Senator says California prisons upgrade cost 'borders on the incredible'

Senator says California prisons upgrade cost 'borders on the incredible'
Sacramento Bee
April 15, 2008
http://www.sacbee.com/111/story/861956.html
Tuesday, April 15, 2008

Legislators gulped hard Monday as the financial toll of future prison construction rang loud and clear.

Add up the interest and principal on two years' worth of prison bonds, and the annual hit on the general fund over the next 25 years would be $1.2 billion.

"It borders on the incredible," said state Sen. Christine Kehoe, D-San Diego, at a budget hearing on prison bonds.

The Schwarzenegger administration and federal receiver J. Clark Kelso are proposing $7 billion in new lease revenue bonds to pay for 10,500 long-term health care beds and to upgrade medical facilities at the state's 33 prisons.

If approved by the Legislature, the proposal would nearly double the $7.4 billion in prison expansion bonds lawmakers crammed into the books in last year's Assembly Bill 900. Some $1.1 billion of the AB 900 money was earmarked for health care facilities.

Kelso and the administration want the health care prison bonds on an expedited basis. They say they need the money to make up for years of inadequate funding that has left prison medical care in shambles.

At Monday's hearing, the Legislative Analyst's Office raised a series of questions about the bonds, mostly their construction and operational expenditures. Projected cost per health care bed under the plan: $602,000.

LAO criminal justice unit chief Dan Carson said the per-bed cost is significantly less than the $1.1 million the prison system already is paying for smaller-scale mental health units. But it's way more, he said, than the $222,000 the agency laid out for new beds at existing prisons under AB 900.

"We appreciate that something focused on a medical purpose will have higher costs," Carson said. "But we can't get there yet on why these costs are so much higher."

Kelso replied that his proposal matches up favorably on the financial aspects with similar projects around the country. He added that the sooner California builds his project, the cheaper it will be.

"One thing we know in the construction industry, the more you delay, the more your costs are going to go up," Kelso said.

Senate budget subcommittee chair Mike Machado predicted rough treatment in the Legislature for the prison health facility plan, up to a point.

"I don't think they're going to react very favorably," the Linden Democrat said of his colleagues. "But do we have a choice? That is another question."

Kelso operates under the authority of U.S. District Court Judge Thelton Henderson in San Francisco, who could simply order the new construction. Henderson, who found California prison health care unconstitutional, created the receiver's office to bring it into compliance.