After Allegheny County announced a contract two weeks ago with nonprofit Adelphoi to reopen and operate the Shuman Juvenile Detention Center, County Council voted to sue the county administration over the plan.
They hadn’t yet seen the details.
The five-year, $73 million contract provides for significant money for Adelphoi up front and includes limited exit options for the county.
The county and Adelphoi have agreed to the contract, but County Controller Corey O’Connor said he has not finished processing it yet. The controller, an independently elected watchdog, is responsible for processing payments to vendors.
O’Connor said in an interview Thursday that he had not signed it because his staff was going through a normal review process, and “we have some questions” about the agreement. He reiterated previous comments that he is opposed to hiring an outside entity for juvenile detention. The controller’s office is a procedural and fiscal backstop, though, and does not generally impose policy views.
Here are five notable provisions in the contract:
A big price tag
The $73 million maximum cost of the contract means that the county could pay significantly more to operate the detention center than it used to. The yearly average of about $14 million is about 40% higher than the county paid when the center was publicly run up until its 2021 closure. And the new price tag doesn’t factor in maintenance, utilities and emergency repairs, which the county will still be on the hook for.
The contract stipulates that the county will pay a fixed amount for each bed in the facility, regardless of whether the beds are in use. That daily rate, set by the state’s Department of Human Services, is $650 and could change each year.
The county’s plan is for the facility to operate 60 beds, which means the county would owe Adelphoi $39,000 per day, or $14.2 million per year.
The payment model based on capacity rather than use could be key in warding off the fear of corruption or corruption itself. As President Judge Kim Berkeley Clark said in an unusual public comment to council to advocate for the reopening plan, the absence of any financial incentive to fill detention beds prevents kickback schemes like Luzerne County’s “Kids for Cash” scandal.
Money up front
Acknowledging that Adelphoi “has and will expend substantial sums of resources and effort” to get the facility up and running, the county agreed to begin paying even before the facility is reopened.
The contract states that the county will pay Adelphoi the daily rate for 12 beds, or $7,800 per day, starting on the day the contract is executed. On top of that, the county agreed to start paying for the other 48 beds four months before the beds are operational. That amounts to $3.7 million in payments for bed spaces that are still under construction on the county’s dime.
Karyn Pratt, Adelphoi’s vice president of marketing and strategy development, said the group will incur “start-up costs in terms of fixtures, furnishings and equipment” and that they will invest in hiring “high-quality candidates so that we can offer a caring, trauma-informed environment for youth who require services.”
A spokesperson for Allegheny County did not respond to a request for comment for this story.
Differing exit clauses
Per the contract, Adelphoi has more freedom to get out of the contract than the county does. The contract allows the nonprofit to terminate the contract “for convenience” at any time, as long as they give 180 days notice. The county, though, can’t terminate the contract for convenience during the initial five year term.
The county can terminate the contract, though, if it loses state or federal funding needed to pay the bill, or if Adelphoi somehow violates the contract.
Without commenting on the specific language in agreement, O’Connor said it is “important” for the next county executive, who will take office in January, to have an out.
“The new executive is going to want to have some of these same conversations, so we have to figure out some ways to do that,” O’Connor said.
Brad Korinski, who served as legal counsel to former Controller Chelsa Wagner for a decade, said the agreement’s terms are unusual, and it’s more typical for both parties to have the same or similar termination options.
“That objectively signifies that one side had a lot more bargaining leverage,” Korinski said.
Pratt said the termination clause was structured to give Adelphoi employees “a long-term, stable work environment and the opportunity for growth and professional development.”
Costs offset by other counties
The contract permits Adelphoi to receive youth for detention from other counties that lack local facility space. When that happens, the contract says, the sending counties would pay the $650 daily rate for each detainee, and that money would offset what the county owes Adelphoi for the facility’s daily capacity.
Staffing and training
The contract requires Adelphoi to operate the facility with a staff to youth ratio of no more than 1 to 6 at all times, and it sets out specific types of training for the staff to undergo.
“The contractor shall train its staff to use the least restrictive alternative at the time of crisis intervention … Only when there is a clear danger to self and/or others shall physical techniques be utilized by the contractor’s staff.”
Adelphoi also agreed to provide for each youth to attend daily group counseling sessions, with topics such as “preparing for treatment in the community,” “aggression replacement training” and conflict resolution.
Below is the complete contract as signed by county and Adelphoi officials:
Editor’s note: A signature page and blueprints attached to the contract are not included above.
Charlie Wolfson is PublicSource’s local government reporter and a Report for America corps member. He can be reached at charlie@publicsource.org.
This story was fact-checked by Rich Lord.
