Contracts 101

Every first year law student learns about contracts. You learn about “offer” and “acceptance” and “consideration”. Unfortunately, everything you learn about contracts gets thrown out the window when a governmental agency is involved.



Inmates become very familiar with DOC’s contracting skills. Just looking at the costs, terms, and limitations makes you think someone at DOC is either getting kickbacks or is a complete moron.


Take the following examples of government contracting impotence:


Corrections Cable. DOC signed a contract with an outfit from Texas called Corrections Cable to provide cable TV service to DOC facilities. First, its not cable. The channels are fed to the prison by satellite. Second, service standards are terrible. Channels go out every day. Third (and most important) it is more expensive than either cable or satellite service through local providers in the facility’s area.


DOC’s contract is a cash cow for Corrections Cable. The cost is high, the channel choice low (16 channels versus 40 on the local providers basic cable package at a lower cost) and the service stinks.


Why would DOC spend more for less? Easy. The money used to pay for cable comes from the “inmate commissary fund” which is the money DOC is paid by Keefe – the commissary provider – for the privilege of exclusively gouging inmates, which leads to:


Keefe Commissary. Keefe is the Goliath of the prison commissary business. Tom Keefe had an idea years ago. He convinced Florida DOC he could provide plastic orange juice containers cheaper than they could buy them. From that grew his billion dollar business.


Inmates do not have a constitutional right to commissary; that is a fact. When inmates complain about the cost of a ramen noodle pack (10 cents at Wal-Mart, 28 cents here, 73 cents at Henrico Jail) it generally falls on deaf ears. Commissary is a necessity, however, because it allows DOC to not meet its obligations to the health and hygiene – and food needs – of the inmate population.


Any inmate who works is required to purchase their own hygiene products (soap, deodorant, detergent, toothbrush, toothpaste, razor). Don’t work, don’t earn good time. Prisons are required to provide hygiene products. They avoid this responsibility by making inmates buy their own from their wages.


That’s OK, except DOC then signs a contract with Keefe giving them an exclusive right to sell all food, clothing (extra t-shirts, boxers, socks – we only are provided three sets), and hygiene products (and TVs and other approved electronics). Keefe, then charges an exorbitantly high price for those items ($1.61 for a 4 oz. bag of tuna; $229 for a 13 inch color TV), gouging inmates. Keefe pays DOC –the local prison – a 15% “commissary fee” which the prison then uses to fund: the inmate law library (inmates have a constitutional right to access legal materials); inmate rec yards (again, inmates have a right to recreation time); cable TV; and – a unique Virginia practice – the chaplain’s office (a non-profit group in Virginia: “Prison Chaplain Assoc.” gets $600,000 a year from the inmate fund to provide Protestant chaplains in the facilities. Catholic, Jewish, and Muslim inmates have no on-site spiritual counselor. Of course, the chaplain here is terrible so no one has spiritual support!).


J.E.M. Jones Express Music of Big Stone Gap, Virginia. Mr. Jones is a former CO. He convinced DOC he could provide audio CD’s and cassettes to inmates from his basement. He is a middleman. You want a Rolling Stones CD? Lady Gaga? Look in Mr. Jones’ catalog. Send him twice the amount you would pay ordering the CD from Barnes & Noble (ironically, we can order books from B & N) plus shipping and, if you’re lucky, Mr. Jones sends you your CD in two to three weeks.


Mr. Jones has little, if any inventory. Mr. Jones has tremendous mark up and poor service. “What does Mr. Jones have”, you ask? That’s easy. He has contacts in DOC and that’s enough to give him an exclusive contract.


You may be thinking “So what? It only affects you law breakers”. Wrong. Think: VCE.


Virginia Correction Enterprises. Every prison has a VCE shop that manufactures products sold to other Virginia State Agencies. Inmates are paid “slave wages”. The 13th Amendment to the United States Constitution outlawed slavery except involving inmate work (look at the language).


Here, VCE builds furniture – upholstered chairs and tables. Skilled VCE workers are paid between 55 and 75 cents an hour.


State Colleges and agencies are required to buy from VCE. That dorm furniture your son or daughter is using was manufactured here.


Here’s the irony for taxpayers: VCE significantly marks up their prices. One conference room chair costs more than four similar chairs purchased on the open market (I have friends in higher ed who confirm this).


So DOC makes a chair for $50 and sells it to State U for $800. Those costs are passed on to parents as higher tuition and taxpayers as schools demand more funding.


Welcome to DOC contracts.