Cost of Prisons:

Bureau of Prisons Needs Better Data to Assess Alternatives for Acquiring Low and Minimum Security Facilities

GAO-08-6: Published: Oct 5, 2007. Publicly Released: Oct 5, 2007.

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Over the last 10 years, the cost to confine federal Bureau of Prison (BOP) inmates in non-BOP facilities has nearly tripled from about $250 million in fiscal year 1996 to about $700 million in fiscal year 2006. Proponents of using contractors to operate prisons claim it can save money; others question whether contracting is a cost-effective alternative. In response to Conference Report 109-272, accompanying Pub. L. No. 109-108 (2005), this report discusses the feasibility and implications of comparing the costs for confining federal inmates in low and minimum security BOP facilities with those managed by private firms for BOP. GAO reviewed available data on a selection of 34 low and minimum security facilities; related laws, regulations, and documents; and interviewed BOP and contract officials.

A methodologically sound cost comparison analysis of BOP and private low and minimum security facilities is not currently feasible because BOP does not gather data from private facilities that are comparable to the data collected on BOP facilities. GAO's past work has shown that generally accepted evaluation criteria for comparing private and public prisons calls for the comparison to be based on a variety of factors, including selection of facilities with similar characteristics (i.e., staffing levels and educational programs offered) and quality of service (i.e., levels of safety and security for staff, inmates, and the general public). However, according to BOP officials, BOP and private facilities differ in characteristics and quality of service, and BOP does not collect or maintain sufficient data on private facilities to account or adjust for these differences in a cost comparison. According to private contractors, some characteristics data are maintained for their own purposes, but at present the data are not in a format that would enable a methodologically sound cost comparison. BOP officials stated that there are two reasons why they do not require such data of contractors. First, federal regulations do not require these data as a means for selecting among competing contractors. Second, BOP believes collecting comparable data from contractors could increase the cost of the contracts, but BOP officials did not provide support to substantiate these concerns. Without comparable data, BOP is not able to evaluate and justify whether confining inmates in private facilities is more cost-effective than other confinement alternatives such as building new BOP facilities. The Office of Management and Budget (OMB) requires agencies to consider and weigh various alternatives using analyses that help determine the benefits and costs of making decisions about the acquisition of assets, such as prisons. According to OMB requirements, selecting alternatives to meet capacity needs without adequate analysis by federal agencies has resulted in higher costs than expected. OMB provides guidance to help federal agencies analyze and weigh the costs and benefits of alternatives, which is important for BOP because BOP officials stated that the population for low and minimum security facilities continues to grow. OMB staff also added that they need more and better cost comparison information on the various alternatives for BOP's low and minimum security facilities to help them better understand the long-term costs and benefits of owning versus the short-term costs and benefits of privatization. Without analyses consistent with OMB requirements, it is difficult to know whether BOP is deciding on the most cost-effective alternative for acquiring low and minimum security facilities to confine inmates, including whether to contract, build, or expand.

Recommendation for Executive Action

  1. Status: Closed - Not Implemented

    Comments: In fiscal year 2007, we reviewed and reported on the federal Bureau of Prisons (BOP) data to assess alternatives for acquiring low and minimum security facilities. We reported, among other things, that because of projections of future growth of inmate populations, BOP will need to continue to acquire additional capacity; however BOP does not have the data necessary to do a methodologically sound cost comparison of its various alternatives for confining inmates in low and minimum security facilities. Department of Justice (DOJ) officials reported that they believe BOP collects the necessary cost information to perform cost comparisons and is, therefore, already complying with the recommendations. Specifically, they said BOP's bedspace arrangements with the private sector, obtained via firm fixed price competitive contracts, represent the full cost to the government and meet growing bedspace needs. According to DOJ, BOP's strategy for procuring bedspace in the foreseeable future will be through competitively awarded private prison contracts, consistent with OMB's Program Assessment Rating Tool guidance and direction. Also according to DOJ, the Department considers this recommendation closed and does not plan to take any additional actions to address it. However, to fully address this recommendation, BOP would have to develop a cost-effective way to collect data on low and minimum security facilities and design and conduct methodologically sound analyses. These analyses would compare the costs of confining inmates in order to consider contracting among other alternatives for low and minimum security confinement, such as building new facilities, buying existing facilities, or expanding facilities already operated by BOP. Therefore, we are closing this recommendation as not implemented.

    Recommendation: To help Bureau of Prisons (BOP) evaluate alternatives for confining inmates in low and minimum security facilities, and recognizing that there is a cost associated with gathering and analyzing data needed to compare costs across BOP and private facilities, the Attorney General should direct the Director of BOP to develop a cost-effective way to collect comparative data on low and minimum security facilities confining inmates under BOP's custody and design and conduct methodologically sound analyses that compare the costs of confining inmates in these facilities in order to consider contracting among other alternatives for low and minimum security confinement, consistent with Office of Management and Budget requirements.

    Agency Affected: Department of Justice: Bureau of Prisons

 

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