Cost of Supervision
 Fiscal Year 1993-94



North Carolina's prison system consists of 95 prison units of various sizes with 31 of the units having a standard operating capacity of less than 100 inmates. The three smallest units, Wilmington, Warren, and Granville have a standard operating capacity of 26, 28, and 36 respectively. The largest facility, Central Prison, has a capacity of 947. The State's legacy of small prisons comes from its history. Most prisons were built during the Depression years when the state assumed responsibility from the counties for housing prison road crews.

This legacy, coupled with the large number of small prison units, is what drives up the cost of North Carolina's prison system. For example, the Fiscal Year 1993-94 per inmate daily operating cost of the 42 bed medium security prison unit at Moore County was $103.44 compared to the $50.82 per inmate daily operating cost of the recently constructed 624 bed medium security unit at Brown Creek. Thus, it is readily apparent that the economy of scale spreads out the fixed operating costs in larger units operated by the Division of Prisons and lowers the per inmate average daily operating costs.

The $50.82 cost per inmate at Brown Creek Correctional Institution compares favorably to the State's current contracts with private industry providers in Tennessee and Oklahoma. The Tennessee contract is for 320 medium security beds at $55.00 per day and Oklahoma is for 550 medium security beds at $53.73 per day. The Brown Creek daily costs do not include any capital costs while the Tennessee and Oklahoma contracts do not factor in some significant administrative costs such as extraordinary medical expenses and the costs related to the diagnosis and classification of inmates.

Costs for Housing Prisoners in North Carolina

The system wide average operational cost for housing inmates in North Carolina prisons in Fiscal Year 1993-94 was $58.58 per day.

Administrative costs for the Department are pro rated into the Division of Prison's costs. The average daily costs, on this basis, for the various custody levels are shown in the following table.

Fiscal year 1993-94
Maximum $92.25
Close $71.77
Medium $62.41
Minimum $49.71
All levels $58.58

There is a broad variation of costs per inmate within the security levels in fiscal year 1993-94. Facilities that house Close custody inmates ranged in cost from $62.09 for Eastern Correctional Institution (average daily population of 507) to $99.68 for Blanch Correctional Institution (average daily population of 127). For Medium custody, the costs ranged from $45.83 per day for Sampson Correctional Institution (average daily population of 479) to $97.36 at Yancey (average daily population of 63 but under recent Small v. Martin ruling has a maximum daily population of 44 at a daily cost of $134.75). Minimum security facilities ranged from $33.60 at Davidson Correctional Center (average daily population of 256) to $86.51 at Warren Correctional Center (average daily population of 72 but under recent Small v. Martin ruling has a maximum daily population of 49 at a daily cost of $ 125.43).

There is also a broad variation of costs per inmate based upon the size of the prison unit. Facilities that house less than 100 inmates on a daily basis cost considerably more than facilities housing from 100 to 500 inmates per day or for those housing over 500 inmates. The table on the following page compares the costs of prison units by size and security level. The information in the table does not include hospital units or other units with special functions.


Fiscal Year 1993-94



$89.44 $60.39 $50.69

Cost for Housing Inmates in Other States

The Corrections Yearbook, published by the Criminal Justice Institute, compares information about prison systems each year. In the 1994 edition they reported on their 1993 survey which found that North Carolina prison costs were near the middle of the list of state costs, ranking 17th. In this survey, North Carolina reported a prison system wide daily cost of $57.56 per inmate based upon the 1992-93 Fiscal Year which compares favorably to the national average of $52.38.

While this survey is useful for making some comparisons, it should be noted that states do not have uniform cost accounting procedures. For example, North Carolina has prison hospitals at McCain and Central Prison and much of the medical costs for inmates at the other facilities are transferred, along with inmates to be treated, to those hospitals. Other states provide medical services to inmates from other state agencies so that full costs may not always be reflected in the agency budget figures used to calculate costs.

North Carolina's main source for ranking as high as 17th in the nation is due to the number of employees required to staff the State's 95 prison units - the most prison units in any state. Again, North Carolina's legacy of small prison units drives up the cost of the prison system and requires more employees to operate. The General Assembly has recognized this and has recently funded the consolidation of 5 prison units in the Warren County area and is considering funding one or two additional consolidations. The Government Performance Audit Committee (GPAC) recommended that a total of 30 small prison units be consolidated into five or six regional prisons.

Costs for Housing Prisoners in Private Prisons

There have been some recent scholarly studies of privatized prisons and their costs. Mr. Charles Perusse, of the Fiscal Research Division of the General Assembly, reported on these studies for his thesis project. The studies covered a period of time up to 1992. Mr. Perusse found studies reporting a cost savings of from five to fifteen per cent savings by privately run prisons as compared to state run prisons. However, other studies in his research found no cost savings. The reported savings by the privately run facilities seemed to be achieved through reductions in personnel costs. This was often done by making substantial numbers of positions less than full time, thus avoiding the need to provide health care and other benefits.

The Fiscal Research Division estimated that the cost for contracting private beds for the Cap removal was $59.46 for medium security when administrative and certain other necessary costs are added to the direct charge. That amount, which includes capital costs, is about 5% lower than North Carolina's average cost of $62.41 for medium security not including capital costs. However, the $59.46 is 17% higher than the $50.82 daily cost of the recently constructed Brown Creek Correctional Institution. Currently, North Carolina has contracts with privately run prisons in Tennessee for 320 medium security beds at $55.00 per day and in Oklahoma for 550 medium security beds at $53.73 per day. These contracts do not include some administrative costs borne by the Department nor do they include the cost of extraordinary medical costs.