ICE needs expanded detention centers — who might profit?
The share prices for both companies have climbed nearly steadily for the past several days, though CoreCivic retreated a bit on Tuesday.
The ICE “request for information” (RFI) about procuring the additional beds is one way the government looks for potential contractors without soliciting formal bids. It was posted June 22 after President Donald Trump rescinded part of his own policy of separating migrant families at the Mexican border by signing an executive order after .
Here’s what you should know about ICE’s family detention centers and the two companies:
ICE has three family “residential centers”
They’re the Karnes County Residential Center and South Texas Family Residential Center, both in Texas, and the Berks Family Residential Center in Pennsylvania. Combined they have a total capacity of 3,326 beds, according to an April report from the U.S. Government Accountability Office.
Karnes, run by Geo Group, and South Texas, run by CoreCivic, were set up as family residential centers in 2014, according to ICE. Berks was set up in 2001 and is operated through Berks County, Pennsylvania. As of June 20, Karnes housed 589 people, South Texas held 1,978 and Berks had 56, according to ICE.
ICE budgeted $291.4 million for its family facilities in fiscal 2018, according to the GAO report.
ICE spokesman Matthew Bourke declined to comment in an email on what companies or vendors have responded to the agency’s request, but he said ICE will make an announcement when and if the agency decides to award a contract.
Will Geo Group and CoreCivic go for the business?
CoreCivic will review the RFI and “assess how best to respond to it. For obvious competitive reasons, we cannot elaborate beyond that,” spokesman Steven Owen said in an email. He noted that CoreCivic had contracted with the federal government for “more than 30 years, and we stand ready to understand and accommodate their changing needs.”
GEO also declined to comment on whether it’s participating in the RFI. “As a matter of long-standing policy, we are unable to comment on procurement processes,” spokesman Pablo Paez said in an emailed statement.
Why both companies could decline
ICE says it needs additional capacity at the detention centers because policy is shifting quickly, analysts from Height Capital wrote in a June 25 note. But that could be a detriment that prevents either CoreCivic or GEO from filling ICE’s gap in bed capacity.
“The current immigration policy that is generating the need for the beds could change in a month, a year, or with the next administration,” the analysts wrote. “If private prison operators rise to meet this demand and the policy changes, they could be left with unused, and therefore unprofitable, facilities. We believe private sector companies are not willing to bet on this uncertainty, leaving ICE with few, and likely very expensive, options.”
CoreCivic, for instance, is “looking for near-term opportunities that are more durable in nature than the current immigration situation,” the analysts wrote.
Other companies also provide services for detained children
Aand nonprofit groups are also earning to house migrant children separated from their parents. And that may continue to be the case, given that Mr. Trump’s June 22 order keeps in place key elements of his “zero tolerance” policy of prosecuting all illegal border crossings along the U.S.-Mexico border.