But stated goals and the actual incentives that prison policy promote turn out to be two very different things. A new report finds that states are giving themselves an incentive to keep inmates in prison longer and to crowd those prisoners into smaller spaces, too.

The report from In The Public Interest, a transparency watchdog group, finds many state, county and local governments that outsource prisons to private corporations frequently sign contracts that guarantee a certain occupancy rate in prison beds. If governments don’t meet those quotas, the contracts require them to pay the firms for unoccupied beds.

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Almost two-thirds of the agreements between county and local governments and private prison contractors have occupancy rate clauses, the study found. And in several states, those rates are sky-high: Three Arizona contracts require 100 percent occupancy; three Oklahoma contracts guarantee 98 percent occupancy. Two contracts in Louisiana guarantee that 96 percent of prison beds will be filled.

Occupancy rates can cost state taxpayers dearly. Thanks to a big drop in crime rates in Colorado, the state has closed five prisons since 2009. But to meet occupancy rate requirements, the state had to place 3,300 prisoners in three facilities run by the Corrections Corporation of America, the nation’s largest private prison operator, rather than housing those inmates in state-run facilities.

After three inmates escaped Arizona’s Kingman prison in 2010, operated by the private Management & Training Corp. (MTC), the state pulled 238 high-risk prisoners out of the facility over what it called lax security. That put the number of prisoners in Kingman below the 97 percent threshold stipulated by contract. Despite the security concerns, MTC threatened to sue the state. Arizona paid more than $3 million for empty beds, according to a 2011 Arizona Republic report.

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The rate requirement cost Colorado taxpayers $20,000 per inmate, at least $2 million more in Fiscal Year 2013 than the state would have paid to house them in state-run facilities, according to the Colorado Criminal Justice Reform Coalition. Steve Owen, a spokesman for CCA, said the company “do[es] not have a contract guarantee with Colorado now, nor did we have one last year.”

Some states even pay private contractors to send inmates out of state. Alaska guarantees the GEO Group an 80 percent occupancy rate for its facility in Hudson, Colo. California promised to fill 90 percent of the beds at correctional facilities in Arizona, Oklahoma and Mississippi under contracts that expired in June. The facility in Eloy, Ariz., also houses prisoners from Hawaii. And Vermont ships some of its prisoners to a CCA-run facility in Beattyville, Ky.

Other states have specifically excluded occupancy guarantees in their contracts with private firms. In Texas, which this year closed two privately-run prisons, contracts are approved only if they have as-needed clauses.

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“It’s unconscionable that you would enter into an agreement that you would incarcerate a certain number of people in return for a certain cost or profit consideration, because it destroys any attempt to find diversion programs or alternatives to incarceration,” said John Whitmire, a Houston Democrat and the longest-serving member of the Texas State Senate. “Prisons ought to be operated for public safety, not for economic development by communities or jurisdictions.”

In The Public Interest’s report comes a year after CCA wrote to governors in 48 states offering to buy public prisons in exchange for long-term contracts with guaranteed occupancy rates. No state took them up on the offer, but the watchdog group warned that big up-front payments can be enticing for cash-strapped governments.

“Bed guarantee clauses can have broad negative implications for government entities,” the authors write. “If lawmakers determine there are more effective ways of dealing with specific criminal offenses than prison time, bed guarantee clauses may restrict their options. If lawmakers pass rules that have the effect of decreasing the prison population, if law enforcement officials take action that results in a reduced prison population, or if the crime rate simply drops, the government might be responsible for funding empty prison beds.”

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The report argues for paying private prison contractors based on the number of inmates housed in a prison on any given day, what Texas contracts call the “Midnight Strength Report.”

Owen, the CCA spokesman, defended the occupancy rate guarantees, which he said are sometimes sought by governments, rather than the company itself. A guaranteed occupancy rate, he said, “helps [governments] ensure that they have the space they need to safely and effectively house inmates, so those beds don’t go to other government agencies seeking capacity.”

“The bottom line is that one of the primary benefits we provide our government partners is the flexibility to meet their changing needs, which we’ve done for Colorado and other partners around the country,” Owen said.

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The private prison industry spends millions of dollars lobbying Congress and state and local governments over corrections policy. From 2002 to 2012, CCA spent more than $17 million on federal lobbyists, according to data compiled by the Center for Responsive Politics. The GEO Group spent an additional $2.5 million over the same period, and handed out $2.9 million in political contributions to candidates for national office.

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Filings examined by the Center for Responsive Politics show CCA lobbied on appropriations bills that apply to the federal Bureau of Prisons, and on bills pertaining to privately-operated prison construction and management. But the company stresses they don’t lobby for harsher prison sentences.