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PROVIDENCE – A judge has allowed the Wyatt Detention Center in Central Falls to enter into receivership after officials said the facility is facing serious fiscal problems, WPRI-TV Channel 12 reported on its website last week.
Lawyers for the privately run prison told a Superior Court judge the facility can’t make its $4.4 million debt-service payment for July. The prison has $93.7 million in outstanding bond debt, according to Margaret Lynch-Gadaleta, Wyatt’s legal counsel.
Jonathan Savage was named a temporary receiver at the request of officials from Central Falls and the prison. Savage oversaw the first two months of Central Falls’ receivership in 2010.
The Wyatt, which employs about 170 people, relies on reimbursements from the federal government for funding. The facility’s chairman told WPRI that the prison’s average daily population has dropped from a high of 649 inmates in 2011 to just 503 in 2014. At its peak population, the prison was still losing $2 million annually. Officials believe it would need more than 700 inmates to break even, she said.
According to the website, the prison went into a financial free-fall when Immigration and Customs Enforcement stopped sending detainees there in 2009 after a Chinese national died while in custody.
Adrienne Walker, a lawyer for the bondholders, argued that receivership wasn’t necessary because her clients were willing to forbear the July payment. She said “there is no urgency” for entering receivership.
Central Falls City Solicitor Matthew Jerzyk said the prison has not made any host payments to the city since 2009. Prison officials said that the facility has lost $7.6 million since 2012. •