Okla. Stat. tit. 57, § 57-561.1

negotiated contracts.

A. Except as otherwise provided by subsection K of this

section, prior to entering into a contract with any private prison

contractor for construction or operation, or both, of a correctional

facility, the Department of Corrections shall establish a process

for requesting proposals or negotiated contracts from such

contractors. The Department of Corrections shall develop criteria

for the process by which a contractor for the construction or

operation, or both, of a private prison is to be awarded a contract.

The criteria shall be subject to approval by the State Board of

Corrections. The criteria for selection of a site for a proposed

facility to be constructed or operated, or both, by a private

contractor shall include, but shall not be limited to, the

availability of medical services, support services, transportation

services and the availability of potential employees who would be

qualified to perform required functions at a state correctional

facility.

B. Any contract between the Department of Corrections and a

private prison contractor, whereby the contractor provides for the

housing, care, and control of inmates in a nondepartmental facility

operated by the contractor, shall contain, in addition to other

provisions, terms and conditions:

1. Requiring the contractor to provide said services in a

facility which meets accreditation standards established by the

American Correctional Association;

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2. Requiring the contractor to receive accreditation for said

facility from the American Correctional Association, within three

(3) years of commencement of operations of the facility;

3. Requiring the contractor to obtain written authorization

from the governing board of any municipality in which the facility

is to be located, or if the facility is not to be located within a

municipality, written authorization from the board of county

commissioners of the county in which the facility is to be located;

and

4. Granting the Department the option at the beginning of each

fiscal year pursuant to an agreement, to purchase any such facility,

with or without inventory or other personal property, at a

predetermined price, which shall be negotiated and included in a

schedule or a formula to be contained in the original agreement.

Such agreements relating to a correctional facility, the

construction of which was financed or is to be financed by

obligations issued from a local governmental entity the repayment of

which is to be made in whole or in part from rentals from the State

of Oklahoma or the Department of Corrections, shall be submitted to

the Council on Bond Oversight as provided in subsection I of this

section.

C. A contractor proposing to enter a contract with the

Department of Corrections for construction or operation, or both, of

a correctional facility pursuant to this section must demonstrate:

1. The qualifications and the operations and management

experience to carry out the terms of the contract; and

2. The ability to comply with the standards of the American

Correctional Association and with specific court orders.

D. In addition to meeting the requirements specified in the

requests for proposals, a proposal for the construction and

operation of a correctional facility must:

1. Provide for regular, on-site monitoring by the Department of

Corrections;

2. Acknowledge that payment by the state is subject to the

availability of appropriations;

3. Provide for payment of a maximum amount per fiscal year;

4. Demonstrate a cost benefit to the State of Oklahoma when

compared to the level and quality of programs provided by state-

operated facilities that have similar types of inmates at an

operational cost not more than the cost of housing inmates in

similar facilities and providing similar programs to those types of

inmates in state-operated facilities. The Department of Corrections
scal year;

4. Demonstrate a cost benefit to the State of Oklahoma when

compared to the level and quality of programs provided by state-

operated facilities that have similar types of inmates at an

operational cost not more than the cost of housing inmates in

similar facilities and providing similar programs to those types of

inmates in state-operated facilities. The Department of Corrections

shall be responsible for determining the cost/benefit of the

proposal;

5. Permit the state to terminate the contract for cause;

6. Contain a proposed per diem operational cost per inmate for

the initial year and subsequent years of operations;

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7. Subject to appropriations, provide that cost adjustments may

be made only once each fiscal year, to take effect at the beginning

of the next fiscal year using as the maximum percentage increase, if

any, an increase not to exceed the previous year's Consumer Price

Index for All Urban Consumers (CPI-U) as prepared by the United

States Bureau of Labor Statistics, except as otherwise provided by

subsection K of this section;

8. Have an initial contract term of not more than one (1) year,

with an option to renew for additional periods not to exceed twenty

(20) years;

9. If the proposal includes construction of a facility, contain

a performance bond approved by the Department that is adequate and

appropriate for the proposed contract;

10. Provide for assumption of liability by the private vendor

for all claims arising from the services performed under the

contract by the private vendor;

11. Provide for an adequate plan of insurance for the private

vendor and its officers, employees, and agents against all claims,

including claims based on violations of civil rights arising from

the services performed under the contract by the private vendor;

12. Provide for an adequate plan of insurance to protect the

state against all claims arising from the services performed under

the contract by the private vendor and to protect the state from

actions by a third party against the private vendor, its officers,

employees, and agents as a result of the contract;

13. Provide plans for the purchase and assumption of operations

by the state in the event of the bankruptcy of the private vendor;

and

14. Contain comprehensive standards for conditions of

confinement.

E. At the beginning of each fiscal year, the Department of

Corrections shall determine the budgeted average daily cost per

inmate. The budgeted average daily cost per inmate shall include

all direct and indirect costs incurred by the Department. There

shall be a separate computation of budgeted average daily cost for

maximum security, medium security, minimum security, and community

facilities. This information shall be presented to the State Board

of Corrections for informational purposes only. After the close of

each fiscal year, the Department shall determine the actual average

daily cost per inmate for the operational costs at each major

category of correctional facility. The actual average daily cost

per inmate shall include all direct and indirect costs incurred by

the Department. There shall be a separate computation of the

average daily rate for maximum security, medium security, minimum

security, and community facilities. The Department shall present to

the State Board of Corrections at its January meeting comparative

data on budgeted daily cost versus actual daily cost, and, after

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appropriate review and analysis, the Board shall adopt as a final

action of the Board an average daily cost per inmate by facility

category for the immediately preceding fiscal year.

F. If a request for proposal process is utilized and no

proposals conform to the established criteria, the Department shall

prepare an additional request for proposals. The Department of
d Reformatories Page 190

appropriate review and analysis, the Board shall adopt as a final

action of the Board an average daily cost per inmate by facility

category for the immediately preceding fiscal year.

F. If a request for proposal process is utilized and no

proposals conform to the established criteria, the Department shall

prepare an additional request for proposals. The Department of

Corrections shall evaluate the proposals within thirty (30) days of

receipt from the prospective contractor. The Department of

Corrections shall specifically determine whether a proposal meets

the requirements of paragraph 4 of subsection D of this section by

comparing the daily rate for housing and care of inmates pursuant to

any proposed contract with a private contractor to the daily rate

for housing and care of inmates at the comparable type of facility

operated by the Department of Corrections using the information

provided pursuant to paragraph 6 of subsection D of this section.

The Department shall evaluate proposals taking into account any

direct or indirect costs that would continue to be paid by the

Department of Corrections including, but not limited to,

transportation, records management, discipline, general

administration, management of inmate trust funds, and major medical

coverage. Such costs shall be added to the proposed per diem of the

private vendor when comparing the total per diem costs of the state

operating facilities.

G. If the Department of Corrections proposes to enter into a

contract for the construction or the operation, or both, of a

private prison, the Department shall compare both the capital costs

and the operating costs for the facility to the imputed capital

costs and the projected operating costs of a comparable facility

constructed and operated by the Department of Corrections.

H. The Department of Corrections shall deliver to the State

Board of Corrections the top three qualified prospective private

prison contractors identified pursuant to this section and pursuant

to Section 561 of this title together with the information reviewed

and analyzed by the Department of Corrections during analysis of the

proposals as required by this section. The Board of Corrections

shall evaluate the information provided and shall make a final

decision selecting the contractor within fifteen (15) days of

receipt of the information.

I. Any contract subject to the provisions of this section

entered into by the Board of Corrections shall be subject to the

approval of the Council on Bond Oversight in the same manner as

provided by law for the review of issuance of obligations by State

Governmental Entities as prescribed by Section 695.8 of Title 62 of

the Oklahoma Statutes.

J. Before submission of the proposed contract to the Council on

Bond Oversight, and prior to the date as of which the proposed

contract is executed by the Board of Corrections, the Attorney

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General and the Director of the Office of Management and Enterprise

Services shall review the proposed final version of the contract.

The Attorney General and the Director of the Office of Management

and Enterprise Services shall have a period of fifteen (15) days

from receipt of the proposed final version of the contract to

approve the contract and execute the document. If either the

Attorney General or the Director of the Office of Management and

Enterprise Services has objections to the proposed contract, the

objections shall be communicated in writing to the Department of

Corrections. The Department of Corrections shall take appropriate

action regarding the objections and shall resubmit the proposed

contract for additional review. The Attorney General and the Office

of Management and Enterprise Services shall have an additional

fifteen-day period to approve the proposed contract and to execute
e

objections shall be communicated in writing to the Department of

Corrections. The Department of Corrections shall take appropriate

action regarding the objections and shall resubmit the proposed

contract for additional review. The Attorney General and the Office

of Management and Enterprise Services shall have an additional

fifteen-day period to approve the proposed contract and to execute

the document. Failure of the Attorney General or the Director of

the Office of Management and Enterprise Services, respectively, to

act within the fifteen-day period shall constitute approval of the

respective official to the proposed final version of the contract.

The contract shall contain a separate signature block or line for

signature by the Attorney General and the Office of Management and

Enterprise Services. The contract shall contain a statement to be

executed by the Attorney General and the Director of the Office of

Management and Enterprise Services that each one of them,

respectively, has reviewed the proposed contract for compliance with

the provisions of this section and Section 561 of this title, and

all other applicable provisions of law and that the contract

conforms with those requirements. Neither the private prison

contractor nor the State Board of Corrections shall execute the

contract until the document has been executed by the Attorney

General and the Director of the Office of Management and Enterprise

Services as required by this subsection unless the approval of the

respective official has been made as a result of failure to take

action within the fifteen-day period prescribed by this subsection.

K. The State Board of Corrections may renew a private prison

contract which is in effect for any time period during the fiscal

year ending June 30, 2009, if the Board determines that the renewal

of such contract will result in a reduced per diem in the fiscal

year ending June 30, 2010. If the State Board of Corrections makes

such determination, the contract shall not be subject to the

restrictions of paragraph 7 of subsection D of this section and the

Board shall negotiate the contract based upon such terms as the

Board deems to be in the best interest of operational efficiency,

including the inmate population, per inmate cost, public safety and

such other terms as the State Board of Corrections determines to be

relevant to such contract. The State Board of Corrections shall

have the authority to negotiate the term of any contract executed

pursuant to the provisions of this subsection subject to the

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availability of appropriations to the Department of Corrections each

year.