Report Title:

Prison Operation; Managed Competition Process

Description:

Authorizes the governor and the director of public safety to consider a managed competition process for operation of in-state correctional facilities constructed after the effective date of this Act. Requires that certain contractual provisions be included within the contract. Designates possible sites.

HOUSE OF REPRESENTATIVES

H.B. NO.

1641

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO PRISONS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

Part I.

SECTION 1. The legislature finds that the State can no longer afford to postpone the critical need for the construction of a new prison and the additional bed spaces it will provide. For example, Halawa correctional facility is the only medium security prison in the State and is currently overcrowded by more than double its capacity, even with the twelve hundred inmates housed in mainland facilities. The legislature further finds that as overcrowding continues, the State is placed in an extremely vulnerable position with regard to exposure for civil rights violations and security risks.

The legislature notes that under existing law, the governor and the director of public safety have the authority to reduce prison overcrowding. Pursuant to section 353-16.3, Hawaii Revised Statutes, the governor may negotiate with an out-of-state jurisdiction to develop a Hawaii correctional facility in that other jurisdiction. In addition, sections 353-16.35 and 353-16.36, Hawaii Revised Statutes, authorize the governor to negotiate with private entities for the development and construction of in-state correctional facilities, which the State or a private entity may own.

The purpose of this Act is to:

(1) Authorize the director of public safety, with the approval of the governor, to use a managed competition process for the operation of in-state correctional facilities constructed after the effective date of this Act;

(2) Repeal section 353-16.3, Hawaii Revised Statutes, that grants the governor the authority to negotiate with an out-of-state jurisdiction to develop a Hawaii correctional facility in that other jurisdiction;

(3) Repeal section 353-16.36, Hawaii Revised Statutes, which is reenacted in the new subsections of 353-16.35; and

(4) Designate a possible site for construction of a Hawaii correctional facility.

Part II.

SECTION 2. Pilot process for managed competition to operate a new Hawaii correctional facility. The department of public safety shall use a managed competition process to determine who shall operate the new state correctional facility. The initial contract shall be for a six year interval from the date of completion of construction.

Step 1 - Operational plan development. (a) One of the primary purposes of developing this operational plan shall be to identify all existing barriers to achieving optimum efficiencies and economies in the new facility's operation. The director of public safety shall identify, analyze, quantify, and assign all operating costs associated with implementing the operational plan in-house, including costs for labor, materials, equipment, utilities, debt service, litigation and claims, training, depreciation, insurance, and direct and indirect costs that are common to all state agencies and that the director of finance and comptroller shall provide. Using these costs, the director of public safety shall quantify the total cost of implementing the operational plan to operate the new facility for the specified operating interval in-house. To carry out this purpose, the director may include provisions inconsistent with any existing rule, administrative directive, or practice or procedure.

(b) At least eighteen months prior to the scheduled completion of the new facility, the director of public safety, with the assistance of a committee comprising as many department of public safety managers as the director designates, representatives from the department of human resources development, and exclusive representatives of the employees of the department of public safety, shall develop an operational plan for the operation of the new facility. The plan shall identify and describe, in detail:

(1) Programs, including education, training, employment, physical fitness, and substance abuse treatment that shall be implemented to provide for the care, custody, and treatment of the inmates confined at the new facility;

(2) Inmate classification and assessment system, including the development of a prescriptive treatment plan for each inmate;

(3) Standards, including physical plant, health care, life safety code, disciplinary, and staffing standards, that shall be satisfied to ensure the health and safety of the inmates confined at the new facility;

(4) Practices and procedures to be used to ensure proper execution of sentences and orders of the courts, proper care and treatment of inmates, appropriate discipline and control of inmates, and the security of all inmates, staff, and the general community, including appropriate correctional officer posts required to meet the requirements of the facility; and

(5) Executive orders, administrative rules, guidelines, procedures, directives, and other provisions relevant to or impacted by the new facility's construction and use, including rules, procedures, and classification plans prescribed by the director of human resources development pursuant to sections 76-13 and 76-17, Hawaii Revised Statutes, and other provisions of title 7, Hawaii Revised Statutes, rules and procedures of the departments of accounting and general services and budget and finance, and terms and conditions of employment collectively bargained and reduced to writing in contracts between the State and the exclusive representatives of persons employed by the department.

Step 2 - Requests for proposals. In accordance with section 103D-303, Hawaii Revised Statutes, and except as otherwise provided by this Act, the state procurement administrator, with the assistance of the director of public safety, shall develop specifications and evaluation criteria based on the operational plan, and shall solicit competitive sealed bid proposals from private providers to operate the new facility in accordance with the operational plan. The director of public safety and the state procurement administrator shall conduct all discussions and evaluations required by section 103D-303, Hawaii Revised Statutes, and shall jointly determine which of the offerors' proposals is most advantageous to the State.

Step 3 - Initial review and determination. After the completion of steps 1 and 2, an initial review shall be made by the director of public safety and the administrator of the state procurement office of the offeror's proposals determined to be most advantageous to the State, compared to the total cost of operations as determined in step 1. If the total cost is determined to be equal to or less than the dollar amount of the most advantageous offer to the State, the State shall operate the new correctional facility in accordance with the operational plan.

Step 4 - Collective bargaining negotiations. The director of public safety shall consult with the director of human resources development and the chief negotiator for the State to determine whether and to what extent existing collective bargaining agreements need to be amended to allow in-house implementation of the operational plan. The chief negotiator shall notify all exclusive representatives of the department of public safety's employees of the opportunity to negotiate a supplemental agreement for the purpose of making additions or adjustments to the existing agreements in order to implement the operational plan.

If, within ten days of the chief negotiator's request, the exclusive representatives fail to agree to reopen the existing collective bargaining agreements, the director of public safety shall award the contract to operate the new facility for the specified operating interval to the offeror of the proposal determined to be most advantageous to the State.

If the exclusive representatives of employees of the department of public safety agree to reopen the existing collective bargaining agreements, the director of public safety shall disclose to the exclusive representatives the specific details of the total cost associated with using department of public safety personnel to implement the operational plan in-house and all operating costs comprising that total, and the specific details and price of the proposal determined most advantageous to the State, to assist the exclusive representatives in negotiations for implementation of the operational plan.

The parties shall proceed to negotiate in good faith. If, notwithstanding such good faith negotiations, no agreement is reached between the State and any one of the exclusive representatives within sixty days of the chief negotiator's request to negotiate supplemental agreements, the director of public safety shall award the contract to operate the new facility for the specified operating interval to the offeror of the proposal determined to be most advantageous to the State. If the State and the exclusive representatives agree to supplemental collective bargaining agreements, the director shall initiate step 5.

Step 5 - In-house cost and contractor price comparison. The director of public safety shall revise the total cost of operating the new facility quantified in the operational plan to reflect the effect of the amendments to the existing collective bargaining agreements and compare this revised total cost to the price of the proposal determined to be most advantageous to the State. If the revised total cost is equal to or less than the dollar amount of the private contractor's price, the director shall award the contract for in-house management and the State and the exclusive representatives shall execute the amendments to the respective collective bargaining contracts. If the revised total cost is above the dollar amount of the private contractor's price, the director shall award the contract to the private contractor whose offer is most advantageous to the State.

Step 6 - Performance monitoring. (a) During the operating interval, the director of public safety, in consultation with the state monitor, if the facility is being operated by a private contractor, shall evaluate annually the operation of the facility to ensure that all services and tasks are being performed in accordance with the operational plan. If the facility is being operated by a private contractor, the director of public safety may replace the private contractor if the director determines that the:

(1) Operational plan is not being satisfactorily implemented by the contractor;

(2) Actual operating costs of operation of the new facility exceed the operating costs comprising step 2 total cost; or

(3) The contractor has abandoned or materially breached its contract before the contract's expiration.

(b) If the director determines that a replacement contractor is necessary, the director of public safety shall immediately assume operational control of the facility, if it is being operated by a private contractor. If the new facility is operated by a private contractor, the director shall have the sole discretion to provide for the continued operation of the new facility by either:

(1) Re-initiating the process at step 1;

(2) Offering a contract to the private sector offeror with the next most advantageous price to the State under step 2, if the price proposed is less than the revised step 1 total cost, or if the director is replacing the department's employees; or

(3) Replacing the contractor with the department's employees if the revised step 1 total cost is equal to or less than the price of the next most advantageous private sector offer.

The director may make offers under this replacement procedure until offers have been made to all private sector offerors and the department's employees or, in the sole discretion of the director, the director determines that it is in the State's interest to initiate step 1 of this process instead.

(c) If a private contractor is replaced by the department's employees, the State and the employees' exclusive representatives shall set out and execute the amendments to the collective bargaining agreements agreed to in step 3 of this process.

If the facility is operated in-house, the director may replace employees for breach of the supplemental bargaining agreements subject to a decision by the Hawaii labor relations board.

SECTION 3. If the contract for operation of the new state correctional facility is awarded to a private contractor, the director of public safety shall appoint a state monitor to oversee all aspects of the operation of the facility and to report to the director any conditions which the monitor perceives to be a threat to the safety of the inmates, the employees, and the public. Any contract executed pursuant to this section shall include the following provisions:

(1) Notification to the director of any inmate escapes or attempted escapes;

(2) Assessment of a financial sanction for any inmate escapes or attempted escapes, and for failure to notify the director;

(3) Access to all areas of the correctional facility to the state monitor at all times;

(4) Compliance with the standards set by any applicable national accreditation bodies selected by the director;

(5) Reasonable access to educational and rehabilitative programs for inmates;

(6) Approval from the department for transfer of an inmate to another correctional facility;

(7) The contractor shall not make a decision that affects the sentence imposed on an inmate or the time served by an inmate, nor make recommendations to the Hawaii paroling authority with respect to the denial or granting of parole or release, except to submit reports to the Hawaii paroling authority and to respond to requests by the department or the Hawaii paroling authority;

(8) The contractor shall not require that inmates engage in any type of work, except to the extent that those requirements are accepted by the department;

(9) The contractor shall not determine inmate eligibility for any form of release from a correctional facility;

(10) Provide training for all of its employees authorized to use force on inmates approved by the department, and only employees who complete the training satisfactorily shall be authorized to use force on inmates;

(11) In the event of a strike, the National Labor Relations Act shall apply;

(12) Any renewal of the contract shall be contingent, in part, upon the State's satisfaction with the recidivism rates of former inmates housed within the privately managed and operated prison;

(13) Provide access to the auditor or a person contracting with the auditor to all areas of the facility and all records maintained onsite or offsite that pertain to all aspects of the facility, including the operation, financial, and inmate records; and

(14) The contractor shall submit an annual financial and management report to the legislature twenty days prior to the convening of each regular session.

SECTION 4. All determinations made by the department of public safety, its director, or the administrator of the state procurement office pursuant to this Act shall be final. No suit may be brought under any law, including laws relating to civil service, collective bargaining, public contracts, procurement, or chapters 632, 661, or 662, Hawaii Revised Statutes, to challenge determinations made or contracts awarded by the administrator of the state procurement office, or the department of public safety or its director, once a contract to operate the new facility is awarded; provided that this section shall not preclude a contractor from bringing suit for breach of a contract awarded under the process set forth by this Act. Challenges otherwise permitted by section 103D-701, Hawaii Revised Statutes, may be brought prior to an award. Services secured by the State under any contract awarded under the process set forth by this Act, and positions and persons providing those services, are exempt from civil service and excluded from collective bargaining, and all of the provisions of chapters 76 and 89, Hawaii Revised Statutes.

SECTION 5. The director of public safety may enter into contracts pursuant to chapter 103D, Hawaii Revised Statutes, to obtain the advice and services of consultants not subject to chapter 76, Hawaii Revised Statutes, to develop the operational plan required under this Act.

SECTION 6. Nothing in this Act shall reduce or otherwise alter any authority the department of public safety presently has or subsequently is given to obtain a service by employment or contract, from a non-civil servant, a contractor, or a person holding a position exempt from the civil service.

Any provision of law or rules adopted pursuant to chapters 76, 89, or 103D, Hawaii Revised Statutes, or any section of title 7 of the Hawaii Revised Statutes that is inconsistent with this Act shall not apply, to ensure that the operation of the new facility is accomplished with optimum efficiency and economy.

SECTION 7. All supplemental collective bargaining agreements negotiated pursuant to section 2 shall remain in effect for the life of the contract.

Part III.

SECTION 8. Section 353-16.35, Hawaii Revised Statutes, is amended to read as follows:

"[[]§353-16.35[]] Development of in-state correctional facilities. (a) Notwithstanding any other law to the contrary, the governor, with the assistance of the director, may negotiate with any person for the development of private in-state correctional facilities or public in-state turnkey correctional facilities, to reduce prison overcrowding. Any development proposal shall address the construction of the facility separate from the operation of the facility and shall consider and include:

(1) The percentage of low, medium, and high security inmates and the number of prison beds needed to incarcerate each of the foregoing classes of inmates;

(2) The facility's impact on existing infrastructure, and an assessment of improvements and additions that will be necessary;

(3) The facility's impact on available modes of transportation, including airports, roads, and highways; and

(4) A useful life costs analysis.

For the purposes of this section, "useful life costs" means an economic evaluation that compares alternate building and operating methods and provides information on the design, construction methods, and materials to be used with respect to efficiency in building maintenance and facilities operation.

(b) The governor may enter into and execute contracts in the name of the State with any private entity to construct and then lease or purchase correctional facilities on public or private lands for the benefit of the State.

(c) The director, with the assistance of appropriate state agencies, shall provide criteria, guidelines, and specifications for the development of the facility.

(d) Any contract issued pursuant to this section shall comply with section 353-16.37 and chapter 343."

SECTION 9. Section 353-16.3, Hawaii Revised Statutes, is repealed.

["§353-16.3 Development of out-of-state Hawaii correctional facilities. Notwithstanding any other provision to the contrary, the governor, with the assistance of the director, may negotiate with any appropriate out-of-state jurisdiction for the development of Hawaii correctional facilities to reduce prison overcrowding; provided that any agreement negotiated pursuant to this section shall be subject to legislative approval by concurrent resolution in any regular or special session."]

SECTION 10. Section 353-16.36, Hawaii Revised Statutes, is repealed.

["[§353-16.36] Contracts for construction of correctional facilities by private entities. The governor may enter into and execute contracts in the name of the State with any private entity to construct and then lease or purchase correctional facilities on public or private lands for the benefit of the State."]

SECTION 11. Section 96-1, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) "Agency" includes any permanent governmental entity, department, organization, [or] institution, or any corporation, partnership, business, firm, governmental entity, or person who is providing privatized correctional services under contract with the State, and any officer, employee, or member thereof acting or purporting to act in the exercise of the officer's, employee's, or member's official duties, except:

(1) The judiciary and its staff;

(2) The legislature, its committees, and its staff;

(3) An entity of the federal government;

(4) A multistate governmental entity;

(5) The governor and the governor's personal staff;

(6) The lieutenant governor and the lieutenant governor's personal staff;

(7) The mayors of the various counties; and

(8) The councils of the various counties."

Part IV.

SECTION 12. Pursuant to section 353-16.35, Hawaii Revised Statutes, the governor is authorized to negotiate with any person for the development of a private correctional facility having the primary purpose of rehabilitation and capable of housing both minimum and medium security inmates in a secure setting to be situated on lands identified as a portion of TMK 3-1-6-001-025 and 3-1-6-001-002; provided that if a site is selected in east Hawaii county, the department shall partner with the east Hawaii prison advisory council pursuant to section 353-16.37, Hawaii Revised Statutes, or on any other appropriate site within the State; provided further that the facility shall:

(1) Have a bed capacity to accommodate a minimum of one thousand seven hundred inmates, with the possibility of expansion of both bed capacity and program space;

(2) Offer an extensive rehabilitation and treatment program in a facility that provides gender specific treatment as follows:

(A) Comprehensive and integrated treatment approach to rehabilitate and resocialize inmates;

(B) Substance abuse treatment, including co-occurring diagnoses; and

(C) Mental health treatment;

provided that no inmate shall be placed in the facility who requires mental health treatment or physical care that is not reasonably available in the facility;

(3) Have sufficient classrooms to accommodate the rehabilitation and treatment programs; and

(4) Offer a variety of correctional industry and educational programs to ensure that when inmates are released from the facility, they will successfully make the transition back to society equipped with employable skills;

provided further that a substantial amount of the facility's operating capacity shall be designated for rehabilitation and treatment programs; and provided further that funds for program personnel shall not be overly disproportionate to the funds for programmatic services.

The developer of the facility shall be responsible for the preparation of an environmental impact statement for the development of a private correctional facility as provided in this Act.

SECTION 13. Any funds appropriated for the development of a new correctional facility may be used to match federal funds as may be available.

Part V.

SECTION 14. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 15. This Act shall take effect upon its approval; provided that part II shall take effect on July 1, 2003.

INTRODUCED BY:

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