Private jail service provider CoreCivic will pull out of Hamilton County's Silverdale facility on Dec. 30 after a facility and per diem funding disagreement.
After more than three decades, CoreCivic tendered its 180-day termination notice to end its $18 million annual management contract of the Silverdale Detention Center, which it has operated since 1984.
"We're very proud of our 36-year partnership in Hamilton County, and we're committed to ensuring this transition happens as safely and seamlessly as possible," spokesperson Amanda Gilchrist told the Times Free Press on Wednesday morning.
While Gilchrist did not immediately provide a reason for the termination, she said that the company required changes to the facility and per diem funding by the county in order to continue their service.
"We understand the county may want to extend the transition period beyond what is required under the current contract," Gilchrist wrote. "In order for us to extend our operations, we would need to see a number of changes implemented to improve the safety, security and operational stability of the facility, including increasing the per diem by $5.63 to enable SDC staff pay raises and making targeted investments in the physical plant."
Gilchrist said the company asked the county to make certain changes, including increasing the $51.43 per diem, or cost per inmate per day, before the July 3 letter canceling the termination.
County Sheriff Jim Hammond said those terms were "cost prohibitive" and that the county will likely end private operations in the 180 days provided.
County Mayor Jim Coppinger called it an amenable split during Wednesday's commission meeting.
"I know it's really easy to criticize CoreCivicBut again, in the event that we can't make that 180 days, by being able to hire people, they're willing to continue to help us out," Coppinger said. "It's an amenable split here, and there's no hard feelings."
The decision comes within days of the company similarly leaving its contract with Nashville, effective Oct. 4, and accusing city leaders of "playing politics," according to the Tennessean.
Hammond suggested at a news conference Wednesday there was a correlation and that the decision was strictly made by CoreCivic.
"I talked to Sheriff [Daron] Hall in Nashville this morning, and he got the same kind of letter this week, and he runs a bigger operation than I do," Hammond noted.
Gilchrist said the two closings are unrelated and that each contract is unique, denying any relationship between the closures.
Coppinger said locally the relationship was far less political and that the Silverdale facility, as the company's first location, was "special." He added that the company stayed longer than was financially feasible since they do not own the facility and had not been allowed to purchase it when they tried in the past.
"They had offered to buy the facility several years ago and it wasn't in our best interest," Coppinger said. "And we're grateful that it wasn't now."
On thin ice
CoreCivic, formerly known as Corrections Corporation of America, was founded in Nashville in 1983, and Silverdale was one of its first facilities. The company operates more than 100 detention facilities across the U.S., and reported nearly $2 billion in revenue last year.
The company recently came under fire by the Hamilton County commission for a number of alleged civil rights violations at the facility in recent years. In June, several commissioners suggested ending the relationship with CoreCivic and allowing the county to run the facility.
"I've been an advocate for several years that the county should take that facility back over," Commissioner Tim Boyd said. "I've never been for privatization of detention in this country. My position is, if the government takes your liberties away and places you in a detention center, the government ought to be responsible for maintaining that facility and your care and well-being."
Hammond said during the June meeting that while the sheriff's office still has eight oversight positions at the facility, the company has a lower threshold of employment than the county would.
"We've had good cooperation with CoreCivic in accomplishing the things we want," Hammond said. "But one of the biggest things we do face out there is they do pay a lot lower wages than we do, so, you get what you pay for, as the old saying goes."
Hammond said if the Hamilton County Sheriff's Office regained control of the facility it could perform "equal to if not better" than the private company.
When asked Wednesday if this dialogue about the county ending the contract had influenced the apparently abrupt decision by CoreCivic, Hammond said he didn't even remember the meeting, never directly answering the question.
Whatever the reason for the contract closure, Hammond must now accelerate the planned feasibility study to determine how to bring the jail in house.
"Pipe dream" facilities
Going forward, the county will have to study the operational expenses to be absorbed by the county and will have to amend the FY 2021 budget to move monies intended for CoreCivic.
According to Hammond, he will have a preliminary plan for a meeting with other county officials and will field questions from the county commission on Wednesday.
"My job is to pull together the best minds I can in this business and let them give me something to present to the mayor," Hammond said. "Even though I'm elected and he's elected, he's head of the money and commissioners decide how to spend it."
In addition to addressing safety concerns about the facility raised by CoreCivic and the public over recent years - including locks, camera, leaks and other necessary updates - Hammond will have to figure out how to best manage the operational expenses of Silverdale and the downtown jail, which the county runs for around $14 million annually.
In what he calls his "pipe dream," Hammond wants to use this opportunity to combine the two jails and potentially some county courts out at the Silverdale facility to save space downtown.
Before that, however, he must make the required updates on the existing Silverdale facility which is "aging out," and will involve debates about who's fiscally responsible for "hundreds of thousands" of dollars in maintenance on the facility, owned by the county and operated by CoreCivic.
Hammond said he is optimistic but not certain that he will be able to operate the jail at a potential cost savings since the for-profit contractor will no longer be involved, but warned of facility woes which could spur further capital expenses. Currently, the county has $20 million budgeted for capital improvements to the facility.
"There's going to be arguments back and forth on who should pay for it," Hammond said. "Yes, make no mistake about it, the county owns the facilitybut the contract has some specific items in there that I'm not prepared to discuss today."
Contact Sarah Grace Taylor at staylor@timesfreepress.com or 423-757-6416. Follow her on Twitter @_sarahgtaylor.