Youth agency contract canceled

State had paid more than $1M for unused beds.

A Texas Youth Commission contract that had taxpayers paying to lease empty prison beds for more than three months \— at a cost of $22,500 a day \— was canceled Thursday.

Jim Hurley, the commission's spokesman, said the contract with Florida-based Youth Services International was terminated after "both parties agreed canceling \u2026 is justified."

The cancellation came after the American-Statesman a week ago reported that the state was getting charged for unused beds as a way to cover the company's startup costs for a new lockup in Eagle Lake — more than $1.26 million since the deal was signed in July by then-Conservator Richard Nedelkoff.

Gov. Rick Perry's office and lawmakers cried foul. Legislative leaders demanded the contract be terminated and in recent days had stopped two pending payments to Youth Services International.

Cherie Townsend, the commission's new executive commissioner, who started work Oct. 1, said the 18 youths transferred into the lockup a week ago will be moved to other centers.

In a statement, she said the company will be asked for a detailed accounting of all state money spent so far on the contract. Senate Criminal Justice Committee Chairman John Whitmire, a Houston Democrat who co-chairs a special legislative committee overseeing agency reforms, said Townsend told him those funds will be refunded.

"This is what I asked for — cancel that contract," he said. "We need to get our money back. It's a good day for taxpayers and the Youth Commission that they corrected this big mistake."

The commission had agreed to lease up to 132 beds for $189.50 per youth per day, guaranteeing they would pay for 119 beds starting the date the contract was signed.

In 2006, the commission spent between $128.66 and $162.88 a day for each youth in its care, according to the latest statistics posted on the agency's Web site.

Commission officials had been criticized for inking the deal when its existing lockups have dozens of empty beds. In a statement Thursday, Townsend said the agency "is evaluating its youth population, future trends and future needs."

The number of teenage lawbreakers in commission lockups has declined from more than 5,000 to about 2,700 in the wake of a reorganization and management shakeup that followed a sex-abuse and cover-up scandal in 2007.

The agency was placed in conservatorship in March 2007. Citing reforms made since then, Perry removed it from conservatorship this month. Townsend has said she is working on her own reorganization to "right size" the agency and its resources. That plan may be announced in December.

mward@statesman.com; 445-1712