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Alabama Plan to Relieve Prison Overcrowding: Tap COVID-19 Funds to Build “Mega-Prisons”

by Jo Ellen Nott

When Alabama Governor Kay Ivey (R) signed legislation in October 2021 to take $400 million of the state’s pandemic relief funds from the American Rescue Plan to build a trio of massive prisons, it was an attempt to assuage federal officials who have been investigating the state since 2016 for not being able to properly administer its prison system.

Yet as the state plows forward with plans to add more prisons it likely can’t manage, it continues to hold thousands of its citizens in unconstitutional confinement.  

The American Civil Liberties Union of Alabama and the Sentencing Project have vehemently opposed Ivey’s plan, arguing that COVID-19 relief money was never intended to be used for financing new prisons. They have publicly voiced their opposition in an open letter to Rep. Maxine Waters (D-Calif.), Chairwoman of the Financial Services Committee in the U.S. House, asking her to open an investigation into the use of American Rescue Plan money.

JaTaune Bosby, executive director of ACLU of Alabama, pointed out that Ivey’s plan is a “gross misuse of funds that were sent to help the people of Alabama, not punish them.” 

The U.S. Treasury Department reacted with mixed messages to the prison construction plan, ruling on the one hand that it did not consider prison construction an eligible use of the State and Local Fiscal Recovery Funds, yet also saying it would not take action to enforce provisions in the final rule if a local government had begun spending those funds consistent with earlier and less restrictive guidelines on how to deploy them.

Using $400 million in federal COVID-19 relief money allows the Alabama Corrections Institution Finance Authority to start turning dirt sooner on its prison expansion, facilities it intended to lease from private prison firms, including CoreCivic, until they were unable to secure financing after lead underwriter Barclays PLC backed out under pressure from prison reform activists in April 2021. [See: PLN, Sep. 2021, p.30.] The two new men’s prisons and a women’s prison have an estimated price tag of $1.3 billion. Alabama lawmakers authorized the state to borrow $758 million in bonds to finance construction, with a debt service of about $50 million per year. Another $150 million in General Fund allocations are expected to be put toward the projects.

In December 2021 the state was searching for banks willing to underwrite the $758 million bond sale who would also promise not to bow to any pressure from prison reform activists like those who successfully scuttled the state’s lease-back deal from private prison firms earlier in the year.  

Sources: Alabama Daily News, AP News, Bloomberg News, Montgomery Advertiser

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