Trump policy a boon to Boca firm

Boca Raton-based Geo Group is in a strong position to capture millions of dollars in business from the Trump administration’s order last week not to separate undocumented families who cross the U.S. border.

On Friday, a “request for information” on 15,000 beds in different locations was issued by the Department of Homeland Security and U.S. Immigration and Customs Enforcement.

Geo operates one of the three family centers for detention: the Karnes Family Residential Center in Karnes City, Texas.

Geo and competitor CoreCivic, which have empty beds in facilities and already operate detention ICE and the

U.S. Marshals Service, are likely to benefit from President Donald Trump’s executive order that ended his controversial policy to separate parents and children who are caught entering the country illegally. Families now will be detained together while they await criminal and immigration proceedings, which means more beds will be needed.

Geo spokesman Pablo Paez declined the South Florida Sun Sentinel’s request for an interview concerning Karnes and potential business from Trump’s order. “We would have to defer to ICE and DHS for questions on the executive order as well as the government’s future plans,” Paez said in an e-mail.

In operation since 1984, Geo owns or manages 141 prisons or detention centers totaling about 96,000 beds, according to the company website.

In Florida, Geo operates the 700-bed Broward Transitional Center at 3900 N. Powerline Road in Deerfield Beach for ICE, according to its website. It also operates prisons in South Bay, Moore Haven, Panama City, Graceville and Milton.

Both Geo and CoreCivic’s stocks rose Friday as investors bet on a rising demand for detention beds.

The federal government’s request for information was issued to gain information about availability and pricing of family residential centers to house “adults with juvenile family members of all age ranges” who were detained after illegally crossing the U.S. border. The residential centers “must appear residential and child-friendly rather than penal in nature,” according to the notice.

Geo operates one of three family centers for detention that combined have 3,326 beds, according to an April report by the Government Accountability Office. Geo’s Karnes Family Residential Center in Texas has a capacity of 1,158, according to a company filing. The other family centers are the Berks County Residential Center in Leesport, Pa., which is operated by that county, and the South Texas Family Residential Center in Dilley, Texas, which is run by CoreCivic, formerly the Corrections Corp. of America.

Pictures of Karnes Family Residential Center on Geo’s website show a playground and picnic tables. The company has had an ICE contract since 2010 to manage what was a detention center in Karnes. In 2014, it was converted into a family residential unit for women and children. Geo expanded the center in 2015, according to a securities filing.

Though Karnes is designated as a “residential facility,” the women and children held there “are locked in, and attorneys and visitors are locked out unless they follow very specific rules to gain entry,” according to a 2014 report on Karnes by the Civil Rights Clinic and Immigration Clinic at the University of Texas’ School of Law in Austin.

Karnes still is a detention facility though it is called a “family center,” said Barbara Hines, founder of the Immigration Clinic at UT-Austin, who last visited Karnes in January to speak with the women and children the clinic represents in asylum cases.

“Their liberty is restrained. They can’t leave. They have to get up at a certain hour. They have to go to bed at a certain hour,” she said. “Women and children share rooms with unrelated women and children.”

Hines said many of the women held at Karnes fled domestic or gang violence in Central America; there also are some Mexican immigrants at the center. They know they have to cross the U.S. border to be considered for asylum, she said.

“It goes to how desperate families are to protect their children. Nobody would make this journey unless they were fearful of what would happen to their children in their home countries,” Hines said.

Geo is in the business of building and operating prisons and detention centers for federal and state law enforcement agencies. In 2017, it recorded revenues of $2.26 billion, up nearly 4 percent over the previous year.

Chairman and CEO George Zoley has told Wall Street analysts during an earnings conference calls in March that he expects Geo will be awarded additional contracts from ICE and the U.S. Marshals Service, which also operates detention centers.

Zoley said a steady stream of illegal border crossings in the southwestern United States has paralleled with increased occupancy at its detention centers. “We expect it to increase,” he said, adding that Trump has indicated he will be asking for new detention centers in the 2019 fiscal budget starting in October.

In fiscal year 2017, ICE operated on a budget of nearly $3 billion to manage the U.S. immigration detention system, according to the Government Accountability Office report.

Geo has been poised for additional ICE, U.S. Marshal’s and Bureau of Prisons contracts since the Trump administration reversed a 2016 move by the Obama administration to reduce the number of federal prisons in private operation due to concerns about their safety levels and high costs.

But after Trump was elected, the reduction plan was rescinded and prison stocks more than doubled in price.