Interim Joint Committee on Local Government


Minutes of the<MeetNo1> 5th Meeting

of the 2009 Interim


<MeetMDY1> October 28, 2009


The<MeetNo2> fifth meeting of the Interim Joint Committee on Local Government was held on<Day> Wednesday,<MeetMDY2> October 28, 2009, at<MeetTime> 10:00 AM, in<Room> Room 171 of the Capitol Annex. Representative Steve Riggs, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Damon Thayer, Co-Chair; Representative Steve Riggs, Co-Chair; Senators Walter Blevins Jr., Julian M. Carroll, Carroll Gibson, Mike Reynolds, John Schickel, Elizabeth Tori, and Johnny Ray Turner; Representatives Ron Crimm, Mike Denham, Ted Edmonds, Derrick Graham, Richard Henderson, Charlie Hoffman, Brent Housman, Adam Koenig, Stan Lee, Tom McKee, Reginald Meeks, David Osborne, Arnold Simpson, Kevin Sinnette, Ancel Smith, Ken Upchurch, and Jim Wayne.


Guests:  LaDonna Thompson and Rodney Ballard, Department of Corrections; Tony Wilder, Department for Local Government; Michael Foster, Denny Nunnelley, and Shellie Hampton, Kentucky Association of Counties; Vince Lang, Kentucky County Judge/Executives’ Association; Bobby Waits and Marshall Long, Kentucky Jailers’ Association; Ron Wolf, Louisville Metro Government; Mark Mangeot, Justice Cabinet; J. D. Chaney, Bert May, and Tony Goetz, Kentucky League of Cities; and Ned Sheehy, Lexington-Fayette Urban-County Government.


LRC Staff:  Mark Mitchell, Joe Pinczewski-Lee, John Ryan, Kris Shera, Tom Dorman, Matt Niehaus, and Cheryl Walters.


Upon the motion of Representative Henderson, seconded by Representative Crimm, the minutes of the September 24, 2009 meeting, were approved.


Representative Riggs recognized Senator Thayer. Senator Thayer expressed the committee’s condolences to Representative Riggs in the passing of his father.


Representative Riggs stated that the purpose of the meeting was to discuss the implementation of the Auditor of Public Accounts’ recommendations for jails. He referred members to the Auditor’s report which was included in the folders. Representative Riggs then recognized Commissioner LaDonna Thompson and Deputy Commissioner Rodney Ballard with the Department of Corrections (DOC).


Regarding the recommendation that DOC should develop and implement a uniform jail financial management system to capture all jail expenditures, Commissioner Thompson told the committee that this is being done at the county level. She noted that county government uses a uniform budget schedule after being approved by their local fiscal courts. Commissioner Thompson added that these budgets are submitted to the Department for Local Government (DLG). She pointed out that DOC does not have any role in setting budget policy at the local level.


Regarding the recommendation that DOC should maintain a cumulative population report for each detention center for the fiscal year, identifying the cumulative number of state, federal, county, and other counties/states inmate days for each fiscal year, Commissioner Thompson stated that this is being maintained on a weekly basis. She added that local governments keep an annual population report.


Regarding the recommendation that DOC should explore restructuring the per diem fee for holding state prisoners and consider indexing the per diem to the consumer Price Index (CPI, Commissioner Thompson explained that the CPI increase is a good idea. She said DOC has recommended a CPI adjustment be figured into the jail per diem on an annual basis and have requested increased funding. Commissioner Thompson noted that they had locked into tying in per diem payments to jails based upon the services jails provide, but because of various reasons, a fair way of determining that payment structure could not be figured out.


Regarding the recommendation that new or expanded jails should only be constructed after review and approval by DLG and DOC, Commissioner Thompson stated that 2009, SB 76 proposed this language and was defeated. She pointed out that DOC does not have the authority to prevent a county to build a local jail if a county so desires. Commissioner Thompson noted that DOC does offer guidelines and recommendations, but the final decision belongs to the fiscal court.


Regarding the recommendation that the Kentucky Jailers’ Association and DOC should undertake a thorough review of the management of medical expenses incurred by the county jails, Commissioner Thompson stated that in 2006, 14 jails privatized their medical service. In 2009, 44 jails now privatize their medical service. She added that jails do work together for best practices and share information. Commissioner Thompson noted that DOC shares best practices with jails, also. She continued to say that jails use the CorrectCare systems which administers and facilitates medical care for inmates. CorrectCare reviews medical charges for appropriateness. Commissioner Thompson added that if jails use the DOC pharmacy, the state pays for this cost for both county and state inmates. She said that jails can sometimes use their own pharmacies and still participate in CorrectCare. Commissioner Thompson attributed a 39 percent savings in medical bills through the use of Correct Care by jails in the last biennium.


Regarding the recommendation that DOC should review and adjust the state’s funding formula for medical expenses so that the funds are applied against actual expenditures for medical services, and consider reimbursing 100 percent of medical costs incurred by jails that have agreed to participate in medical management programs prescribed by DOC, Commissioner Thompson said they pay the cost of medical management and that DOC does not have a line-item budget to reimburse the counties at 100 percent. However, she noted that 2009 HB 191 was designed to off-set the costs of county catastrophic medical inmates to include caring for pregnant females.


Regarding the recommendation that counties should review their policies with the goal of maximizing inmate fees; ensure the jail has an adequate accounting system to track fees owed and collected, Commissioner Thompson  explained that in FY 2005, jails collected $3.5 million; in FY 2008, they collected over $4 million—an increase of almost $600,000. She noted that jail management systems are running negative balances on amounts owed by inmates. Commissioner Thompson added that collection of fees owed by inmates after they are released from jail has been difficult because released inmates are often unemployed or transients. She noted that it is easy to obtain a civil judgment, but difficult to collect it. She added that some jails have turned debts over to a collection agency to see if monies owed can be collected.


Regarding the recommendation that jails, at a minimum, use competitive bidding or documented price comparisons to purchase food or meals, and if meal costs are above the statewide average, fiscal courts should demand explanations, Commissioner Thompson said jails are privatizing services more and more. She said the smaller the jail, the less the jail is able to privatize because of a lack in volume. With more jails privatizing their food service, she said it has allowed jailers to call and do price comparisons of their food service operations.


Regarding the recommendation that jails should report to the fiscal court all elements of the financial transactions involving telephone service vendors, Commissioner Thompson stated that revenue and expenditure transactions are between the local jailer and fiscal court. She noted that DOC could require reports, but it would have no impact on the contracts.


Regarding the recommendation that DOC should perform a mandatory jail efficiency audit if a jail requests state reimbursement for inmates and inmate cost per day exceeds the state average by more than 10 percent, Commissioner Thompson said that DOC does not do an efficiency audit. She explained that DOC pays a set fee to house state inmates; and the jailers work with the fiscal courts for any amount in excess of that amount.


Representative Riggs asked if DOC brought a copy of the review of the medical expenses. Commissioner Thompson replied no, but they would see that the committee got a copy of it. She cited some medical savings figures from the report.


Representative Riggs asked if DOC has been satisfied with CorrectCare. Commissioner Thompson replied that DOC has been satisfied with CorrectCare.


Representative Riggs asked why DOC did not do a jail efficiency audit. Commissioner Thompson said that efficiency issues were between the county and the jails. She added that the per diem remains the same amount always.


Representative Koenig asked how food was bidded out. Mr. Ballard stated that there is no requirement to bid out food services, but that there was an increased interest in privatizing food services.


Representative Koenig asked how many jails are in Kentucky. Mr. Ballard said there were 77 full service jails in Kentucky.


Representative Hoffman expressed concern with private food service. He asked who the main food service contract was with generally in Kentucky. Commissioner Thompson stated that Aramark was the main food service contractor and provides food service for the state.


Representative Hoffman asked if DOC knows of any jail that had returned to providing their own food service once they had privatized. Mr. Ballard said he knew of none that had done so.


Senator Carroll asked how much it costs to house a prisoner. Commissioner Thompson replied it was over $50 a day to house a prisoner in a state facility and that the state pays $34 a day to house a state prisoner in a county jail. Senator Carroll wondered why the state would not house more prisoners in county jails and then expressed concerns about the lack of educational attainment amongst prisoners. Commissioner Thompson indicated that the per diem costs for housing prisoners were averages and that program levels offered in the institutions were a factor also. In addition, she cited the classification of prisoners held in county jails and statutory requirements relative to the housing of prisoners in county and state facilities.


Senator Carroll asked how many regional jails were in Kentucky, and if DOC was working to increase that number. Commissioner Thompson said there are three regional jails. She noted that regionalization was a recommendation in the University of Louisville jails study. Senator Carroll asked if that study could be made available to the committee. Commissioner Thompson said that study would be made available to the committee.


Senator Carroll also asked how many prisoners were high school dropouts. Commissioner Thompson said she would find out.


Representative Lee asked what percentage of jails privatized their food services, if they all used a specific vendor, and if the contract was a bid out. Mr. Ballard replied that there were three vendors in the Commonwealth:  Aramark, Kellwell, and Cantina. He indicated that the counties made the decision of whether or not to bid for food service. Commissioner Thompson noted that Aramark was Kentucky’s vendor and the contract was bid.


Representative Lee asked how much money is saved by jails contracting with food service vendors. Commissioner Thompson said she did not know the current figure but would make that figure available to members.


Representative Lee asked if a reason for the North Point prison riot had been determined. Commissioner Thompson responded by saying the Cabinet had gathered a critical response team and was conducting extensive investigations to determine the cause. She noted that a report was pending. Mr. Ballard interjected that in his county’s jail, privatizing food service saved five staff positions. He further noted that food can be bland but that he regularly sampled the food.


Senator Thayer asked how many jails used Aramark. Mr. Ballard answered that 20 jails used either Kellwell or Aramark. Senator Thayer noted that Aramark was an often used vendor and suggested that no riots had occurred in other locations.


Representative Henderson asked if there has been any discussion to consolidate jails. Mr. Ballard replied yes, but there are no tax incentives and no help from the legislature.


Representative Henderson also asked if DOC would agree that most jails are in the red. Mr. Ballard said “yes.” Representative Henderson expressed concern over drug related medical cost impacts to jails and noted the necessity of consolidating jails.


Regarding food costs for jails, Senator Tori asked how many jails cultivate their own food. Mr. Ballard said he didn’t have the exact number but that several jails grow their own food. Senator Tori also asked if DOC encourages jails to grow their own food or is it left up to the jailers. Mr. Ballard said they do encourage it, but that many of the urban jails do not have the land to grow their own food.


Representative Crimm asked what behavioral controls are available in prisons. Commissioner Thompson replied that external punishments are available, such as additional charges, and internal controls are available, such as segregation.


Representative Wayne commented that it was his understanding that the daily reimbursement rate to jails happens after a person is incarcerated, that pre-incarceration is not reimbursed. Commissioner Thompson said that was correct.


Representative Wayne expressed concern over the lack of a required bidding process for counties in securing food service contracts. He stated that it is in the best interest of the Commonwealth to treat prisoners humanely.


Commissioner Thompson noted that in her experience, the philosophy of DOC has been the humane treatment of inmates, and they have tried to provide social services to the inmates.


Senator Schickel commented that Kentucky is actually used as a corrections model nationally. He noted the history of the elected jailer and the reasons behind elections. Senator Schickle further noted that, as the Auditor indicated in the jail study, that many jails were efficient and used best practices, and could be used as models. He said that, in his experience, riots were the result of a breakdown in discipline.


Senator Blevins commented that the General Assembly has to step up to the plate to fund jails. He questioned practices of continuing to imprison individuals who are not longer threats. Senator Blevins also commented about radio communications problems in facilities. He asked about canteens in prisons. After explaining how canteens operate, Commissioner Thompson noted that grants have been received by DOC for radios and monitoring equipment.


Representative Edmonds commented that a county consolidation bill has been prefiled and that counties are discussing consolidation as a way to help with the cost of funding jails.


In reference to Representative Wayne’s comments about potential bidding abuses, Representative Koenig noted that counties do have required ethics codes and are regularly audited.


Representative Riggs invited DOC to suggest legislative changes they felt necessary.


Representative Riggs next introduced Commissioner Tony Wilder with the Department for Local Government (DLG). Commissioner Wilder told the committee that DLG receives reports from jails on a quarterly basis. He stated that jailers must present their budget to the fiscal court by April 1st. Commissioner Wilder explained that it becomes part of the general budget that is considered on May 1st. He added that DLG receives budgets to review to see if they are balanced and receive and monitor quarterly reports. Commissioner Wilder noted that ultimately fiscal courts bear fiduciary responsibility. Regarding the building of jails, he stated that counties must go through the state-local finance officer when seeking bonding for amounts in excess of $500,000. Commissioner Wilder said there are statutory requirements in existence for these procedures.


Representative Riggs noted that there are 40 jails that are doing well and the remainder are not doing as well. He asked what DLG was doing to spread best practices information. Commissioner Wilder answered that best practices were discussed at the various conferences conducted throughout the state.


Representative McKee asked if there are jails showing a profit and if so, which jails. Commissioner Wilder stated that there are some jails showing a profit, but he did not know which ones. He noted that the number of “paid” prisoners makes a difference in profitability. Commissioner Wilder said he would make that information available to the committee.


Senator Thayer stated that at the next meeting, the committee should hear from the jailers that are making money and what they are doing right.


Representative Denham asked Commissioner Wilder if he could recommend one thing to reduce prison population, what it would be. Commissioner Wilder said he would recommend substance abuse treatment instead of jail time.


Senator Gibson, after citing some local statistics and practices of his local regional jails, commented that there needs to be more regional jails. He noted that federal prisoners tend to be profitable for jails.


Representative Riggs lastly introduced Mr. Michael Foster, President of the Kentucky Association of Counties (KACo). Mr. Foster stated that he agrees with a unified corrections system, and that training should be provided for jail efficiency. He mentioned that as Christian County’s attorney, he was proud of his county jail’s performance. Mr. Foster noted that the jail design has a lot to do with efficiency. He stated in his personal opinion, there should be more oversight because some jails were built that should not have been built. Mr. Foster mentioned that privatization of food services should remain a local decision, noting that Christian County feeds its prisoners for $1.04 per prisoner per day.


There being no further business, the meeting was adjourned at 12:00 p.m.