Lawmakers Lambaste Money-Losing Prison Industries Program

We have been posting about an investigation into prison labor violations in Nevada.  Three posts by VLTP Executive Director Bob Sloan, which you can access here, here, and here.  After exposing this to the entire Nevada State Legislature, Governor Sandoval (R), AG Masto (D), and Union leaders, and aided by an interview on the Dana Gentry Show just over a month ago, the ball started rolling fast. 

Elected leaders and Union leaders realized that they were being  at the least, misled by DOC Chief Cox and Nevada Department of Corrections Public Information Officer Brian Connett (who, not so incidentally, also NCIA logo  serves as the head of NCIA and is likely guilty of a serious conflict of interest) and reacted quickly to the information provided to them by Bob.

 

Today, elected officials had a special hearing to address the information about Messrs. Cox and Connett.  Many questions were obviously formed from the Cox and Connettinvestigative report that Bob had  researched and submitted to the Legislature, Governor, Attorney General and Secretary of State.

The following article from the Las Vegas Sun – complete with Bob’s comments – show that there are a lot of powerful people who are very upset and embarrassed about being defrauded.  The disgust was bipartisan, as the impact on Nevada taxpayers and the abuse of prison laborers united both progressives and conservatives in condemning the actions of Cox and Connett.

There is still a lot more to happen until this situation is fully and properly resolved, including what to do about the legal transgressions and tax issues. This issue will be discussed next at an open meeting of the Nevada commission sometime later this month. Bob Sloan will be writing his own article on the events to date, but for now I’d like to present you with the MSM Newspaper coverage of today’s events to bring you up-to-speed on what is happening as the result of Bob’s investigation for VLTP.  All emphasis is mine.

————————————-

From the Las Vegas Sun, by   (contact)

Friday, March 8, 2013 | 4:03 p.m. CARSON CITY — Legislators lambasted the state’s prison industry program Friday. They bemoaned the financial losses the program has incurred during the past few years and further decried the possibility that prisoners could be unduly competing with the private sector for scarce jobs.

“It appears that at some point the reserves are going to run out, but in the meantime, it’s a loss-loss across the state,” Assembly Speaker Marilyn Kirkpatrick, D-North Las Vegas, said at a legislative committee meeting, noting that the state would lose money and the private sector could lose jobs.

The prison industries program uses voluntary prison labor to run various shops with some proceeds from sales paying for restitution and room and board for prisoners; the prisoners receive training and skills they can later use to find a job when they are no longer incarcerated.

Department of Corrections chief Greg Cox conceded that the program has been a money loser during recent years but still defended the merits of the Silver State Industries program.

“We have been able to say historically this is helping us operate our facilities, it’s a good management tool, and it provides vocational training,” he told legislators. “The cold hard facts are now that we have to aggressively look at what industries are not turning a profit.”

The prison industries’ furniture and metal shop, auto and upholstery shop, and drapery shop have lost hundreds of thousands of dollars during the past few years.

Others, like the mattress, print and garment shops have turned small profits. But those surpluses aren’t enough to offset losses in the other shops, and the department has been drawing down reserves as a result.

“This is a clear track into the dirt, and without substantial retooling, it’ll be in the hole,” Assemblyman David Bobzien, D-Reno, said.

Bobzien and Assemblyman Michael Sprinkle, D-Sparks, tried to wrangle an answer from Cox about which programs would be cut and what the department would do to get its industry program on a sustainable track.

Cox said he’s “very pessimistic” about future revenues and that “when resources go, of course programs will go.”

He cited the auto shop, the biggest money loser, as one program that could be under the chopping block.

Cox faced further criticism for the prison industry’s public-private partnership with Alpine Steel, which owes the state about $400,000.

The company also got a below-market rate lease to operate within High Desert State Prison, which Bobzien called an unfair subsidy.

The challenge of convincing a business to work within a prison environment necessitated the need for a cheap rate, said Nevada Department of Corrections Public Information Officer Brian Connett. (note: there’s a whole lot of conflict-of-interest here).

Danny Thompson, of the AFL-CIO, also protested Alpine Steel’s use of cheap prison labor.

“They’re displacing people who are out of work with prisoners,” he said. “There’s no way you can compete. … I have 300 out-of-work ironworkers who are not criminals.”

He said Alpine Steel produced steel girders for a construction project at the North Fifth Street Bridge in North Las Vegas.

Calling into question the quality of prison labor, he said the potential lack of certification and training for prison laborers could lead to unsafe construction on a public road over Interstate 15.

The company’s owner, Randy Bulloch, testified to legislators that his company did no work on girders for that project and that the prison laborers have required certifications.

Cox also said Alpine Steel is on a payback program and is no longer operating within the state’s prison system, although that could change in the future.

and now for Bob’s comment posted to the Las Vegas Sun’s article:

  1. By bobsloan

March 8, 2013 8:32 p.m. Director Cox seemed to be at a loss for solutions to the many problems surrounding his prison industries – and on how to damper the criticisms aimed at him because of the industry program. Some obvious solutions that could have been suggested to the legislature today never came up in the responses the NDOC Director and his Deputy provided to pertinent questions. They could have suggested ways to stop the industries from losing money, such as enforcing collection of lease payments, owed salaries for staff.

Reevaluate all facility leases private companies enjoy with prison industries and increase them comparable to similar leases in the private sector – you know at the rate all other Nevada businesses pay for manufacturing space. They could have suggested not extending credit (tax dollars) to companies partnering with the prison industries. The decision on reducing lease rates to private companies on publicly owned property or facilities should not be a decision made by a Deputy Director, rather one made by the Board of Prison Commissioners.

Taxpayers rely upon Director Cox to protect their interests. Entering into leases that cost those taxpayers as much as $90,000 per year in potential income does not generate trust – or a lessening in deficits. To use such low cost leases as an “incentive” to encourage companies to bring manufacturing to the prison industries is an expenditure that should be authorized at a higher pay grade. It was disheartening to learn that after owing the state more than $400,000 for four years the company in question was offered an agreement to repay the money over an additional four year+ period without even interest penalties. Director Cox added insult to injury by declaring that if Alpine Steel’s work picked up he would reopen the prison industry to him.

That statement alone left the impression the Director was willing to move forward with a partnership that has already cost the state nearly a half million dollars – and let that company amass more debt as if the NDOC can extend state subsidies in the face of legislative objections or concerns.