United States Marshals Service Intergovernmental Service Agreement for Detention Facilities with the Western Tidewater Regional Jail, Suffolk, Virginia

Audit Report GR-30-06-001
December 2005
Office of the Inspector General

Executive Summary

The United States Marshals Service (USMS) assumes custody of individuals arrested by all federal agencies. It is responsible for the housing and transportation of federal detainees from the time they are brought into federal custody until they are either acquitted or incarcerated.1 Each day, the USMS houses more than 47,000 detainees throughout the United States. In order to house these pre-sentenced detainees, the USMS executes contracts known as Intergovernmental Service Agreements (IGA) with state and local governments to rent jail space. According to the USMS, 75 percent of the detainees in USMS custody are detained in state, local, or private facilities.

An IGA is a formal agreement between the USMS and a state or local government to house federal prisoners at a fixed jail day rate based on actual and allowable costs for the same level of service provided to state or local prisoners in a specific facility.2 To request either a jail day rate, or an increase to the current jail day rate, the USMS requires the local governments to complete and submit a Form USM-243, Cost Sheet for Detention Services (Cost Sheet), to the appropriate USMS district office. The USMS district office then forwards the Cost Sheet to USMS Headquarters for evaluation and approval.

The USMS awarded the Western Tidewater Regional Jail (WTRJ) IGA number 83-92-0082 on November 01, 1992. According to the IGA, detainees are housed in the WTRJ at a rate of $65 per jail day. In April 1996, the USMS modified the IGA to include reimbursement for guard transportation services at a rate of $0.30 per mile and $10 per hour. According to the WTRJ’s accounting records for Fiscal Years (FYs) 1998 through 2005, the WTRJ was paid $17,781,769 for the housing and transportation of federal detainees under the IGA.

The purpose of this audit was to determine if the jail day rate is current and accurate; the costs for the detention and care of inmates are allowable, allocable, and reasonable under Office of Management and Budget (OMB) Circular A-87, Cost Principles for State, Local and Indian Tribal Governments; and the amounts billed are correct.3 Based on our audit of actual costs and daily population, we determined that the WRTJ’s accounting records do not support the $65.00 rate used to bill the USMS. As shown in the following table we calculated the jail day rates to be $35.00 and $37.36 for FYs 2004 and 2005.

Audit Determined Jail Day Rates

  FY 2004 FY 2005
Total Expenses $8,639,896 $9,134,595
Add: Depreciation $67,291 $130,821
Less: Audit Exceptions ($190,531) ($332,627)
Equals: Allowable Costs $8,516,656 $8,932,789
Divided by: Actual Jail Days 243,331 239,098
Equals: Audited Jail Day Rate $35.00 $37.36
Source: Western Tidewater Regional Jail financial records

Our audit determined that the USMS overpaid the WTRJ by $2,862,349 for FYs 2004 and 2005 ($1,244,220 in FY 2004 and $1,618,129 in FY 2005). Additionally, we determined that the USMS could save $1,618,129 by implementing the audited rate for FY 2006.4 We found that the overpayments were primarily due to the USMS awarding the WTRJ a $65 jail day rate even though WTRJ’s unaudited Cost Sheet only supported a $52.26 jail day rate, and the significant increase in total jail days from FYs 1998 to 2005.


  1. Federal detainees are generally individuals housed in jails awaiting trial, sentencing, or immigration hearings or removal proceedings.

  2. A jail day is the equivalent of one person incarcerated for one day and begins on the date of arrival, but does not include the date of departure.

  3. See Appendix I for more information on our objectives, scope and methodology.

  4. To determine the FY 2006 savings, we multiplied the FY 2005 federal jail days (58,543) by the difference between the current jail day rate and the audit determined rate for FY 2005 ($65.00 - $37.36).


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