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Corrections Corporation of America Message Board

  • r7ualj r7ualj Apr 28, 1999 9:56 AM Flag

    Bad News!!!

    My sources have indicated that the inmates at the
    CCA-operated South Central facility have taken over the
    prison. This is the same facility that has had a number
    of escapes over the last few months. I'll keep you
    guys posted.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Yes the sccf incident was blown out of
      proportion. It did have all of the rumblings that could have
      lead too a major problem. If the commish. of the St of
      Tn had not have quickly and call in the state
      troopers and a correctional officers from a locale state
      ran facility this could have been huge. Why is it
      that a cimpany is paid by tax dollars, they botch it
      and the Tax payer get stuck with the bill again.

      • 2 Replies to underinv
      • I'm just a stockholder, not an expert in this
        field but I don't understand the problem with State and
        Local law enforcement assisting (at taxpayer cost) with
        a prison break from a privately run prison. I would
        assume that this occasional (very rare) cost is factored
        in to the operator's contract. If prison breaks
        became too frequent, the operator would "pay" for this
        either by losing the contract or through their contract
        provisions (rates).

        Question for you - when a local
        or state run prison experiences a prison break, does
        that Prison's operating cost get hit with the cost of
        State Trooper assistance? I'll bet not.

        As
        always, nobody's asking for preferential treatment. Let's
        just make sure we are always comparing apples to
        apples.

      • Your title serves you justly. 1st you fed false
        information at the beginning of this new. I suspect the
        information you are feeding now is also false. This is just a
        speculation from the inside.

        If there was a situation
        at any prison (state or private) that was large
        enough scale, the state troopers and other law
        enforcement agencies would be called in. If you can't
        understand this I will explain. Like us there job is public
        safety. Regardless of the cost to whom we in the
        facilities along with law enforcement have the public
        interest as a #1 priority.

        If you would like to
        compare apples to apples, when a similar situation were
        to happen at a state facility. The cost wouldn't be
        shown for that of the highway patrol. Therefore, let
        apples be apples.

        Thank you for your post and
        work from the inside glittergoddess. I hope I
        remembered your name right.

    • Nothing in local newspaper or on local CNN affiliate.

    • R7 is correct about the Davis Bacon. Luckily some
      states do not have it and it is typically where there is
      not a big Union influence in the state. Double the
      cost may be little exagerated but union/Davis Bacon
      does cost more. There has also been some pretty bad
      fraud cases with Davis Bacon to inflate
      wages.

      Much of the cost savings is from simplicity of design
      as I stated before. This is a savings in material
      and labor cost. As far as R7's financing this can be
      offset by the governmental body financing and
      maintaining ownership of the facility as they would if they
      were to operate. They pay for it one way or the other.
      Either by the cost per inmate if private pays to build
      and own or by obtaining the funds themselves.


      R7's contention that taxpayers subsidize the private
      construction would therefore be correct. So if that is the
      case the taxpayers are better off to pay for and own
      the facility and only pay private as operators. Not
      privates first choice, but if you look at PZN's owned vs
      operated you will see that they will do it.

    • You think stoppage of equity sales was a tacit
      admission by the management it is STUPID to continue doing
      so at such depressed prices - I think everyone would
      agree with this message but others might say it
      differently. Yes, management recognized the stock is
      underpriced and stopped the sales because while they aren't
      technically dilutive, debt financing is financially preferred
      given this stock price and the present cost of
      debt.

      Why couldn't the same thing have been done in the
      'old' CCA skin? IMHO, in RETROSPECT I think you might
      be correct. However, you have to remember that at
      the time Doc made the decision, REITS were money
      magnets. Raising equity was very easy for REITS and Doc
      was no doubt heavily influenced by the huge stock
      price appreciation seen in the original PZN. I think
      Doc saw the coming decline in management contracts
      and correctly saw that building/owning facilities was
      going to be the game. This of course would require a
      huge amount of capital.

      Why do I say you
      "might" be correct? Let's be realistic, when CCA was $40
      a share, industry and company growth was forcast to
      be 35-40%. If Doc had done nothing and the (industry
      and company) growth dropped to ~20% as it now is,
      what would have happenned to CCA stock? 20 sounds
      about right to me. So CCA would be out there right now
      faced with today's same challenge - issue equity @ $20
      or hit the debt markets.

      So in retrospect, it
      seems that a whole lot of pain and gyrations were gone
      through to get to where we are now but I think we would
      have been here (~ $20 a share) either as old CCA or
      New PZN.

      I think Doc made the best possible
      decision given the available information at the time. He
      couldn't forsee the unprecedented disdain investors
      started showing REITS last year. I suppose he is guilty
      of that. He also couldn't maintain the company's and
      industry's 40% growth rate. Guilty as charged here
      also.

      The bottom line is that "we are where we are" and
      each investor or potential investor should make their
      decision looking forward. I've benefitted from your
      previous posts and look forward to the future ones. They
      need not be Happy posts; critical posts are much more
      useful than cheerleading posts but let's concentrate on
      today's and tomorrow's challenges. Plenty lay ahead.

    • ....

    • 1)"Any public facility would be all over the
      front pages if a similar incident happened". Yeah,
      right. At a public facility that event wouldn't make it
      outside the prison walls unless the warden wanted it out
      and the inmates would have gotten the shit beaten out
      of them (and, by the way, most people reading a
      story like this think that when prisoners repeatedly
      don't do what they are told they should get gassed). I
      read the front pages (and everything in between) of
      many newspapers every day and in the past year I've
      seen more negative news on CCA/PZN than what I've seen
      on all the public facilities combined(check out 60
      Minutes tonight, looks like we've got another one coming)
      yet what share of the total market does CCA have?
      About 55% of the 7% that's been penetrated or 3%. So
      they have 3% of the total market share but get as much
      bad news as the whole public sector combined. CCA
      must be REALLY bad at what they do. I guess that's why
      they've been growing at only 35%.

      2)You imply that
      PZN does a good job of controlling the press. Boy, as
      an investor I wish that was true but it is perhaps
      their weakest point.

      3)I'm sure there is
      established protocal for dealing with an incident such as
      this one. I would be very surprised if PZN's protocal
      is substantially different from a public facility's.
      First you ask, then you gradually get more aggressive.
      Just what would you have done to get the inmates to
      follow orders after your orders were not followed and
      I'm sure they were warned that gas was the next step?
      Had some one-on-one breakout sessions?

    • that I'd never posted the earnings release and CC
      info which I usually do.

      Managements words,
      intriguing or not, are due out tomorrow, not Thursday, as
      you'd said, so I've been sitting here for probably a
      week or two thinking that I'd already let everyone
      know. My next post will reveal all.

    • I previously thought the issue was Private vs.
      Government but it is my conclusion that we are really
      engaged in Private Sector (which happens to be non-union)
      vs. Union. Of course, these days all government
      workers are for all practical purposes unionized.
      Government workers are "protected" more so than Private
      Sector employees. Gov workers are usually in
      environments where years of service means more than
      performance. Just my opinion anyway.

      I don't think we
      have to be concerned with anti-private sector
      legislation going anywhere unless the big Bore wins AND the
      Dems wins the House and Senate. For now I'm sleeping
      well.

    • Lets tell all the prisoners just to go home it
      was all a joke. And another idea, lets let the
      congressmen who sponser these stupid bills to work weekends
      at the prisons. BETTER yet, they can stay at their
      homes!!!! SInce this country has only half the beds. I
      imagine Springer has some extra beds in his house. EVEN
      BETTER YET...how about YOUR HOUSE Sunites. Got room for
      1.6MM inmates?

      The Unions could do this country
      better by aiding in the process not trying to make it
      worse. It's very sad. Make them illegal would be the
      best choice. THey half finished anyway.

      Cheers
      and have a nice day.

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