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Illinois Prisoners Bilked Out of Millions Through DOC Commissary Surcharges
In order to generate more revenue to help fund an over-capacity prison system, the Illinois General Assembly passed Senate Bill 0629 in 2004. The bill, which became Public Act 93-0607, granted the IDOC authority to add up to a 25% surcharge on all non-tobacco products and up to 35% on all tobacco products sold at prison commissaries. Prior to this amendment the surcharge was capped at 10%.
Illinois prisoners groaned as commissary prices rose. As captive consumers who rely on meager prison wages, the price increase meant a drastic reduction in what they were able to purchase.
Ironically, it wasn’t prisoners who cried the loudest about the price increase but rather prison guards. Their union, the American Federation of State, County and Municipal Employees (AFSCME), was able to convince state lawmakers to sponsor a bill to exempt IDOC employees from most of the price increase by capping commissary surcharges at 10% for prison staff. The bill passed and became Public Act 94-0913, effective June 23, 2006.
Further, beginning November 1, 2005, the IDOC began imposing an additional surcharge of 3% on commissary items beyond the statutorily-permitted 25% and 35% mark-ups. Two months later the IDOC increased the additional surcharge to 7%, where it remains today.
Those may seem like small amounts, but consider there are around 45,000 IDOC prisoners who purchase commissary items on a regular basis. In a July 20, 2009 report, the Illinois Auditor General concluded that the IDOC had received additional revenue from the 3%-7% surcharges in the amounts of $1,266,911 for fiscal year 2006, $2,259,760 in fiscal year 2007, and $2,339,244 in fiscal year 2008. Thus, over that three-year period the IDOC had reaped $5.8 million from the additional commissary mark-ups.
The unlawful nature of the 3%-7% surcharges was first pointed out to the IDOC by the Auditor General’s Office in a 2007 report, which noted they were “duplicative and exceed the statutorily allowed mark-up.” The report recommended that the IDOC “revise its methodology” and “comply with the statute and only mark-up goods for resale in the inmate commissary the allowable amounts.”
IDOC officials tried to justify their actions with a self-serving interpretation of the statute (730 ILCS 5/3-7-2a), which they claimed allowed “additional charges” to pay the wages and benefits of commissary employees. The Auditor General recommended that the IDOC “seek a formal written Attorney General opinion on this matter.”
During an April 1, 2008 hearing before the Legislative Audit Commission, then-IDOC Director Roger E. Walker, Jr. said the department would continue imposing the 7% surcharge until they received a response from the Attorney General’s office. However, when the Auditor General asked for a copy of the IDOC’s letter requesting an opinion from the Attorney General, the IDOC revealed that it had never sought a formal opinion.
This was not the only devious tactic employed by the IDOC. Instead of applying the 3%-7% surcharges to the cost of commissary items sold, the IDOC was applying the increase to the selling price of items after the authorized 25% and 35% mark-ups were added. Thus, instead of a 3%-7% surcharge, prisoners were paying an effective 9% increase.
The IDOC was largely unapologetic, despite having bilked Illinois prisoners out of almost $6 million between fiscal years 2006 and 2008. Prison officials stated they would “once again try to get permission to seek an opinion from the Attorney General,” and optimistically said there was “every expectation permission will be granted.” In the meantime, Illinois prisoners continue to pay the legally-questionable 7% surcharge on prison commissary sales.
Sources: Illinois Auditor General reports, www.ilga.gov
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