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Push for private prison was downfall

  • Author: Tom Kizzia
  • Updated: September 27, 2016
  • Published August 12, 2008

An intense political battle over private prisons in Alaska kept the state's jail-building efforts tied in knots for a decade, ending only in 2005 after complaints of strong-arm lobbying helped turn legislative sentiment against the idea.

A driving force for privatizing prisons throughout that time was Bill Weimar, the former halfway house official who pleaded guilty Monday in U.S. District Court to conspiring to make illegal payments to a legislative candidate in 2004.

Weimar was the principal spokesman for the first two private-prison proposals to surface in the 1990s, but faded into the background after selling his halfway houses in 1998 to Cornell Corrections, a national prison company based in Houston.

Even as late as the summer of 2004, however, when the private prison idea was on its last legs, Weimar held a substantial interest in the deal, standing to make $5.5 million if a private prison was ever built, according to the federal charging documents filed Monday.

Among Weimar's private-prison partners, at least for much of the time he was pushing the idea: Veco Corp.

Resorting both to raw political muscle and to high-flown sentiments about saving money and bringing Native prisoners home, backers of the private prisons won legislative support for successive plans aimed at Anchorage, Delta Junction, Kenai and Whittier. Two prison deals were approved, and two others made it through the state House. Competing proposals to build state-run facilities were shoved aside.

But each private plan eventually died, falling victim to local opposition, resistance from prison guard unions and skepticism from Republican and Democratic governors.

Meanwhile the number of state prisoners shipped to the Lower 48 because of inadequate space here grew to more than 800. A new 1,500-bed state-run prison now being built in the Mat-Su Borough is intended to bring many of those inmates back to Alaska.

Through the years, debate centered on whether inmates could be housed reliably and cheaply in a facility designed and run by a for-profit firm. The stakes were high: a 25-year prison deal, worth $1 billion, would have been the largest state-private contract in Alaska history.


Corrections Group North, the original design-build joint venture pushing a private deal, included not only Cornell and Weimar's company, Allvest, but the well-connected oil field services and construction firm Veco. Some of Juneau's top lobbyists worked for the cause, and they had strong advocates in the Legislature.

Among the elected leaders were the House Finance chairman, Rep. Eldon Mulder, R-Anchorage, whose then-wife worked with Cornell lobbyist Joe Hayes, and former state Sen. Jerry Ward, who had ties to the Kenai Natives Association, a Cornell partner. Ward's real estate firm managed pull tab parlors for the Kenai Native group.

With each plan came complaints about backroom deals.

"What I see, over and over, is repeated sole-source, pre-arranged, heavy-money deals that go to specific contractors. ... It's never been a clean, competitive proposal," Rep. Eric Croft, D-Anchorage, complained in a 2004 committee hearing. "We are going to see somebody indicted and probably imprisoned over this series of proposals."

The first proposed private prison would have been built on Veco-owned land in South Anchorage. A contract was approved by the House in 1997, but with a Senate vote pending the idea was withdrawn on the eve of a citywide vote.

Anchorage voters went ahead to reject the idea by a 2-1 margin -- what one Assembly member called "driving a nail in the coffin."

The idea quickly rose again, with help from Ward, who put together a plan for facilities in the Mat-Su and Seward. The plan was publicly praised by Weimar, but was soon replaced by the idea of locating a private prison at the mothballed Fort Greely near Delta Junction.

A deal with Allvest was approved in 1998, both by local voters and then the Legislature. But after Weimar brought Cornell into the consortium that year, a change of sentiment in Delta Junction upended the contract. The prison companies sued and won a settlement of $1.1 million.


The prison backers bounced back, striking a deal with Kenai Natives Association and taking it to the Kenai Peninsula Borough. The borough assembly invited proposals from other firms. Corrections Group North finished second in the bidding, but was bumped to first on the strength of its proposed Native-owned location and its political expertise.

The Legislature approved the Kenai project in May 2001, but once again local opposition was rising. The borough assembly decided to seek voter approval, and when the project lost by a 3-1 ratio the plan died.

After a brief dalliance in Wrangell, the Cornell private prison made its last stand in Whittier. The isolated Prince William Sound port jumped on board within six weeks of the Kenai vote. But momentum in Juneau was beginning to slacken. For three legislative sessions the private prison issue was debated without a decision.

By the summer of 2004, Veco was out of the consortium and the Whittier plan was limping along. That's when, according to the charges he pleaded guilty to on Monday, Weimar made illegal payments to a legislative candidate in return for the candidate supporting the project. The effort failed, and in March 2005 Whittier announced it was done with the prison.

Cornell continued with its halfway houses in Alaska but said it was no longer interested in pursuing a private prison in Alaska.