CoreCivic Inc

Stock Symbols
NYSE
:
CXW
company headquarters
USA
ISSUES

The world’s largest private prison corporation. Owns and manages over 100 correctional, detention, and other residential reentry facilities. Provides the government with other services as part of the criminal punishment system.

CoreCivic, Inc., formerly known as Corrections Corporation of America or CCA, is the largest private prison corporation in the United States. Founded in 1983, CoreCivic was the first company to design, build, and operate both a private prison and a private immigrant detention center. As of December 2018, CoreCivic owns and manages 77 correctional, detention, and residential reentry facilities. In total, these 77 facilities have a capacity of 78,000 beds across 19 states. CoreCivic also estimates that it owns 59 percent of all privately owned prison beds, manages 39 percent of all private prison beds, and is the second-largest community corrections service provider in the United States. CoreCivic is the largest owner of private real estate used by the US government.

In 2018, CoreCivic reported $1.83 billion in revenue.  Almost half of CoreCivic’s revenue is derived from federal contracts with US Immigrant and Customs Enforcement (ICE), US Marshals, and the Bureau of Prisons (BOP). In March 2019, ICE contracts accounted for 27 percent of CoreCivic’s total revenue, an increase from 13 percent in 2014.

Private Prisons

While private prisons companies claim to lower the national recidivism rate through correctional services, these companies’ profit model creates a perverse incentive to keep as many people in custody for as long as possible, in order to maximize revenues. The profit model of private facilities works further against the social goals of rehabilitation because it is driven by the incentive to cut costs, which leads to inadequate staff training, a high turnaround for guards, and poor services.

The conditions at CoreCivic’s Trousdale Turner Correctional Center in Hartsville, Tennessee have called attention to the counterproductivity of privatized prisons. Since 2016, when the facility became operational, there have been concerns around inadequate staffing, excessive use of force, and solitary confinement. After only four months of operation, the state stopped sending prisoners to the new facility. In January 2017, a lawsuit against CoreCivic alleged that understaffing at the facility had led to insufficient care for about 60 diabetic people.

The Trousdale correctional facility is only one of many CoreCivic private prison facilities that have faced public scrutiny. In 2010, an Associated Press report revealed that the company’s Idaho Correctional Center had more assaults than all other Idaho prisons combined. It was dubbed the “Gladiator School” after video footage showed an incarcerated person being severely beaten by another incarcerated person, pleading for help as company guards looked on. In 2012, incarcerated people filed suit against CoreCivic for deliberately understaffing the facility. The judge found CoreCivic guilty of understaffing but was not forced to pay for damages. In 2014, CoreCivic lost its $30 million contract for the prison.

In 2013, the Texas Observer called the CoreCivic-run Dawson State Jail “the worst state jail in Texas.” Between 2004 and 2013, seven incarcerated people died due to medical neglect and malpractice. One prisoner gave birth to a premature baby at 26 weeks after CoreCivic guards ignored her cries for medical attention. The baby was delivered in a prison toilet with no medical attention and died four days later. In August 2013, the Texas Department of Criminal Justice closed the facility.

Immigrant Detention Centers

CoreCivic has been operating private immigrant detention facilities since the year it was founded in 1983. In fact, the company’s first privately operated facility was a motel converted into an immigrant detention center in Houston, Texas. As of March 2019, CoreCivic owns or manages 21 Immigration and Customs Enforcement (ICE) facilities with a combined detention capacity of 17,243.

The increasing number of immigrants detained by ICE has presented a substantial business opportunity for  CoreCivic. In 2019, the single largest source of revenue for CoreCivic was ICE contracts, accounting for 27 percent of total revenue. This is a sizeable increase in comparison to 2014, when ICE contracts accounted for only 14 percent of the company’s revenues. In May 2019, CoreCivic announced the reopening of two ICE detention facilities in Eden, Texas and Torrance County, New Mexico. In 2019, CoreCivic has expanded the capacity of its Otay Mesa detention facility in order to detain an additional 512 people there. When completed at the end of 2019, Otay Mesa will have a detention capacity of nearly 2,000.

CoreCivic also operates ICE’s South Texas Family Residential Center, in Dilley, TX. With a capacity to hold 2,400 people, it is ICE’s largest family detention center, representing over seventy percent of ICE’s total family detention capacity as of July 2019. After the Trump Administration declared its “zero-tolerance” immigration policy in April 2018, CoreCivic CEO Damon Hininger told shareholders, “this is probably the most robust kind of sales environment we’ve seen in probably 10 years”. Following the Family Separation Policy, CoreCivic stands to profit immensely from President Trump’s attempts to detain families together indefinitely while they await legal proceedings. In March 2019, Physicians for Human Rights reported that infants as young as 27 days old have been detained at the Dilley facility and have been denied medical care.

CoreCivic’s immigrant detention centers have faced public scrutiny for numerous human rights abuses, including medical neglect, sexual and physical assault against detainees, understaffing, and overcrowding. In February 2017, detainees at an ICE facility managed by CoreCivic went on a hunger strike to protest their detention and CoreCivic retaliated by locking them in solitary confinement. In 2017, a federal audit revealed that a CoreCivic immigrant detention center in Kansas lacked oversight and was severely understaffed. The audit concluded that this was also a problem at other CoreCivic detention facilities.  In September 2018, over one hundred detainees went on hunger strike in the company’s La Palma Correctional Facility in Eloy, AZ, demanding access to bathrooms, three meals a day, and an end to brutality and violence by CoreCivic employees. In March 2019, ICE was granted a court order to physically restrain and force-feed a detainee on hunger strike in the same CoreCivic facility. Forced feeding is considered a form of torture under the UN Convention Against Torture.

Corporate Influence and Lobbying

Through the for-profit model of private prisons, GEO and other private prison companies are incentivized to expand the carceral system by lobbying for more beds, harsher sentencing, and longer periods of “community” supervision. Private prison companies spend millions of dollars on lobbying and campaign contributions in order to encourage policy that favors higher rates of incarceration that benefits their profit-making. Since 1989, CoreCivic and The GEO Group (GEO) have spent over $10 million on political candidates and nearly $25 million on lobbying efforts to ensure that their prison beds are filled.

In 2005, alone, CoreCivic spent over three million dollars on lobbying. Between 2008 and 2010, CoreCivic, then CCA, spent $4.4 million lobbying the Department of Homeland Security, ICE, the Office of the Federal Detention Trustee, the Office of Budget Management, the Bureau of Prisons, and both houses of Congress. In 2016, CoreCivic, Inc. spent over one million dollars on lobbying Congress, the Department of Homeland Security, the U.S. Marshals Service, the Federal Bureau of Prisons, the Department of State. CoreCivic has lobbied on matters of budgetary appropriations for prison and detention center contracts, immigration reform, and the Private Prison Information Act - a bill that would require private prisons to make available the same information as federal prisons. CoreCivic donated $250,000 to President Trump’s inaugural fund.

CoreCivic has also been a longtime member and financial supporter of the American Legislative Exchange Council (ALEC), a business-backed group that authors pro-incarceration state legislation for coCongressALEC is known for its role in the rapid growth of mass incarceration in the 1980s and 1990s, and more recently, its role in expanding prison labor. For this reason, a company’s ALEC affiliation is often enough reason for activists to target the company with demands for divestment from the prison industrial complex. In 2010, it was reported that ALEC had arranged secret meetings with Arizona state legislator’s and CoreCivic, then CCA, to draft Arizona’s anti-immigrant law.

Facility Financing, Construction, and Ownership

In January 2013, CoreCivic converted to a Real Estate Investment Trust (REIT). Although CoreCivic’s primary form of business is operating prisons, the prisons themselves are considered real estate. There are special tax advantages for REITs, which generally pay no income tax.

According to a 2018 report published by In the Public Interest, CoreCivic has been actively pushing governments to consider private financing of new facilities. REITs mark a shift into an ownership and maintenance model designed to increase the real estate business side of the company, which is more profitable than managed-only contracts. For instance, in 2017, CoreCivic made six times the profit from owning and managing its facilities as opposed to only managing. However, this has serious potential implications for policy making: private prison construction deals perpetuate mass incarceration, result in higher financing costs for the public, and often neglect standards for facility maintenance.

CoreCivic’s contract with the Trousdale County to finance and construct the Trousdale Turner Correctional Center in Hartsville, Tennessee is an example of the fully privatized finance model, whereby the private company designs, builds, finances, operates, and maintains the facility. Once completed, the company will own the facility. The government will pay the company according to a previously decided number of prisoners for a specified amount of time. CoreCivic invested approximately $144 million in constructing the Trousdale correctional facility and finished construction in 2015. In turn, the company stands to collect $276 million from the state over a five-year period. A similar contract was awarded to CoreCivic in November 2017 by the Kansas Department of Corrections (KDOC) to design, finance, build, and manage a new facility in Lansing. KDOC will operate the private facility, and at the end of the 20-year contract term, the prison will transfer ownership to the state.

Community Correctional Services

As of 2018, CoreCivic is one of the largest community corrections owner and operator in the United States, second to The GEO Group. The company began expanding into the community correctional services in 2013, through the acquisition of Correctional Alternatives, Inc. (CAI). At the time, CAI provided work furloughs, residential reentry programs, and home confinement. In 2015 and 2016, CoreCivic continued expanding into the sector, acquiring Avalon Correctional Services, Inc. and Correctional Management, Inc. (CMI), and purchasing four community correctional facilities from Community Education Centers. In 2016, CoreCivic generated a total revenue of $41.5 million from its acquisitions of Avalon and CMI. As of December 2018, CoreCivic owns and manages 26 community correctional facilities.

CoreCivic’s reentry facilities have a documented history of abuse, neglect, and mismanagement. In 2016, at Tulsa Transitional Center, which houses 390 men, an incarcerated person was found unresponsive and was later pronounced dead at the facility. Turley Residential Center, which houses 289 women, faced criticism in 2013, when a report revealed inappropriate relationships between staff and incarcerated people and unreported sexual abuse. In 2018, the family of a woman who died while detained in a CoreCivic Center sued the private prison company.

As a wholly-owned subsidiary of CoreCivic, Avalon Corrections represents a significant part of CoreCivic’s reentry facilities and programs. In 2015, CoreCivic acquired Avalon for $157.5 million. As of 2018, CoreCivic’s Avalon subsidiaries manage 12 facilities with over 3,000 beds in Oklahoma, Texas, and Wyoming. The company generates its revenue from direct payments and fees collected from incarcerated individuals and from contracts providing services that were previously provided for by the government or non-profit organizations. 

Residents in Avalon facilities are required to find employment in the local community and are restricted to night curfews. In certain states, such as Oklahoma, residents’ income from such work is used to pay Avalon. If residents are unable to pay because they could not find or keep a job, they are sent back to state prison. This arrangement, by which residents are expected to pay for their stay at Avalon’s halfway homes creates an exploitative and unsafe environment for those in Avalon’s care.

Since 2008, allegations have surfaced in other states, including insufficient security, unqualified staff, falsified drug tests, sexual relations between staff and prisoners, and inadequate record-keeping. At one Avalon-run women’s facility in Oklahoma, Avalon administrators repeatedly ignored reports of abuse and sexual harassment in order to keep the women at the facility. The women were repeatedly threatened with being returned to prison or charged with misconduct for speaking out. As a result, 50 women filed suit against Avalon in 2014. As the suit progresses, more women have come forward with similar stories, and investigators have uncovered incidents of “inappropriate staff/offender relationships.” At the same Oklahoma women’s facility, a woman’s family filed a lawsuit in 2014 after Avalon staff denied her medical care, resulting in her death the next day. Before this incident, Avalon had previously abandoned its non-correctional care facilities, including elderly care, in part due to patient deaths.

These are not the first reports of sexual assault by Avalon employees with convictions dating as far back as 2002. In 2003, former Avalon employees sued both the company and Colorado officials, alleging that state officials had refused to investigate problems that included inappropriate sexual relations between staff and incarcerated persons, drugs, broken or missing security equipment, and billing for services not actually rendered. Colorado later canceled all of its contracts with Avalon. In 2014, Avalon Tulsa residents sued the company alleging that staff members were involved in drug sales among residents and guards, falsified drug tests, extortion, gambling activity, and fights between residents as a form of punishment.

Local investigators have criticized Avalon’s practice of underreporting and hiding resident conduct violations, including escape and rampant drug use. After a surprise visit from the Department of Corrections, nearly half of all residents at Avalon’s Tulsa center tested positive for drugs. Avalon had either ignored or downgraded these problems in order to keep its government contracts. In 2014, Oklahoma state officials shut down one of its facilities, and issued a corrective plan for another due to Avalon’s reporting problems.

Avalon has been subjected to press scrutiny and litigation following numerous reports of escapes and improper treatment of facility residents. Resident escapes from Avalon halfway houses have been reported in local media, including two escapes in 2015 from a Texas men’s facility. Investigations also revealed that almost 30% of residents had escape-related violations.

E-Carceration

In line with CoreCivic’s diversification into community “correctional services”, the company acquired Colorado-based Rocky Mountain Offender Management Systems (RMOMS), LLC in January 2018. As of June 2018, CoreCivic operates electronic monitoring contracts through RMOMS with over 155 government agencies across eight states.

In December 2018, CoreCivic completed the acquisition of Recovery Monitoring Solutions Corp for $15.9 million. This represents CoreCivic’s second acquisition of an electronic monitoring company. Recovery Monitoring Solutions holds contracts with municipal, county, and state government agencies in Texas, Oklahoma, Iowa, and Minnesota.

Prison and Detention Transportation services

CoreCivic owns a subsidiary called TransCor America, LLC, which claims to be the largest detainee and prisoner transportation company in the US. In 2017, TransCor generated $2.3 million, a decrease from 2016 and 2015 revenue of $2.6 million and $4.1 million, respectively. The prison transportation sector has faced criticism because of abuse that is rampant within transit. TransCor is paid per prisoner per mile, and therefore overcrowds the vans, limits food and water intake, and does not allow for bathroom breaks.

Economic Activism Highlights
  • In October 2019, the California Public Employees' Retirement System (CalPERS), the largest pension fund in the U.S., announced that it will sell its stocks of private prison companies GEO Group and CoreCivic.
  • In August 2019, PNC Bank became the seventh major bank to announce that it would not no longer finance private prisons and immigrant detention centers, including private prison companies CoreCivic and GEO Group.
  • On August 6, 2019 the Denver City Council voted to not renew future contracts with private prison companies CoreCivic and GEO Group to operate halfway houses in the city. The future contracts were directed to community corrections facilty operations and would have been worth $10.6 million.
  • On July 31, 2019, Barclays PLC announced that it will stop providing future financing to companies that manage private prisons and immigration holding facilities, joining other major lenders in shunning the industry. 
  • On July 15, 2019, Fifth Third Bank became the sixth major bank to announce that it would not provide future financing to companies that manage private prisons and immigration holding facilities, including CoreCivic. The decision came at the heels of SunTrust Bank and BNP Paribas' decisions to end future financing of private prison companies. 
  • On July 12, 2019, BNP Paribas announced it will no longer provide future financing for US private prison operators including CoreCivic. BNP Paribas became the fifth major bank and first foreign bank to distance itself from the industry, announcing the decision only days after SunTrust Bank's decision to end future financing of the private prison industry.
  • On July 8, 2019, SunTrust Bank, the fourth largest bank in the U.S., announced that "Following an ongoing and deliberate process, SunTrust has decided not to provide future financing to companies that manage private prisons and immigration holding facilities." SunTrust will maintain its contractual obligations with CoreCivic until 2023. SunTrust's decision follows three other major US banks deciding to end future contractual relations with CoreCivic and GEO Group.
  • On July 5, 2019, it was revealed that the Canadian Pension Plan Investment Board (CPPIB) which manages $299 billion USD in pension funds, has quietly removed CoreCivic and GEO Group from its list of foreign public equity holdings. In December 2018, the CPPIB held nearly $8 million USD in GEO Group and CoreCivic stock. Federal MP Charlie Angus argued that public pressure convinced the CPPIB to drop its holdings. Advocacy groups SumOfUs and LeadNow collected more than 55,000 signatures calling CPPIB to divest GEO Group and CoreCivic.
  • On March 5th, 2019 JPMorgan announced that it would no longer finance private operators of prisons and detention centers, citing the bank's ongoing evaluations of the costs and benefits of serving different industries.
  • On December 31, 2018, Wells Fargo's Annual Business Standards Report described how as part of the company's environmental and social due diligence, its "credit exposure to private prison companies has significantly decreased and is expected to continue to decline." On March 12, 2019, Wells Fargo CEO Timothy Sloan declared that the bank decided two years ago to end its business relationships with CoreCivic. A bank's spokesperson later confirmed that Wells Fargo had "cut ties" with CoreCivic.
  • On November 7, 2018, the Teachers’ Retirement Board of the California State Teachers’ Retirement System voted to direct investment staff to remove the Fund’s holdings in the two U.S. publicly-held companies that operate private prisons: CoreCivic and GEO Group.
  • On July 17, 2018, the Metro Nashville City Council voted to pass a resolution to not invest or contribute to any private company going forward. The resolution specifically targeted CoreCivic.
  • On July 13, 2018, New York State announced that it will fully divest from private prisons and private immigrant detention center corporations, becoming the first in the country to eliminate private prison stock holdings in CoreCivic and GEO Group. The campaign was led by Make the Road New York with the support of Enlace.
  • On October 26, 2017, the Philadelphia Board of Pensions and Retirement divested $1.2 million from private prison companies, including The GEO Group, Inc., CoreCivic, Inc., and G4S plc. 
  • In August 2017, Cincinnati City Council proposed divesting $2.5 million from companies involved in private prisons, stating that the city "should not support an 'immoral' system." The companies the city is proposing to divest from include G4S, CoreCivic, and the GEO Group.
  • On June 8, 2017, New York City's pension funds divested $48 million from private prison companies, including CoreCivic, Inc.
  • On January 29, 2017, the University of California decided to terminate $150 million worth of contracts and a $300 million line of credit with Wells Fargo, after previously terminating $25 million commercial paper contract with the bank on November 2016. The decision was the result of protests by the Afrikan Black Coalition and the Prison Divestment Campaign.
  • On February 25, 2016, University of California Davis ASUCD passed prison divestment resolution that urges “both the Board of Regents of the University of California (UC Regents) and the ASUCD to undertake practices of corporate social responsibility by divesting in corporations which are directly and indirectly involved in the private prison industry,” including CoreCivic, The Geo Group, Inc., and Wells Fargo. 
  • On February 22, 2016, the city of Portland’s Social Responsible Investments Committee unanimously voted to recommend to the city to divest from Wells Fargo & Company for its ties to private-prison companies, such as CoreCivic. 
  • On February 10, 2016, California State University, Los Angeles administrators have agreed to divest from private prison companies, including CoreCivic, after pressure from CSULA Black Student Union.
  • In December 2015, University of California Chief Investment Officer announced that the UC endowment, covering 10 campuses across the state, divested from private prisons, including CoreCivic. 
  • In December 2015, the California Endowment divested its holdings from "companies that derive significant annual revenue from private prison services," including CoreCivic. 
  • In October of 2015, the FCC passed new rules regarding the cost of local and long distant calls, it eliminates or limits exorbitant fees commonly tacked on by providers, such as CoreCivic. 
  • In July 2014, Columbia University divested from CoreCivic after a student lead campaign. The decision also prohibits any future investment in the prison industry. 
  • In April 2014, three investors, Scopia Capital, DSM, and Amica Mutual Insurance all pledged to remove their collective investments of about $60,000,000 from the CoreCivic and The GEO Group, Inc. DSM President Hugh Welsh explained, “In accordance with the principles of the UN Global Compact, with respect to the protection of internationally proclaimed human rights, the pension fund has divested from the for-profit prison industry.” 
  • In December of 2013, Systematic Financial Management divested 2,754,722 shares of CoreCivic stock, thereby exiting from the private prison industry completely. Systematic Financial Management is an investment company that manages over $13 billion in investments for local governments, retirement funds, corporations, wealthy individuals, and unions.
  • In 2012, the United Methodist Church voted to permanently divest its shares in CoreCivic and simultaneously moved to institute a screen against future investment in any prison-related industry.
  • In 2012, General Electric divested 2.7 million shares in CoreCivic
  • In 2011, Pershing Square Capital Management fully divested its CoreCivic holdings of over 7 million shares worth $180 million 
  • In 2007, Farallon, the hedge fund responsible for managing Yale University's endowment, sold its entire $90 million stock in CoreCivic, including Yale's $1.5 million stock in the company. The decision followed a concerted campaign by Yale's Graduate Employees and Students Organization against CoreCivic, supported by teachers and students at eight other universities managed by Farallon.
  • In 2001, a student campaign resulted in six US universities (American University, SUNY-Albany, Goucher College, Evergreen State, James Madison University, and Oberlin) dropping their contracts with Sodexo SA due to the company's investment and close relationship with CoreCivic. The loss of contracts caused Sodexo to sell all of its shares in CoreCivico, and CoreCivic's president also resigned from Sodexo's board of directors. 
This profile was last updated on
19 July 2019