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Jan 7, 2022

Prison Population Down, But Overhead Expenses Up

The prison also recently got an adjustment on their contract last month. Murillo explained that under the previous contract, fourteen dollars was provided to feed and shelter each prisoner per day; while, under the new contract, that amount has gone up to just under nineteen dollars per prisoner per day. Murillo explained that despite the fact that the facility is now home to some six hundred fewer inmates than it had eight years ago, the overhead expenses have gone up, and so has the cost of living, so that balances off the food bill for the reduced population.


Virgilio Murillo

Virgilio Murillo, C.E.O., Kolbe Foundation

“At the time when we went to the Government asking them for some consideration, we were hovering around a thousand fifty and by all accounts, it would seem that we’re going to be below a thousand by the end of the fiscal year this year. That is based on my historical data. What that translated to, that drop, it translated to roughly around three million dollars less revenue for the prison. And remember, there’s a fixed cost to manage a facility of this size and what the adjustment from Government did was gave us one point five million dollars more on our current budget. That would push it around nineteen dollars per prisoner per day. That is what it averages out to thereabouts. But at the end of the day, because we have reduced the population by thirty-three percent or let’s say almost six hundred prisoners, it literally means that the Government still ends up winning because they are saving no less than one point five million dollars even though they gave us that one point five million dollars adjustment. It’s really just to make us meet our actual operating expenses because we have to run the facility. When we took on the contract back in 2002, G.S.T. was at ten percent. Since we are in this business, there have been legislative changes to the G.S.T. alone and that has increased by two point five percent. You do the math on two point five percent of a million dollars and you’ll see the kind of money you’re looking at. There’s been an increase with social security contributions. We know that. So inflation by and large, cost of living by and large, in layman’s terms, will naturally maybe eat up that one point five million dollars. Who know? We might be going back to the Government and say hey, we still can’t manage now with less prisoners – yes, less mouths to feed but I don’t know if you’ve checked out (the price of) butane recently. Butane price have almost doubled. Butane prices have increased by seventy-five to eighty percent recently. That’s within the last six months – not to mention fuel prices. Let us look at shortening, shortening used to cost forty-two dollars for a case. Today shortening is eighty-four dollars a case. That’s a hundred percent increase. It has doubled.”

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