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Cost, Performance Studies Look at Prison Privatization

NCJ Number
NIJ Journal Issue: 259 Dated: March 2008 Pages: 32-36
Gerry Gaes Ph.D.
Date Published
March 2008
5 pages
This article summarizes the findings and implications of the "Taft studies," which consisted of two cost and performance analyses of the same four prisons, one privately operated and three publicly operated.
According to one analysis (the Abt analysis), the average cost of the three public facilities was 14.8 percent higher than the private correctional facility (Taft facility). The second study (Bureau of Prisons study), however, determined that the average cost of the public facilities in 2002 was only 2.2 percent higher than Taft. There were two primary reasons the two cost analyses were so different: the way inmate population sizes were handled and what was included in overhead costs. This article explains the procedural differences in the costing analyses of the two studies. Instead of favoring one procedure, this article uses the different study outcomes to remind policymakers and others interested in the prison privatization issue that making cost comparisons between privately run and publicly run correctional facilities is not a simple matter of arithmetic. Regarding performance measurements of the two studies, the article notes that because no method exists for measuring publicly and privately operated prisons on many performance dimensions, both of the performance studies had limitations. Until a uniform performance measurement is developed, any analysis will leave many questions unanswered regarding whether publicly or privately operated correctional facilities perform better. Based on lessons learned from these two studies, this article recommends that a uniform method comparing publicly and privately operated prisons on the basis of audits be developed. It also suggests that future analytical methods allow simultaneous cost and quality comparisons. Also, given the fact that the two studies reviewed are currently two of the best prison privatization analyses thus far, the full reports warrant detailed study by administrators, policy analysts, and researchers. 7 notes