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Santa Ana Jail Briefing May 20, 2014 Page 2 Update on Negotiated Rates and Cost /Revenue Strategies Two essential actions are needed to sustain viable jail operations: 1) Negotiate increased rates to ensure cost recovery and; 2) Provide for a cost restructuring that will flatten or decrease costs over the long term. An update on these actions is as follows: 1) US Marshalls: Under the existing contracts with USM and ICE, the City receives $82 per inmate per day. This rate has not been adjusted since June of 2006. The USM contract can be cancelled by either party with 30 days' notice. The ICE contract can be cancelled with 120 days' notice. Historical trends place the average daily population for the jail facility at 460 inmates. As such, in order to recover the net cost to the City of $18.5 million, the per diem inmate charge would need to increase to $110. This per diem rate would recover operating expenses, debt service, City indirect costs associated with the jail, and excludes the benefit the City receives for processing and booking individuals (Exhibit 1). The Police Chief and I traveled to Washington D.C. to meet with the US Marshalls and ICE. All costs associated with operating the City's jail facility were presented. In reviewing the City's costs, the US Marshalls agreed to a 28% increase in rates from $82 to $105. The new rate will result in additional revenue of $1,463,358. Discussions with ICE officials are still ongoing. Note: Although marginal (less than 1% of the jail population), the City has also recently negotiated a per diem rate of $146 with the cities of Tustin, Fountain Valley and Irvine. 2) Cost Restructuring Jail personnel costs account for approximately 70% of all direct costs associated with the jail. As such, reducing these costs would be essential for long -term sustainability. In order to control long term costs, the proposed restructure would require the hiring of part-time personnel in lieu of full -time positions. As such, on March 18, 2014, the City Council approved the establishment of the part -time class titled "Correctional Services Officer ". The Police Chief has requested the initial hiring of 15 part -time Correctional Services Officer positions. Currently, Personnel has identified 21 candidates. These candidates are going through the background process. It is estimated that for each full -time equivalent position hired that the City will save $57,000. Next Steps /Actions - Establish an annual review of jail operations as requested by the City Council The City Manager and Police Chief to meet with the May Day Group cc: Chief Carlos Rojas Francisco Gutierrez Ed Raya 25B -4