Although many criminal justice activists are quick to denounce the most egregious race-based expressions of prison privatization, ranging from involuntary prison labor to racially disparate sentencing policies, few, if any, have attended to the deeply racialized, yet somewhat arcane, relationship developing between the private prison industry and the Internal Revenue Service (IRS). Curiously, one of the best ways to understand exactly how the private prison industry views itself and its fundamental mission is to analyze changes in the IRS corporate filing status of private prison companies.
In July 2012, the GEO Group – the nation's second-largest private prison operator behind Corrections Corporation of America – sent a letter to the IRS requesting a conversion from a typical "class-c" corporation to a Real Estate Investment Trust (REIT).
At the time, the Florida-based company specializing in "correctional detention and residential treatment services" billed its potential REIT conversion as a way to increase long-term shareholder value, lower the cost of capital and attract a larger base of potential shareholders.
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