Otay Mesa Prison Overrun Hits $13.4 Million

Multimillion-dollar cost overruns--a bane of the state’s ambitious prison construction program--emerged Wednesday on two facilities, including one in San Diego County.

State Department of Corrections officials told a legislative committee that the cost overrun on a 2,200-cell medium-security prison on Otay Mesa has grown to $13.4 million.

The total cost has risen to nearly $154.6 million, which prison officials say is still $40 million below the estimate for the original design, which was vetoed by lawmakers.

A new 1,700-bed medium-security prison in the Amador County community of Ione, about 35 miles southeast of Sacramento, is $1.9 million over budget, despite a savings of $2.8 million in the award of bids, officials said. The total estimated cost now stands at $138.6 million.

The overruns were the latest in a series that has plagued the state’s planned $2.5-billion prison construction program, aimed at housing an inmate population that has grown to 59,454. That figure is 176% of the current system’s capacity.

Prison officials defended the latest overruns, telling legislators that inflation and higher costs in some geographic areas were much to blame.

“I think we’ve done an excellent job” of keeping the price as low as possible through innovations and adoption of state-of-the-art planning, said Jim Gomez, the department’s chief deputy director. “We’re not going to cut these costs. It’s just not in the cards.”

Sen. Robert Presley (D-Riverside) who chairs the two-house Committee on Prison Construction and Operations, asked whether contractors were gouging the state by purposely submitting higher than necessary bids.

“I don’t think the building industry is taking advantage of the state in any way, shape, or form,” Gomez said.

Part of the problem may stem from the increased building activity throughout the state, legislators and prison officials speculated. Contractors, flush with plenty of work, have little incentive to compete aggressively on bids, they said.

Assemblyman Richard Floyd (D-Hawthorne) criticized prison planning officials for “low-balling” estimates by omitting estimates of inflation. Gomez said inflation is taken into account but can be difficult to anticipate and can change swiftly.

Committee members and prison officials disagree over whether the increases require committee approval.

The department says it has been advised by the attorney general’s office that the committee’s price cap on the Otay Mesa prison was waived when it approved a new design for the project.

The first 500 cells at Otay Mesa are finished and ready for occupancy, but will apparently sit vacant until a dispute between Republican Gov. George Deukmejian and Democratic state Senate leadership over a proposed new prison in Los Angeles County is resolved.

State law says new prisons in San Diego County and Stockton cannot be occupied until a prison site has been authorized in Los Angeles. But an Administration-supported bill by Presley to approve a site near East Los Angeles has been held up in the Senate due to objections by Senate President Pro Tempore David Roberti (D-Los Angeles), other senators and Los Angeles Latino community activists.