Michigan Mulls Privatization of Juvenile Justice

LANSING, Mich. — In an effort to make up a $2.8 billion shortfall in statewide revenue, Republican state legislators introduced a bill that would complete the privatization of Michigan’s juvenile justice system.
The long-term plan, which will be considered for the 2011 budget cycle in an effort to streamline government services and avoid statewide tax increases, would result in the state closing at least four high-security facilities and the estimated loss off 274 state employees.
“Overall, state employment might benefit because of the ramping up of the private industry,” says state Rep. John Proos (R-Berrien County). “There are some who say private providers might do just as good a job at less cost to taxpayers … or it could logically be one of the most costly efforts in privatization and might cost more in privatization use.”
Approximately 80 percent of Michigan’s juvenile justice system is already privatized. The remaining 20 percent consists of 200 beds statewide. With a current budget of $30 million, the department is facing a loss of approximately $5 million in funds for the 2010 budget cycle, which legislators are now reviewing.
A large portion of the juvenile justice operations has already been privatized and has created efficiencies, Proos says. “This is one of those proposals that we think should be looked at and vetted for potential benefits, or dismissed for its negative implications to the state,” he says.
The state Department of Human Services, which oversees juvenile justice services, has already “felt the pinch” of the state’s approximately 25 percent revenue loss. The Democratic leadership, who hold the majority in the House, has not endorsed the plan.
The Michigan Bureau of Juvenile Justice lists six facilities of varying security levels located around the state: Academy Hall Community Justice Center, Bay Pines Center, Maxey Training School, Nokomis Challenge Center, Pine Lodge Center, and Shawono Center.
“The department continues to close adult and juvenile correctional facilities, repurposing them and moving prisoners and juvenile offenders to more centralized locations, which helps to save money by virtue of shutting down other facilities,” Proos says.
The House Fiscal Agency, a nonpartisan legislative provider of research and statistics, estimates that privatizing the juvenile justice system could save the state $3.5 million in the first year and $7 million thereafter.
The projected savings are based on what high-security private agencies currently charge and not what they would charge to hold maximum-security youths currently held at state-operated facilities, says Bob Schneider, HFA human services associate director.
BJJ contracts with more than 23 private vendors and partners, from Havenwyck Hospital in Auburn Hills to the Vista Maria youth treatment program in Dearborn Heights. Nine juvenile justice employees would remain on staff as part of the proposal to maintain contracts with the private providers, according to reports.
However, many youths with acute behavioral issues are rejected by private facilities because the companies don’t have the appropriate security to monitor them, says John Evans of the Bureau of Juvenile Justice. The concern, if the entire system were to be privatized, is that these youths would slip through the cracks or end up in the prison system, and there is currently no good way to require a contracted facility to take all youths, he says.
“A private operator has the option of rejecting a referral, where a state system doesn’t,” Evans says. “The state has no right of refusal — we must take everybody and treat them.”
Evans sees the benefits to both the privatized and state-run portions of the juvenile justice system.
“We’ve had a long, productive relationship with private providers,” Evans says, pointing out that private vendors have “always provided safe, structured treatment.”
“The private system can do certain things at less cost than a government system, there’s no question about that,” Evans says. “Appropriately, private facilities will only take youths they can treat successfully, which is why the state system costs more to operate — these are very high-needs kids.”