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Corrections Corporation of America Message Board

  • r7ualj r7ualj Apr 20, 1999 10:21 AM Flag


    The Augusta Chronicle

    Page A04
    (Copyright 1999)

    newspaper has always supported Georgia Corrections

    Commissioner Wayne Garner's no-nonsense policies with regard
    prison inmates. There's a big perception, though,
    that Garner has run
    amok with regard to the new
    private prison program.

    Jenkins County will be
    the home of Georgia's sixth private prison. Yet

    this prison and two others under construction are not
    being built through
    state contracts!

    would the Nashville-based Corrections Corp. of America
    on such a seemingly risky, costly move?

    Well, the CCA claims it has an "understanding" with
    "the state" (through
    Garner?) to fill their three
    prisons and recoup their $135 million
    investment. Now
    guess who is Garner's longtime best friend? Oily
    lobbyist Jim Hammock.

    Yet Garner claims
    he's had no talks with any CCA employee about the

    three prisons. (If any discussion has taken place, the
    law has been
    broken.) State law also requires
    that any contract with a private prison
    firm must
    be awarded through a competitive public bidding

    Garner is leaving office, so what better time to
    ask him and the CCA
    what "understanding" there is
    to circumvent legal open bidding? Gov. Roy

    Barnes says he knows of no such "understanding."

    The CCA already holds state contracts for two
    prisons, and Hammock
    boasts of having powerful friends
    in the Democrat-controlled General
    Assembly. So
    does the nation's largest prison-building company
    figure it
    can just get its legislative cronies to
    get competitors shoved aside so it can
    from running three more prisons?

    Also, did
    Garner provide Hammock with secret inmate statistics

    indicating a new governor would quickly need three more
    prisons in order
    to handle an unanticipated inmate
    influx due to tightened parole board


    An Atlanta newspaper reports Garner called
    Hammock 48 times on his
    state car phone in the 63
    days after the Request for Proposal was issued
    the first two prisons CCA built.

    That was
    before CCA got the contract -- and was a direct
    violation of
    the RFP language. So what other funny
    business has a telephone- happy
    Garner been up to?
    Will he later end up working for CCA?

    governor should intervene in what could be the first
    scandal on his
    watch. If Hammock is successful in
    lobbying key lawmakers to
    rubberstamp and fund the
    three new prisons without competitive bidding
    violation of state law, it will make a mockery of Barnes'
    government" promises.

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    • When it comes to managing prisons, Garner has
      been controversial due to his belief that prisons
      should be as they were intended -- houses of punishment.
      He got rid of the law libraries, the workout/weight
      facilities, the the TV's, etc. This, coupled with former Gov.
      Zell Miller's "3 strikes and you are locked up for
      life" sentencing reform, habitual felons are getting
      put away in Georga (don't wet the bed, Hampton).
      Garner and Gov. Barnes are on different pages
      politcally. The Augusta Chronicle, a left-leaning daily, has
      been used as the attack machine (contrary to their
      statement, I haven't seen anything in print showing their
      support for Garner). In Southern politics, you just don't
      replace your adversaries. You kick them out, conjure up
      some dark clouds, and sling some mud. I'll follow this
      story and keep the thread updated as it develops. GA
      does need those new facilities. G

      • 2 Replies to Go2Glenn
      • Why is there so much talk about CCA and prison
        guards on this board? I thought PZN was going to become
        a REIT and most of their income was going to be
        derived from building prisons and other correctional
        facilities and leasing them back to whatever governmental
        agency they are doing business with. I thought PZN would
        not have anything to do with the management part of
        the business.

        If the above is true, why
        should CCA's problems reflect negatively on PZN. For
        instance, Franchise Finance of America builds and leases
        restaurants. If somebody gets food poisoning at a Wendy's, or
        Hardees, or a Chili's that was built by FFA, don't blame
        FFA. They just built the physical plant. They didn't
        cook the burgers. Please enlighten me.

      • Atlanta Journal Constitution - 4/20/99

        The New Corrections Commissioner - Jim

        The 61-year-old grandfather of eight said he probably
        will order an audit of the agency to "see what I'm
        inheriting," but he already knows he will have to turn his
        immediate attention to space issues.

        "I believe
        Corrections is full," Wetherington said.

        About 3,000
        sentenced felons are backed up in county jails waiting for
        a space in the state system, which already is
        growing by about 1,700 a month. D.O.C. already has moved
        inmates into tents in prison recreation yards and into
        bunks in common areas in cellblocks. The state also is
        renting space in three private prisons.

        Wetherington has served as a police officer in Columbus, Ga,
        since 1959, including 14 years as Chief of

        Due to the ole supply and demand principles, PZN most
        likely will prevail in GA, IMO. G

    • Life 95...I can easily understand your harsh
      reaction to the inaccurate information (or accurate
      disinformation) Cleo pushed out regarding insider selling when
      there had been no selling and, instead, there had been
      insider buying up to and including this month. Try to
      remember that his or her misunderstanding of just about
      everything that's happened with PZN for the last year is
      really intended to provide a bit of comic relief for
      those who do understand. The last thing I and perhaps
      some others would want to see would be a reduction in
      the number of his or her amusingly inaccurate
      postings. And no, Cleo, I am Charlie and not MK.

    • An exclamation sign after a question sign is used to accentuate the question, to show real surprise. This is still much clearer, than 95% of verbiage used on this and other boards!

    • <Picture: Yahooins - disclaimer
      April 20, 9:36 pm Eastern Time

      REIT shares climb
      higher on Buffett investments

      NEW YORK, April 20
      (Reuters) - The shares of real estate investment trusts are
      running on high, boosted not only by expectations of
      strong first quarter growth, but on recent news about
      billionaire Warren Buffett's investments.

      Buffett is
      as good a reason as any for the recent rally in real
      estate stocks, say some industry analysts watching the
      shares of larger companies push toward their 52-week

      ``I think it helps,'' Steve Bloom, an analyst with
      Morgan Stanley, said about Buffett's REIT

      ``He's now invested in his second REIT. Sometimes I'm
      surprised by his choice of REITs, but to the degree that a
      well-regarded, valued investor is going into these stocks that
      certainly has given the group a good swift kick in its

      Buffett, chief executive of investment conglomerate
      Berkshire Hathaway Inc. (BRKa - news), recently bought 5
      percent stakes in two REITs -- Tanger Factory Outlet
      Centers Inc. (SKT - news) and Town and Country Trust (TCT
      - news), according to filings with the Securities
      and Exchange Commission.

      Tanger shares soared
      to $26.125 from $20.50 when Buffett bought about
      417,000 shares on April 9. The share closed at $25.375 on
      Tuesday. Likewise, shares of Town and Country are now
      trading around $17, up from $15.50 last week when Buffett
      bought about 797,200 shares.

      Wall Street firm BT
      Alex. Brown said REIT share prices as a group soared
      7.3 percent on its index last week compared with a
      2.3 percent fall in the Standard & Poor's 500

      Buffett, known as the ``Sage of Omaha,'' also recently
      received heightened attention for saying that virtually
      all U.S. stocks are too expensive.

      REITs, on
      the other hand, are widely considered grossly
      undervalued. And after hovering below analysts' price targets,
      shares last week began to rise.

      Shares of
      AvalonBay Communities Inc. (AVB - news), for example,
      jumped to $34.25 on Tuesday from around $31 last week.
      Equity Office Properties Trust (EOP - news) shares
      closed at $27.06, near a year high of

      Buffett was traveling and his spokesman declined comment
      on his investments.

      Most of the larger REITs,
      including Duke Realty Investments Inc. (DRE - news) and
      retail REIT Weingarten Realty Investors (WRI - news) are
      expected to meet expectations as they report first quarter
      results in the next few weeks.

      Investment and Management Co. (AIV - news), or AIMCO, on
      Monday posted first quarter funds from operations of
      $66.2 million, or 96 cents per share, up from the net
      FFO reported a year earlier of $39.1 million, or 80

      ``I think this all seems to have crystallized in last
      couple of weeks,'' said Steve Wechsler, chief executive
      of the National Association of Real Estate
      Investment Trusts, or NAREIT. ``A lot of the industry was
      trading below net asset value. That won't last forever in
      a functioning marketplace.''

      Analysts at BT
      Alex. Brown said in a report that they think the rally
      can last. The firm has strong buy or buy ratings on
      15 companies, including AIMCO, Duke, AvalonBay and

    • CCA-managed, PZN-owned contracts/facilities
      provide the best margins and are the most sought after
      situations. Management only contracts are fine if the numbers
      are right, but recent experiences in Texas show that
      competition is driving margins down and reducing the number
      of opportunities meeting CCA's criteria (also, in
      the future that income won't be going to PZN -
      although it will allow CCA to pay high rents on PZN owned
      facilities). The new opportunity is PZN-owned,
      government-managed facilities - something that wasn't available in
      the past. That may be where the big money is in the

    • Doc and others bought more in March. PZN has been
      tadeing in a box for a while. This stock should start to
      move up the letter. Now might be the time to get in. I
      have been holding for the end of the rainbow.

    • Yahoo Insider shows HUGE sales by the management
      in January:
      Doc sold 456,000 shares, Doc Jr. sold
      150,000 shares and Devlin sold 150,000 shares( the last
      two seem to have sold their bonuses for "inventing"
      REIT!!). I do not recall much about it being
      Any comments?!

    • Yes, PZN was formed as a captive REIT for CCA.
      However, upon the merger completion, CCA became PZN. So,
      the captive becomes the captor. OPCO is the captive
      of PZN. Some would argue that the market value of
      the stock has suffered because the market perceives
      PZN to be the captive of the privately held OPCO.
      Such a perception is wrong, IMO. OPCO is totally
      dependent on PZN. PZN can make OPCO disappear at any time,
      simply by merging with it.

      Old CCA (and new PZN)
      always pursued a bricks and mortar strategy (WHC is
      still trying to catch up). As you of all people should
      be most aware (by your postings), the management
      side is frought with problems. What is unchanging is
      the acute shortage of beds for prisoners. If OPCO
      loses a mgmt contract in a PZN owned facility, where do
      you think the prisoners will go? Chances are they
      will stay in the PZN faility and be managed by either
      another private entity or by the government. I suspect
      the government would not balk at a lease value based
      on $75,000 per bed.

      Remember, CCA got to
      where it was for a reason: there was a shortage of
      prison beds. There still is. That doesn't change
      wheteher or not you like CCA or PZN or REITs or Doc or
      Doc is telling us that as the "market" for beds
      evolves, the capital intensive strategy is the way to go.
      I believe he can read this better than his
      competitors, and that he can continue providing a
      product/service that appeals to governments.

      Saying PZN is
      dependent on OPCO to make lease payments is too
      superficial. PZN is dependent on governments needing beds.
      OPCO is a conduit, and will be less important as such
      in the future as PZN leases directly to the
      government. OPCO's just there to meet REIT requirements.

    • Same old Cleo..same old Cleo - finding fault with
      everyone else. I'm responsible for her failure to clearly
      communicate; Clinton's responsible for all of America's ills
      and Doc's responsible for the popularity of anal sex.
      (Well. perhaps their's a germ of truth in the
      Thanks for putting me in the same analytical
      company as LT and Anderson. Actually my talents lie in
      other areas but I appreciate
      the compliment. I'm
      just another shareholder, like you, with a big loss in
      PZN. No claim to genius and omniscience like

      You take good care Cleo, ya hear

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