Detention Center Fails to Help Impoverished Rhode Island Town
By Maggie Clark, Staff Writer
For years, the faded industrial town of Central Falls, Rhode Island, the poorest community in the state, teetered on the brink of bankruptcy. Its one longstanding hope was that the Wyatt Detention Facility, a privately operated installation built in 1993 for federal prisoners, would eventually bring in the jobs and pay the impact fees needed to keep the town afloat.
But it hasn't worked. For the past three years, Wyatt has been unable to pay the town any of its $525,000-per-year impact fees because the federal government removed all its detainees after one of them died there while in custody. This past spring, Central Falls officially went bankrupt.
Since then, things have only gotten worse. Last week, the CEO of the Wyatt Facility, Michael Fair, told a state investigating commission that the firm won't be able to pay impact fees to the town anytime soon. The company is $7 million in debt as a result of years of poor management and low occupancy rates, according to the Providence Journal .
What some are calling a "raw deal" for Central Falls might offer suggestions for other states and cities looking to private prisons as an economic development plan. State Senator Elizabeth Crowley, who represents Central Falls and chaired the state commission, says that when setting up private prisons, states need to take extra care in choosing the prison's board of directors. "I think that when they set up boards," Crowley says, "they need to be made up of people who are very knowledgeable about not only how to conduct prison, but finances as well. There was not enough oversight here."
After the commission began its investigation, it was revealed that the legislation creating the public-private detention center did not specifically mandate impact fees to the town, even though the center was given tax-exempt status on the assumption that it would pay the impact fees. Under Fair's leadership, Wyatt has streamlined its finances and is holding more detainees, which brings in more money, but the detention center will not be able to resume paying impact fees until it pays down the $7 million-dollar debt.
The commission may issue recommendations as early as January on how to change the relationship between the community and the facility. This could include revising the legislation which initially created the detention center to force the prison to pay impact fees to the struggling town.
Senator Crowley remains hopeful that once the detention center gets a handle on its finances, it could still be an economic asset for Central Falls. "The prison has been a good neighbor to the town," Crowley says. "But it needs to pay its bills."