Legislature(2003 - 2004)

04/16/2003 09:04 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
     SENATE BILL NO. 65                                                                                                         
     "An  Act authorizing  the Department  of  Corrections to  enter                                                            
     into agreements with  municipalities for new or expanded public                                                            
     correctional  facilities in the  Fairbanks North Star  Borough,                                                            
     the Matanuska-Susitna  Borough, Bethel, and the Municipality of                                                            
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Co-Chair Wilken stated  that this bill "authorizes the Department of                                                            
Corrections  to enter into a twenty-five  year lease agreement  with                                                            
the Fairbanks  North Star Borough,  the Mat-Su Borough, Bethel,  and                                                            
Anchorage  for   a  total  of  1,160  beds  at  State  correctional                                                             
facilities and a new State correctional facility."                                                                              
Co-Chair Green referenced the sponsor statement.                                                                                
SFC 03 # 54, Side B 09:53 AM                                                                                                    
Co-Chair Green  emphasized the need for additional  prison beds. She                                                            
reminded  of the over  650 prisoners  currently  housed outside  the                                                            
State, which  she characterized as  "the least of the worries".  She                                                            
explained the  primary concern is  the need for additional  pretrial                                                            
facilities  in Bethel and Fairbanks  due to the significant  expense                                                            
incurred in  transporting prisoners  between holding facilities  and                                                            
court proceedings.  She furthered that the need exists  for a larger                                                            
complex,  informing  that  that  it has  been  determined  the  most                                                            
efficient  method to  accomplish this  would be  to expand  existing                                                            
Co-Chair Green shared that  under the provisions of this legislation                                                            
local  governments would  issue bonds  to generate  revenue for  the                                                            
construction  costs. Under a release  agreement with the  Department                                                            
of Corrections,  she stated  that the Department  would oversee  the                                                            
operations of the facilities, as is the current practice.                                                                       
Co-Chair  Green remarked that  Sutton is  a preferable location  for                                                            
expansion  because  of  the existing  minimum  and  medium  security                                                            
facilities.  The presence  of the two facilities,  she stated  would                                                            
provide  "immediate  backup" in  the event  of additional  needs  or                                                            
emergencies.  She furthered  that inmates  in this  location are  in                                                            
close proximity  to hospitals, courts and the city  of Anchorage "in                                                            
tolerable instances."                                                                                                           
Co-Chair  Green  stressed  that  regardless  of  whether  additional                                                            
prisons are constructed  in Alaska the State would  incur $40 to $45                                                            
million in  debt within four  years for the  care of prisoners.  She                                                            
explained this  is due to the need to contract with  private prisons                                                            
to house  inmates.  She pointed  out that  these  funds "leave"  the                                                            
State and that  the funds could instead  be used to employ  Alaskans                                                            
if additional prison space were constructed in Alaska.                                                                          
Co-Chair Green  for adoption of CS  SB 65, 23-LS0392\S as  a working                                                            
There was no objection  and the committee substitute  was ADOPTED as                                                            
a working draft.                                                                                                                
Amendment  #1:  This  amendment  lowers  the  maximum  annual  lease                                                            
payment for the  proposed facility from $14,600 to  $11,000 per bed.                                                            
The  amended  language  in Section  1,  on page  2  line  19 of  the                                                            
committee substitute reads as follows.                                                                                          
                (2) if construction of a new facility of a new                                                                  
     facility  is authorized, the  municipality shall initially  own                                                            
     the  facility,  and the  state  shall  enter into  a  long-term                                                            
     lease-purchase not  to exceed 25 years with the municipality to                                                            
     operate the  facility and to receive ownership  of the facility                                                            
     at the  end of the lease;  the annual  lease payment for  a new                                                            
     facility may not exceed $11,000 a bed;                                                                                     
Co-Chair Green moved for adoption.                                                                                              
Co-Chair Wilken objected for an explanation.                                                                                    
Co-Chair Green explained  this amendment conforms the $11,000 amount                                                            
to language contained elsewhere in the committee substitute.                                                                    
Senator  B. Stevens  asked how  the reduction  in  the annual  lease                                                            
payment was achieved.                                                                                                           
Co-Chair  Green replied  this change  is the result  of an  "overall                                                            
MARK ANTRIM,  Commissioner, Department  of Corrections testified  to                                                            
the ongoing  process to make the project  more cost efficient  since                                                            
this bill was first introduced.                                                                                                 
Senator  B. Stevens  asked  why  the maximum  lease  payment  amount                                                            
authorized for the Bethel facility was not reduced as well.                                                                     
JERRY  BURNETT,  Director,  Division  of  Administrative   Services,                                                            
Department of Corrections,  replied that although the estimated cost                                                            
to  operate  the  facility  in the  Mat-Su  area  was  reduced,  the                                                            
facilities located in the other areas remains unchanged.                                                                        
Senator  B. Stevens  clarified  that  the  operating cost  would  be                                                            
$16,000  per bed annually  at the  Bethel facility,  $14,600  at the                                                            
Anchorage location, and $11,000 at the Mat-Su location.                                                                         
Mr. Burnett affirmed.                                                                                                           
Senator B. Stevens  asked why the Mat-Su and Anchorage  amounts were                                                            
Mr. Burnett  responded that construction  of the Anchorage  facility                                                            
would be 100 percent federally funded.                                                                                          
Mr.  Antrim  furthered  that  the  differing  figures  also  reflect                                                            
different construction  costs, as well as the different  missions of                                                            
the three  facilities.  He explained  that the Anchorage  Jail  is a                                                            
"booking  facility"  and that  the "booking  function"  is the  most                                                            
expensive activity of the Department.                                                                                           
Co-Chair  Green  added  that  examination   of  operating  costs  of                                                            
existing  facilities   across  the   State  demonstrates   variation                                                            
depending on the mission  and size of a facility and type of inmates                                                            
housed. She pointed  out that the Mat-Su facility  is less costly to                                                            
operate because of the  number of inmates housed and also because it                                                            
is not generally used as a pretrial facility.                                                                                   
Mr. Antrim  informed that  pretrial facilities  must be build  to be                                                            
indestructible,  explaining  that when  first arrested,  people  are                                                            
most combative.                                                                                                                 
Senator  Bunde  referenced  the spreadsheet  titled  "Department  of                                                            
Corrections  FY 2008  Prison Bed  Cost Comparison"  [copy on  file],                                                            
which  lists the  costs of  housing inmates  at  a private  facility                                                            
located  in Arizona,  a private facility  located  in Alaska,  and a                                                            
public prison located in  Alaska.  He compared the operating/capital                                                            
costs per  day of $94 per  inmate at a private  prison in  Alaska to                                                            
$51.36  operating  costs  for  a  public  prison.  He  relayed  that                                                            
arguments in favor  of a private prison in Alaska  attest that wages                                                            
would be lower than those paid by the State.                                                                                    
Senator  Taylor  asked  the relation  of  construction  expenses  to                                                            
future lease  amounts, asserting  that operating  expenses  of other                                                            
facilities have not been based on construction costs.                                                                           
Co-Chair Wilken  the question applies to bill itself  rather than to                                                            
the amendment.                                                                                                                  
Co-Chair  Wilken  removed  his  objection  to the  adoption  of  the                                                            
amendment and the amendment was ADOPTED.                                                                                        
Mr.  Antrim gave  testimony  to  the bill,  referencing  a  handout,                                                            
titled "Department of Corrections"  [copy on file]. He attested that                                                            
the State of Alaska  is "approaching crisis level",  noting that the                                                            
inmate facilities  operate at 98 to  100 percent of capacity  on any                                                            
given day.  He reported  that currently  four of  the 13  facilities                                                            
were  over capacity.  He opined  that  operating  the facilities  at                                                            
levels  close to full  capacity is  advisable given  that the  State                                                            
also contracts with private  facilities located outside the State to                                                            
house inmates.                                                                                                                  
Mr.   Antrim  indicated   the   chart  titled   "Inmate   Population                                                            
Statistics,"  included  in  the handout,  is  based on  an  accurate                                                            
mathematical  model, and  the "Institution  Activity 1997-2002"  bar                                                            
graph  shows the large  number,  over 30,000,  of inmate  "bookings"                                                            
each year.  He informed that 20,000  of the bookings involve  people                                                            
new to the Department  system. He also pointed out  the large number                                                            
of  annual  transfers,  which  he  explained   as movement   between                                                            
facilities. He compared  the amount of bookings and transfers to the                                                            
Average Daily Count, or static population of 3,055.                                                                             
Mr. Antrim clarified  the information on the bar graph  for Co-Chair                                                            
Wilken,  showing that  in the year  2000, the  Department  conducted                                                            
over 30,000 admissions  to all facilities, 22,000  transfers between                                                            
facilities and  that the total population was over  3,000. He stated                                                            
that the average daily  count has not changed significantly since no                                                            
new construction has occurred to increase capacity.                                                                             
Senator  Bunde asked  why  the significant  number  of transfers  is                                                            
Mr. Antrim stated that  inmate transfers are the Department's effort                                                            
to  "balance  accounts"  between  the  overcrowded   facilities.  He                                                            
detailed  the daily  process  of analyzing  the population  of  each                                                            
facility  and determining  which  inmates  would be  transferred  to                                                            
which locations  to ensure each facility  remain below its  capacity                                                            
level. He reiterated this is an expensive process.                                                                              
Senator Bunde  surmised that the rate of recidivism  is considerable                                                            
given that only 3,000 remain incarcerated.                                                                                      
Mr. Antrim agreed the recidivism rate is high.                                                                                  
Senator Bunde  asked the percentage of inmates booked  who are found                                                            
not guilty or are not sentenced to jail terms.                                                                                  
Mr.  Antrim stated  he would  provide  the information,  noting  the                                                            
number varies  each year.  He estimated  approximately one-third  of                                                            
the bookings  are the result of recidivism  based on the  20,000 new                                                            
Senator Hoffman  noted the  Department has  little control  over the                                                            
number  of bookings  and the average  daily count.  He detailed  the                                                            
process by which an inmate  at the Bethel facility is transferred to                                                            
another  facility due to  overcrowding in  Bethel, and subsequently                                                             
transferred  back for  each  court hearing.  He asked  the  expected                                                            
reduction  of  transfers   that  would  result  from   the  proposed                                                            
Mr. Antrim  assured  a reduction would  occur, although  he did  not                                                            
know  the  exact  amount.  He  explained  that  a  large  number  of                                                            
transfers  occur  between  the Bethel  area  facility  and  outlying                                                            
villages and that  due to the large percentage of  pretrial inmates,                                                            
those inmates  must be transferred to Anchorage to  create space for                                                            
new arrestees.  He stated this situation exists in  Nome as well. He                                                            
predicted that  additional beds at  the two facilities would  reduce                                                            
the number of transfers necessary.                                                                                              
Senator  Hoffman  furthered  that  the expansion  would  also  allow                                                            
correctional  officers  to  remain  at the  facilities  rather  than                                                            
accompanying transferring inmates.                                                                                              
Mr.  Antrim  clarified  that  Alaska  State   Troopers  execute  the                                                            
transfers of  pretrial detainees with  the expenses incurred  by the                                                            
Department of Public Safety.  He indicated that the transfer figures                                                            
listed in the  handout represent both  pretrial detainees  and other                                                            
inmates transferred to  reduce overcrowding, which the Department of                                                            
Corrections  is  responsible  for. He  noted that  the  data in  the                                                            
handout is  intending to  show the institutional  activity  and that                                                            
expansion  of the Bethel  and Nome facilities  would result  in cost                                                            
reductions  to  the Department  of  Public  Safety  as well  as  the                                                            
Department of Corrections.                                                                                                      
Senator  Taylor  asked the  percentage  of  the transfers  that  are                                                            
necessary to avoid overcrowding.                                                                                                
Mr. Antrim was uncertain  and qualified that the number of necessary                                                            
transfers varies daily.  He assured that efforts are made to conduct                                                            
transfers as "economically  possible". He stated that almost half of                                                            
the inmates housed at the  Lemon Creek Correctional Center in Juneau                                                            
are from the Anchorage  area and are housed in Juneau  to make space                                                            
available  in Anchorage for  inmates from  other outlying areas.  He                                                            
characterized the transfer process as "quite a shell game".                                                                     
Senator Taylor  commented on the amount  of "juggling" required  and                                                            
the  "horrendous"  cost  of  these efforts.  He  surmised  the  only                                                            
solution  would be adequate  facilities in  each community  and that                                                            
construction  one or more large facility  in one location  would not                                                            
address  the issue. He  shared that  when he served  as a judge,  he                                                            
chose community  service over incarceration  as sentencing  to avoid                                                            
the expense of inmate transfer.                                                                                                 
Senator Olson  asked whether private  prisons should be part  of the                                                            
Senator Bunde asked if  the projected inmate population figures take                                                            
into account  the aging  of the  general population  as well  as the                                                            
possibility  that the  population  in Alaska  could  decline in  the                                                            
event of a  discontinuation of the  permanent fund dividend  program                                                            
or increased taxation.                                                                                                          
Mr.  Burnett explained  that  the data  utilizes  the Department  of                                                            
Labor and Workforce  Development demographic  statistics  as well as                                                            
further analysis conducted by the Department of Corrections.                                                                    
Mr.  Antrim  next  addressed  a bar  graph  in  the  handout  titled                                                            
"Comparison  of  Facilities  with  Varying   Missions"  listing  the                                                            
different costs  of four existing  correctional facilities  based on                                                            
their  mission, and  another  page in the  handout,  which reads  as                                                            
     General Specs                                                                                                              
     Draft CS SB 65                                                                                                             
        · 1250 beds                                                                                                             
        · 1000 medium custody beds (est.)                                                                                       
        · 190 close custody beds (est.)                                                                                         
        · 60 maximum/segregation beds                                                                                           
Mr. Antrim  spoke to  other pages  in the handout,  which lists  the                                                            
total  cost of  this legislation  as  $94.94: $51.36  for  operating                                                            
costs, $22.92  for capital  costs and $20.66  "other direct  costs",                                                            
assuming a  25-year term in debt issue.  He indicated these  figures                                                            
apply to  a proposed facility  located in  Sutton within the  Mat-Su                                                            
Senator Taylor asked how the capital costs were determined.                                                                     
Mr. Burnett  responded that the amounts  are "based on the  language                                                            
of SB 65 that  would have the Department  entering into a  lease for                                                            
this  facility".  He  clarified  that  the  capital  cost  would  be                                                            
included in the State's  cost and that the estimated capital cost of                                                            
$22.92 assumes  that the total capital cost for a  1250-bed facility                                                            
is $132 million financed with a revenue bond for 25 years.                                                                      
Mr. Antrim indicated this  is detailed on the page titled "Estimated                                                            
Debt Service."                                                                                                                  
Senator Taylor asked who would own the facility.                                                                                
Mr. Burnett  replied  that under the  provisions  of this bill,  the                                                            
facilities  would be  a lease/purchase  arrangement  with the  State                                                            
paying the  Borough lease and assuming  ownership at the  end of the                                                            
lease term.                                                                                                                     
Senator Taylor  asked if  the Borough would  earn a profit  from the                                                            
Mr. Burnett answered it would not.                                                                                              
Senator Bunde asked for  a breakdown of the "other costs" indicated.                                                            
Mr. Burnett  replied that  the earlier referenced  "Prison  Bed Cost                                                            
Comparison"  spreadsheet details  these costs  for inmate  programs,                                                            
medical costs, administrative costs and statewide direct costs.                                                                 
Senator Bunde calculated the medical costs at $11.88.                                                                           
Mr.  Burnett  detailed  the estimates  of  medical  staffing  levels                                                            
comparing differed scenarios.                                                                                                   
Senator B. Stevens  asked how the $22.92 capital cost  listed on the                                                            
handout relates to Amendment #1.                                                                                                
Mr. Burnett responded that  this amount only relates to the proposed                                                            
facility in the Mat-Su Borough.                                                                                                 
Senator B. Stevens calculated the daily amount at $30.                                                                          
Mr. Burnett stated he would  review the figures, but pointed out the                                                            
$11,000 limit adopted in the amendment is a maximum amount.                                                                     
Mr.   Antrim  interjected   that   the  "Estimated   Debt   Service"                                                            
spreadsheet  calculates $30.62 for  a 15-year debt term,  and stated                                                            
that  if  the term  were  lengthened,  the  daily  amount  would  be                                                            
Mr. Antrim  then  referenced the  pages titled  "Bethel Expansion",                                                             
"Fairbanks   Expansion"  and   "Anchorage   Expansion"  as   showing                                                            
justification for the projects.  He noted the presence of a Superior                                                            
Court in  Bethel, resulting  in a  number of  pretrial detainees  at                                                            
that location and the United  States Marshall's expected increase in                                                            
the number of  federal detainees housed in Anchorage  and Juneau. He                                                            
also  indicated   diagrams  illustrating   the  expansions   in  the                                                            
Fairbanks Correctional Center and the Anchorage Jail.                                                                           
SFC 03 # 55, Side A 10:41 AM                                                                                                    
JIM   LECRONE,   Retired   Correctional   Officer,   testified   via                                                            
teleconference   from  Anchorage,   about  the  dangers   of  prison                                                            
DEE HUBBARD,  Sterling Resident and  Citizen Activist, testified  in                                                            
person in support of this legislation.                                                                                          
Senator Olson  asked of Mr.  Lecrone ever feared  for his life  as a                                                            
result of overcrowding.                                                                                                         
Mr.  Lecrone informed  that  he  was stationed  in  lesser  security                                                            
facilities and although  wrestling occurred, he never feared for his                                                            
Senator Olson asked if  weapons were therefore not found on inmates.                                                            
Mr. Lecrone  corrected that inmates  were found to have weapons  and                                                            
described these weapons.                                                                                                        
Senator Taylor requested  a comparison of the number of escapees and                                                            
assaults  committed  by Alaskan  inmates at  the  private prison  in                                                            
Arizona versus public facilities in Alaska.                                                                                     
Co-Chair Wilken ordered the bill HELD in Committee.                                                                             

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