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Businesses have made millions off Trump's child separation policy

Hunter Walker
White House Correspondent

WASHINGTON — President Trump’s controversial child separation policy is being carried out with the help of private businesses who have received millions of dollars in government contracts to help run the shelters where young migrants are being held away from their parents.

The government has released few photos of the shelters where the children are being detained and at times declined to allow media and even elected officials access to the facilities. Amid this secrecy, many of the businesses participating in the program have remained behind the scenes without being identified.

However, by reviewing publicly available contracts data, Yahoo News was able to identify five companies that are participating in the operation of the shelters, including two companies that have not previously been tied to the program. And in response to inquiries, one of the companies said it would cease participation in a program that required it to “maintain readiness” to transport young migrants to government facilities.

Child immigrants play outside a former Job Corps site that now houses them. (Photo: Wilfredo Lee/AP)

The Trump administration has given a series of conflicting explanations for the child separations with the president repeatedly falsely blaming it on Democrats. In reality, the situation is the result of a “zero tolerance” policy announced by Attorney General Jeff Sessions in April that requires authorities to treat all border crossings outside official ports of entry as crimes. This means that adults are arrested when they cross the border and, typically, when a parent is jailed, their children are taken from them.

According to Kenneth Wolfe, a spokesperson for the Department of Health and Human Service’s Administration for Children and Families (ACF), the agency currently operates “100 shelters across 17 states.” Citing “the safety and security of children in the program,” Wolfe declined to provide further details about the locations where the young migrants are being held. As of Tuesday morning, Wolfe said 11,786 children were being held as part of the “unaccompanied alien children program.” This program, which is run by ACF’s Office of Refugee Resettlement, is designed to offer “unaccompanied alien children entering the United States” a variety of services including “classroom education, health care, socialization/recreation, vocational training, mental health services, family reunification, access to legal services, and case management.” While this program was designed for “unaccompanied” children, who are typically teenagers driven out of their homes in Central America by poverty, abuse or gang violence, since the beginning of the Trump administration’s zero tolerance policy, there have been widespread reports of children as young as toddlers being taken away from their parents and brought to shelters. Wolfe told Yahoo News his agency defines “unaccompanied” as “any minor referred by [the Department of Homeland Security] to HHS for our unaccompanied alien children program.”

Inside one of the cages at a border protection facility in McAllen, Texas. (Photo: U.S. Customs and Border Protection’s Rio Grande Valley Sector via AP)

The data reviewed by Yahoo News was posted on the site GovTribe.com, which provides “real-time federal contract marketing data.” This information gives a glimpse of the recent growth of the government’s shelter system for young migrants and some of the companies who have lucrative contracts to participate in the program.

Contract vehicles are one of the mechanisms the U.S. government uses to award contracts to vendors. The data reviewed by Yahoo News was for a contract vehicle called “Shelter Care for Unaccompanied Children 2022.” This included 10 different contracts for up to approximately $92 million that were awarded to five different vendors starting in September 2017. The contracts include plans to operate the shelters through September 2022.

Comprehensive Health Services Inc. (CHSI), a Florida-based company that touts its experience with “immigrant shelter services” received the bulk of the contracts. According to GovTribe, the company was awarded three contracts worth up to about $65 million. The first contract awarded to CHSI through the vehicle kicked off in September 2017 and was for “emergency shelter operations.” It was worth at least $32.4 million. Later that month, the company was awarded a smaller $1.4 million contract for unspecified “emergency and other relief services.”

In February of this year, CHSI was awarded a contract through the vehicle worth $30.9 million to operate an “emergency shelter” in Homestead, Fla., with “500 UAC beds,” an acronym referring to “unaccompanied alien children.” That contract was modified last month to double the number of beds in the shelter. This presumably was the same shelter described in this article by the Miami Herald. Pictures obtained by the paper show the shelter includes large tents, a fenced in soccer field and crowded rows of beds.

The Homestead Temporary Shelter for Unaccompanied Children in Homestead, Fla. (Photo: Joe Skipper/Getty Images)

Yahoo News contacted CHSI and the company’s President and CEO Gary G. Palmer to ask if it had any concerns about playing a role in the child separations. Palmer did not respond. Gail Hart, a CHSI spokesperson, referred all questions to the Department of Health and Human Services. The CHSI website claims its facilities are “compassionate” and boasts of its recent experience working on an HHS contract for a “rapid ramp-up of a large temporary shelter” for immigrants.

Dynamic Service Solutions, a Maryland firm, was awarded a contract worth up to $8.7 million from HHS through the “shelter care for unaccompanied children” vehicle in September 2017. The company has posted job openings online indicating it is hiring Spanish-speaking “youth care workers” to work with “unaccompanied alien children” in Homestead. Darnell Armstrong, president and CEO of Dynamic Service Solutions, referred all questions about his role in the child separation policy to the Department of Health and Human Services.

Southwest Key Programs was awarded two contracts through the vehicle in September 2017 worth up to $1.8 million each for “emergency shelter operations.” According to ABC News, Southwest Key, a nonprofit, runs 26 facilities for young migrants including Casa Padre in Brownsville, Texas. Casa Padre, located in a cavernous former Walmart, is the largest licensed facility for immigrant children with a capacity of 1,500. ABC also reported that children who are held there are allowed to make two calls a week. The news network was among a group of media outlets and lawmakers, including Sen. Jeff Merkley, D-Ore., that toured Casa Padre on June 17. They were admitted after Merkley had been turned away from the facility two weeks earlier. After Merkley’s first attempt, Southwest Key Programs spokesperson Cindy Casares released a statement describing itself as a “humanitarian first responder, caring for immigrant children arriving in this country without a parent or guardian.”

“We provide round-the-clock services including: food, shelter, medical and mental health care, clothing, educational support, supervision, and reunification support,” the statement said.

Bloomberg reported on Tuesday that the government is set to pay Southwest Key over $458 million this fiscal year. Southwest Key’s website went offline on Tuesday evening shortly after the stories from Bloomberg and Yahoo News were published. Casares and Southwest Key Programs President Dr. Juan Sanchez did not respond to multiple requests for comment from Yahoo News about whether they were concerned the nonprofit is aiding child separation.

Sen. Jeff Merkley, D-Ore., right, speaks in front of the U.S. Customs and Border Protection’s Rio Grande Valley Sector’s Centralized Processing Center in McAllen, Texas, June 17, 2018. (Photo: Joel Martinez/the Monitor via AP)

Dynamic Educational Systems, a subsidiary of the Arizona firm Exodyne, was awarded a pair of HHS contracts worth up to approximately $5.6 million for “emergency shelter operations.” One of the contracts specified it was for “unaccompanied children.” The company’s founder, chairman, and CEO Ralph Rockow, did not respond to a request for comment from Yahoo News. A woman who answered the phone at Exodyne Inc. on Tuesday laughed when we said we were calling to ask if executives there had concerns they might be helping separate children from their parents. The woman said Rockow and another person who could answer questions were both unavailable.

The fifth business with contracts through the HHS vehicle for “shelter care for unaccompanied children” is Virginia-based MVM. According to GovTribe, the company was awarded two contracts worth up to $9.5 million in September 2017 for “shelter operations” and for unspecified “emergency and other relief services.” Earlier this month, the Daily Beast reported MVM was looking to fill a number of positions, including a compliance coordinator to work in San Antonio on the “rapid deployment of an Emergency Influx Shelter for unaccompanied children.”

In response to an inquiry from Yahoo News, the company sent a statement saying it “has tremendous empathy for the families and children arriving at the U.S. border” and believed there was a “misperception of the role MVM is playing on the issue of unaccompanied immigrant children.”

“The current services MVM provides consist of transporting undocumented families and unaccompanied children to Department of Health and Human Services–designated facilities — we have not and currently do not operate shelters or any other type of housing for minors,” the statement said. “While these children and families are in our care, our priority is ensuring they are safe and treated with dignity and compassion. We have been providing these transport services since 2014 and take pride in the level of care these children receive from our dedicated, professional staff.”

According to the company’s statement, “MVM was one of several organizations awarded a contract to provide as-needed emergency support services” to the Office of Refugee Resettlement. The company emphasized this was in 2017, “prior to the zero tolerance policy” that led to child separations. In addition to the recent contract vehicle for “shelter care for unaccompanied children” Yahoo News has identified four contracts the company was awarded in past years for “unaccompanied alien children (UAC) transportation services” worth at least $308 million. While those contracts cover work through next year, according to GovTribe, the company has already earned the full amount. The largest of those contracts, which was worth at least $162 million covered a period from 2014 through 2019. The other contracts covered a period from 2016 through this year. The data on GovTribe shows that MVM Inc. has only provided $3,100 of services out of the nearly $9.5 million authorized in the “shelter care” contract vehicle.

MVM’s statement said the company does not expect to provide further services through the program. It also pledged the company would not take contracts that involved the child separation policy.

“At the direction of the company’s leadership, we have removed job postings related to readiness operations under the current zero tolerance policy,” the statement said. “MVM has not pursued any new contracts associated with undocumented families and children since the implementation of the current policy.”

Update [June 20 11:45 am]: This story has been updated with new additional information about the finances of Southwest Key and MVM Inc.

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