The California Department of Corrections (CDC) is responsible for the incarceration, training, education, and care of adult felons and nonfelon narcotic addicts. It also supervises and treats parolees released to the community.
The department now operates 33 institutions, including a central medical facility, a treatment center for narcotic addicts under civil commitment, and a substance abuse treatment facility for incarcerated felons. The CDC system also includes 12 reception centers to process newly committed prisoners; 16 community correctional facilities; 38 fire and conservation camps; the Richard A. McGee Correctional Training Center; 34 community reentry, restitution, and drug treatment programs; 136 parole offices; and 4 outpatient psychiatric services clinics.
The budget proposes total expenditures of $4.4 billion for CDC in 2000-01. This is $128 million, or 3 percent, above the revised estimate for current-year expenditures. The primary causes of this increase are the growth in the inmate population, increases in staff compensation, and the expansion of parole, substance abuse treatment, and medical services programs. Thus, the budget includes $235 million for augmentations to employee compensation and $106 million for new CDC programs. It also includes $58 million to reflect the additional full-year cost of staff and new programs added during the current year, with most of that sum for custody staff needed to activate additional prison beds. These additional costs are partly offset by a $159 million drop in state retirement contributions due to changes in the way assets in the state retirement system are valued. Also, there is a $21 million reduction in the funding needed for prison staffing.
Under the budget plan, the CDC workforce would grow by about 350 personnel-years, or less than 1 percent, above the projected 1999-00 staffing level. This projected 2000-01 growth in the CDC workforce compares with anticipated growth of about 3,500 personnel-years, or 8.5 percent, during 1999-00.
Expenditure Growth Continues to Slow. The 2000-01 budget proposal for CDC represents a significant slowdown in the overall rate of growth of its expenditures. If the budget were adopted as proposed, CDC expenditures would grow by the smallest dollar amount since 1983-84, except for 1992-93--a year when the state faced an unusually large revenue shortfall and CDC spending actually decreased slightly. The CDC expenditures have not otherwise grown this slowly on a percentage basis since 1967-68, when they went up 3 percent. As discussed below, the proposed slowdown in correctional spending is associated with a slowdown in the growth in the inmate population and related growth in CDC staffing.
However, even as overall CDC expenditure growth is slowing, the average cost of providing supervision for each of those inmates is increasing significantly. After holding stable for many years, the average cost of holding an offender in the CDC prison system (excluding capital outlay costs) would grow to $23,136, an increase of about 7.6 percent over 1998-99. The average cost of supervising a parolee would grow even faster under the budget plan--about 11 percent over two years--to $2,505 per offender under active supervision.
General Fund Expenditures. Proposed General Fund expenditures for the budget year total almost $4.3 billion, an increase of about $150 million, or 3.6 percent, above the revised estimate for current-year General Fund expenditures.
The General Fund contribution to the proposed budget would grow more than the CDC budget overall. One major reason is a decline in the availability of bond funds to partly offset CDC costs. In prior years, bond funds that were no longer needed for completed prison construction projects were used to offset the ongoing payments provided in the budget to pay off lease-payment bonds. For 2000-01, bond reimbursements are budgeted at about $29 million, a decline of about $17 million, or 36 percent, below the amount of such reimbursements included in the 1999-00 Budget Act. Because the state has nearly exhausted these surplus bond funds, larger General Fund appropriations to CDC are now required to pay off these bonds.
Federal Fund Expenditures. The Governor's budget assumes that the state will receive about $178 million from the federal government during 2000-01 as partial reimbursement of CDC's cost (estimated to be $551 million in the budget year) of incarcerating inmates in prison and supervising felons on parole who are illegally in the United States and have committed crimes in California. That is the same level of funding that the state is estimated to receive in the current year. The federal funds are not included in CDC's budget display, but instead are scheduled as "offsets" to total state General Fund expenditures for CDC and the Department of the Youth Authority.
Figures 1 through 5 illustrate the characteristics of the state's prison population, which was 162,064 as of June 30, 1999. About 93 percent of the population is male. The charts show:
The Department of Corrections (CDC) is now projecting slower growth in the prison population than the state experienced through much of the 1990s. The CDC projections suggest that the number of inmates will exceed 183,000 by June 2005. Recent prison population data suggest, however, that the growth rate is even slower than the new projections would indicate and that a stabilization in the prison population, if only a temporary one, may now be occurring.
Inmate Population Growth. As of June 30, 1999, the CDC housed 162,064 inmates in prisons, fire and conservation camps, and community correctional facilities. Based on the fall 1999 population forecast prepared by the CDC, the inmate count would reach about 165,090 by June 30, 2000, and increase further to 167,133 by June 30, 2001. These figures represent an annual population increase of 1.9 percent in the current year and 1.2 percent in the budget year. As can be seen in Figure 6, this projected trend, if it actually occurs, would be significantly slower than the 6.9 percent average annual inmate population growth the state experienced during the past decade.
The CDC projections assume that the population will increase over the following four years, reaching 183,421 inmates by June 30, 2005. This represents an average annual population increase of about 2.1 percent over the six-year period from 1998-99 through 2004-05.
Parole Population Growth. As of June 30, 1999, the CDC supervised 112,494 persons on parole. The fall 1999 projections assume that the parole population will be 114,291 as of June 30, 2000, and will drop slightly to 114,063 by June 30, 2001. These figures assume a parole population increase of 1.6 percent in the current year and almost no change during the budget year.
The fall 1999 projections also assume that the population will remain fairly stable during the following four years, reaching a total of 114,364 parolees by June 30, 2005.
Change From Prior Projections. The fall 1999 projection of the inmate population has decreased significantly from the prior CDC forecast (spring 1999), which was the basis for the 1999-00 Budget Act. The new fall 1999 forecast for June 30, 2000, is about 2,200 inmates lower than the spring forecast. As can been seen in Figure 7 (see page 36), the differences between the spring 1999 and fall 1999 inmate projections generally widen with time over the projection period. By 2004-05, the difference is almost 15,000 inmates, or the equivalent of about three prisons filled to overcrowding levels.
|Total Inmate Population
Recent CDC Projections
|Projection as of:|
|Spring 1999||Fall 1999||Difference|
|a For selected years.|
As regards the parole population, the fall 1999 projection also reflects a significant decrease relative to the prior, spring 1999 CDC forecast. The new fall 1999 forecast for June 30, 2000 is about 3,800 parolees fewer than the spring forecast. As can be seen in Figure 8, the differences between the spring 1999 and fall 1999 parole projections also widen with time over the projection period until the differential exceeds 14,000 parolees as of the end of the 2004-05 fiscal year.
|Total Parole Population
Recent CDC Projections
|Projection as of:|
|Spring 1999||Fall 1999||Difference|
|a For selected years.|
Why the Forecasts Changed Between Spring and Fall 1999. According to CDC, the lower projections in the inmate and parole populations are based primarily on the downward trend in court-ordered admissions of felons to prison. During a six-month period ending in May 1999, felon admissions fell an average of 5.9 percent statewide. In some of the largest jurisdictions, the change was even more dramatic. For example, Los Angeles County courts sentenced 13 percent fewer felons to state prison. In Orange County, the drop in admissions was 12 percent, while it was 10 percent in Sacramento County.
Of additional significance is the fact that the decline in the number of court admissions statewide is now a sustained trend--one that has occurred three years in a row. The CDC records back to 1971 indicate that the state has never sustained a drop in felon admissions for more than one year in a row. As a result, CDC has adjusted its fall 1999 projections to assume that there will be about 5,800 fewer court admissions during the budget year than the spring 1999 projections did. By 2004-05, the differential is almost 6,800 admissions annually.
The CDC suggested in its fall 1999 projections report that the continuing slide in felon admissions to prison is probably the result of several factors, including a steadily dropping crime rate, continued economic growth and the resulting low unemployment rate, and local crime prevention and prison diversion efforts.
Potential Risks to Accuracy of Projections. As we have indicated in past years, the accuracy of the department's latest projections remain dependent upon a number of other significant factors. Among the factors that could cause population figures to vary from the projections are:
Significant further changes in any of these areas could easily result in a prison growth rate higher or lower than the one contained in CDC's projections. Given the significant slowdown in prison inmate growth that has already occurred in the last two years, it is possible now that, at least on a temporary basis, the prison population may be stabilizing.
Current Inmate Count Varies Significantly From Most Recent Projections. The actual CDC inmate count has already varied significantly from CDC's fall 1999 projections. The CDC had overestimated the number of inmates who would be incarcerated as of the end of December 1999 by about 2,700. As of that same date, the fall 1999 projections underestimated the number of parolees being supervised on parole by almost 3,500.
During the first half of 1999-00, the prison population had been projected to increase by more than 1,500 inmates, but instead it decreased by about 1,400. Given the historical pattern of inmate population growth, it is likely that this downward trend will reverse itself in the spring of 2000, when more inmates normally are admitted into the prison system than at other times of the year. Even if there is a turnaround in the trend this spring, however, it still appears unlikely that the fall 1999 projection of a 1999-00 population gain of about 3,000 inmates will be achieved. Actual growth may be less than 1,300 inmates. As can be seen in Figure 9, it has not been unusual in recent years for the CDC system to absorb growth of 11,000 inmates annually.
Several factors appear to have caused the inmate population to drop during the latter part of 1999 instead of growing as had been projected. The CDC data indicate that fewer parole violators than projected are being returned to prison by administrative actions of the Board of Prison Terms, and that they are serving slightly less time in prison than had been expected. Moreover, fewer parolees than anticipated are being returned to state prison by the courts.
A number of factors have probably contributed to this result, including many of the same ones--the improved economy and dropping crime rates--that are behind the drop in felon admissions generally. But it appears probable that one factor keeping more parolees out of prison is the expansion of services for parolees that began in 1998-99, such as drug treatment, casework services, and job placement, to assist these offenders in making their transition back to the community.
The CDC data indicate that the parole "failure rate"the rate at which parolees come back to prison by actions of the Board of Prison Terms and the courtswas equal to about 67 percent of the parole population during the second half of 1999. While that failure rate is high compared to other states, the data suggest that California's parole failure rate has dropped for the second year in a row. In effect, California has reversed the prior trend of five straight years of increases in the parole failure rate that peaked at 74 percent in 1997.
The CDC data also show a pronounced difference in the trend for male and for female inmates. During 1999, the number of male inmates increased by 1,253 but the number of women inmates decreased by 265. The reasons for the difference in trends are not yet clear.
Budget Modified to Reflect Trend. The Governor's January budget proposal for CDC is ordinarily based upon CDC projections released the previous fall. However, that is not the case for the proposed 2000-01 CDC spending plan. In preparing the budget, the Department of Finance (DOF) made fiscal adjustments to account for differences between the fall 1999 projections and actual inmate and parole population counts.
Specifically, DOF reduced caseload funding for the state prisons by the equivalent of 616 inmates for 1999-00 and by 582 inmates for 2000-01. The department increased caseload funding for parolee supervision by the equivalent of 1,493 more parolees for 1999-00 and 3,946 parolees for 2000-01.
Because of these inmate and parole population adjustments, DOF has estimated that about $4.3 million less would be needed to handle the prison and parole caseload during 1999-00. Similarly, DOF adjustments mean that about $276,000 less in funding would be provided to handle the prison and parole caseload during 2000-01 than if the budget plan were based strictly on CDC's population figures.
We recommend that the 2000-01 budget request for inmate and parole population growth be reduced by $14 million because prison population growth continues to lag below Department of Corrections' (CDC's) projections. In regard to the current year, we believe that CDC caseload expenditures will be $9.4 million less than budgeted. Further changes to the CDC budget for the current and budget years should be considered following review of the May Revision. (Reduce Item 5240-001-0001 by $14 million.)
As we indicated earlier, CDC's fall 1999 population projections appear to have overestimated the number of inmates who are being incarcerated and understated the number of parolees under supervision. The Governor's budget, as submitted, adjusts CDC's fall 1999 projections to reflect a slower growth rate. However, based on our review of more recent data not available when the budget plan was drafted, we believe that if current trends hold, the adjustments made by the Governor's budget will be insufficient. Our estimates of the CDC inmate population, which take into account more recent inmate population trends, are shown in Figure 10.
|Inmate Population Assumptionsa|
|California Department of Corrections||163,840||165,881|
|Legislative Analyst's Office||161,713||163,167|
|a Average daily population.|
Current-Year Effect. Based on the population as of the end of December 1999, we estimate that the average daily population of the prison system in 1999-00 will be about 1,100 inmates below the caseload actually funded in the Governor's budget plan. We further estimate that the average daily parole population will be about 1,500 lower than the caseload actually funded in the Governor's budget plan. We estimate that the net effect of these two changes would be a savings in the current year of $9.4 million after taking into account the fiscal adjustments made by the Department of Finance.
Budget-Year Effect. We anticipate that this fiscal trend will carry over into 2000-01. Based on available population counts, we estimate that the average daily prison population in the budget year will be about 2,100 fewer inmates than the number assumed in the proposed budget. We further estimate that the average daily parole population will be about 4,500 higher than assumed in the budget plan. Based on these calculations, we believe that the CDC budget for handling its inmate and parole caseloads is overbudgeted by $14 million even after taking into account the fiscal adjustments made by DOF. (Our recommendation also takes into account our recommendation for a separate fiscal adjustment regarding the use of leased jail beds in Los Angeles County, a proposal discussed later in this analysis.)
The CDC will issue updated population projections in spring 2000 that form the basis of the May Revision. At that time, we will review whether further adjustments to CDC's funding for inmate and parole caseloads are warranted.
Analyst's Recommendation. In summary, we recommend that the 2000-01 CDC budget be reduced by $14 million from the General Fund primarily to reflect slower CDC inmate population growth. The current-year budget is also likely to reflect savings of about $9.4 million due to slower CDC caseload growth. We recommend that the Legislature consider making further CDC caseload adjustments at the time of the May Revision.
We withhold recommendation on the Department of Corrections' (CDC's) plan for housing the projected increase in the prison population because an administration decision to halt the procurement of community correctional facility beds and other factors have rendered the plan obsolete. We anticipate that the CDC will revise the housing plan at the time of the May Revision.
Housing Plan Relied Heavily on Canceled Beds. The Governor's housing plan for accommodating inmate population growth during 2000-01, which was submitted to the Legislature along with the budget for the department, assumed that almost the entire net gain in new capacity would be achieved by activating 2,000 community correctional facility (CCF) beds. These are beds in secure facilities obtained by soliciting bids from outside vendors.
The housing plan additionally provided for the activation of about 700 other prison beds, mostly for female offenders. But any gain in beds in institutions would have been offset by the deactivation of more than 700 beds in overcrowded male institutions.
However, the housing plan is obsolete largely because of significant changes in the Governor's budget that are not reflected in the housing plan:
As has been the practice in the past, CDC will revise its housing plan at the time of the May Revision to take these housing decisions into account as well as updated inmate population growth projections.
Future Impact on Privatization a Concern. Last year, the CDC advocated the procurement of 2,000 CCF beds to accommodate projected future growth in the inmate population and to address concerns about the high level of overcrowding that already exists in its prisons.
In December 1999, however, the CDC canceled the bid solicitation process to procure these 2,000 CCF beds shortly before bids were due, citing as its reason the slowdown in inmate growth. In response to our questions, the CDC has clarified that its decision to cancel the procurement does not constitute a policy decision to abandon the procurement of CCF beds as an inmate housing strategy--an approach often referred to as correctional privatization. The department has indicated that it would reassess using such an approach in the future if a high rate of inmate population growth were to resume.
The decision to cancel the CCFs may have some significant consequences, however, such as the potential impact of the action on future state privatization initiatives. Companies and local governments which invested significant amounts of funding to participate in the bidding process may be less willing to do so in the future. If the state again needs to turn to the procurement of beds from private companies or local governments, it could find fewer bidders. Because the procurement was canceled just before the state was to receive the bids, the state did not receive information that might have influenced its final decision.
We would note, however, that the proposed budget includes full funding for 500 new community reentry center beds to be activated near the end of 1999-00, as well as full funding for about 800 additional community correctional facilities on the grounds of existing public and private facilities. Both of these proposals represent continued privatization efforts, which we believe should be a part of a balanced approach to meeting the state's future needs for prison capacity.
Youthful Offender Housing Program. The Governor's budget request includes $1.2 million and about 21 personnel-years to comply with a longstanding statutory requirement that inmates under the age of 18 be housed separately from adult offenders. The CDC indicates that it now holds about 116 offenders below that age. The CDC plan is to move these offenders to the California Correctional Institution at Tehachapi in Kern County and to relocate the existing high-security adult inmates now in those beds.
Although we are concerned that CDC has not acted until now to comply with the law--the current statute was enacted in 1976--we recommend approval of the request, which includes additional funding for custody and program staff that CDC advises are necessary to ensure separation of this group from adult offenders.
Analyst's Recommendation. Because the existing inmate housing plan is obsolete, it is likely to be revised significantly at the time of the May Revision. Thus, we withhold recommendation on the plan pending receipt of CDC's revised prison inmate population projections and the updated housing plan provided in the May Revision.
The Governor has exercised his statutory authority to redirect $10.5 million provided in the 1999-00 Budget Act toward two programs: (1) in-prison drug treatment and community residential aftercare and (2) new programs for mentally ill parolees. The budget plan for 2000-01 also continues a series of additional inmate and parole programs that were begun or significantly expanded in 1998-99 and 1999-00.
Background. In a 1997 report, Addressing the State's Long-Term Inmate Population Growth, and in subsequent reports to the Legislature, we have recommended that the state take a balanced approach toward addressing a significant projected shortfall in future prison capacity and the existing high level of overcrowding of existing prison facilities. In outlining our concept of balance, we advocated building some additional prison space to hold inmates while also expanding inmate and parole programs and adopting sentencing law changes designed to slow growth in the inmate population.
In recent years, the Legislature and the Governor have pursued such a balanced approach to the prison capacity issue. In 1998, and again last year, the Legislature and Governor reached agreement on legislation authorizing the construction of additional beds for inmates while also authorizing various new programs intended to reduce the need for more prison space by reducing inmate recidivism.
New and Expanded Programs. The 1999-00 Budget Act and subsequent legislation (Chapter 54, Statutes of 1999 [AB 1535, Flores]) included funding for new and expanded programs to provide additional assistance to parolees such as substance abuse treatment, job training and job placement, literacy training, and housing placements. Chapter 54 and Chapter 617, Statutes of 1999 (AB 34, Steinberg) provided the Governor with limited authority to shift CDC funding from these programs to other specified inmate and parole programs selected by the administration.
The Governor exercised that authority to redirect a total of $4.5 million in funding to expand in-prison treatment programs and community residential aftercare for offenders with substance abuse problems. This was accomplished by (1) reducing a job placement program (Jobs Plus) by $1.4 million and (2) eliminating $3.1 million for a pilot program to test new parole supervision methods along with day reporting centers for parolees.
The Governor further exercised his authority to shift $6 million in the current fiscal year to establish improved programs for mentally ill parolees. This funding shift was accomplished by (1) eliminating $5 million appropriated for a so-called prerelease program to better prepare inmates ahead of time for their release to the community and (2) eliminating the entire $1 million appropriated to start a new community punishment program for parole violators. The Governor's actions left intact a separate $1 million appropriation, initially provided in 1998-99, to expand prerelease programs.
The 2000-01 Budget Plan. The Governor's budget plan would continue a series of inmate and parole programs that were begun or significantly expanded in 1998-99 and 1999-00. These programs are summarized in Figure 11.
In addition to these new inmate and parole programs, Chapter 54 provided $15.5 million in the current year to reduce parole agent caseloads from about 80 parolees to every one agent to a new ratio of 70 parolees per agent. The cost of carrying through with this initiative in the budget year is $16.1 million and this funding is provided in the Governor's 2000-01 budget plan.
|Augmentations for Inmate and Parole Treatment Programs|
|In-prison drug treatment and community aftercare expansion||$40.0||$69.0|
|Preventing Parolee Crime program expansion||9.5||9.5|
|Offender job placement (Jobs Plus)||1.6||1.6|
|Offender Employment Consortium||1.0||1.8|
|Pilot programs for female offenders||10.6||10.6|
|Work and education program expansion||5.0||5.0|
|Reentry center expansion (500 beds)||0.7||8.7|
|Transitional case management for parolees diagnosed as HIV-positive or having AIDS||0.8||1.5|
|Mental Health Continuum of Care programs||6.0||6.0|
The budget plan would provide for a significant expansion of the state's force of parole agents as well as the expansion of programs to assist inmates who have been released from prison in making a crime-free transition back into the community. We recommend that the Legislature approve the proposal to create a Second Strike Task Force, but consider augmentations to improve the effectiveness of this program. We recommend denial of an augmentation of a program to search for offenders who have fled on parole. Finally, we offer other options to reform the adult parole system and break California's cycle of parole failure and reincarceration. (Reduce Item 5240-001-0001 by $2 million.)
New Proposals Affecting Parole Operations. The Governor's budget plan contains three new proposals that would significantly affect parole operations beginning in 2000-01:
Our analysis of the proposal for parole agents to supervise mentally ill parolees, as well as other elements of the Governor's 2000-01 budget initiative relating to mentally ill criminals, can be found under "Crosscutting Issues" earlier in this chapter. We will discuss here the other two proposals, as well as some related recommendations.
Second Strike Task Force. We believe the Governor's proposal to target felons on parole with two or more violent or serious convictions (so-called "strikes") on their record constitutes a reasonable effort to target limited state resources toward high-risk offenders. We agree that the state should take a targeted approach to increasing parole supervision of high-risk offenders instead of a "one-size-fits-all" approach to parole supervision. As of the end of 1999, nearly 3,400 of the 5,900 offenders sentenced to prison under the "Three Strikes and You're Out" law with sentences of at least 25 years to life were parolees at the time of their most recent offense.
We believe, however, there are several options the Legislature may wish to consider to improve this proposal. For example, the Legislature may wish to consider augmenting the funding proposed by the Governor for the task force to also include funding for casework services, job placement, and other parole assistance programs that can be rapidly expanded and then designating the funds primarily for the 9,800 high-risk parolees targeted for tighter parole supervision. The proposed task force would likely prove to be much more successful in improving public safety and holding down state incarceration costs if these parolees received special assistance in making a safe transition back into the community.
The Legislature also may wish to consider augmenting the Governor's budget request to start an early intervention program that would focus primarily on this same target group. Under this concept, these offenders would face rapid and escalating punishment for repeated, minor parole violations. Offenders who began to get into trouble would be swiftly assigned to community work crews or cognitive-skills classes designed to change criminal behavior, or placed under electronic monitoring, to deter more serious conduct that would result in their return to state custody.
The investment of additional resources in these areas would likely prove to be cost-beneficial. Each such offender who fails on parole and returns with a Three Strikes sentence of at least 25 years to life would cost the state at least $460,000 over the course of their prison term. If members of this target group failed on parole at the same rate as parolees generally fail, and half were returned to prison with Three Strikes sentences, the state would bear a long-term cost for their reincarceration of more than $340 million.
Expanded Parolee-at-Large Program. We recommend the denial of this $2 million budget request because it would significantly expand a program that has failed to achieve its stated goal--reducing the number of parolees-at-large who pose a public safety risk.
Like the existing $3 million program it would expand, this proposal does not directly target the most dangerous parolees-at-large but instead a secondary, less risky group of parolees. In addition, as of last year, the state was separately providing $3.2 million to the parole division to target the most high-risk group of parolees-at-large for apprehension.
The stated goal for the $3 million program, which was initially funded in the 1996-97 Budget Act, was a 25 percent reduction in the targeted parolee-at-large population. However, the overall population of parolees-at-large is 14 percent higher than before the new program began. Given the evidence that the program is not meeting its stated goal and the lack of any independent evaluation documenting its effectiveness, we do not believe its expansion is warranted.
We believe an alternative approach more likely to result in a measurable improvement in public safety would be for the CDC to pursue the formation of additional partnerships with local law enforcement agencies for crime prevention projects focusing upon the seizure of firearms from parolees in community crime "hot spots" in order to reduce gun violence. Because the courts have held that parolees are subject to immediate search by parole agents as a condition of their parole without the delay otherwise required to obtain court-issued search warrants, the participation of parole agents in such programs can assist local law enforcement agencies in monitoring chronic offenders and conducting searches for weapons.
Research into experimental efforts in Boston and Kansas City suggests that such strategies discourage offenders from carrying guns and reduce the level of gun violence in the targeted community. The CDC is already participating in a similar effort in central Los Angeles known as the CeaseFire Project and a related "community policing" effort is being planned for the Sacramento area.
The Legislature may wish to direct CDC to consider similar collaborative law enforcement efforts targeting high-crime hot spots in other urban areas of the state. Besides having a direct potential impact on crime rates by reducing gun violence, we believe this approach would further result in the apprehension of the most violence-prone parolees-at-large.
Other Steps to Improve Parole Operations. The Legislature may wish to consider additional steps to improve public safety and hold down state reincarceration costs through further reform of the adult parole system. These steps could include:
Analyst's Recommendation. In summary, we recommend that the Legislature approve the $10.4 million proposed for the Second Strike Task Force, but consider providing augmentations to target these same offenders for additional parole services and an early intervention sanctions program. We further recommend that the Legislature not approve $2 million requested for expanding unproven parolee-at-large recovery programs. Instead, the Legislature may wish to consider alternative approaches that would likely improve public safety, such as "hot spot" gun seizures and pending legislation to "contain" high-risk sex offenders. The CDC should report at budget hearings on the status of the new parole classification system so that the Legislature can consider what additional steps toward its implementation are warranted at this time. The CDC should also report on what steps it plans to take to standardize the parole revocation decision-making process.
We recommend that Legislature review at budget hearings the findings of a Bureau of State Audits (BSA) report recommending that the Department of Corrections (CDC) establish and implement managed care practices that could help curb CDC's rapid increase in medical costs.
We recommend (1) approval of several initiatives contained in the Governor's budget plan to remedy problems in medical services identified by the BSA and by the courts and (2) reduction of the medical budget by $5.3 million for medical services contracting and medical and psychiatric supplies because the requests are based on outdated inmate population estimates. We withhold recommendation on an additional $7.6 million requested for these purposes pending a status report at budget hearings on CDC's implementation of the BSA recommendations and the projected savings from such efforts in the budget year. (Reduce Item 5240-001-0001 by $5.3 million.)
The BSA Audit Findings. Eight years ago, CDC created a Health Care Services Division to more efficiently manage the provision of medical care for state prison inmates. In January 2000, however, a BSA report commissioned by the Legislature found that the department does not fully or adequately use many standard managed care practices that could help hold down CDC's medical costs.
In particular, BSA found that the CDC uses only limited methods to contain costs and ensure uniform care and that medical operating costs vary widely among the prisons providing medical care. The BSA also determined that rapidly growing CDC pharmacy costs could be reduced if the department employed more effective contracting methods.
Given the size and rapid growth in the CDC medical operations budget, we believe the BSA findings and recommendations warrant careful review by the Legislature. The CDC's medical expenditures are growing by about $40 million annually--a total of $593 million is requested for 2000-01--even though the rate of growth in the inmate population has slowed significantly.
Analyst's Recommendations. We recommend that the Legislature take the following actions in regard to various CDC requests for additional funding for its medical operations:
A Bureau of State Audits (BSA) report has found that poor personnel management practices at state prisons are wasting as much as $35 million annually and building up a state liability of leave time that could amount to $127 million within four years. We recommend an $18.3 million reduction to reflect the savings from correcting these problems. (Reduce Item 5240-001-0001 by $18.3 million.)
We withhold recommendation on $119 million provided in the budget for overtime pay pending a review of the Department of Corrections` (CDC's) response to the BSA recommendations and a report from CDC at budget hearings regarding additional short-term funding needed to address the leave-time liability problem.
Audits Find Significant Problems. In last year's analysis of the CDC budget, we discussed the significant problems the department had been experiencing in effectively managing its prison personnel. We noted our concerns regarding high overtime costs that increased $25 million in one year, constraints on prisons' use of less costly permanent intermittent workers, and unusually high vacancy rates for custody positions in some institutions. In response to these concerns, the Legislature directed that BSA review the personnel management policies and practices at a sample of state prisons and recommend what changes, if any, were warranted in CDC's prison operations.
That audit, which was released in late January 2000, concluded that CDC has failed to effectively manage sick leave usage and its holiday and leave programs. The audit found that, as a result, the department is incurring high overtime costs primarily as a result of significant use of sick leave by custodial staff. A prior audit, released in July 1999, found that overtime was being authorized improperly for CDC employees.
Among the significant findings of the two audits:
Analyst's Recommendation. Because of the concerns raised by the BSA audits regarding mismanagement of personnel operations at state prisons, we recommend that the Legislature take the following actions:
We recommend a reduction of $17.1 million requested in the Department of Corrections' (CDC's) budget for leased jail beds, recruitment of new correctional officers, internal affairs investigations, a new inmate drug-testing program, prison construction staffing, and special repair projects. We recommend that positions proposed for development of a new training curriculum for new and existing staff be extended to two years instead of the one year that is proposed. Finally, we recommend that CDC provide the Legislature before hearings with full documentation of the details and the ramification of its departmental restructuring plan. (Reduce Item 5240-001-0001 by $17.1 million.)
The proposed 2000-01 CDC budget includes funding relating to leased jail beds, recruitment of new correctional officers, development of new training curriculum for new and existing staff, internal affairs investigations, and a new inmate drug-testing program. The budget also provides $140 million for administration of the department.
Analyst's Recommendation. We recommend deletion or a reduction of funding for various proposed expenditures that we have found are not justified, and offer other recommendations as outlined below.