day it charged the INS or the $45/day it charged the USMS and the BOP. Accordingly, the OIG computed an overcharge of $6,168,546 for the year 2000 and forecast that ongoing overcharges would extrapolate to $6.4 million per year
INS began its contract with York in 1995 at a $50 daily prisoner rate, adjusting it to $55 in 1997 and $60 in 1999. The USMS began in 1983 with a $33 rate, which grew to $45 by 1999. This federal cash-cow inspired York County to expand its prison capacity from 210 (1979) to 600 (1989), 1,200 (1993) and finally 1,650 in 1999. York?s actual average daily population in 2000 was 1,682 -- now the largest INS detention facility in the United States.

York?s business model was so lucrative that in 1999 the Susquehanna Valley Center for Public Policy commented, ?Thanks to income from the INS, York County has balanced its $87.4 million budget without raising taxes. What?s more the county doesn?t expect to raise taxes until at least 2003. The county didn?t even need more tax money to make a $6 million payment on its $20 million prison expansion project, a project the county expects to pay off in a mere two to three years.?

Formerly giddy taxpayers will now have to pay the piper. York County quietly settled with the INS, without admitting wrongdoing, agreeing to reimburse $16 million to squash allegations that it pumped up charges from 1999 to 2003. It is not known what such overcharges, if any, accrued after 2003 to the INS?s successor agency, the Bureau of Immigration and Customs Enforcement (part of the new Department of Homeland Security).
Sources: U.S. Office of the Inspector General, Report No. GR-70-01-005 (June 25, 2001),,

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