Cayetano negotiating new jail in Halawa Valley

By Johnny Brannon
Advertiser Staff Writer

Gov. Ben Cayetano's staff has assumed direct responsibility for negotiating with developers to build a jail in Halawa Valley, and the administration hopes to strike a deal by the end of Cayetano's term in office on Dec. 2.

Officials won't say whether an agreement would require a private company to operate the facility rather than state employees, but Cayetano has said he is open to such an arrangement if it would save taxpayers money.

"The state has been working on this for a long time, and we're hopeful we can complete negotiations very soon," said Sam Callejo, Cayetano's chief of staff. "Because we are in negotiations, we aren't in a position to comment on specifics."

The Legislature authorized Cayetano several years ago to directly negotiate with developers for a new jail, but the administration first had the Department of Accounting and General Services seek bids for the project.

Cayetano's staff took over after the single bid DAGS received was turned down in August. Officials said they could not legally provide details about the rejected bid, but characterized it as "substantially higher" than the state's $130 million estimate for the project.

Some lawmakers favor privatizing the new facility to save money, but some reform advocates worry that could create a profit motive to keep nonviolent prisoners locked up instead of referring them to community-based drug abuse treatment programs.

The new jail would be built adjacent to the Halawa Correctional Facility, a state prison. It would replace another jail, the crowded O'ahu Community Correctional Center in Kalihi.

OCCC has space for 954 inmates but often holds more than 1,100. The population includes felons awaiting trial or sentencing, misdemeanants serving short sentences, and parole violators headed back to prison.

Callejo said no decision has been made about the future of the OCCC site if the facility is replaced.

The group that submitted the earlier bid to build the new jail was led by a Mainland architectural and construction management firm called Durrant. The company is based in Iowa and has branches in eight other states, including Hawai'i.

State officials would not confirm whether Durrant is the company they are negotiating with, or whether there are others. Durrant officials did not return calls. The company's Hawai'i branch is part of a group recently chosen to design a $30 million astronomy education center for the University of Hawai'i-Hilo.

Department of Public Safety director Ted Sakai has been involved in the negotiations for the jail and said they are taking longer than expected, but that the project must be affordable.

"We were hoping to have a decision made by now, but we just haven't been able to conclude it," he said. "We have a certain amount of money. We can't negotiate a deal that we can't pay for."

Sakai said officials hope to nail down an agreement by the end of Cayetano's term but don't want to rush into a bad deal.

"We know we have to make a decision real soon," he said.

The state's original plan was to raise money for the project by issuing debt instruments called certificates of participation, then buy the facility through lease payments over 30 years.

That method would be more expensive than issuing bonds, but would not count toward the state's debt ceiling and would allow the project to be built faster.

It also would not have to compete with more popular projects, such as schools and libraries, for support from the Legislature for bond financing.

Reach Johnny Brannon at jbrannon@honoluluadvertiser.com or 525-8070.