A representative of an Indiana-based company said on Thursday it intends to “vigorously protest” the state’s selection of a competitor to operate Arkansas’s youth lockup facilities.
The Arkansas Democrat-Gazette reported Wednesday that Rite of Passage, a Nevada-based company, was awarded a $15.8 million contract to run five lockups in Dermott, Harrisburg, Mansfield
The only company besides Rite of Passage to submit a bid to run the five lockups was Youth Opportunity Investments of Indiana. Both companies proposed a similar daily rate to run the lockups, but state procurement officials gave Rite of Passage a higher technical evaluation score. (The two proposals and the state’s request for proposal are made available by the Office of State Procurement, which issued the RFP on behalf of the Department of Human Services’ Division of Youth Services.)
In a written statement, Gary Sallee, the chief legal officer for Youth Opportunity Investments, said Rite of Passage “did not meet the minimum qualifications for a bidder as defined by the state.”
Sallee referenced a line on page 13 of the RFP stating that “Prospective Contractor shall not have received a contract termination due to non-performance within the past five (5) years.” Other states have terminated contracts with Rite of Passage in the past five years, Sallee claimed, citing incidents in Nevada and elsewhere. Youth Opportunity Investments will soon file a formal protest with the state, Sallee said in a brief phone interview.
Rite of Passage officials could not be reached for comment before the end of the business day on Thursday. A spokesperson for the parent agency of the Office of State Procurement said he was not immediately aware of any issue regarding Rite of Passage not meeting minimum qualifications.
When Rite of Passage began running the AJATC facility in 2016, it took over from a series of previous contractors that had faced criticism over incidents of misconduct, abuse
Until recently, the state had eight youth lockups, including AJATC. One facility, in Colt, closed its doors just last month as part of ongoing juvenile justice reforms. Another facility, in Dermott, is expected to close later this year. (However,
Since the beginning of 2017, all of the lockups except AJATC have been under the direct management of the Division of Youth Services. Before that, they were run for decades by two Arkansas-based nonprofits, South Arkansas Youth Services
Hutchinson then stepped in and directed the state to assume provisional management of the facilities effective Jan. 1, 2017. The state ran into problems of its own when managing the lockups directly, but elected to retain control of them for the next two years. The governor and DYS said in November it expected to re-privatize the lockups (minus the two slated for closure) by summer 2019.
Sallee’s statement Thursday appeared to reflect Youth Opportunity Investment’s frustration that it still has not secured a contract in Arkansas despite years of effort:
YOI has invested three years, countless dollars and man-hours, working within the processes established by the State to award management of the select juvenile facilities. YOI has established programs, sought best-in-class service providers, and retained superior management personnel with an eye toward elevating Arkansas’ facilities for the treatment and education of its at-risk youth. YOI was selected for the award on two prior occasions. It is a better company now, with better programming, than then. It met all criteria for bidding and winning then and now. [Rite of Passage] did not.
The cost of Rite of Passage’s winning bid for a $15.8 million contract is based on the company’s proposed daily bed rate of $235 per youth. Youth Opportunity Investment’s bid proposed a daily rate of $236. Both are much higher than the $145 daily rate paid to the two Arkansas-based providers before the state takeover.