Building a federal prison in Letcher County is a bad investment. U.S. Rep. Hal Rogers’ plan to spend $444 million to create 300 jobs is bizarre. Rogers, a fiscal conservative, is telling us, one job costs $1.48 million to create.
These aren’t high-paying jobs; federal prison employees make an average of $38,000 a year. So 300 employees making $38,000 costs $11.4 million annually. That is a return of 2.5 percent.
This money is earmarked, but that doesn’t stop me from envisioning a better use of tax dollars. They could be put into a high-yield bank account that generates 5 percent interest (which would be $22.2 million) every year.
If that yearly interest was divided by 55,000, which is a number you’d need to create a job that pays $45,000 to $40,000 a year after health insurance and employer insurance, you could create 400 jobs with $165,000 to spare. That’s 400 jobs, better paying and more sustainably sound, than the 300 jobs that Rogers’ office is pitching.
If you look at data in Boyd, Clay, Martin and McCreary counties, crime rates increase after a prison is built. The poverty and unemployment rates increase as well. There is no metric that points to federal prisons working for Appalachia Kentucky.