Private Prison Contractor Donates $10,000 to Governor's Fund; Gets $20
Million California Contract Two Months Later

With the appearance of a stunning return on investment, GEO Group, a
Florida-based private prison contractor, won a $20 million-sole-source
award from the California Department of Corrections and Rehabilitation
(CDCR) less than two months after GEO deposited a $10,000 check into
California Governor Arnold Schwarzenegger's initiative campaign committee's
account.

According to public records, GEO has donated $68,000 to various
Schwarzenegger committees in the past two years. CDCR officials insist
there is no connection between the donations and contract, as did Marty
Wilson, the governor's chief fundraiser. Wilson's comments came days after
Schwarzenegger announced he will return a $50,000 check from a partner in a
Native American tribal casino project, after public outcry that he
negotiates with tribes for casino permits. The GEO contract is at arm's
length, Wilson distinguished, because GEO negotiates with a state agency,
not the governor. However, Kathy Feng, executive director of California
Common Cause, a citizens' finance reform watchdog group, called the timing
particularly troubling.

Ted Slosek, CDCR spokesman, reported that GEO was the only bidder for the
200 man McFarland (Fresno area) minimum-security community correctional
facility. GEO had operated that facility for a decade before the state
terminated the contract in December 2003 under guards' union (CCPOA)
pressure to phase out such privately run facilities. The McFarland property
continues to be leased from Correctional Properties Trust, an entity whose
board includes Schwarzenegger's former finance director, Donna Arduin.
Arduin insists she played no role in the California lease or GEO contract.
CDCR currently is awarding four private prison contracts for a total of
1,017 beds.

Sources: San Jose Mercury News, Associated Press.