LOUISVILLE, Ky. (AP) -- Stepping out of the private prison business for the first time in three decades, Kentucky announced Tuesday is not renewing a contract with private prison giant Corrections Corporation of America for an 826-bed facility in the central part of the state.
The decision means almost 800 state inmates at the Marion Adjustment Center in St. Mary in Marion County will be moved to other state prisons, county jails or half-way houses. The contract with the Nashville, Tenn.-based company expires Sunday. The state will have 120 days to move all inmates to other facilities.
Kentucky officials estimated that the state can save of $1.5 million to $2.5 million per year by not renewing the contract.
A spokesman for the Kentucky Justice and Public Safety Cabinet said the inmates will be evaluated and sent to an appropriate facility, depending upon their needs and where beds are available.
"They'll go to one of our facilities or to county jails or half-way houses," Brislin said.
The move is the latest in a series since 2008. At that point, Kentucky had inmates in three prisons run by CCA. The state in 2010 pulled out of Lee Adjustment Center in Beattyville, an 800-bed facility that houses inmates from Vermont, and in 2012 from Otter Creek Correctional Center, a 600-bed facility in Wheelwright in far eastern Kentucky that's currently vacant.
A spokesman for CCA, Steve Owen, called the move "disappointing."
He said the company had no indication the state was making the move and "made every effort" to meet cost-savings measures. Right now, the priority was the 166 employees, he said.
Justice and Public Safety Secretary J. Michael Brown said policy changes enacted in the 2011 legislative session, which included changes in the drug laws, reduced prison time for low-risk, nonviolent drug criminals caught with small amounts of drugs.
Marion Adjustment Center currently houses 794 inmates. Brown and Brislin said inmates currently enrolled in substance abuse programs will either complete the program before being transferred or will be placed in a similar program elsewhere to continue treatment.
"One of the major considerations in making this decision was whether we could continue to meet the treatment needs of inmates struggling with substance abuse issues, and that has been assured," Brown said.
CCA owns the facility, which opened in 1980. The company will determine what will become of the employees working there. Brislin said the state will offer assistance as needed.
"It's just to help with applications and the like," Brislin said. "Obviously, that doesn't guarantee a job."
Kentucky paid CCA $21 million in fiscal 2010 to operate Otter Creek, along with the Marion Adjustment Center and Lee Adjustment Center.
Kentucky has run into issues with CCA facilities in the past. Gov. Steve Beshear ordered all female inmates transferred from Otter Creek in 2010 after a sex scandal involving guards and allegations of sexual abuse of inmates at the facility. The state transferred 400 female inmates to Western Kentucky Correctional Complex in Fredonia and moved men into Otter Creek.
Hawaii also removed 168 female inmates in 2009, sending them to a prison in Arizona. Multiple lawsuits were filed over the sex accusations. Most were dismissed.
Inmates at Lee Adjustment Center rioted in 2004 after allegations of inmate abuse and mistreatment increased and visits from friends and family were cut back.
And, CCA is being sued by a group of shift supervisors Marion Adjustment Center who allege the company forced them to work extra hours and denied them overtime.
CCA has denied the allegations. The lawsuit is pending in federal court in Louisville.
"For nearly 15 years, CCA's dedicated professionals at MAC have provided safe, secure housing and meaningful recidivism-reducing programs to inmates at a significant cost savings to taxpayers," the CCA statement said.
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