Craig Harris and Yvonne Wingett Sanchez

The Republic | azcentral.com

Lobbyists for GEO Group%2C a private prison firm%2C obtain %24900%2C000 more for the company in latest state budget.

State Department of Corrections says it did not ask for additional funds for GEO.

GEO is guaranteed high occupancy rates at its prisons%2C and is projected to receive %2445 million this fiscal year.

Lobbyist for private prison obtain %24900%2C000 in state budget%3B Department of Corrections did not ask for increase.

Private-prison lobbyists succeeded in getting state lawmakers to include nearly $1 million in extra funding in the state budget even though the Arizona Department of Corrections says the money isn't needed.

The eleventh-hour funding was placed into the budget by House Appropriations Chairman John Kavanagh, R-Fountain Hills, who said GEO Group Inc. lobbyists informed him the company wasn't making enough money from the emergency beds it provides Arizona at prisons in Phoenix and Florence.

The request came even though GEO bid for its contracts and had agreed to previously negotiated rates with the Corrections Department, which guarantees the company nearly 100 percent occupancy at its prisons.

House Minority Leader Chad Campbell of Phoenix was incensed by the additional money for GEO.

He voiced disappointment on the House floor late Thursday during the budget debate and again Friday, telling The Arizona Republic that the request "came out of nowhere."

Some lawmakers, he said, learned of the addition to the House budget hours before members began voting on it.

Campbell said Kavanagh is responsible for pushing the proposal through the House with support from all but one Republican: Rep. Ethan Orr of Tucson.

"This is somebody getting a handout," Campbell said. "It's unnecessary. This came out of nowhere — I mean that. No one said a word about it. It wasn't in the Senate budget, it didn't come as a request from DOC. There's something really shady here."

Doug Nick, a state Corrections spokesman, confirmed his agency did not seek additional money for GEO.

"We did not request it," Nick said. "We had nothing to do with it."

The state this fiscal year is projected to pay GEO $45 million to house minimum- and medium-security inmates in the company's 2,530 beds, according to Corrections records.

Guaranteed rate

Arizona guarantees GEO an occupancy rate of 95 to 100 percent at those facilities.

GEO, based in Boca Raton, Fla., posted $115 million in profits on $1.52 billion in revenue in 2013. The company, which is publicly traded on the New York Stock Exchange, is worth $2.3 billion, and it paid Chairman and Chief Executive George Zoley $4.62 million in total compensation last year.

The additional money for GEO comes as lawmakers debate a $9.2 billion budget passed by the House late Thursday night.

The $900,000 for GEO was one of many additions made to get the support of some holdout Republicans.

Democratic lawmakers criticized the spending proposal, saying private prisons are being prioritized over education.

Caroline Isaacs, a watchdog on prison spending and the program director for the American Friends Service Committee, called the additional funding "outrageous."

"Why this corporation feels it's entitled to bypass the contract process with a state agency it is serving and go directly to the money man (Kavanagh) is incredible," Isaacs said. "This indicates a level of coziness that should make taxpayers nervous."

Isaacs said lawmakers appear more concerned about padding GEO's bottom line instead of looking out for public education and abused children who have fallen through the cracks at Child Protective Services.

Kavanagh said GEO had been giving the state a "cut rate" for emergency beds during the recession and, "now that the economy has come back, they want to get more money."

He said if GEO didn't take the inmates, it would cost the state more to house them at overcrowded facilities.

GEO, however, is not at full capacity, records show. The company as of Friday was housing 2,466 inmates in its 2,530 beds.

Maricopa County Sheriff Joe Arpaio and sheriff's offices in Apache, Pinal, Cochise, Navajo and Santa Cruz counties have said they would be willing to take Department of Corrections inmates to ease the state's overcrowding burden and make some additional money.

Beds available

The six sheriffs have said they could provide at least 1,750 beds.

Kavanagh declined to identify the lobbyists who asked him for additional money for GEO. State lobbying records show that Pivotal Policy Consulting represents GEO.

Neither Pivotal Policy Consulting nor GEO Group could be reached Friday.

The state Senate will hold a hearing on the budget Monday.

Senate Appropriations Chairman Don Shooter, R-Yuma, declined to speculate on whether the additional funding for GEO will remain. "We can't talk anything about the budget process,'' Shooter said. "It would be bad form."