CoreCivic sells Kansas prison, leaving Leavenworth with oversight and financial questions

TOPEKA — CoreCivic on Wednesday announced the sale of its Leavenworth prison facility to the federal government, likely negating months of negotiations and court hearings city officials pursued to ensure the humane treatment of immigrants detained there. 

Nashville-based CoreCivic announced in a news release that it sold two facilities, Leavenworth’s Midwest Regional Reception Center and the Prairie Correctional Facility in Appleton, Minnesota, to U.S. Immigration and Customs Enforcement. CoreCivic will continue to operate both facilities. 

The sale was a blow to Leavenworth city commissioner Holly Pittman, who only agreed to a special use permit in March that put restrictions and expectations on how CoreCivic would operate the Leavenworth prison because she was concerned the sale would happen. 

During negotiations, she said a sale to the federal government would mean the community loses control of how the prison was operated. The special use permit – much debated in contentious public hearings – outlined staffing ratios and allowed city officials oversight of the prison through a community committee. 

Now Pittman’s worst expectations may come true, although she said it is too early to fully understand implications of the sale. But federal buildings typically don’t pay property taxes, for instance, which means the county stands to lose tax dollars, she said. 

As part of negotiations, CoreCivic agreed to make annual payments to Leavenworth to help pay for costs the police, emergency services and others would bear because of the prison. The first payment of $1.5 million was made, Pittman said, but future payments are obviously in jeopardy.

“I was concerned that was going to happen, so now we’re just working through what it means for us, what it means for the special use permit, what it means for property tax revenue, what it means for the oversight committee,” Pittman said. “We’ve got a lot of safeguards that were in there.”

Pittman said the city learned early Wednesday morning about the sale, and that city attorneys are working to understand implications for Leavenworth. 

“My priorities are with the taxpayers, the residents, to remain protected, and that these safeguards remain there,” she said. “We want to make sure there’s still transparency there, accountability. I don’t know that we’ll have that now with the federal government.”

Midwest Regional Reception Center  sold for $238.4 million and the Prairie Correctional Facility for $495.6 million, the CoreCivic release said.

“After federal and state income taxes of approximately $182.2 million and transaction costs, the Company anticipates its net proceeds from these asset sales to be approximately $522.5 million,” the release said. 

This story is developing.