As a result of the latter investigation, in November 2014 Christopher Epps resigned as commissioner of the Mississippi Department of Corrections (MDOC), which he had headed since 2002.
[7] The next day he and businessman Cecil B. McCrory, a former state legislator, were indicted on 49 federal counts of bribery and receiving kickbacks from for-profit companies operating and serving Mississippi prisons.
[citation needed] As of 2016, the state owes $121 million in bonded indebtedness for the construction and subsequent expansions of the Walnut Grove correctional facility.
[9] In the late 20th century, the Mississippi Department of Corrections (MDOC) began to contract with private companies to build and operate prisons in the state to meet rising demand, in part due to changes in sentencing guidelines.
Counties and towns had vied to attract the private prisons, in hopes of stimulating economic development and providing jobs in rural areas.
Cornell Companies expanded the Walnut Grove Youth Correctional Facility (WGYCF), which originally opened in March 2001 under a different operator.
A state audit in 2005 showed the guard to prisoner ratio was 1 to 60, which was believed to contribute to the high rate of violence and abuses reported there.
[14][11] By 2006, the town of Walnut Grove annexed the prison site, resulting in an apparent, and dramatic, increase in the city's population, from 488 to 1,424.
[16] The 200 prison guard jobs helped employ townspeople who had been laid off by closure of a local garment manufacturing plant.
[14] Walnut Grove received payment in lieu of taxes from the prison corporation; these monies made up 15% of its annual budget.
It said that conditions at WGCF were "among the worst we have seen in any facility anywhere in the nation," characterizing both GEO and the MDOC's lassitude as ignoring the safety of young inmates, allowing a denial of required health care, and hiring guards who were known to have gang affiliations.
[22][23] Extensive testimony was heard in court related to the class action suit, including about the state's oversight of the privately run prisons.
"[24] Under the federal court decree, the state agreed to move youthful offenders (17 and under, plus some inmates under 20 who were classified as vulnerable)[20] from the prison to more suitable locations that conformed to juvenile standards.
[25] Under federal court order, the state established a state-run youthful offender unit at Central Mississippi Correctional Facility in Rankin County, for prisoners 17 and under, and 18 and 19-year-olds considered vulnerable.
[26] On April 20, 2012, the State of Mississippi announced that it would end its contracts with the GEO Group, as required in the terms of the class action settlement.
Sparkman said that MDOC would be making a new contract with a prison management company in 2012, and that it intended to include specific staffing requirements and financial penalties for failure to maintain these.
At the time, Commissioner Chris Epps, MDOC, said that the department believed it would be advantageous for the state to solicit a combined bid for all three prisons for which contracts were being offered.
Epps resigned in November 2014 and pleaded guilty in February 2015 to charges related to Operation Mississippi Hustle, a major corruption investigation by the FBI.
Managing attorney Jody Owens of the Southern Poverty Law Center (SPLC), who had led youth justice reform efforts in Mississippi, said the state ... has substituted one bad actor for another.
Private prisons have an inherent profit motive to not run facilities in a manner that's safe for the people there, and to shortcut staff and medical and mental health services whenever possible.
SPLC attorney Owens said Mississippi must take a tougher position on oversight in order to change conditions with a new for-profit operator.
"[20] The Walnut Grove Corrections Facility, used only for adults, remained under court oversight, with a federal monitor providing regular reports on conditions.
In May 2013, a series of articles in Mother Jones magazine described the Walnut Grove Correctional Facility as one of the ten worst prisons in the United States.
As a result, the federal judge in the class action suit extended court oversight of the facility for an additional period.
[28] In mid-June 2016, the state announced it would close the WGCF for budget reasons, as the demand for prison spaces had declined; this took place on September 16, 2016.
The closing of this facility is expected to have adverse economic effects in the town of Walnut Grove, which had been booming because of prison jobs and revenue.
[28] A related five-year federal investigation, named by the FBI as Operation Mississippi Hustle, has been conducted into allegations of corruption and kickbacks between state officials and private contractors.
The FBI investigation has resulted in numerous indictments and convictions by the US Attorney for the Southern District of Mississippi,[31] including of Corrections Commissioner Chris Epps; Cecil McCrory, a consultant and former state legislator; consultant Robert Simmons of Biloxi; and William Grady Sims, the mayor of Walnut Grove and director of the Walnut Grove Transitional Center.
[32] William Sims pleaded guilty to interfering with a witness and received a seven-month prison sentence, plus six months' home confinement.
The state of Mississippi has been defrauded through a pattern of bribery, kickbacks, misrepresentations, fraud, concealment, money laundering and other wrongful conduct."