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Prison closing a blow to County

by Larry Patrick

WALSENBURG- Walsenburg and Huerfano County could face an economic loss of up to 20 million dollars in the next year if CCA closes its prison in April. With 90 employees from Huerfano County facing job losses, Huerfano County Administrator, John Galusha says the loss in wages alone would amount to 2.7 million dollars based on an average of $30,000 per local employee of CCA. A dollar goes through a community up to 7 times, benefiting businesses and individuals. That would amount to around 20 million dollars. That doesn’t tell the entire financial story.

    The news last week that Arizona was transferring all of their 700 prisoners from the CCA prison in Walsenburg back to Arizona was devastating news for the Huerfano County area. Arizona had just made a deal last year to transfer those prisoners to Walsenburg and pay more to house them than Colorado would for the prisoners that were here. The economy played a major part in the decision by Arizona officials to take their prisoners back. It could also leave a gaping hole in the local economy if CCA is unable to garner another contract to house prisoners in Walsenburg.

    CCA says it is seeking another contract to keep the prison in Walsenburg open but they also have a facility in Oklahoma that is 3 times larger than the one locally that is also in danger of closing because of Arizona’s decision.

    Mayor Bruce Quintana’s comment on a Pueblo TV station last week that the City of Walsenburg will just have to try and find a replacement for CCA jobs is easier said than done in this economy. CCA employs 188 people, approximately 90 of which live in Huerfano County. There’s too much revenue to be lost so the Huerfano County Commissioners, City of Walsenburg and other community leaders will be working to encourage CCA to find a way to stay. In situations like this, the prevailing wisdom is that it is easier to try and keep what you have than trying to find a replacement for it.

    Galusha, says a Colorado legislative committee, the County Commissioners and CCA have met to discuss the situation. CCA is looking to California and Texas to see if they have prisoners they might consider sending here or their prison in Oklahoma.  CCA is responsible for the current amount of property taxes for this year and 2011 which amounts to around $700,000 per year. CCA would still be responsible for property taxes after that but the amount could be different.

    There is money available from the Sudden & Severe Economic Dislocation Fund that the City of Walsenburg and Huerfano County could be qualified. The money is for communities that lose a major business that affects over 10% of the workforce. The dollars could be used to try and find employment for displaced workers locally.

    Here is what Walsenburg and Huerfano County both face if CCA does indeed close their doors in April:

1.Loss of approximately 90 jobs. With the money lost by these workers, it creates a big void for the local economy in local dollars spent and sales tax revenue collected to go into the city and county budgets.

2.CCA is offering local workers opportunities to relocate to their other facilities. If many of the approximate 90 Huerfano County workers at the facility were to leave, the loss of future revenue from those people also has a negative impact on the local economy.

3.Huerfano County’s budget takes a big hit, as a per diem of 50 cents per day, per prisoner, is taken in by the County. With 700 prisoners, that is a loss of approximately $350 per day amounting to around $135,000 per year in lost revenue according to Galusha.

4.Property taxes amount to around $700,000 per year. While CCA will still be responsible for property taxes, it’s not known if the value of the facility being empty, will amount to as much after 2011.

5.The City of Walsenburg is already facing financial troubles. If CCA closes, it will face even bigger problems. Since CCA is one of the biggest employers locally, the City of Walsenburg loses out on water and sewer income and from revenue on natural gas sales to heat the facility. Let’s break that down to an approximate value. The exact figures cannot be released because of privacy laws dealing with individual or company’s utility costs.

A.Each commercial toilet in Walsenburg is assessed a monthly fee of around $60 each. CCA has literally hundreds of toilets at the prison. Depending on the exact number of toilets, the City could face a monthly loss in sewer rates alone of $15,000 to $25,000 per month.

B.The water usage to run a 700-bed facility is enormous and would result in many thousands of dollars of additional lost revenue for the City.

C.The cost to heat such a large facility would also create a loss of many thousands of dollars per month.

    The cost to the City could be $30,000 to $40,000 or more per month resulting in an annual loss of  $300,000 to $400,000 per year in utility sales. Again, these are approximate numbers but either way you figure it, the financial impact will be huge. The impact could easily reach 20 million dollars or more that is lost for all local government entities and businesses from lost wages and sales tax revenue, etc.

    The local business community could face a dim 2010 and beyond if CCA were to leave. Such a loss of a big, local industry could prove the downfall to businesses that are barely hanging on now in this tough economy.

    While there is hope that natural gas exploration and wind farm developments may bring jobs to Huerfano County in the future, the immediate future and the long term future is much bleaker if local officials and leaders can’t find a way to keep CCA operating in Walsenburg. There will be a lot of work behind the scenes in the next 60 days to save the CCA facility.

    We’re not doomed yet but time is short to find a way for CCA to remain in Walsenburg.

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