Alabama prison plan could be dead after major investors pull out

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MOBILE, Ala. (WKRG) — Gov. Kay Ivey’s plan to have a private company build new prisons in the state, then lease them to the state may be dead in the water.

It was announced Monday that a major investor in the plan, Barclays Capital, is pulling its support.

In a statement, the financial company said, “While our objective was to enable the state to improve its facilities, we recognise that this is a complex and important issue. In light of the feedback that we have heard, we will continue to review our policies.”

Several published reports on Monday, including Bloomberg News, reported that Barclays and Keybanc Capital Markets were pulling out of the plan.

The two investment groups were underwriting a deal between the state and CoreCivic, a private real estate company that owns and manages private prisons. The deal that Governor Ivey signed without input from the legislature was said to have cost the state about $3B over the life of the 30-year lease.

The original plan would have seen the building of three modern prison facilities, one near Atmore, Al. in Escambia County, and one in Bibb and in Elmore Counties. It was a deal that has seen harsh criticism, particularly from members of the legislature and Alabama State Auditor Jim Zeigler. In a statement, Zeigler said, “the Ivey plan may be dead – thankfully.  Governor Ivey would not listen, but the investors did listen.”

The Department of Justice filed a lawsuit against the state in December alleging Alabama’s prison system violated inmates’ constitutional rights. The lawsuit alleged incidents of excessive abuse by guards, prisoner on prisoner violence, and sexual abuse.

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