New Jersey has embarked on a grand experiment – shifting state prisoners from expensive state prisons into less expensive, privately-run halfway houses. The state prison system bas less than 25,000 beds while the around two dozen halfway houses in the New Jersey system house about 3,500 state prisoners and parolees. But the system is not without problems--5,100 prisoners have escaped from the halfway houses since 2005 and former employees and prisoners report that drug and alcohol use, crime and violence are rampant in some halfway houses.

Community Education Centers

The largest private influence in the halfway house system is Community Education Centers (CEC), a West Caldwell, New Jersey company that manages private jails, prisons and halfway houses throughout the United States. It operates six large facilities which account for 1,900 of the state's 3,500 halfway house beds. CEC also runs the 900-bed Albert M. "Bo" Robinson Assessment and Treatment Center (Bo), which acts as both a halfway house and an intake center for state prisoners transitioning into the halfway house system. Prisoners who are deemed low risk at Bo are transferred to other halfway houses, including those run by other private entities.

CEC is enmeshed in New Jersey politics. New Jersey Governor Chris Christie was registered as a lobbyist for CEC in 2000 and 2001. Later, he kept close ties with CEC, visiting the company's facilities and praising CEC repeatedly while serving as a U.S. Attorney, a position that has little to do with state corrections.

William J. Palatucci, a senior vice president at CEC, is Christie's close friend, confident, political advisor and former law partner. A Republican, Christie became governor in 2010. That year, he hired the son-in-law of John

J. Chancey, CEC's founder and CEO, to work as an assistant in the governor's office with a $42,000 annual salary.

CEC's political ties are not limited to the Republican Party or the current governor. Such is the clout of CEC that, in the 1990s, regulators allowed CEC to set up a non-profit organization called Education and Health Centers of America (EHCA) to skirt the state statutory requirement that only nonprofit agencies receive contracts to operate halfway houses. EHCA has a mere ten employees. Chancey receives a $351,346 annual salary from EHCA, which is required to disclose its financial reports, in addition to the salary he receives from CEC, which is privately-held and does not disclose its finances.

The primary purpose of EHCA seems to be to funnel the hundreds of millions of dollars it receives from state and county agencies to CEC as its sole "subcontractor." Thus, the vast majority of the $71 million CEC received from New Jersey state and county agencies in fiscal year 2011 came through EHCA.

Halfway House Escapes Are Rampant

The total state and county private halfway house budget in New Jersey was $105 million in FY 2011. With so much money on the line there is a question of whether the privately-run halfway houses are worth the money the taxpayers are spending on them. One persistent problem has been a high rate of escapes from the halfway houses.

"The [halfway house] system is a mess," according to Thaddeus B. Caldwell, who, as a senior state corrections investigator, spent years tracking escapees. "No matter how many escaped, no matter how many they still kept releasing more guys to halfway houses, and it kept happening over and over again."

Caldwell is right, the number of monthly halfway house escapees astonished even those people involved in corrections--46 in September 2011, 39 in October, 40 in November and 38 in December. This led Christie to brag that "only" 181 escaped from halfway houses in the first five months of 2012, after he instituted reforms. But this still compares poorly with the record of the much larger state prison--3 escapes in 2010 and none in the first nine months of 2011, the latest period for which statistics are available.

About 10,000 state prisoners and parolees pass through the halfway house system each year. CEC officials use that number to claim that their escape rate is "staggeringly low." But that argument holds little water when one compares the escape rate to that of the state prison system or considers that there are only about 3,500 people in the halfway houses at anyone time.

Halfway house officials complain that halfway house residents returning late from work release or surrendering themselves after a couple of days absence are harmless, yet often considered escapees. They also point out that their employees are unarmed and without authority to stop an escape and that they depend upon educating those in halfway houses as to their best option to prevent escapes.

Escapees Rarely Prosecuted

Those points may have some validity, but they ignore the fact that many of the escapees are from "locked down" halfway houses, those with no work-release program, and few escapees are prosecuted for the escape once they are recaptured. For instance, the prosecution rate for Essex County escapees has been 10% since 2009.

Sometimes the low prosecution rate reflects local prosecutors' lack of interest in prosecuting a minor infraction which will be handled through the prison system's disciplinary procedure, but often law enforcement officials don't even know that a person has escaped from a halfway house until that person commits another crime--sometimes not even then.

Rafel Miranda escaped from a halfway house and was on the run for four months with no one looking for him until he fatally shot a man in Newark, three miles from where he escaped. In 2010, David Goodell, imprisoned for assaulting his ex-girlfriend, escaped from Logan Hall, a Newark halfway house with one of the highest escape rates--185 from 2009 through 2011--and murdered another young woman who had broken off her relationship with him.

Valeria Parziale escaped from a Trenton halfway house in 2009. Nine days later, she used a folding knife to cut of£ a man's ear in a liquor store. She was charged with assault, but not escape r because prosecutors had no clue that she was an escapee.

Reasons for Escapes But why are so many people, who are on parole or only a few months away from being released, throwing it all away to escape from a halfway house?

Halfway houses run by the Kintock Group, a nonprofit, amounted to almost half of the escapes in recent years. CEC uses this to deflect criticism that there is something wrong with CEC's management of its halfway houses. But the Kintock Group points out that all of the prisoners sent to its halfway houses are first sent to the CEC-run Bo facility for evaluation. Only those deemed low-risk by CEC are sent on to Kintock facilities. For 2009 through 2011, 16% of the escapees escaped from CEC-run halfway houses, but another 43% of the escapees had first been evaluated as "low-risk" by CEC then escaped from other halfway houses. Therefore, improper evaluation by CEC is an explanation for some of the escapes.

Another explanation is the growth in the percentage of prisoners convicted of violent crimes who are being transferred to halfway houses which grew from 12% in 2006 to 21% in 2012. This coincides with a budget-savings-driven expansion in halfway house use. And the incentive to use halfway houses is unlikely to change. It costs between $125 and $150 a day to house a prisoner in a state prison, but only $60 to $75 to put the same prisoner in a halfway house.

Dangerous Environment in Halfway Houses

If you ask some former halfway house residents and workers though, you get a different explanation for the escapes. They say that halfway houses are violent, dangerous, gang-infested places rampant with drug use and other contraband.

"This industry just infuriates me," said Nancy Wolff, director of the center for Behavioral Health Services and Criminal Justice Research at Rutgers University. "If you want to go there and sit in peer-run groups--or hang out and smoke and play cards and have access to drugs--it's a great place."

But according to Vanessa Falcone, 32, there is a much darker side to some halfway houses. Falcone was assigned to a cleaning crew at Bo in 2009 when an employee ordered her into a closet and forced her to perform oral sex on him.

"He took his pants off and grabbed my hair and pushed me down," said Falcone. "That started a few weeks of basically hell."

After a senior guard discovered what was going on, Falcone was transferred to another halfway house and the employee was fired, but not prosecuted for sexually assaulting Falcone.

In a similar incident, a woman who escaped from Bo and was recaptured told police she was trying to get away from a Bo counselor, Joseph A. Chase, who had repeatedly raped her. When police searched Chase's car, they found drugs. They then arrested him and charged him with sexual assault and drug possession. CEC officials claim that this was an isolated incident.

Both former employees and prisoners describe Bo as dangerous--especially at night. Prisoners are housed in barracks-style rooms with only one or two low-wage, poorly-trained employees to oversee each 170-person unit overnight. Some of the employees are so afraid they refuse to patrol the halls. Thus, at night, the rules of the jungle prevail--with robberies, sexual assaults and the weak being preyed upon by the strong. Employee say that many prisoners ask to be returned to the state prison system because they feel safer there.

"They definitely told me, 'I want to go back to prison, said former Bo G.E.D. teacher Assenka Okiloff, 50. "They would tell me that all the time."

"It's not a safe environment-not safe for inmates or for staff," according to Robert Brumbaugh, former deputy director of security at Bo and a 25-year veteran of the prison system. "it was horrendous."

Unqualified Personnel and Falsified Treatment Records

But the purpose of Bo and the other halfway houses is to provide training and therapy to belp the prisoners succeed. Their records show them doing so. How then could it be that, when Mercer County conducted a surprise drug test of the 75 prisoners it had housed at Bo in August 2009, 55 (73%) came up positive for drugs, test results confirmed by former Bo prisoners?

"Bo is like the projects," according to Matthew Leibe, who was incarcerated at Bo in 2011. "I'm walking down the hallway from mess and I'm getting approached by everybody selling everything. 'I've got batteries, T-shirts, weed, heroin, coke…’”

One explanation former employees gave for the prevalence of drugs at Bo is rampant falsification of inmate records. The records show drug treatment and other classes as well as drug tests, all of which never occurred. When the services are offered, they are given in a haphazard fashion or by untrained employees merely reading the written materials to the group.

Denette Pasqualini, 40, was hired as a counselor at Bo in June 2011. She had what she thought was relevant experience working security at Six Flags, but soon found out that nothing was right at Bo. Supervisors drank whiskey hidden in soda bottles, counselors were having sex with prisoners and when she tried to intervene when a prisoner stabbed another prisoner with a pen, the other prisoners held her back. She also observed counselors warning prisoners of pending drug tests, allowing them to take urine cups into the bathroom without supervision and simply doctoring the test documents so that they showed prisoners passing drug tests who had not been tested.

"The staff is from the Trenton area and know the inmates from the streets," said Pasqualini. "They say: 'I'm not going to give her a drug test. I know her. I'll let it go.’”

Cynthia Taylor, 55, another former Bo counselor, falsified records and saw others falsify them after she was hired despite having no previous counseling experience. She was told to give five lectures on drug treatment therapy and parenting.

"When we had to have a report for a group session," she said. "We would look at what was said for the last group and cut and paste.

"We all understood it was a numbers game, Community Education made money not on how many people were rehabilitated. 'How many bodies can we get in here and keep here for a certain amount of time?' That's what they were interested in."

State Officials Ignore the Problems in Halfway Houses

When these kinds of problems are brought to the state government's attention, they are often ignored, according to Bronislaw Szulc, formerly a senior state official in charge of investigating conditions at halfway houses. Szulc said he submitted reams of documentation of drug use, violence, lax security and escapes at Bo and other halfway houses before he retired in 2010. But state officials rarely held the halfway houses' operators accountable, instead demanding that he soften the criticism in his reports.

"I was told to stand down and ease up--not to go after things so hard," said Szulc. Contraband in Halfway Houses The influence of gangs explains some of the prevalence of violence and drugs in the halfway houses. "Beyond outright threats and shakedowns, even time on a facility’s pay phone was found to be controlled and sold by gang members," said Lee C. Seglem, assistant director of the State Commission of Investigation which investigated the influence of gangs in the correction system in 2009. The commission found that gangs were a much greater problem in halfway houses than prisons. Clearly, where there are gangs there will be contraband brought in by gang activity. Some halfway houses have a form of work release which might explain the presence of contraband. Bo is not one of them. Bo is a locked-down facility that was opened in 1997 and named after a former Trenton city councilman. Despite its locked-down status, there have been at least nine escapes from 80 since 2009 and drug use is rampant. CEC's hiring standards may also help account for its contraband problems. Dana Vetrano was hired off the street as a counselor at Bo. She had done time for armed robbery and she wasn't the only ex-con hired. "They were from the streets," she said. "They needed a job, they came in from the street, they were hired--that was it. They had no qualifications. Nothing.

"I used to dread going into that place, because of the staff."

The Government's Response to Halfway House Problems

So what is the Christie administration doing to reign in the anarchy in the halfway house system? According to David W. Thomas, the executive director of the parole board, his agency conducted an inquiry. But Thomas refused to give any details of the inquiry and, when asked for a copy of the findings, he said, "There is no actual document.”

In July 2012, the state legislature held two days of hearings into gan~ activity, violence and drug use in halfway houses. The hearings were prompted by a New York Times expose of the problems at the halfway houses Which followed a ten-month investigation by the newspaper. Afterward, legislators vowed to introduce bills increasing the oversight of halfway houses and improving contracting procedures.

In August 2012, the $45,000 in fines were announced for nine escapes from six balfway houses, two of which were run by CECa That was the largest sanction ever taken against private halfway houses and was the result of a review of the escapes which occurred during th previous nine months. The only other fines against halfway houses amounted to $30,000 in April 2012 for six other escapes which occurred between July and September 2011. Six of the fifteen escapees were from CEC-run halfway houses--more than any other fined halfway house operator.

At the same time that it was announcing fines of $5,000 per escape, the Christie administration was working to reduced halfway house oversight. In June 2102, Christie issued a line-item veto to diminish new disclosure requirements and, in August 2012, he significantly weakened a requirement for special audits of halfway house contracts.

Legal Challenge to Validity of CEC Running Halfway Houses

Meanwhile, the local union that represents Essex County guards has filed a lawsuit in state Superior Court alleging that the largest halfway house in the state, the l,200-bed CEC-run Delaney Hall in Newark, has been operated for more than a decade without legal authority. The suit by the Policeman's Benevolent Association alleges that EHCA is Ita sham nonprofit corporation engaged solely in activities designed to generate income for" CECa It challenges the waiver granted by the attorney general in the 1990s. In addition to the funding it received for housing state prisoners and parolees, CEC also received a $130 million contract in December 2011 to house Essex County prisoners and federal immigration detainees at Delaney Hall.

The lawsuit is not the first legal challenge to CEC's halfway house arrangement, but it is riding on the wave of publicity created by the New York Times expose.

"We need to get a judge’s opinion on whether or not it's illegal," said Joe Amato, president of the union local and a named plaintiff in the lawsuit. "When you incorporate profits into corrections, that's when corners are cut, because everyone is worried about the bottom line instead of safety.1t

That sound like a great argument for banning privately-run prisons, jails and halfway houses.

Sources: New York Times