The Office of the Inspector General (OIG), Audit Division has audited costs incurred in relation to the Intergovernmental Service Agreement (IGA) between the United States Marshals Service (USMS) and the Hamilton County, Tennessee, Silverdale Correctional Facility. Under the agreement, the Hamilton County Silverdale Correctional Facility houses adult male and female detainees at a jail day rate of $37.81. The Federal Bureau of Prisons (BOP) and the Department of Homeland Security (DHS) also house detainees at the correctional facility under the $37.81 rate for the IGA.1 Hamilton County has requested an increased jail day rate of $38.81, which similarly will apply to the BOP and DHS.
Our audit objectives were to determine whether: (1) information in the Cost Sheet for Detention Services is accurate, complete, and supported by adequate documentation; and (2) the requested daily rate is supported by adequate documentation and is based on reasonable, allocable, and allowable costs in accordance with applicable laws, regulations, guidelines, and terms and conditions of the IGA.
For the period July 1, 2004, through June 30, 2005, the USMS, the BOP, and the DHS paid or were billed a total of $1,373,046 to house federal detainees. Details of the billing and payments are shown below.
- The USMS paid Hamilton County $1,285,200 for fiscal year (FY) 2005 to house an average of 93.1 detainees per day. The USMS also paid Hamilton County $8,143 for the services of transportation guards and mileage for transporting detainees.
- The BOP paid Hamilton County $53,805 for FY 2005 to house an average of 3.9 detainees per day.
- The DHS was billed by Hamilton County $34,041 for FY 2005 to house an average of 2.5 detainees per day.
The USMS entered into the agreement with Hamilton County on April 1, 2003, for a fixed per diem jail day rate of $37.81. Hamilton County submitted an FY 2005 Cost Sheet for Detention Services requesting a jail day rate of $38.81. Based on our audit of Hamilton County’s FY 2005 actual costs and actual daily population, we found the requested jail day rate of $38.81 was overstated. We determined the audited jail day rate to be $38.35, primarily because of $125,882 in unsupported and unallowable operational costs. The largest exceptions pertain to unsupported personnel expense, unreported income, and unallowable maintenance expense.
Assuming the requested rate of $38.81 is approved and used in the future, and the average annual jail days utilized by the USMS remain constant along with recurring costs, the USMS would have funds put to a better use of $15,631. Similarly, the BOP would have funds put to a better use of $655 and the DHS would have funds put to a better use of $420; however, we make no recommendation regarding the use of the IGA by DHS.
Our findings are described in detail in the Findings and Recommendations section of this report. Our audit scope and methodology appear in Appendix II.