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Cornell Wins $19.5 Million Alaska Contract; CCA Protest Denied

by Matt Clarke

In September 2009, Alaskan officials denied a protest filed by Corrections Corporation of America (CCA), which was the final hurdle before awarding Cornell Corrections of Alaska (a subsidiary of Cornell Corrections) a contract worth $19,446,000 to house up to 900 Alaskan prisoners in an out-of-state private prison.

CCA had held the contract since 1994 and was paid $20,669,000 last year to house Alaskan prisoners at its Red Rock Correctional Center in Arizona. In December 2009, the 770 prisoners at Red Rock were transported to Cornell’s new l,250-bed Hudson Correctional Facility in Colorado.

Cornell’s subsidiary received special bidding preference because it was an Alaska-based company. CCA had bid $18,724,000 per year for the three-year contract, and filed a protest against awarding the contract to Cornell Alaska because it had used its Texas-based parent company as the qualified service provider. CCA claimed that Cornell Alaska, which manages Alaskan halfway houses, would not otherwise have had the requisite experience to perform under the contract. CCA also maintained that if Cornell Alaska had to depend on its parent company, then it was no longer entitled to preference as an Alaskan company and CCA’s low bid should have won. Alaska’s Department of Correction (DOC) denied the protest, ruling that Cornell Alaska met the requirements for a bidder’s preference and had the necessary experience.

Cornell had been trying for years to generate support for a private prison in Alaska, but became tainted by the guilty plea of its lobbyist, Bob Bobrick, for attempting to bribe Alaska state Rep. Tom Anderson, who is currently serving a five-year federal prison sentence. [See: PLN, March 2009, p.20].

Construction of the $240 million, 2,536-bed medium-security Goose Creek Correctional Center is scheduled to be complete in 2012. The facility, located in Port MacKenzie, Alaska, will likely put an end to the need for out-of-state prison beds. Rather than being built by the state, the prison’s construction was financed through bonds issued by the Matanuska-Susitna Borough. The borough intends to pay off the bonds by leasing the prison to the DOC, then will transfer ownership of the prison to the state.

Meanwhile, some Alaskan prisoners have cited improved conditions at Cornell’s Hudson Correctional Facility. “As compared to CCA, this is like a five-star restaurant. It’s like a college campus,” stated prisoner Danny Roach. Alaska DOC officials agreed. “Programmatically, it fits in to what we hope to have at Goose Creek, what we’re planning for, and we can mirror many of the programs and the recreational opportunities that we’re going to have at Goose Creek, we’ll mirror them here. The transition will be a smoother one while we have our prisoners here at Hudson,” said Alaska DOC official Garland Armstrong.

Others remained skeptical. “They say all this stuff all the time because they want the public to feel like their dollars are doing something,” remarked Brenda Watkinson, the wife of an Alaskan prisoner who served time at CCA’s Red Rock facility. “They started programs like that at Red Rock and [then] dropped them to save money.”

On April 14, 2010, a disturbance involving Alaskan prisoners broke out at the Hudson facility after cell doors in a disciplinary housing unit were mistakenly or accidentally opened. About ten prisoners broke sprinkler heads and windows; two Cornell guards fled and locked themselves in an office. Tear gas was used to regain control, the prison was placed on lockdown and the Colorado DOC is investigating.

Sources:,, Anchorage Daily News, Denver Post

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