Does Crime Pay?
Pros and Cons of Rural Prisons

By Zanetta Doyle, Digest Editor

Many rural communities have looked to incarceration as a way to bring about an economic revival. Nonetheless, the subject continues to generate lively debates among those for and against rural prisons. Proponents tout the positives including jobs, business for local companies, tax benefits, real estate opportunities, and the need for new businesses such as hotels and fast food restaurants.

Opponents voice a litany of downsides:

The probability of increased crime rates in their community.

Jobs, especially higher paying positions, such as wardens and department heads, are often filled by outside residents.

Lower property values for homes near the facilities.

Unwelcome families following inmates to town.

A reputation as a prison town, which may detract new business and tourism.

The expense of building a prison.

Increased demand on court systems and social services.

Amid the debate, however, prisons continue to be built. Calvin Beale, Senior Demographer at the Department of Agriculture’s Economic Research Service (ERS), recently told the New York Times that in the last decade, 245 prisons sprouted in 212 of the nation’s 2,290 rural counties. He added that an average of 25 new rural prisons opened each year in the 1990’s, up from 16 in the 1980s and four in the 1970s. As a result, in the 212 rural prison counties, the population rose 12 percent in the 90s, surpassing the previous decade’s rate of 1.5 percent.

ERS’s Rural Development Perspective: Rural Prisons: An Update, which reports on the growth of rural prisons between 1992 and 1994, revealed that new nonmetro prisons provided 23,000 jobs in direct employment, a mean of about 275 workers per institution and 35 jobs for each 100 inmates. Additionally, with the extensive commuting that characterizes rural areas today, workers are typically drawn from surrounding counties as well as from the host county.

While there are many positive aspects of building prisons in rural areas, recent reports show that decreasing crime rates are changing the briskness of the prison boom. According to Beale, only 11 prisons were opened or scheduled to open in 2001, compared to 38 in 1998.

Minnesota Prison Reaps Benefits

In the 1950s and 60s, Appleton, Minnesota was a vibrant community mainly dependent on agriculture. But after a major economic downturn in the 70s and 80s, resulting in a decline in family farms, the loss of numerous other businesses, and a decreasing population, Appleton was left with a sagging economy and no available options to turn the situation around.

During 1989, Bob Thompson, City Coordinator for Appleton, read reports about the nation’s escalating prison population. He began to research the overall impact of having a prison in a small community. “After realizing that we probably wouldn’t be able to convince companies like IBM or Honeywell to come to Appleton, we started looking for other alternatives,” said Thompson.

After years of research, networking and overcoming some political hurdles, the Prairie Correctional Facility opened in 1993. The $27.4 million facility, which was initially built as a 500-bed prison, received funding from the Economic Development Administration (EDA), Community Development Block Grant, (CDBG) funds and $300,000 from the state towards infrastructure. According to Thompson, the Upper Minnesota Valley RDC in Appleton, Minnesota provided information to the city and served as coordinator in helping Appleton secure funding from EDA.

“The prison has provided a significant economic boost to a community that was basically in dire straights for many years before its construction,” said Paul Michaelson, Executive Director of the Upper Minnesota Valley RDC, an EDA funded district. Michaelson also credited EDA Minnesota’s Economic Development Representative Jack Arnold for diligently working with the town to not only secure initial funds for the project but also additional monies for the facility’s expansion. “EDA made a significant investment from the infrastructure standpoint,” he added.

While the medium security prison did not have any inmates during its first year of operation, today it has expanded to a 1,300-bed facility, almost operating at full capacity, with a $14 million budget and the largest taxpayer in the county. The prison currently receives prisoners from Wisconsin, North Dakota, Hawaii and Puerto Rico.

Widespread Economic Impact

According to Appleton officials, the facility, which was sold to a private company, Corrections Corporation of America in 1998, has been the number one factor for the revitalization of the community. It has spawned economic growth for local vendors who provide supplies and services to the prison, jobs for local and outside residents, street and sidewalk repairs, and the opening of new businesses. The Prairie Correctional facility has also worked with the five technical colleges in the area to develop a curriculum providing training for prison staff and educational opportunities for inmates.

The facility employs more than 400 employees, but according to Gary Hendrickx, County Commissioner for Appleton, prison officials recently reported a high employee turnover rate. “There is a high turnover, however, this is not necessarily a negative thing, because some of the employees have used this as a stepping stone to grow their careers in the correctional field,” said Hendrickx.

He added that one of the challenges that remain is improving the quality of life for prison employees and the entire Appleton community. “At first we thought that if we built it then they would come, but what we’ve learned is that some of the prison employees come to work here, but not to live here.” Hendrickx said.

The town is beginning to look at creative ways to make Appleton a more attractive option for prison employees currently living outside the area. One idea recently discussed was renovating an old high school building and turning it into something that would provide entertainment to locals. “We haven’t been able to capture the employees yet, but everything is a process, and we’re learning as we go,” Hendrickx said.

Regional Law and Order

Virginia realized that its local jails needed significant renovation and in some cases, replacement, after conducting routine inspections in the early 1990s. As a result, several localities met to discuss local corrections needs. While the state offered assistance in the construction or renovation of jails, assistance to individual localities had been terminated. However, the state would pay for 50 percent of the construction costs of a regional jail.

The New River Valley Regional Jail in Dublin, Virginia

Grayson, Giles and Pulaski Counties, and the City of Radford began to pursue the construction of a regional jail, after agreeing that this was the most economically sound solution for the region, as it would reduce individual jail renovation, operating and liability costs. During the preparation of a Community Based Correction Plan, required for state participation and approvals, other jurisdictions showed interest. Ultimately, Bland, Floyd, Carroll and Wythe Counties joined in the creation of the New River Valley Regional Jail Authority.

After several years of planning and coordinating, the New River Valley Regional Jail, located in Dublin, Virginia, opened in 1999. The facility, which is operated by the Regional Jail Authority, houses 454 inmates, and employs 150 people, all of whom live in the region.

The Authority borrowed $39 million to fund the project. The state contributed $14.5 million of the amount and the Authority members financed the remainder. Construction costs for the jail were approximately $25.4 million, and the rest was used to pay for all other costs associated with building this type of facility.

Regional Assistance

The New River Valley Planning Development Commission (PDC) in Radford, Virginia, an EDA funded district, provided staff during the early discussions of the jail’s construction; they also provided staff to the localities during the preparation of the Correction Plan; coordinated with the state in the review and approval processes for the plan; and contracted with the engineering/architectural firm to prepare the Planning Study.

In addition, the Commission supported the Study Committee as it transitioned into a Regional Jail Authority and provided staff to the Authority as it dealt with the State General Assembly to secure Virginia’s commitment to the project. They also worked with the Authority’s financial advisors as they prepared the funding package for the project.

The New River Valley PDC served as fiscal agent for the Authority during construction. “In addition to receiving and reviewing pay requests, preparing checks and monthly statements, we managed the documentation processes required by the state and served as the purchasing agent for the Authority,” said David Rundgren, Executive Director of the New River Valley PDC. “This resulted in considerable savings as purchases were made in the name of the Authority, a government entity instead of through the contractor and each of the subcontractors.”

Benefits and Impact

Rundgren explained that as with most new projects, there were some hurdles to overcome including state law and administrative processes that were not designed for the implementation of a jail, the indecisiveness of the localities as they considered the pros and cons of a regional facility, and the reluctance to lose corrections services in each locality.

However, he added that the positives have been paramount. The jail has done more than just provide jobs to local residents in the region. “The Authority does everything within its power to utilize services and make purchases within the region,” said Rundgren. “The jail, with its shared costs of operation, has allowed localities to invest their funds in other projects.”

Additionally, as a part of the planning and development, the Authority formed a committee of the adjacent residents to keep them informed of the decisions being made. The Authority also sought to have the state law amended to specify that the jail would release inmates in their home communities. “These actions by the Jail Authority created positive responses from the community,” said Rundgren.

For More Information Contact: Paul Michaelson of the Upper Minnesota Valley RDC at 320/289-1981 or email umvrdc@umvrdc.org; David Rundgren of the New River Valley PDC at 540/639-9313 or email dave.nrvpdc@nrvpdc.

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