The United States Marshals Service’s Cooperative Agreement Program

Audit Report 05-28
June 2005
Office of the Inspector General

Background A strategic objective of the Department of Justice (Department) is to provide for the safe, secure, and humane confinement of detained persons awaiting trial and sentencing. One of the Department’s strategies to achieve this objective is to acquire needed detention capacity through a multi-pronged approach that includes agreements with state and local governments, contracts with private vendors, construction and operation of federal detention facilities, and the use of alternatives to detention. In November 2004, the Office of the Inspector General (OIG) included detention and incarceration as a top Department management challenge because of the current overcrowding rate in federal prisons and problems noted in our audits and reviews relating to medical contracting costs. The United States Marshals Service (USMS) assumes custody of individuals arrested by federal agencies and houses and transports detainees. Each day, the USMS houses about 49,000 detainees in federal, state, local, and private jails throughout the nation. Bed space for housing detainees are provided through: Cooperative Agreement Program (CAP) agreements with state and local jails, where the Department provides capital investment funding in exchange for guaranteed bed space; Intergovernmental Service Agreements (IGAs) with state and local jails, where the Department pays a daily rate to the jails; private jail facilities, where the Department pays a daily rate to house detainees; and federal detention facilities, where the Department pays for construction and operation of the facilities. Overcrowding in federal prisons limits the option of using federal prisons to house USMS detainees. In addition, the USMS is also reluctant to use private jail facilities because the jails usually require a minimum number of detainees to be housed at the facilities. Consequently, the USMS primarily has used IGAs and CAP agreements to meet its need for detention space. The USMS contracts with about 1,300 state and local governments for jail space. Seventy-five percent of the detainees in the USMS’s custody are detained in state, local, and private jail facilities. In locations where detention space is scarce, the USMS provides state and local governments with funds from the Cooperative Agreement Program (CAP) to improve local jail facilities or to expand jail capacities. In return, the state and local governments guarantee the USMS space for Federal detainees for an agreed-upon number of years.4 Use of the bed space also requires an IGA between the USMS and the facility. When the USMS uses the bed space guaranteed by the CAP, it pays a jail day rate to the facility for each detainee as negotiated through the IGA. The jail day rate is based on the annual operating cost of the facility and can be periodically modified. The USMS has internal guidelines to determine if a CAP agreement is needed to secure detention space in areas where detention space is scarce. According to the USMS CAP Training Manual, prior to awarding a CAP agreement the USMS’s Prisoner Services Division should consider: 1) the results of annual detention status surveys completed by USMS District offices for each court city, 2) whether a reported shortfall in the number of required detention bed spaces is continuous and is not based on a temporary increase in the detainee population, 3) if there is a more economical way to meet the detention need in the local court city, 4) whether existing Bureau of Prisons (BOP) facilities located within a reasonable distance have space for USMS detainees and are being fully utilized, 5) whether any detention facilities within a reasonable distance could be utilized by participating in an Intergovernmental Agreement (IGA) or by expanding an existing IGA, and 6) if existing CAP agreements in the District can be expanded or extended to meet bed space needs.5 The USMS Prisoner Services Division annually reviews CAP agreements that are about to expire and determines the need for expanding or continuing the agreements. To aid in this review, the Prisoner Services Division obtains an annual survey from each USMS District office for each of the 280 federal court cities in the United States. Appendix III of this report contains examples of FY 2004 federal court city surveys. The Appendix contains three examples, one each for the reported Detention Status categories of “no problem,” “serious,” and “emergency.”6 Before determining if a CAP agreement is needed, the U.S. Marshal in a particular district must coordinate with the BOP to ensure that existing BOP facilities located within a reasonable distance from the federal court city in question that have space specifically dedicated to house USMS detainees are being fully utilized.7 Use of BOP space takes priority because this space is provided at no cost to the USMS. If there is no BOP space available, the District must identify all facilities within a reasonable distance to the court city that may be interested in entering into an IGA with the USMS. According to USMS guidelines, new cooperative agreements should be considered as a solution only when IGA participation and existing cooperative agreements are not viable options to adequately meet detention bed space needs. As of January 13, 2005, the USMS was managing 180 active CAP agreements totaling about $208 million and guaranteeing 11,203 bed spaces. Budget Responsibilities for the CAP While the USMS has primary responsibility for implementing the CAP within the Department of Justice, the budget responsibilities for the CAP involve multiple agencies. CAP funding, if provided by Congress, is contained each year in the Office of Justice Programs (OJP) appropriation. However, OJP has no responsibility for implementing the CAP. Prior to FY 2003, OJP transferred the CAP funding to the USMS for implementation of the program. Beginning in FY 2003, OJP transferred the CAP funding to the Office of the Federal Detention Trustee (OFDT), which then transferred the CAP funding to the USMS.8 Before FY 2004, the CAP budget was processed as follows. The USMS submitted its request for CAP funding through OJP to the Department of Justice’s Justice Management Division (JMD). JMD analyzed the USMS’s CAP funding request and made recommendations to accept, increase, or decrease the USMS’s request. The revised CAP funding request was then included in the Department of Justice’s budget submission to the Office of Management and Budget (OMB). The OMB reviewed the CAP funding request and made recommendations to accept, increase, or decrease the request. The revised CAP funding request was then included in the President’s budget request to Congress. Congress debated the President’s budget request and made appropriations, which may or may not have included funds for the CAP. Initial budget estimates are submitted about 18 months before the start of the fiscal year and therefore the FY 2004 budget initially was compiled in the spring of 2002. Until the spring of 2003, the USMS had been responsible for preparing the budget for its detention activities. At that time, the OFDT took over the detention budget planning function by preparing the FY 2005 budget request and making recommendations regarding the CAP funding request before it was submitted to JMD. Funding History for the CAP The Attorney General is authorized to make payments from funds appropriated for the support of United States detainees by entering into contracts or cooperative agreements with any state, territory, or political subdivision thereof for the necessary construction, physical renovation, acquisition of equipment, supplies, or materials required to establish acceptable conditions of confinement and detention services.9 In return, the state or local jurisdiction must agree to provide guaranteed bed space for federal detainees within its correctional system. Since 1982, the USMS has awarded about $285 million to state and local jurisdictions under CAP agreements that have provided more than 13,600 guaranteed spaces for federal detainees. However, in recent years, Congress reduced the appropriation for the program from $35 million in FY 2001 to no appropriation in FY 2005, as shown in the following table. Budget Requests and Approvals FY 2001 through FY 2006 (In Millions) Organization FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 USMS Request $167 $45 $35 $46 $2 $52 OFDT Recommendation N/A N/A N/A N/A N/A10 $20 JMD Recommendation $35 $60 $5 $5 $2 $2 OMB Recommendation $35 $35 $0 $0 $0 $0 Congressional Appropriation $35 $20 $5 $2 $0 Not Enacted Source: USMS Prisoner Services Division, OFDT, JMD, Appropriations as Enacted As explained in detail in the first finding of this report, for FY 2005 neither the Department nor OMB requested an increase above the $2 million CAP appropriation for FY 2004. For reasons not specified in its accompanying report, Congress provided no appropriation for the CAP in FY 2005. Prior Audit Reports The OIG previously audited the USMS CAP and, in a March 1992 report, we found that the USMS did not: consistently apply criteria for proposed CAP projects and thus did not have adequate assurance that CAP funds were disbursed only where needed; have a satisfactory system for forecasting its prisoner workload and detention space requirements; obtain guarantees of jail space of sufficient duration when it awarded CAP funds for construction, expansion, or renovation of buildings; adhere to its policy of mandating periodic reports from both the local USMS Districts and the recipients of awards; and always enforce the terms of the CAP agreements by recouping funds from jurisdictions which failed to honor the agreements.11 In response to our 1992 report, the USMS stated that it had: established an enhanced review process to identify and prioritize CAP projects; continued efforts to obtain longer guarantees for CAP projects that fund construction, expansion, or renovation of buildings; worked with the BOP, INS, and other members of the Department’s Detention Planning Committee to develop projections for detention requirements from FYs 1993 through 1997; modified the USMS’s Prisoner Population Management System to capture the daily prisoner population totals to obtain an actual average daily prisoner population each month; took steps to hold U.S. Marshals accountable for progress report submissions; and reached agreement with three jails that had not complied with the CAP agreement terms by increasing the number of USMS detainees that the jails would house each year. In September 1992, the General Accounting Office (GAO) reported that OMB staff believed CAP bed space was less economical than BOP bed space and that OMB staff preferred to fund more permanent BOP jails.12 However, the GAO report indicated that CAP bed space is cost effective and fills needs the BOP cannot meet. The GAO also reported that the BOP believed it was not cost-effective to build jails with capacities of less than 500 beds. The GAO recommended that the Director of the OMB reexamine the OMB’s concerns about the cost effectiveness of CAP bed space and more carefully evaluate and balance a variety of cost elements in assessing the cost-effectiveness of this program. In response to the GAO’s 1992 report, OMB said that it would take the recommendation into consideration. However, OMB disagreed with the assumptions underlying the GAO’s analysis of comparative CAP and BOP costs in two respects. First, OMB disagreed with the GAO’s use of the current average per diem because many of the current rates were negotiated years earlier, and if renegotiated at that time would result in a higher average cost. Second, OMB disagreed with the GAO’s use of 30 years as the useful life of a BOP facility before major renovation or repair costs are required because BOP facilities continue to be used past the 30-year point without renovation. In December 2004, we issued a report on the OFDT in which we found that although the OFDT had been in place for almost four years, it had not completed the goal of centralizing and overseeing the Department’s detention activities. The former INS’s transfer to the DHS, leadership vacancies, and other obstacles had complicated the OFDT’s ability to build a firm foundation with a clearly defined organizational purpose. In addition, funds had to be transferred to the OFDT from other Department initiatives to cover detention fund shortages.13 We made 11 recommendations to assist the Department and the OFDT in improving its management of detention activities. In response to our 2004 report, the OFDT stated that it undertook various corrective actions, including: requiring the USMS to develop a district-level operating plan that must be submitted to the OFDT for approval for FY 2005, refining the model for projecting future detention space needs by incorporating measurable and reliable leading indicators, and updating the FY 2006 budget request to ensure that a shortfall does not occur. Audit Approach Our audit approach focused on whether the USMS had developed plans, in the absence of CAP funding, for: 1) replacing bed spaces that will no longer be guaranteed when existing CAP agreements expire, and 2) securing detention space in court cities where jail space is scarce but no CAP agreements exist. To achieve these objectives, we reviewed applicable federal laws, regulations, policies, manuals, memoranda, USMS files, and prior audit reports. We also interviewed officials from the USMS’s headquarters and selected District offices, JMD, the OFDT, and OMB. For additional details of our audit methodology, see Appendix I. Footnotes Congress mandated than any CAP agreement with a cost per bed space that exceeds $25,000 must remain in effect for no less than 15 years. An IGA is a formal written agreement between the USMS and a state or local government to house federal detainees at a fixed per diem rate based on actual and allowable costs for the same level of service provided to state or local prisoners in a specific facility. Prisoner Services Division staff told us that they assume there is no problem if a District does not complete a survey for a court city. Besides reporting the Detention Status for each court city, the Districts are requested to describe other initiatives that might affect local jail population and thus bed space needs, such as current drug, gun, immigration, and violent crime initiatives. The Districts are also asked to identify local facilities with jail construction or renovation plans, and additional local jails with available beds, that could house detainees for Districts experiencing emergency bed space shortages. The USMS defines reasonable distance as a drive of one hour or less each way from the court city to the detention facility, taking into consideration factors such as typical weather conditions, road conditions, traffic, and geography. In FY 2001, Congress approved the Department of Justice’s request to establish the OFDT. Historically, the confinement of persons in federal custody awaiting trial or immigration proceedings was the responsibility of the USMS and the former Immigration and Naturalization Service (INS). The detention activities of the former INS were transferred to the new Bureau of Immigration and Customs Enforcement when the Department of Homeland Security (DHS) was created in March 2003. The funding authority regarding cooperative agreements for detention services is contained in Title 18, United States Code, Section 4013. Beginning in FY 2005, the USMS submitted its budget requests through the OFDT. However, the OFDT did not make a funding recommendation for the CAP in FY 2005. Office of the Inspector General Audit Report number 92-8, “United States Marshals Service Cooperative Agreement Program,” March 1992. The GAO report is entitled “Federal Jail Bedspace: Cost Savings and Greater Accuracy Possible in the Capacity Expansion Plan,” report number GAO/GGD-92-141, September 1992. On July 7, 2004, the GAO was renamed the Government Accountability Office. Office of the Inspector General Audit Report number 05-04, “Department of Justice Office of the Federal Detention Trustee,” December 2004.