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Prison Closures Cause Economic Turmoil

Shrinking state budgets across the country are leading to prison closures that in turn have a negative impact on communities that depend on the facilities as a source of jobs and revenue. [See: PLN, June 2013, p.1; April 2009, p.1]. Small towns in Kentucky, Georgia and New York are among those facing recent adjustments to this new economic reality, but some local residents and lawmakers have fought back with campaigns to keep the prisons open.

The city of Wheelwright, Kentucky was hit hard by the closure of the 600-bed Otter Creek Correctional Center, a prison owned and operated by Corrections Corporation of America (CCA). Officials said over 170 jobs were lost, although CCA pledged to relocate as many employees as possible to other facilities. The company said the June 2012 closing of Otter Creek was necessary after Kentucky did not renew its contract to house state prisoners at the facility.

“A lot of them [the employees] live within the city and a lot of them live in the community, you know,” said Andy Akers, Wheelwright’s mayor. “We’re a tight knit community around here.” Just before the closure of the prison, Akers had predicted a devastating impact on local businesses, fearing the city’s economy would suffer.

“If you don’t have jobs you can’t spend money at them. Money keeps rolling over and over when you spend it,” he said. “I hate to see it closing, but if there’s any way we can help we’re trying.”

Kentucky also declined to renew its last contract with CCA in June 2013, to house prisoners at the company’s 826-bed Marion Adjustment Center in St. Mary. State officials said the decision would save $1.5 to $2.5 million per year, and the prisoners will be moved to other facilities. CCA vice president Steve Owen said the non-renewal of the contract, resulting in the closure of the prison, was “disappointing” – though he was likely referring to the economic impact it would have on the company rather than the local community.

Kentucky DOC spokesperson Jennifer Brislin said the state would assist the 166 CCA employees whose jobs were eliminated due to the facility’s closure.

“We understand that this creates uncertainty for them,” she stated. “We’re mindful that this creates an enormous challenge.” However, “It’s just to help with applications and the like,” she clarified. “Obviously, that doesn’t guarantee a job” elsewhere.

Additionally, CCA announced in December 2013 that it would be closing the North Georgia Detention Center in Gainesville, Georgia due to a decline in the number of immigration detainees held at the facility. The closure will affect around 130 employees.

City Manager Kip Padgett said they “will be exploring all options for future use of the facility”; Gainesville had expected to receive $825,000 in rent from the CCA-operated detention center for fiscal year 2014. The facility also had a $7 million payroll and CCA spent around $295,000 with local businesses.

“It was news to us,” Gainesville Mayor Pro-Tem Bob Hamrick said, in regard to CCA’s unexpected announcement that it was closing the detention center. “Obviously, it is a blow to our employment here. But, hopefully, we can come up with some way to not only absorb the employees that will be laid off but also to find some use for that facility.”

In New York, a community group organized to prevent the state from closing the Chateaugay Correctional Facility as scheduled on July 26, 2014, which will eliminate up to 111 jobs with a $5.8 million annual payroll. The Save Chateaugay Correctional Facility Task Force published a 30-page booklet describing the impact the closure will have on the community and Franklin County.

For example, the booklet compares the number of jobs lost in Chateaugay to the equivalent of 6,000 jobs lost in Brooklyn. It also notes that Chateaugay is the state’s newest medium-security prison, and that it will cost less to operate once the facility starts using natural gas instead of fuel oil, taking advantage of a pipeline project in the county.

Chateaugay is one of four prisons scheduled to close under a proposal announced by New York Governor Andrew Cuomo in July 2013, but state lawmakers questioned whether the closures are truly justified. State Senator Kathleen Marchione, who has been critical of the plan, said “misplaced priorities” are to blame for closing 15 New York correctional facilities since 2011. She said she will fight to keep open the Mt. McGregor prison, a medium-security facility located in the legislative district she represents.

“The closure of Mt. McGregor would cost our community 320 public safety positions and hurt the local economy,” Marchione argued. “I disagree with the administration’s closure proposal that would impact the public safety professionals who serve New York with honor and work in some of the toughest, most stressful and dangerous conditions imaginable.”

In addition to Chateaugay and Mt. McGregor, the Cuomo administration has announced the closure of the Butler Correctional Facility in Red Creek and Monterey Shock Facility in Beaver Dams. Closing the four prisons will save an estimated $30 million.

Groups that represent prison employees have mounted opposition to the closures, claiming that shutting down the four facilities does nothing to alleviate the condition of more than 10,000 state prisoners who are still double-bunked due to steps taken by former Governor Mario Cuomo in the 1990s to address prison overcrowding.

The New York State Correctional Officers & Police Benevolent Association called the state’s decision to close the prisons “political posturing,” “insulting” and “a show of disrespect.” The association called on its members to hold rallies, sign petitions and contact their legislators to oppose the closures, urging them to “Stand with your brothers and sisters and stop the closures of more prisons and mental health agencies! Enough is enough! Your facility could be next!”

Local resolutions have been passed by officials in the cities and counties affected by the prison closures, including the towns of Wilton and Chateaugay as well as Chemung, Franklin, Wayne and Saratoga Counties.

Contending that the legislature was blindsided by the Cuomo administration’s plan, Senator Marchione and State Assemblyman James Tedisco both introduced bills that would require approval by state lawmakers before any prisons could be closed. The legislation would also require the state to announce closings at least a year in advance.

Although the four facilities are expected to close as planned, the legislature imposed a two-year moratorium – until July 2016 – on any further prison closures.

Officials with the state Department of Corrections and Community Supervision (DOCCS) said the crime rate in New York has fallen 13% over the past decade, reducing the need for prison capacity. Further, the state’s prison population has dropped nearly 24% since 1999, from 71,600 to around 54,100.

“As the inmate population has continued to decline, prisons that are no longer needed can close,” stated DOCCS Commissioner Anthony J. Annucci. “By pursuing policies that are tough, smart and fair, we can maintain or improve public safety on the outside, so there is less need to put offenders on the inside, delivering great savings to New York.”

Meanwhile, prison officials pledged to do what they can to soften the impact on state employees. “At the time of the closure announcement there were 673 employees at the four facilities,” according to a DOCCS statement. “As of February 3, 2014, there were 386 staff remaining, and DOCCS personnel have been holding another round of meetings with those staff members to assist in planning their transitions.”

State officials noted that since the closings were announced there has been “a gradual transition of staff to other prisons, other state agencies or retirement.”

Sources:,,,,,,,, Associated Press,, Atlanta Journal-Constitution,


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