The United States Marshals Service (USMS) assumes custody of individuals arrested by all federal agencies and is responsible for the housing and transportation of prisoners from the time they are brought into federal custody until they are either acquitted or incarcerated. Each day, the USMS houses more than 47,000 detainees throughout the nation. 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, and private facilities.
The USMS awarded the Central Virginia Regional Jail (CVRJ) IGA number 84-00-0013 on February 29, 2000.1 According to the IGA, prisoners are housed in the CVRJ at a rate of $50 per jail day.2 In addition, the CVRJ is also reimbursed $16.25 per hour for each guard hour providing transportation services for federal prisoners, and receives the General Services Administration mileage rate for transportation services. According to CVRJ’s accounting records for Fiscal Years (FY’s) 2003 and 2004, the CVRJ was paid $6,671,600 for the housing and transportation of prisoners under the IGA.
The purpose of the audit was to determine if the allowable costs for the detention and care of inmates under Office of Management and Budget (OMB) Circular A-87, “Cost Principles for State, Local and Indian Tribal Government” supported the jail day rate.3 We could not review the actual costs incurred by the CVRJ prior to FY 2003 because the CVRJ no longer maintained those accounting records.
We found that the USMS did not require the CVRJ to submit a cost sheet demonstrating actual and allowable costs used to derive the jail day rate for this IGA. The USMS stated to us that they did not require a cost sheet because the $50 jail day rate was the same as the rate set in 1991 under a previous IGA. However, we determined that the allowable costs and jail days identified in the 1991 cost sheet did not support a rate of $50.
At the start of our audit, we requested that the USMS provide us a cost sheet for the current agreement based on 2003 costs, which was provided in August 2004. The cost sheet proposed a $55 per diem rate for federal prisoners; however, the cost sheet figures only supported a proposed rate of $44.98. When we asked CVRJ personnel how they arrived at the $55 figure, they stated that they did not know how to calculate the figure and simply chose $55. The CVRJ indicated to us that they requested guidance from the USMS in preparing the cost sheet, but were provided inaccurate information.
Our audit determined that the CVRJ’s FY 2003 allowable costs only supported a jail day rate of $30.62 for the housing of prisoners. Applying these rates to jail days incurred in FY’s 2003 and 2004, we question $2,833,9374 and believe that $1,416,9695 could be put to better use in FY 2005.6 Although both the USMS and the CVRJ stated that the $50 rate was a result of a waiver, neither could produce a waiver.
- The effective date for the IGA was November 1, 1999.
- 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.
- For more information on our objectives, scopes, and methodology, see Appendix II.
- Questioned costs are expenditures that do no comply with legal, regulatory or contractual requirements; are not supported by adequate documentation at the time of the audit; or are unnecessary or unreasonable. Questioned costs may be remedied by offset, waiver, recovery of funds or provision of the supporting documentation.
- Funds to better use are future funds that could by used more efficiently if management took actions to implement and complete audit recommendations.
- See Appendix I for a schedule of questioned costs and funds to better use.