NCJ Number
131956
Journal
Journal for Juvenile Justice and Detention Services Volume: 5 Issue: 2 Dated: (Fall 1990) Pages: 6-8
Date Published
1990
Length
3 pages
Annotation
This cost analysis examines the financial impacts of three approaches to privatization in corrections: operation and maintenance contracts, lease contracts, and service contracts.
Abstract
Privatization can typically produce criminal justice facilities more rapidly and less expensively and operate them at lower costs than can traditional methods. These effects occur because private firms that are facility owners generally use more modular designs, faster construction approaches, and creative financing approaches such as variable rate loans. In addition, private sector firms try to minimize operating expenses and can take advantage of tax benefits. An analysis of a hypothetical $100 million facility reveals an annual savings of 8.5 percent from privatization. For such benefits to occur, a detailed implementation process should be used in choosing the private-sector firm.