Bloomberg News

Florida’s $230 Million Prison Contract Rejected by Judge

December 04, 2012

Corizon Health Inc.’s five-year, $230 million contract to provide services for inmates in central and northern Florida prisons was blocked after a judge ruled the state Corrections Department entered into the deal illegally.

State Circuit Judge John Cooper in Tallahassee ruled today that the Legislative Budget Commission broke the law when it approved the department’s request to transfer $57.6 million meant to pay the salaries and benefits of 1,837 state employees to instead help fund the contract with Brentwood, Tennessee- based Corizon.

“While the state of Florida does have authority to privatize prison health care throughout the state, the full Legislature must do so by passing the appropriate funding mechanism specifically directed to that goal,” Cooper wrote. “Authorizing and funding privatizing health services in Florida’s prisons is the prerogative of the full Legislature and not of that of the Legislative Budget Commission.”

Rick Scott, the former chief executive officer of Columbia HCA Healthcare Corp., has made prison privatization a priority since becoming Florida’s governor. The Republican promised during his 2010 campaign to cut prisoner costs by $1 billion. His office and the Florida Department of Corrections said they would appeal the ruling.

Prison Budget

Florida Department of Corrections Deputy Secretary Mike Crews said the decision could lead to a $90 million shortfall in the agency’s budget over the next 18 months.

The ruling “will jeopardize other department needs and legislative budget priorities, which could include additional reductions and staffing and program services,” he said.

In September, the corrections department asked the 14- member budget commission to authorize the transfer of $57.6 million from salary and benefits for prison health-care workers to help fund the first six months of the contract with Corizon.

The spending panel, which is allowed to shift already appropriated money within the budget, can’t create new policies.

AFSCME Florida and the Federation of Physicians and Dentists/Alliance of Healthcare and Professional Employees sued Sept. 14 in Leon County Circuit Court in Tallahassee, arguing that the Corrections Department wasn’t authorized to privatize inmate health care in 2012 and, additionally, that the legislative panel overstepped its authority.

Union Comment

Alma Gonzalez, special counsel for AFSCME Florida, said the decision sends a strong message to Scott’s office.

“He cannot play fast and loose with the Florida constitution,” Gonzalez said.

Cooper, in his ruling, disagreed that the state didn’t have the authority to contract with private vendors, both nonprofit and for-profit, to provide health care.

Previously, the Legislature in 2011 authorized prison health-care privatization in its annual general appropriations act. A lawsuit against that action was declared moot in July by Circuit Court Judge Kevin Carroll, who said the privatization authority expired at the end of the fiscal year, June 30, 2012.

Prison health-care privatization isn’t the only legal dispute unions have had with the Scott administration. Under the governor’s direction, the Legislature altered state employee pension benefits by requiring workers to contribute 3 percent of their salaries to their retirement. AFSCME Florida challenged the changes and won. Scott appealed, and the case is pending before the Florida Supreme Court.

The prison case is Florida Public Employees Council 79 v. Tucker, 37 2012 CA 003119 (Tallahassee).

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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