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Author Topic: The Price of Prisons: What Incarceration Costs Taxpayers  (Read 3611 times)
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Forevermah
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« on: January 26, 2012, 03:38:14 PM »

The Vera Institute has just released a report about the full costs of state corrections, The Price of Prisons: What Incarceration Costs Taxpayers, (January 2012).  The report is extremely informative, and for Illinois presents cost information that has not been readily available.  And because the Vera report looks at 40 states, the Vera report also allows comparisons among different states, including Illinois' Midwestern neighbors: IN, MI, MN, and OH.

By adding capital costs and expenses such as pension and health insurance benefits to the costs identified within the Department's budget, the Vera report shows that Illinois' cost per prisoner is $38,268, considerably higher than the  $25,500-figure many of us have been using.

The value in this report is in helping us to parse out actual corrections costs for Illinois.

This link will take you to the full report and state fact sheets:  http://www.vera.org/pubs/price-prisons

I've attached a copy of the fact sheet Vera prepared for Illinois.

There will be a tendency to compare costs among states. For example, while Illinois cost-per prisoner rate is relatively high compared to some Midwest states (Michigan - $28,117; Indiana $14,823) it is less than the per prisoner cost in Minnesota ($41,364) and on a par with Wisconsin ($37,994).

But these comparisons must be made with great caution. The introduction to the report provides an important disclaimer from the Vera staff:

We cannot pass along this valuable tool, however, without also speaking
to its risks. Chief among them is that in these times of lean budgets,
policy makers will want to compare their per-inmate cost with those
of other states—and demand to know why theirs is higher and that it
be cut. Per-inmate cost is a measure of cost and cost alone. It reflects
neither quality, as measured by, say, staff safety, nor outcomes, like the
impact on recidivism. In some states, for example, this cost has been
limited by incarcerating people in numbers far beyond what facilities
were built to hold.

Other states rely heavily on housing state prisoners in local jails, which
typically saves money, while still others incarcerate a larger proportion of
low-risk offenders who are less expensive to manage. All these practices
reduce a system’s per-inmate cost but do not necessarily contribute to
greater public safety.

The reference to incarceration of low-risk offenders is important. Even with the sharp increases in prison population over the last two years and a large number of low-level drug offenders in the system, Illinois has a more modest prison incarceration rate than Michigan and Indiana. Minnesota, with a significantly higher cost per inmate, has a very low incarceration rate. This information can be teased out, but it is important to follow Vera's admonition against inexact comparisons in the mean time.

Malcolm C. Young




The Price of Prisons:  What Incarceration Costs Taxpayers

01/26/2012 Christian Henrichson, Ruth Delaney

Staff from Vera’s Center on Sentencing and Corrections and Cost-Benefit Analysis Unit developed a methodology to calculate the taxpayer cost of prisons, including costs outside states’ corrections budgets. Among the 40 states that participated in a survey, the cost of prisons was $38.8 billion in fiscal year 2010, $5.4 billion more than what their corrections budgets reflected. States’ costs outside their corrections departments ranged from less than 1 percent of total prison costs in Arizona to as much as 34 percent in Connecticut.

The full report provides the taxpayer cost of incarcerating a sentenced adult offender to state prison in 40 states, presents the methodology, and concludes with recommendations about steps policy makers can take to safely rein in these costs. Fact sheets provide details about each of the states that participated in Vera’s survey.

The links for the following reports/pdf's are at the link provided:


The Price of Prison Report pdf:  http://www.vera.org/pubs/price-prisons

The Price of Prisons: 40 State Fact Sheets pdf:     http://www.vera.org/pubs/price-prisons


The report for Illinois is on page 23, this is it:


The Price of Prisons | Illinois
WHAT INCARCERATION COSTS TAXPAYERS   FACT SHEET • JANUARY 2012

IN FISCAL YEAR 2010, the Illinois Department of Corrections (IDOC) had nearly $1.2 billion in prison expenditures. However, the state also had $566.1 million in prison-related costs outside the department’s budget. The total cost of Illinois’s prisons—to incarcerate an average daily population of 45,551—was therefore more than $1.7 billion, of which 32.5 percent were costs outside the corrections budget.

Determining the total cost of state prisons requires accounting for expenditures in all areas of government that support the prison system—not just those within the corrections budget. The additional costs to taxpayers can include expenses that are centralized for administrative purposes (such as employee benefits and capital costs) and services for inmates funded through other agencies. Prison costs also include the cost of underfunded contributions to corrections employees’ pensions and retiree health care plans; states must pay the remainder of those contributions in the future.

Prison costs outside the IDOC’s budget included the following:

Key Findings
$1.2 billion
IDOC prison budget
$1.7 billion
Total state cost of prisons
$38,268
Average annual cost per inmate
Taxpayer Costs (dollars in millions)
IDOC prison budget
Other state costs
$1,177

EMPLOYEEBENEFITS.ThestateofIllinoisspent$163.8milliononhealth insurance for corrections employees.

PENSIONCONTRIBUTIONS.Thestatemadeacontributionof$152.5million for corrections employees in 2010.

UNDERFUNDEDPENSIONCONTRIBUTIONS.In2010,thestateofIllinois contributed 93 percent of the annual amount required to fully fund pension benefits in the long run. The state will need to pay the remaining $11.3 million, plus interest, to provide for corrections employees’ pension benefits.

RETIREEHEALTHCARECONTRIBUTIONS.Thestatemadeapaymentof $48.4 for corrections employees.

UNDERFUNDEDRETIREEHEALTHCARECONTRIBUTIONS.In2010,the state of Illinois contributed 33 percent of the annual amount required to fully fund retiree health care benefits in the long run. The state will need to pay $99.1 million, plus interest, to provide for the retiree health care benefits of corrections employees that are scheduled under current law.

CAPITALCOSTS.In2010,thestatespent$64.8millionondebtservicefor the IDOC’s capital assets.

Employee benefits   $163.8
Pension contributions   $152.5
Underfunded pensions   $11.3
Retiree health care contributions   $48.4
Underfunded retiree health care   $99.1
Capital costs   $64.8
Statewide administrative costs   $26.1
Subtotal: Other state costs   $566.1 TOTAL TAXPAYER COST   $1,743.2

Source: Vera Institute of Justice, True Cost of Prisons survey. See “Methodology” for more details.

Taxpayer costs include expenses funded by state and federal revenue. Apparent discrepancies between subtotals and totals are the result of rounding.

Download the report, which fully explains the methodology, at www.vera.org/priceofprisons.


METHODOLOGY

The Vera Institute of Justice conducted a survey to collect data on spending by corrections departments and other state agencies. For the survey, prisons are defined as residential facilities that hold sentenced adult offenders in state custody. Prison costs include expenses for the operation of state-run prisons, privately run prisons, and any payments made to local jails and to other states for housing state-sentenced inmates. Taxpayer costs include expenses funded by state and federal revenue. Vera excluded from this analysis any corrections department expenses that do not directly relate to prison operations, such as community corrections or juvenile justice.

Vera obtained information regarding the underfunding of pensions and retiree health care through Consolidated Annual Financial Reports for fiscal year 2010. Prison-related administrative costs were determined per each state’s most recent publicly available Statewide Cost Allocation Plan (SWCAP).
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