Jail Finance: Documentation 'To Be Recorded At A Later Date'

Waco – Figures obtained from public information requests and on-line budget records reveal that finance of the Jack Harwell Detention Center is in budget shortfalls by hundreds of thousands of dollars.

McLennan County Commissioners Court will be forced to make a decision next Tuesday morning whether to extend a closure of the 326-bed downtown jail and a waiver of a $2 per day licensing fee which is costing the taxpayers as much as $30,000 per month.

On May 14, the Court in a special meeting made a decision to close the jail when numbers of prisoners necessary to make operation of the 816-bed Highway 6 jail operated by private contractor CEC (Civigenics), Inc., of New Jersey a profitable operation with a downtown jail population of 283 prisoners - less than half the planned capacity, according to Mike Wilson, warden of the Jack Harwell Detention Facility.

At that time, Commissioner Kelly Snell asked, “What do we do if this doesn't work out?”

That day is here.

Mr. Wilson replied, Commissioners will have to “...make the best decision you can with what's there at the time...I guess the short answer is it creates a lot of problems if there are no prisoners there...”

CEC representatives assured the Court that if there was an inadequate number of prisoners to ensure a positive cash flow, “...we'll have to draw on the reserves.”

Appointed money managers for the county have so far been unable to reach agreement on the true classification of those reserve funds.

Newly-appointed Budget Director Adam Harry is on record saying that the fund entitled Public Finance Corporation Fund 196, or Jail Lease Fund, is a “contingency fee” from which was drawn money needed to satisfy a shortfall of $200,000 to pay the debt service of $3.7 million for the 2010 interest carry on a $49.9 million bond issue to build the privately operated jail.

Public Finance Corporation was formed by McLennan County attorney Herb Bristow to comply with statutory requirements governing public finance of public facilities which built to be operated by private corporations.

County Auditor Steve Moore said, “I do not understand exactly what is being requested,” when queried in a Open Records Act request for public information. “Fund 196 is not a PFC fund. It is a McLennan County fund and it had no financial activity until June, 2010. It performs one function. It receives money from third party senders of inmates and remits those collections, and only those collections, to the PFC as rent on the sublease.”

According to fiscal year 2011 budget projections published on-line, “All appropriations in Fund 196 are subject to and limited by the proceeds from rents received from entities who have sent inmates to the Jack Harwell Detention Center for incarceration, including those rents paid by McLennan County for its own inmates incarcerated in the Jack Harwell Detention Center.

The McLennan County budget for fiscal year 2011 calls for an allocation of $10,079,475 in both projected income from inmate housing and payments in the same amount to retire the debt, according to adopted budget published published on-line.

This piece is based on the investigations and reporting of R.S. Gates.