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The Budget

Budget does not Include Private Prisons in Michigan

After a steady decline in prisoners in Michigan’s prison systems since 2007, the number has increased by about 1,000 this year. Russ Marlan, spokesperson for the Department of Corrections (DOC), attributes nearly all of the increase to parole violators. The prison population as of May 4, 2012 was 43,801; the population in March 2007 was 51,554 prisoners.

As for how the state will be affected by this increase with the recent DOC budget cut, Sen. John Proos (R-St. Joseph), chair of the Senate Appropriations DOC Subcommittee, says that since the State did not see much savings from a decrease in prisoner population over the last five years, the budget has room to absorb the 1,000 extra prisoners. The DOC budget has stayed at about $2 billion for several years.

As far as specific changes to the DOC budget, please note: This year’s budget does not include privatizing any of Michigan’s prisons, an idea that has been frequently visited this legislative session. Unions, House Republicans, and the Governor all had issues with closing the Ionia prisons and taking a privatization route instead. The budget does stipulate, however, cutting costs at several DOC run facilities, as well as the closure of Mound prison and the elimination of 115 vacant field operations positions.

The DOC will cut $25 million out of its budget by cutting out overtime costs by using retirees on a part-time basis. The Department will also reclassify positions: assistant resident supervisors will become prison counselors, field service agents will become parole supervision assistants, and resident unit officers will become corrections officers.

Department of Corrections Budget- Items of Interest

Appropriations Changes from 2011-2012

Prison and Re-Entry Center Restructuring Conference increases funding by $10.8 million to implement a planned MDOC restructuring of current prison and re-entry facilities. Ryan Correctional Facility would be re-purposed as the Detroit Reentry Center to house parolees and parole violators, while a similar Tuscola County re-entry facility will be closed. In addition, to maintain prison bed space, the Muskegon Correctional Facility will be reopened. Overall, the changes add 290 regular prison beds and 884 re-entry beds to the system. Funding impacts are summarized below:

Funding Change
Convert Ryan to re-entry center (117.4) ($11,799,000)
Close Tuscola re-entry center (34.0)  ($3,849,000)
Re-open Muskegon prison 209.4 $22,948,000
Food service/transportation/health care  26.0 $3,500,000






  • Reclassification of Resident Unit Officer Positions Conference recognizes $11.9 million in GF/GP savings related to the recent reclassification of 10-level resident unit officers back to the 9-level corrections officer classification. The action reduces salary and retirement costs for over 2,400 MDOC employees that had been classified as resident unit or medical unit officers.
  • Prison Savings Facility and Regional Office Staffing Conference reduces budget by $7.2 million to recognize savings from proposed staffing changes in MDOC prisons and regional offices. Newberry Correctional Facility will be converted from a mixed Level I and II facility to a Secure Level I facility (reduction of 56.1 FTEs, $3.5 million GF/GP). Level IV housing at the Alger Correctional Facility will be converted to Level II (8.7 FTEs, $1.0 million GF/GP), and custody staffing efficiencies will be achieved at the Marquette Correctional Facility through the use of Level I prisoners within the prison kitchen (7.2 FTEs, $750,000 GF/GP). In addition, further staffing savings will be achieved in the Southern regional office (25 FTEs, $1.9 million GF/GP).
  • General Prison Operations Savings Conference reduces GF/GP authorization to each correctional facility line item by $80,400 and 1.0 FTE position from Executive-recommended levels, which equates to total savings of $2.3 million. Department would need to identify additional staffing reductions or operating efficiencies to achieve these savings. House had imposed 2% across-the-board savings totaling $20.1 million, while Senate had cut 580.0 FTE positions to achieve $58.8 million in GF/GP savings.
  • Other Prison Operation Savings Initiatives Conference recognizes savings from various other MDOC savings proposals, including $1.8 million in negotiated personnel contract savings, $2.0 million assumed from bidding out for linens and prisoner clothing and reducing Michigan State Industries laundry operations, $600,000 from converting to an electronic prison law library system, and $500,000 from converting Assistant Resident Unit Supervisor positions to Prisoner Counselor positions (with lower pay scale) upon new attrition.
  • Prison Savings - Staffing Reductions Eliminates a net 32.8 miscellaneous FTE positions across the state's prison facilities and within both regional administrative offices. Position adjustments are based on need, with some facilities gaining positions and others losing positions. Proposal results in total savings of $2.4 million GF/GP.
  • Field Operations Staff Reductions Conference includes $11.3 million GF/GP savings and reduction of 125.0 field operations staff positions related to supervision of parolees and probationers. Also includes additional savings of $1.0 million tied to the elimination of an additional 10 parole/probation agent positions and $280,000 related to the conversion of around 300 agent positions to parole supervision assistant positions.
  • Contingency Plan – Competitive Bidding of Prisoner Health Care and Mental Health Services Reduces funding by $10.1 million GF/GP in anticipation of savings to be achieved through competitive bidding of prisoner health care services and mental health services currently delivered by state employees along with the operations of the Woodland Center Correctional Facility, which houses MDOC prisoners with serious mental illness. While no specific FTE reduction is proposed, the plan could impact around 1,948 positions currently funded in the budget. Proposal was also included as part of MDOC’s FY 2011-12 contingency savings plan to achieve GF/GP savings in lieu of employee concessions.

Boilerplate Changes from 2011-2012

  • Management-to-Staff RatioREVISED Expresses legislative intent that Department maintain management-to-staff ratio of 1 supervisor to for each 5 employees at Lansing central office and regional administration offices. Conference concurs with Senate in revising to "not more than" 1 supervisor to for each 5 employees. (Sec. 239)
  • Facility Closure GuidelinesDELETED Establishes legislative intent that MDOC fully consider local economic impact when making determinations on facility closures and makes it a high priority to close a facility for which the local economic impact is minimized. (Sec. 935)
  • Cost Effectiveness of Correctional FacilitiesNEW Requires MDOC to evaluate facilities in terms of cost effectiveness and to make determinations as to how long each facility should remain open; requires analysis of economic impact of closing obsolete facilities and provides that Department shall work with Michigan Economic Development Corporation and other entities to encourage private sector investment in affected communities. (Sec. 935)
  • Competitive Bidding ProvisionsREVISED Requires competitive bidding for the privatization of the special alternative incarceration (SAI) facility at Camp Cassidy Lake. Conference modifies language to also require bidding of prison stores, food service, and up to 1,750 custody beds. (Sec. 939)

DHS Privatization in Michigan’s Future?

The finalized budget for FY 2012-13 call for the Maxey juvenile justice center and two similar facilities to remain open, although they will see a combined cut of about $2 million. The House-passed version of this budget had called for the closure of all three facilities. Additionally, all Kent County DHS operations (except child welfare workers) are to be privatized. A work group will be created whose goal it will be to strategize exactly how the privatization will be carried out when it goes into effect on September 30th, 2013.

Also in the Human Services budget is $250,000 for two pilot DHS offices to be opened. The offices will be focusing on an effort to improve the turnaround time for people applying for Medicaid. The Senate DHS Appropriations Subcommittee chair, Sen. Caswell (R-Hillsdale), said that if these offices provide marked improvements to the system, the pilot program will be expanded statewide, and if not, privatization may be the alternative.


Legislation Regarding Contracting with Private Prison Provider Still on House Floor


The House has yet to act on two bills (HB 5174, Rep. Jon Bumstead, R-Newaygo and HB 5177, Rep. Joe Haveman, R-Holland) that would allow the Department of Corrections to contract with the operator of the privately-owned correctional facility in Lake County—or any other public or private correctional facility providers—if the contract would result in an annual cost savings of at least 10%. The Senate has passed similar legislation (SB 877-8, Senator John Proos (R-St. Joseph). We continue to encourage contact with House members regarding the inherent problems with privatizing correctional services. Points you may wish to raise with your state representative include:

  • Is incarceration an appropriate role for government to farm out to the public sector or, given its role in regards to public safety and our justice system, one better performed by state agencies that are directly responsible to elected officials?
  • When the Geo Group (previously incorporated as the Wackenhut Corrections Corporation) previously ran the Lake County facility as the Michigan Youth Correctional Facility, the state’s auditor found that the facility’s daily cost of housing prisoners was higher than the comparable daily cost in 33 of the state’s 37 other facilities.

As far as privatizing an entire facility—our message should be: tried that, been there, it didn’t work! Urge your state representative to vote “NO” on all four of these bills: HB 5174 and 5177 and SB 877-8.

Prison Labor Bills Pass House

House Bill 5658 was introduced recently by Rep. Joe Haveman (R-Holland). The legislation would make it possible for inmates serving time in state, county or re-entry programs to be assigned work under private contractors. Prisoners could only work for these private contractors if they are producing goods used solely in state, county, or re-entry correctional facilities. The bill also stipulates that these prisoners can be paid a stipend and do not need to be paid minimum or prevailing wages- as current law requires for any inmate worker.

The Department of Corrections (DOC) budget for FY 2012-13 does leave open the possibility for competitive bidding, although there are currently no private contractors employing any Michigan prisoners. Rep. Stacy Erwin Oakes (D-Saginaw) raised some concerns in committee that this type of policy may end up replacing, in many situations, private contracted labor from prisoners with work currently being done by correctional officers and prison staff, which not only takes away jobs, but also puts quality of work into question.

Concerns have been raised about the safety precautions that would be neglected since private contractors do not have any training in the supervision of prisoners. In response to the negative reaction from Michigan unions regarding his bill, Rep. Haveman conceded that he expected as much, but that the bill is a way to create fair competitive bidding for the state in the years to come.

HB 5658 was voted out of the House Judiciary Committee and has passed the House with a 63-44 margin.

Ellen Hoekstra
Capitol Services