News: Pros and Cons

Ohio privatizes prison goodies

Unlike other states, Ohio didn't gouge prisoners when it privatized prison commissaries.

The con with the Tootsie Pops ruined it for everyone else. Until Jan. 1, inmates serving lonely stretches at Grafton, Mansfield and crossbar hotels across Ohio were able to receive care packages from home, filled with everything a man needs to make life inside a concrete cell a little easier. Coffee. Candy. Deodorant. Fresh undies.

But that meant paying some low-rung staffer to inspect the packages. Someone had to make sure there wasn't a dime bag rolled up inside those BVDs. And no matter how attentive the inspectors, drugs still got through.

Terry Collins, director of Ohio's Department of Rehabilitation and Correction, remembers the guy with the Tootsie Pops, for example.

"Someone was shipping drugs into one of our prisons, and we couldn't tell how it was being done," he says. "Eventually, we discovered that dealers on the outside were melting down Tootsie Roll pops and replacing the candy center with bags of marijuana, then reconstituting the candy. They looked just like Tootsie Roll Pops. They're ingenious. They always find a way."

So Collins recently negotiated a deal with a private company to act as a middleman between family members and the criminals they love. Now every personal item must be purchased through the Keefe Group, a mail-order business that accepts institutional checks from inmates and credit cards from outside friends and relatives.

No more screening every package that comes in, and no more homemade cookies. Instead, prisoners have their choice between (no joke): Pete Rose's Peanut Butter Cremes or Ozzie Smith's Chocolate Chip Cookies — unless they splurge for Nabisco. But at 80 cents a bag, you can't beat the prices.

A closer look at the Keefe Group, however, suggests that the inmates aren't the only ones looking to pull a fast one on the State of Ohio.

Kickbacks on candy bars
Headquartered in St. Louis, the Keefe Group's automated service, the Keefe Commissary Network, is the nation's leading supplier of food, personal care products, electronics and clothing to the correctional market, according to the company's Web site. Newspaper reports put Keefe's market share at around 65 percent. There's a lot of money to be made from prisoners who don't make a lot of money, and Keefe makes the most.

Being the big kid on the cellblock allows Keefe to underbid competitors and hire lobbyists to push their agenda in new states. But it's the deals with prison officials that keep getting them into trouble.

In 2003 the head of the Illinois Department of Corrections, Ernesto Valesco, provided a glowing review of Keefe's performance on the company's Web site, which was used to market its program to other states. The Chicago Tribune later learned that Valesco's wife was hired by Keefe at about the same time the post went up.

A year later Keefe lost a contract in Collin County, Texas after charging inmates sales tax on items that were not taxable. Before they were caught, Keefe had overcharged more than $5,000, according to The Dallas Morning News.

Two state prison officials in Florida were charged with accepting kickbacks from a Keefe subcontractor in Florida on July 5, 2006. Jeb Bush appointees James Crosby, secretary of Florida Department of Corrections, and Allen Clark, the department's regional director, netted $135,000 before they were busted.

The deal went down like this: Florida wanted snack booths set up inside the prisons, where visitors could buy inmates items and pay for them with cash on site. Keefe wanted to provide the food and sundries but didn't want to deal with the cash. So Crosby and Clark supplied the subcontractor for Keefe in exchange for a portion of that company's profit. The extent of Keefe's knowledge of the kickbacks is unknown.

Keefe's arrangements with prison officials often vary from state to state. In Texas, Keefe paid the state 40 percent of its profit for its monopoly. To run Florida prison commissaries, Keefe paid 82 cents for each inmate per day, while each inmate was limited to spending $65 a week. According to The Palm Beach Post, four months after signing that contract, the Florida Department of Corrections increased the spending cap for inmates to $90 a week without increasing Keefe's daily payment to the state.

Keefe spokesman Mark Jensen, when asked about his company's history, played it cool.

"We don't comment on a lot of things," he said. "We're a low-key company."

The misery market
Those already opposed to prison's harsh environment believe companies like Keefe only profit from the misfortune of others. Nat Smith, an organizer with the group Critical Resistance, can hardly contain her animosity.

Smith isn't a spokeswoman per se, because that would imply a hierarchal system, which Critical Resistance doesn't believe in (yes, they're based out of California). Hierarchies are for institutions bent on demeaning fellow humans — like prisons, which Smith says should be replaced with schools and drug treatment facilities.

When one company is in charge of everything a prisoner can buy, that company can charge whatever it wants, she says. In California, the imprisoned transgender population serves time in male prisons but are required to wear bras. The bras must be purchased through Keefe's online catalog.

"They make quite a bit of money that way," Smith says. "And prisoners aren't wealthy."

When Terry Collins negotiated Ohio's deal with Keefe, he was very much aware of the Florida indictments. So Collins made a bold move for a prison official — he decided to give the money back to the inmates. Instead of a cut of the revenue, he asked Keefe to provide lower prices for Ohio inmates, in exchange for being the sole provider for those items.

At first, even Smith didn't know what to say. Could Collins be that rare public official who actually does some good?

Smith regains composure and finds a comment: "Even at a wholesale rate, it's still a company that is making money by exploiting men in cages."

But is the deal making our prisons safer? Possibly.

Random drug tests are given to inmates each month in Ohio. According to Collins, the normal rate for positives is around 5 percent. Since Keefe took over the care package problem, positive drug tests have dropped to less than 1 percent.

Collins, apparently, is no sucker. ©

JAMES RENNER writes for Clevland Free Times, where a verssion of this story first appeared.