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McLennan County private jail deal creates perverse incentives

After high interest rates had earlier caused delays, the McLennan County Commissioners Court this week approved issuing bonds to construct a new jail that will be operated by a private contractor, the Waco Tribune Herald reports ("McLennan County Commissioners Court approves bond sale for new jail," Nov. 26), but there's a hitch:?This will work out as long as the jail is full or has adequate number of inmates in the jail, which is the case now and in the short term,? [County Treasurer Bill] Helton said. ?My concern is 10 years down the line, if the jail population were to decrease and there are not enough inmates in the jail to produce revenue to cover the costs, what happens to the county?s bond rating and credit worthiness if they were to default on the payments??That's an excellent question and depending on unpredictable things like the economy, the Legislature, and even national immigration policy, it could become an issue sooner than ten years from now...continue to full post

Full post as published by Grits for Breakfast on November 26, 2008 (boomark / email).