Longstanding BOP “Crisis” a Top Justice Department Priority

Last week, Inspector General Michael Horowitz sent a memorandum to the Attorney General and Deputy Attorney General concerning “Top Management and Performance Challenges Facing the Department of Justice.” The first identified challenge? Addressing the Persisting Crisis in the Federal Prison System,” namely the system’s ever escalating cost, which consumes a significant percent of DOJ’s budget, and safety and security issues stemming from chronic overcrowding.

Containing the Cost of the Federal Prison System

The costs to operate and maintain the federal prison system continue to grow, resulting in less funding being available for the Department’s other critical law enforcement missions. Although the size of the federal prison population decreased for the first time since 1980, from 219,298 inmates at the end of FY 2013 to 214,149 inmates at the end of FY 2014, and the Department now projects that the number of inmates will decrease by 10,000 in FY 2016, the downward trend has yet to result in a decrease in federal prison system costs. For example, in FY 2000, the budget for the Federal Bureau of Prisons (BOP) totaled $3.8 billion and accounted for about 18 percent of the Department’s discretionary budget. In comparison, in FY 2014, the BOP’s enacted budget totaled $6.9 billion and accounted for about 25 percent of the Department’s discretionary budget. During this same period, the rate of growth in the BOP’s budget was almost twice the rate of growth of the rest of the Department. The BOP currently has more employees than any other Department component, including the Federal Bureau of Investigation (FBI), and has the second largest budget of any Department component, trailing only the FBI.  The Department’s leadership has acknowledged the dangers the rising costs of the federal prison system present to the Department’s ability to fulfill its mission in other areas. Nevertheless, federal prison spending continues to impact the Department’s ability to make other public safety investments, as the Department’s FY 2015 budget request for the BOP is a 0.5 percent increase from the enacted FY 2014 level.

Our work has identified several funding categories where rising prison costs will present particularly significant challenges in future years. For example, inmate healthcare costs constitute a rapidly growing portion of the federal prison system budget. According to BOP data, the cost for providing healthcare services to inmates increased 55 percent from FY 2006 to FY 2013. The BOP spent over $1 billion on inmate healthcare services in FY 2013, which nearly equaled the entire budget of the U.S. Marshals Service (USMS) or the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). The rapid increase in inmate healthcare costs can partly be attributed to the growth of the aging inmate population. From FY 2009 to FY 2013, the population of sentenced inmates age 50 and over in BOP-managed facilities increased 25 percent, while the population of sentenced inmates under the age of 30 decreased by 16 percent. The growth in the aging inmate population has significant budgetary implications for the Department because, according to studies cited by the National Institute of Corrections in a 2004 report, older inmates generally cost more than their younger counterparts to incarcerate. BOP data indicates that aging inmates account for about 19 percent of the total current population in BOP-managed facilities and 31 percent of inmates housed in BOP medical centers. In 2013, the average cost of incarcerating an inmate in a BOP medical center was $58,956 compared to $27,549 for inmates in the general population. The Office of the Inspector General (OIG) is completing a review of the impact of the BOP’s aging inmate population on inmate and custody management, including inmate programs and activities, housing, and costs.

The cost of prescription drugs is also driving BOP’s healthcare costs. New prescription drug treatments, particularly for chronic hepatitis C (HCV), could exponentially increase costs in the coming years. The BOP currently spends $6,600 per patient for a standard HCV treatment regimen. However, the treatment regimen newly approved by the Food and Drug Administration could cost an additional $20,000 to $40,000 per patient, according to BOP estimates. In 2014, the BOP estimated that at least 11,000 of its inmates have HCV, meaning that the BOP could face additional costs for these patients of approximately $220 million to $440 million. The BOP recently issued interim guidance on the implementation and management of HCV treatments. The OIG continues to monitor the effects of rising healthcare costs.

Given this crisis in the prison system, the Department needs to better utilize programs that can assist in prison population management, particularly existing programs and policies that Congress has already authorized. The OIG found in its 2013 review of the BOP’s Compassionate Release Program that the program was not well-run and that an effectively managed program could assist the BOP with its prison capacity issues, which would result in cost savings for the BOP. Following our review, the BOP expanded its Compassionate Release Program to include criteria for elderly inmates with and without medical conditions. Similarly, in our 2011 review of the Department’s International Prisoner Transfer Program, which permits certain foreign national inmates from treaty nations to serve the remainder of their sentences in their home countries, the OIG found that the Department rejected 97 percent of transfer requests by foreign national inmates, and that in FY 2010 few foreign inmates were transferred back to their home countries. Following our review, the BOP took steps to ensure that the treaty transfer program was communicated more effectively to inmates. According to recent BOP data, the number of inmates requesting transfer has increased significantly; however, the number of foreign inmates ultimately transferred to their home countries remains stagnant. The OIG anticipates completing its follow-up review of the treaty transfer program this fiscal year, and plans to report on whether there is additional progress that can be made to reduce prisoner numbers and costs in this area.

Separately, the Department has recently announced initiatives and changes in prosecution, sentencing, and early release policies that could reduce federal prison costs. These proposed policies target inmates sentenced for drug offenses, a group that accounts for more than half of the current federal prison population. The Department’s FY 2015 budget request includes $173 million to support the Smart on Crime initiative, which the Department indicates is intended to promote prevention and reentry programs, such as drug courts and veterans courts as alternatives to incarceration, and encourages prosecutors to draft criminal charges for low-level nonviolent drug offenders in ways that will not trigger mandatory minimum sentences. Further, in April 2014, the Department announced a clemency initiative for prisoners already serving long sentences for low-level, non-violent drug offenses.

The Department also has indicated its support for programs that provide alternatives to incarceration, coupled with treatment and supervision, in an attempt to reduce recidivism. In an August 2013 speech, the Attorney General identified state-sponsored initiatives that he said served as effective alternatives to incarceration by providing offenders the treatment and supervision designed to reduce recidivism while also reducing states’ prison populations. The Attorney General also instructed all U.S. Attorneys’ Offices (USAOs) to designate a Prevention and Reentry Coordinator in their respective Districts to expand on existing programs that promote the implementation of the Smart on Crime initiative. The OIG is currently conducting an audit that will evaluate the design and implementation of pre-trial diversion and drug court programs, variances in the usage of the programs among the USAOs, and costs savings associated with successful program participants.

Improving Prison Safety and Security

At the same time it focuses on prison costs, the Department must continue its efforts to ensure the safety and security of staff and inmates in federal prison and detention facilities. Prison overcrowding presents the most significant threat to the safety and security of BOP staff and inmates. In its FY 2013 Agency Financial Report, the Department once again identified prison overcrowding as a programmatic material weakness, as it has done in every such report since FY 2006. Yet, the federal prisons remain almost as crowded today as they were in FY 2006. As of June 2014, federal prisons operated at 33 percent overcapacity, with 42 percent overcrowding at higher security facilities and 40 percent at medium security facilities. Overcrowding in the federal prison system has prevented the BOP from reducing its inmate-to-correctional officer ratio, which according to the Congressional Research Service has remained at approximately 10-to-1 for more than a decade. The Department’s FY 2014-2018 strategic plan includes an outcome goal to reduce system-wide crowding in federal prisons to 15 percent by FY 2018. However, as of June 2014, the BOP’s Long Range Capacity Plan projects prison overcrowding to be 38 percent by FY 2018, higher than it is today. To reach the long-term outcome goal in the strategic plan, without expending additional funds to build more federal prison space or to contract for additional non-federal bed space, the Department would have to achieve a net reduction of about 23,400 federal prisoners from the June 2014 prison population, based on the existing bed space available within the federal prison facilities.

The safe and secure incarceration of federal inmates not only applies to BOP-managed facilities, but also extends to privately managed BOP contract facilities. Effective oversight of these facilities is critical since the proportion of inmates housed in contract facilities has increased substantially, from 2 percent of the prison population in 1980 to 19.5 percent in 2013. Riots in two privately managed BOP contract facilities, one in Texas in 2009 and the other in Mississippi in 2012, resulted in the death of a correctional officer, severe injuries to prisoners and employees, and over $60 million in property damage. The causes of both incidents have been at least partially attributed to prisoners’ reactions to their perceptions of inadequate medical conditions and mistreatment at the facilities. The OIG is examining how the BOP manages its private contract prisons, whether the three contract prisons we are reviewing meet BOP and other safety and security requirements and how contract facilities compare with similar BOP facilities in terms of inmate safety and security. The use of segregated housing in private contract facilities and federal prisons also raises inmate safety and security concerns. In 2013, the BOP agreed to have an independent assessment conducted on its use of segregated housing. The OIG awaits the results of the report, and will continue to monitor the BOP’s management of restrictive housing operations.

Sexual abuse in prison also remains a serious safety and security issue for the Department. In May 2014, the Department estimated that four percent of state and federal prison inmates reported experiencing one or more incidents of sexual victimization by another inmate or a facility staff member within the previous 12 months. The Prison Rape Elimination Act of 2003 (PREA) expanded the Department’s responsibility to prevent the sexual abuse of inmates in BOP facilities and detainees in the custody of the USMS. The OIG recently completed a review of the Department’s efforts to implement and comply with PREA since the Department’s 2012 publication of the National Standards to Prevent, Detect, and Respond to Prison Rape (standards), which apply to all federal, state, and local confinement facilities. The OIG found that while the Department has made progress complying with the standards during the early period of implementation, significant work remains. For example, the Department does not have an effective mechanism in place to ensure compliance with the provisions of the standards that place obligations on the Department’s law enforcement components that investigate sexual abuse in confinement settings. Consistent with those standards, all OIG investigators responsible for investigating sexual abuse allegations completed training earlier this year. The OIG will continue its longstanding efforts to investigate allegations of sexual abuse in federal prisons and detention facilities, work that has resulted in numerous criminal convictions and administrative actions by the BOP and the USMS.

The introduction of weapons and contraband, such as drugs, cell phones, and tobacco, into correctional facilities also presents considerable safety and security concerns. The OIG released an audit in June 2014 that assessed the usage and effectiveness of 65 x-ray machines purchased by the BOP for approximately $4 million following an attempted smuggling incident at the Federal Correctional Complex in Pollock, Louisiana. Our audit found that the machines were not effective for screening certain commodities commonly received by institution warehouses, and that prior to the audit the BOP had no policy guidance outlining the x-ray machines’ limitations on effectively scanning dense items. In response to an OIG memorandum, the BOP issued guidance to ensure consistent application of all critical security and operational procedures for the use of x-ray machines at all BOP institutions that have received the equipment.

The unauthorized use of cell phones in prisons and detention facilities has proven to be a significant danger, and presents an increasing threat to the safety of the public as well as BOP staff and inmates. According to a 2011 Government Accountability Office (GAO) report, the number of cell phones BOP confiscated at federal prisons increased from 1,774 in 2008 to 3,684 in 2010. BOP officials reported that contraband cell phone use can threaten the security of prisons and expand criminal activity both inside and outside of prisons. For example, in January 2011 an inmate at a federal institution was sentenced to an additional 14 years in prison for running an identity-theft ring using a contraband cell phone, resulting in over $254,000 in fraudulent purchases. In September 2014, five correctional officers from the Baltimore City Detention Center, which is a state operated facility that also houses federal inmates under a contract with the USMS, pled guilty to participating in a 2-year racketeering conspiracy that included the smuggling of drugs and contraband, including cell phones, for further distribution by inmates who were active gang members. The OIG will continue to monitor cell phone interdiction efforts by the states and the BOP. In July 2013, the BOP released new staff entrance and search procedures, which authorized random pat searches of staff and in September 2014 the BOP announced a pilot program to use Millimeter Wave Scanners (similar to those used in airports) for contraband detection at six institutions. The OIG continues to monitor the BOP’s compliance with a 2003 OIG recommendation regarding the searching of staff and their property when entering BOP institutions. In October 2014, the OIG initiated a review of the BOP’s contraband interdiction efforts, including staff and visitor searches as well as physical security measures. That review will also examine state prisons’ contraband interdiction practices.

Addressing the challenge of ensuring the safety and security of correctional officers and federal inmates will require the BOP to take several actions. First and foremost, the BOP must pursue strategies to reduce prison overcrowding. It must also provide effective oversight of privately managed contract prison facilities, reduce the incidence of inmate sexual abuse, and prevent the smuggling of weapons and contraband into prison.

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