SOURCE: Corrections Corporation of America
NASHVILLE, TN--(Marketwired - Jun 12, 2013) - CCA (NYSE: CXW) (Corrections Corporation of America) announced today that the Texas Department of Criminal Justice (TDCJ) elected not to renew its contracts for the CCA owned and operated 2,103-bed Mineral Wells Pre-Parole Transfer Facility and the 2,216-bed Dawson State Jail, owned by the state of Texas but operated by CCA. The TDCJ was legislatively required to close two facilities due to budget reductions. As a result, in August 2013, upon expiration of the contracts, CCA will cease operations of the Dawson facility and will idle the Mineral Wells facility.
Additionally, CCA announced it was not selected for the continued management of the 1,000-bed Wilkinson County Correctional Facility owned by the state of Mississippi. CCA will cease operations of the Wilkinson facility at the end of June 2013, upon expiration of the contract. The Wilkinson facility was operating at a loss.
CCA previously disclosed that it could lose the contracts for the continued management of these facilities, and its 2013 guidance is not affected by the loss of these contracts. Guidance does not include goodwill or other charges associated with the closure of these facilities. CCA expects to report such charges totaling approximately $3.5 million during the second quarter of 2013.
CCA is the nation's largest owner of partnership correction and detention facilities and one of the largest prison operators in the United States, behind only the federal government and three states. We currently operate 67 facilities, including 51 facilities that we own or control, with a total design capacity of approximately 92,500 beds in 20 states and the District of Columbia. CCA specializes in owning, operating and managing prisons and other correctional facilities and providing inmate residential services for governmental agencies. In addition to providing the fundamental residential services relating to inmates, our facilities offer a variety of rehabilitation and educational programs, including basic education, religious services, life skills and employment training and substance abuse treatment.
This press release contains statements as to the Company's beliefs and expectations of the outcome of future events that are forward-looking statements as defined within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. These include, but are not limited to, the risks and uncertainties associated with: (i) our ability to meet and maintain REIT qualification tests; (ii) general economic and market conditions, including the impact governmental budgets can have on our per diem rates, occupancy and overall utilization; (iii) the availability of debt and equity financing on terms that are favorable to us; (iv) fluctuations in our operating results because of, among other things, changes in occupancy levels, competition, increases in cost of operations, fluctuations in interest rates and risks of operations; (v) our ability to obtain and maintain correctional facility management contracts, including as a result of sufficient governmental appropriations and as a result of inmate disturbances; (vi) changes in the privatization of the corrections and detention industry, the public acceptance of our services, the timing of the opening of and demand for new prison facilities and the commencement of new management contracts; (vii) changes in government policy and in legislation and regulation of the corrections and detention industry, which may adversely affect our business, including the impact of the Budget Control Act of 2011 on federal corrections budgets, California's utilization of out of state private correctional capacity, and the impact of any changes to immigration reform laws; and (viii) increases in costs to construct or expand correctional facilities that exceed original estimates, or the inability to complete such projects on schedule as a result of various factors, many of which are beyond our control, such as weather, labor conditions and material shortages, resulting in increased construction costs.
CCA takes no responsibility for updating the information contained in this press release following the date hereof to reflect events or circumstances occurring after the date hereof or the occurrence of unanticipated events or for any changes or modifications made to this press release.