California, the state with the highest prison population, has also historically been one of the most privatization-friendly states, despite the influence of the powerful corrections officers lobby. The state has given hundreds of millions of dollars per year to the industry to house some of its prisoners in a vain attempt to reduce the burden of its overcrowded prison system, rewarding the industry's investment in campaign contributions and lobbying. But the industry's hold on the nation's most desperate prison system seems to be slipping in the wake of the Brown v. Plata decision from the Supreme Court.
That decision basically held that the state needed to remove about 40-45,000 prisoners from its state system just to ease overcrowding to the point where it could provide medical care that would not be so insufficient as to violate the prisoners' right to be free from cruel and unusual punishment. At the height of the overcrowding, it was estimated that one prisoner died every week from a preventable cause, because the state simply didn't have the resources or manpower to treat all the people it decided to lock up (coincidentally enough, its prison population exploded due largely to sentencing initiatives like 3-Strikes and Truth in Sentencing laws, which were passed by the industry through its work in ALEC during the 90's. But that's a topic for a whole different post). The governor's plan to fix the overcrowding is to send thousands of state prisoners to county jails; basically, he's shifting responsibility for the state's overzealous criminalization of nonviolent activities onto counties, many of which are poorly equipped to handle an influx of new prisoners.
In addition to shifting prisoners to county facilities, the Secretary of Corrections announced a few months ago that the state was looking at ways to reduce its reliance on private prisons and stop shipping prisoners to private facilities in other states. It looks like the state has actually started to work towards this goal; a few weeks ago, it announced a plan to halt $4 billion in new prison construction and return nearly 10,000 state prisoners from private facilities in other states. This plan would save the state almost $400 million per year that it spends on private prisons, and reduce the prison system's impact on the state budget by nearly 4%; in a state with a budget near $137 billion, that's an awful lot of money.