Should companies that do business with California prisons be taxed to raise money for preschools?

Karina Ioffee, East Bay Times   ·   Link to Article

A Bay Area politician wants to tax companies that do business with California prisons as a way to raise money for preschool programs and reduce incarceration rates.

Assembly Bill 43, authored by Assemblyman Tony Thurmond, aims to restore some of the $227 million previously promised to preschool programs that is on hold because of state budget challenges. Without that money, nearly 3,000 children will not be able to attend subsidized preschools next fiscal year and possibly beyond. It also limits the reimbursement rates for childcare providers.

Under Thurmond’s proposal, any for-profit company doing business with the Department of Corrections and Rehabilitation, which oversees state prison and parole systems, would be taxed 10 percent. The state corrections system currently holds an estimated 1,000 business contracts with companies that provide everything from food, construction, architecture and many other services, totaling $4.5 billion, according to Thurmond’s office.

More than $2 billion of that is paid to CoreCivic, a private prison company that owns or controls 60 facilities around the country, including one in California.

“It’s long been held that preschool and after-school programs are key to preventing kids from ending up in the criminal justice system, and a good predictor whether someone stays in schools and goes to college,” said Thurmond, who spent 20 years as a social worker before running for the state legislature. “If we don’t address long-term poverty and lack of education, we’re going to see more of our youth offend and end up in prison.”

The legislation bars companies from passing the costs onto their customers by means of higher prices, and would force companies to certify under penalty of perjury that consumers aren’t picking up the tab.

The California Chamber of Commerce, reached for comment, said that it was still reviewing the proposal and has not taken a position.

Because it’s a new tax, the proposal needs two-thirds approval in the state legislature, which will be an uphill battle, according to Ron Ahnen, a professor of politics at St. Mary’s College.

“Even if Democrats have a majority in both houses, there is a caucus of moderates who aren’t excited about new taxes, so the bill has significant challenges,” Ahnen said.

Despite that, Ahnen, an expert on incarceration issues, thinks the proposed legislation is a good idea.

“It tells companies that are making money off incarceration that they owe something to society,” said Ahnen. “The majority of people behind bars are not hardened criminals… Why are we we spending billions on incarceration when we could spend a lot less on prevention?”

California has shipped thousands of its inmates to other states since Gov. Arnold Schwarzenegger ordered emergency measures to prevent prison overcrowding in 2006. Today, some 4,200 California prisoners are housed in CoreCivic facilities in Arizona and Mississippi, and another 1,900 in privately-run facilities in the state, according to California Department of Corrections and Rehabilitation data. A total of 130,000 people are currently incarcerated in California’s prison system.

The estimated annual cost to house a state prison inmate is as high as $70,000, compared to approximately $12,000 a year for quality preschool education, according to Sean Casey, the executive director of First 5 of Contra Costa, an advocacy group that invests in programs and activities focused on children during their first five years, considered the most important time in a child’s development.

“There is a raft of research that shows that investing in quality early interventions, particularly in kids in distressed communities with higher level of violence, more poverty and unemployment, results in strong outcomes,” Casey said.

The legislation is expected to be heard later this month.