NEW DEAL URGED FOR PRIVATE PRISONS

Litscher Favors 3-Year Contract To House Inmates Out Of State

Madison - State corrections officials want a new three-year contract to
house inmates in private prisons in other states - a controversial deal
that would let Gov.-elect Jim Doyle and legislators keep up to 5,500
prisoners at a time outside Wisconsin through 2005.

In a letter to the Legislature's budget committee, Corrections Secretary
Jon Litscher says the current contract with the private Corrections
Corporation of America ends Dec. 21. He recommends a three-year deal at
rising costs - including an immediate 10% jump in the daily cost.

The proposal gives Doyle, the Democrat who takes office Jan. 6, a chance to
signal how he wants to reform prison policies. In the campaign for
governor, Doyle repeatedly said he wanted the number of out-of-state
inmates reduced, but offered no plan to do that.

He has not yet named anyone to replace Litscher, who retires Jan. 6, the
day Doyle is to become the state's 44th governor.

Doyle transition spokesman Thad Nation said he could not reach Doyle, who
was in Washington on Monday, for a response to Litscher's request.

Also, Litscher warned legislators that his agency's current budget is at
least $22.2 million short: $11.9 million in costs to house inmates outside
Wisconsin and $10.3 million in inmate health care costs.

The request for a new contract for out-of-state prison beds must receive
approval from the full Legislature, which does not convene until January,
or the Joint Finance Committee, which is tentatively scheduled to meet next
week.

In an interview Monday, Litscher said the new contract with the company
would give Doyle and his choice to run the Corrections Department the
option of continuing to send Wisconsin inmates to seven private prisons in
Oklahoma, Minnesota, Georgia, Mississippi and Tennessee.

"That's where we'll buy beds if we need them," Litscher said. "We need beds."

Wisconsin began exporting more inmates than any other state in 1996, when
soaring prison populations exceeded the capacity of crowded state prisons.
In mid-November, 3,496 male inmates were being held outside Wisconsin.

But the number of out-of-state inmates will drop to about 2,000 after Jan.
1, when the Stanley prison opens with beds for 1,500, Litscher estimated.
And he said the number of out-of-state inmates could drop much lower, if
Doyle and the Legislature agree next year to open other facilities: a New
Lisbon prison set to open in 2004 with 950 beds, two proposed work centers,
and a facility in Chippewa Falls for 300 of the oldest inmates.

Litscher said the new contract would give the Doyle administration
flexibility in sorting out which prisons state government can afford to
open and trying to close a budget deficit of $2.6 billion by mid-2005.

Unions for state prison guards will watch any deal closely. Those unions
were leery of Doyle's campaign pledge to cut up to 12,000 state jobs over
the next eight years if he is re-elected in 2006.

"This contract goes high and low" in the numbers of Wisconsin inmates who
could be held at private prisons outside the state the next three years,
Litscher added.

The new contract could total up to $300 million over three years if
Wisconsin kept the maximum 5,500 inmates per day outside the state - a
scenario considered unlikely.

The new contract would raise the daily cost of renting out-of-state prison
beds, now $44, to $48.50 on Dec. 22, to $49.96 from December 2003 and '04,
and to $51.46 from December '04 and '05.

Still, renting out-of-state prison beds is much cheaper than the average
daily cost of operating a Wisconsin prison for adult men, which is $71 to
$73, Litscher added.

If a new contract isn't signed by the Dec. 21 deadline, Litscher said,
state government and the company could work out an extension, although the
daily rate would have to be negotiated.

In a separate letter to the committee, Litscher says an average daily
prison population of 21,554 inmates this year - 855 higher than the
governor and the Legislature forecast - contributed to the expected budget
shortfall of $11.9 million in costs to house inmates in the year that ends
June 30.

Prescriptions for inmates are expected to cost $11.5 million this year, a
24% increase over last year, causing a separate budget shortfall for inmate
health care, Litscher adds. But Litscher does not ask the committee to find
that additional money next week.

"However, given the enormity of the funding shortfall, the Corrections
Department will almost certainly need to appear before the Finance
Committee at a later date to request supplemental funding to meet our
obligations," Litscher adds.

Until January, the 16-member committee is equally divided between
Democratic and Republican legislators. When the new committee is seated
next year, Republicans will control it, 12-4.