Title of Regulation: 6VAC15-28. Regulations for Public/Private Joint Venture Work Programs Operated in A State Correctional Facility (amending 6VAC15-28-10, 6VAC15-28-30, 6VAC15-28-40).

Statutory Authority: §§ 53.1-5 and 53.1-45.1 of the Code of Virginia.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: February 19, 2010.

Agency Contact: Janice Dow, Policy and Initiatives Unit Manager, Department of Corrections, 6900 Atmore Drive, Richmond, VA 23261, telephone (804) 674-3303 ext 1128, FAX (804) 674-3017, or email janice.dow@vadoc.virginia.gov.

Basis: The Board of Corrections has the statutory authority to promulgate regulations that are necessary to carry out the laws of Virginia administered by the Department of Corrections (DOC) or its Director, pursuant to § 53.1-5 of the Code of Virginia. Section 53.1-45.1 of the Code of Virginia allows the DOC Director, with the prior approval of the Governor, to enter into an agreement with a public or private entity to operate a work program in a state correctional facility for prisoners confined therein.

Purpose: The joint venture programs review process provides an orderly system for proposed agreements to be received and approved, increasing DOC's visibility within the community and private sector. In turn, opportunities for individuals to obtain post-incarceration employment are improved, which may ultimately lead to enhanced community public safety and welfare. Since this regulation was promulgated, §§ 53.1-45.2 through 53.1-45.5 of the Code of Virginia (creation of the Virginia Correctional Enterprises Advisory Board and appointment of Advisory) has been repealed by Chapters 94 and 854 of the 2003 Acts of Assembly. The amendments to this regulation will delete references to this committee and assign approval power to the Director of the Department of Corrections.

Substance: Amendments to this regulation delete requirements for committee review of proposed agreements between the DOC and a public or private entity as the committee was abolished by statute. The application and approval process for submission of proposed agreements between the DOC and public or private entities is delegated to the DOC Director. Additionally, the Proposed Joint Venture Application Form incorporated by reference is deleted. All current criteria for approval of proposed agreements remain in place.

Issues: This action poses no disadvantages to the public or the Commonwealth. The amendments affect internal operational practices and serve to make the regulations more consistent with the Code of Virginia. These regulations should prove advantageous to DOC and participating private entities because the programs allow DOC to have access to external resources in order to expand facilities, enter new markets, or develop new products. In turn private entities benefit through utilization of manpower resources from DOC.

The Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. Pursuant to Chapters 94 and 854 of the 2003 Acts of the Assembly, the Board of Corrections (Board) proposes to amend its regulations governing the approval of joint venture work programs so that it is clear that the Director of the Department of Corrections (DOC) has the power to approve these work programs that operate within state correctional facilities.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. Prior to 2003, Virginia Code § 53.1-45.1 required that any proposed joint venture work program agreements be submitted for review to the Virginia Correctional Enterprises Advisory Board. In 2003, the General Assembly repealed the statutory language that instituted this advisory board. The Director of DOC retained the power to enter into work program agreements with the concurrence of the Governor.

The Board now proposes to amend its regulations that govern work program agreements to account for this statutory change. Specifically the Board proposes to replace all instances of the word "committee" (referring to the now defunct advisory board), and insert the word "director" so that the regulations accurately state who has the power to review and approve work program agreements. Since this action will not change how work programs are currently approved, no affected entity is likely to incur any additional costs on account of these proposed regulations. To the extent that the divergence between statutory and regulatory language may have made the process by which work programs are approved opaque, these regulatory changes will provide the benefit of clarity.

Businesses and Entities Affected. DOC reports that these regulations affect all public and private entities that current have, or seek to have, work programs in correctional facilities. Currently, approximately 175 civilians and 1,500 inmates are employed in joint venture work programs.

Localities Particularly Affected. No locality will be particularly affected by this proposed regulatory action.

Projected Impact on Employment. This regulatory action will likely have no impact on employment in the Commonwealth.

Effects on the Use and Value of Private Property. This regulatory action will likely have no effect on the use or value of private property in the Commonwealth.

Small Businesses: Costs and Other Effects. Small businesses in the Commonwealth are unlikely to incur any costs on account of this regulatory action.

Small Businesses: Alternative Method that Minimizes Adverse Impact. Small businesses in the Commonwealth are unlikely to incur any costs on account of this regulatory action.

Real Estate Development Costs. This regulatory action will likely have no effect on real estate development costs in the Commonwealth.

Legal Mandate. The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Administrative Process Act and Executive Order Number 36 (06). Section 2.2-4007.04 requires that such economic impact analyses include, but need not be limited to, the projected number of businesses or other entities to whom the regulation would apply, the identity of any localities and types of businesses or other entities particularly affected, the projected number of persons and employment positions to be affected, the projected costs to affected businesses or entities to implement or comply with the regulation, and the impact on the use and value of private property. Further, if the proposed regulation has adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include (i) an identification and estimate of the number of small businesses subject to the regulation; (ii) the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the regulation, including the type of professional skills necessary for preparing required reports and other documents; (iii) a statement of the probable effect of the regulation on affected small businesses; and (iv) a description of any less intrusive or less costly alternative methods of achieving the purpose of the regulation. The analysis presented above represents DPB's best estimate of these economic impacts.

Agency's Response to the Department of Planning and Budget's Economic Impact Analysis: The Virginia Department of Corrections has reviewed the Department of Planning and Budget's (DPB) economic impact analysis for 6VAC15-28, Regulations for Public/Private Joint Venture Work Programs Operated in a State Correctional Facility. The agency concurs with DPB's analysis.

Summary:

This regulation governs the form and review process for proposed agreements between the Director of the Department of Corrections (DOC) and a public or private entity to operate a work program in a state correctional facility. These regulations have been in place in their current form since 1995. Since that time there have been several changes to the Code of Virginia related to "work programs and agreements with other entities." The proposed amendments affect internal operational practices for the review of proposed agreements between the DOC and public or private entities. The proposed changes delete the requirement for an appointed committee to approve any contractual documents implementing an agreement prior to forwarding it to the Office of the Attorney General to ensure compliance with state statutes and to the Governor. There is no change to the criteria listed in 6VAC15-28-40; all current criteria shall continue to be met before the director approves a proposed agreement.

Part I
General Provisions

6VAC15-28-10. Definitions.

The following words and terms, when used in this chapter, shall have the following meaning, unless the context clearly indicates otherwise:

"Agreement" means a legal arrangement between the Director of the Department of Corrections and a public or private entity to operate a work program in a state correctional facility for prisoners confined in it.

"Board" means the Board of Corrections.

"Committee" means the group appointed by the governor which reviews any proposed agreement between the Director of the Department of Corrections and a public or private entity to operate a work program in a state correctional facility for prisoners confined tn it. The committee consists of representatives from an employee association or organization, the business community, a chamber of commerce, an industry association, the Office of the Secretary of Commerce and Trade, and the Office of the Secretary of Public Safety.

"Department" means the Department of Corrections.

"Director" means the Director of the Department of Corrections.

"Prevailing wage" means a rate which is not less than that paid for work of a similar nature in the locality in which the work is to be performed.

Part II
Review Process

6VAC15-28-30. Review process.

A. Any proposed agreement between the department and the public or private entity shall consist of a Proposed Joint Venture Application Form which shall be completed by the public or private entity. The completed application form shall be submitted directly to the department, which shall then forward the application to the appropriate organizational unit for initial research and evaluation of the proposed agreement. This initial research and evaluation shall be completed in a timely manner, not to exceed 30 calendar days from the receipt of the completed application from the public or private entity.

B. The department shall submit the proposed agreement with a submission package to the board. The submission package shall include, at a minimum:

1. A prospectus of the public or private entity.

2. A description of the size and scope of the proposed operation.

3. An assessment of the project's financial viability.

4. A recommendation for entering or not entering into the proposed agreement.

5. Draft formal agreement papers, if the department recommends entering into the agreement.

C. The board shall review the proposed agreement and submission package and submit the package to the committee director with a recommendation for entering or not entering into the agreement.

D. The committee director shall evaluate the proposed agreement according to the criteria listed under 6VAC15-28-40.

E. Upon approval by the committee director, any contractual documents implementing the agreement shall be forwarded to the Office of the Attorney General to ensure compliance with state statutes.

F. Upon the assurance of the The Office of the Attorney General will assure that the agreement is in compliance with state statutes, the . The governor shall review the agreement.

G. Upon the governor's authorization, the director and the public or private entity may sign the agreement.

Part III
Criteria

6VAC15-28-40. Criteria.

A. The committee director shall review the provisions of any proposed agreement according to the following criteria:

1. The proposed agreement shall provide adequate job skills to inmate participants. Any proposed agreement which requires relatively unskilled labor may be acceptable providing the work project establishes good work habits.

2. The public or private entity shall be environmentally sound, with appropriate certification, as required by applicable state and federal regulations.

3. The public or private entity shall provide prevailing or minimum wage, whichever is applicable.

4. The public or private entity shall provide Equal Employment Opportunity for all inmates involved in the proposed agreement.

5. The proposed agreement shall demonstrate financial viability.

a. If the department acts as a subcontractor in the proposed agreement, the proposed agreement shall be evaluated by its capability both to meet the required goods or services as well as to provide an acceptable rate of return to the department.

b. If the department acts as a supplier of labor in the proposed agreement, the proposed agreement shall be evaluated upon its capability to provide a gross margin both to cover the expenses of the department as well as to generate a sufficient return on investment to the department.

6. The proposed agreement shall not displace civilian workers.

7. Any rent paid to the department for space occupied by the participating public or private entity shall be at a reasonable rate.

8. The product produced by the proposed agreement may be sold on the open market.

9. The proposed agreement shall meet any provisions listed in §§ 53.1-41 through 53.1-62 of the Code of Virginia pertaining to "Employment and Training of Prisoners."

B. All criteria listed in 6VAC15-28-40 A shall be met before the committee director approves a proposed agreement.

FORMS (6VAC15-28) (Repealed.)

Proposed Joint Venture Application Form.