First Fully Privatized Prison Opens in Houston Under CCA Contract with Immigration and Naturalization Service

Corrections Corporation of America (CCA) opens the first adult detention facility to be fully managed and run by a private corporation in the United States in over a century. After winning “the first contract ever to design, build, finance and operate a secure correctional facility” from the Immigration and Naturalization Service (INS), CCA faces an unrealistic 90-day deadline and converts the Olympic Motel on I-45 North in Houston into a makeshift detention center. On January 22, 1984, co-founder T. Don Hutto personally fingerprints the first 87 immigration detainees.

CCA subsequently constructs a permanent Houston Processing Center—a $5 million, 350-bed facility that becomes the model for the entire private prison industry. The facility’s construction cost of $14,286 per bed establishes the economic framework for privatized immigration detention. This contract creates the template for privatizing government functions: corporations design, build, finance, and operate facilities while billing the government per bed, per day—a model that incentivizes maximum detention capacity and occupancy.

The Houston facility launches immigration detention as a major profit center, establishing a revenue stream that grows from CCA’s initial contract to representing 30% of CoreCivic’s revenue and 43% of GEO Group’s revenue by 2022. The success of this first facility demonstrates to Wall Street that human detention can be a scalable, profitable business model.