Balukoff targets Otter connections to prison scandal in ad

BOISE – The gloves have come off in Idaho’s governor’s race, with Democratic challenger A.J. Balukoff launching a hard-hitting new ad faulting GOP Gov. Butch Otter’s handling of a scandal involving the state’s largest prison.

Idaho took over operation of the Idaho Correctional Center this year from private operator Corrections Corporation of America, after multiple lawsuits, reports of violence so intense that the prison was dubbed “Gladiator School,” and evidence that CCA had fraudulently overbilled the state for thousands of hours of guard duty that were never worked.

Otter, an advocate of privatization, made the announcement reluctantly on Jan. 3; on Feb. 4, he announced a settlement in which the state dropped all claims against CCA in the staffing dispute in exchange for a $1 million payment. At the time, the state had been saying for a year that the Idaho State Police was conducting a criminal investigation, but it turned out no investigation ever had been launched. Otter said then that the ISP had determined none was needed; two weeks later, after meeting with Attorney General Lawrence Wasden, Otter reversed his stance and called for a criminal investigation by the ISP. In March, the FBI stepped in.

“It fails the smell test badly,” Balukoff said, “and we have to wonder what more will come out when the FBI wraps up its ongoing investigation of this debacle.”

Balukoff’s new commercial, which started running statewide over the weekend – including in the Spokane broadcast TV market – includes actual footage of inmate violence at the prison, notes that CCA is a major campaign contributor to Otter – the firm has donated $20,000 to his campaigns since 2003 – and calls the settlement a “sweetheart deal.”

“It could have a significant effect,” said Jim Weatherby, Boise State University professor emeritus and a longtime observer of Idaho politics, particularly if the race is close; the few public polls released in the race differ widely on that question.

Until now, Otter had benefited from two outside groups, the Idaho Association of Commerce and Industry business lobbying group and the Republican Governors Association, that poured hundreds of thousands of dollars into attack ads against Balukoff, with no response from Balukoff. In the meantime, Otter’s TV ads were all positive ads touting his candidacy.

Balukoff’s were as well, until this one. “Rather than taking fire, he’s striking out,” Weatherby said, “which any successful challenger needs to do at some point in the campaign, particularly when he’s been on the defensive almost from day one.”

Otter also said in two recent debates against Balukoff that the settlement can be “set aside and then we can go after CCA” if the FBI’s investigation turns up anything. But a copy of the settlement, obtained by The Spokesman-Review through a public records request, shows no such provision. Instead, it says all claims related to staffing at ICC are “fully, forever, irrevocably, and unconditionally” settled.

The governor’s office also provided, in response to a public records request, an email exchange in which Otter aide Mark Warbis inquired about how far the release of claims extended. “Does this release and discharge apply only to civil claims, or could this potentially block the pursuit of criminal claims should they emerge?” Warbis wrote in a Feb. 17 email.

Mark Kubinski, lead deputy attorney general for the Idaho Department of Correction, responded, “The release section only applies to civil claims. The signatories are Division of Purchasing, IDOC and the Board, none of whom have any authority to waive any potential criminal charges. I’m comfortable with the language as drafted.”

That means the state still could prosecute CCA for criminal violations if the FBI investigation finds any, but could not seek further civil penalties related to staffing issues. A state-commissioned report from an auditing firm concluded that CCA falsely billed the state for more than 26,000 hours of guard duty at ICC in 2012; the firm recommended expanding the review to include other years, but the state declined.