Business prospects for two of the nation’s largest private prison operators have brightened as the Trump administration has called for more federal detention facilities for immigrants awaiting asylum hearings or deportation, The Wall Street Journal reported on Tuesday.
Tennessee-based CoreCovic Inc. and Florida-based Geo Group have already benefitted from higher federal spending on Immigration and Customs Enforcement, and now the Trump administration is requesting $2.8 billion in the 2019 budget year to significantly boost the number of beds in immigration detention centers.
Shares in both firms went up last month after a "request for information" on 15,000 beds in different locations was issued by the Department of Homeland Security and U.S. Immigration and Customs Enforcement after President Donald Trump halted his policy of separating children from their undocumented parents as they illegally crossed the border, according to the Sun Sentinel.
Immigrant detention has become an increasingly important proportion of revenue for private prison companies as the number of detainees goes up and state prison populations decline, The Wall Street Journal reported.
For example, the share of CoreCivic’s revenue from ICE increased to 25 percent last year from 13 percent in 2007, while for Geo Group it has gone up to 24 percent in 2017 from 10 percent a decade earlier.
That trend was exacerbated in 2016 when the Justice Department’s inspector general found that private prisons were more dangerous than government-run ones.
That led the agency to announce it would begin phasing out contracts for federal prisons, but not for ICE detention centers.
However, the Trump administration canceled the plan to decrease private prison use.
Both companies donated $250,000 each for Trump’s inauguration festivities, and Geo Group held a leadership conference last year at a Florida golf resort owned by Trump.
Due to Trump’s crackdown on undocumented immigrants, the number of people detained by ICE has risen to a record high of more than 40,000 daily.
Companies which operate these facilities get paid a daily rate for each immigrant they detain.
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