How Do Jails Make Money?

Have you ever wondered how jails make money? It’s a question that may not often cross our minds, but it’s an important one to understand. In this blog article, I will delve into the fascinating world of jail economics and explore the various ways in which these institutions generate revenue.

If you’ve ever been curious about the financial aspects of jails, you’re in the right place. In this article, I will share answers to the intriguing question of how jails make money. We’ll explore the different avenues through which these facilities generate revenue and shed light on some lesser-known aspects of their financial operations. So, if you’re ready to dive into the economics of jails, keep reading!

As a business research guru with a passion for helping people find answers, I have delved into various industries to uncover the inner workings of their financial systems. Through my experience, I have gained valuable insights into the revenue-generating strategies employed by different institutions, including jails. I believe that understanding how jails make money is crucial for gaining a comprehensive understanding of the criminal justice system as a whole.

In this article, I will present you with the best-researched analysis on the topic of how jails make money. I have delved deep into the subject, exploring various sources and conducting extensive research to provide you with accurate and reliable information. So, rest assured that you will find well-informed insights and a comprehensive understanding of the financial aspects of jails in this article. Let’s explore this intriguing topic together!

How Do Jails Make Money?


Jails are an integral part of our criminal justice system, serving as facilities where individuals who have been arrested or convicted of crimes are detained. While their primary purpose is to ensure public safety and rehabilitate offenders, many people wonder how jails generate income to sustain their operations. In this article, we will explore the various ways in which jails make money to support their functioning.

1. Incarceration Fees

One of the main sources of income for jails is through the collection of incarceration fees. These fees are typically charged to individuals who are incarcerated and can vary depending on the jurisdiction. In some cases, the fee may be a daily charge for room and board, while in others, it may be a fixed amount for the entire duration of the incarceration. These fees help cover the costs associated with housing and providing basic necessities to inmates.

2. Phone Calls and Communication Services

Another revenue stream for jails is through phone calls and communication services provided to inmates. Inmates are often charged exorbitant rates for making phone calls, sending emails, or using video visitation services. These fees can be a significant source of income for jails, as they often have exclusive contracts with service providers, allowing them to charge higher rates than those available to the general public.

3. Commissary Sales

Jails also generate income through the operation of commissaries, which are stores within the facility where inmates can purchase various items such as snacks, toiletries, and clothing. Inmates typically use funds from their personal accounts or money sent by family and friends to make these purchases. The prices charged at the commissary are often higher than those in regular stores, allowing jails to make a profit from these sales.

4. Inmate Work Programs

Some jails have implemented inmate work programs, where incarcerated individuals are assigned to perform various tasks within the facility or for external entities. These work programs can range from maintenance and cleaning to manufacturing goods or providing services. The wages earned by inmates through these programs are often significantly lower than minimum wage, with a portion of the earnings going towards covering the costs of their incarceration.

5. Grants and Funding

In addition to fees and inmate-related activities, jails also receive funding through grants and government allocations. These funds are often designated for specific purposes such as improving facilities, enhancing security measures, or implementing rehabilitation programs. Grants from non-profit organizations or private entities may also contribute to the financial resources of jails, particularly for initiatives aimed at reducing recidivism rates.

6. Medical and Healthcare Services

Jails are responsible for providing medical and healthcare services to inmates, and in some cases, they charge for these services. While the provision of basic healthcare is mandated by law, additional services beyond the essentials may come at a cost. Inmates who require specialized treatments, medications, or consultations may be charged for these services, contributing to the revenue generated by the jail.

7. Inmate Transportation

When inmates need to be transported between facilities, such as for court appearances or transfers to other jails, the costs associated with transportation are often passed on to the inmate or the agency requesting the transfer. These fees can include expenses for fuel, staff, and security measures. In some cases

Frequently Asked Questions about How Jails Make Money

Below are some commonly asked questions about how jails generate revenue and make money.

1. How do jails generate income?

Jails generate income through various means, including:

  • Government funding: Jails often receive funding from local, state, or federal governments to cover their operating costs.
  • Inmate fees: Some jails charge inmates for certain services, such as medical care, phone calls, or commissary items. These fees contribute to the jail’s revenue.
  • Contracting with other agencies: Jails may enter into contracts with other agencies, such as the U.S. Marshals Service or Immigration and Customs Enforcement (ICE), to house their inmates for a fee.
  • Work-release programs: Some jails offer work-release programs where inmates are allowed to work outside the facility and earn wages. A portion of these wages may be collected by the jail.
  • Donations and grants: Jails may receive donations or grants from individuals, organizations, or foundations interested in supporting their operations.

2. How do inmate phone calls contribute to jail revenue?

Inmate phone calls can contribute to jail revenue through a commission-based system. Telecommunication companies provide phone services to jails and pay the jail a commission on the revenue generated from inmate calls. This commission can vary depending on the contract between the jail and the service provider.

3. What are commissary sales, and how do they benefit jails financially?

Commissary sales refer to the purchase of goods by inmates from a jail’s commissary store. Inmates can buy items like snacks, toiletries, and stationery using funds in their personal accounts. The profits from these sales contribute to the jail’s revenue and can be used to cover operating expenses or fund programs and services for inmates.

4. Do jails receive funding for housing federal or immigration detainees?

Yes, jails can receive funding for housing federal or immigration detainees. The U.S. Marshals Service and ICE, for example, may enter into contracts with jails to house individuals awaiting trial or immigration proceedings. These contracts typically involve a per diem rate paid by the federal agency to the jail for each detainee housed. This funding helps jails offset their costs and generate revenue.

5. Are there any legal limitations on how jails can generate revenue?

Yes, there are legal limitations on how jails can generate revenue. The specific limitations can vary depending on the jurisdiction and applicable laws. For example, there may be restrictions on the types and amounts of fees that can be charged to inmates. Additionally, jails are generally required to provide certain essential services to inmates, regardless of their ability to pay, which can impact their revenue generation strategies.


So, there you have it! Throughout this article, we have delved into the secret business model behind jails and how they make money. We have explored various ways in which these institutions generate revenue, from charging inmates for basic necessities to outsourcing services to private companies. It’s truly eye-opening to see the intricate web of profit-making within the criminal justice system.

As I reflect on the information we have uncovered, I can’t help but feel a sense of awe at the resourcefulness and ingenuity displayed by jails in their pursuit of financial gain. While we may not agree with the ethics behind these practices, there is something to be learned here. Jails have managed to turn a profit by capitalizing on the needs and vulnerabilities of their incarcerated population.

In my opinion, this serves as a valuable lesson for us all. By studying the strategies employed by jails, we can gain insights into how to identify opportunities in our own lives and make the most of them. While we may not be operating within the same industry, the principles of resourcefulness and adaptability can be applied to any field. So, let’s take a page from their book and learn from their successes and failures.

Investing early in understanding the dynamics of money-making, even in unconventional sectors like jails, can provide us with invaluable experience and knowledge. As we continue on our journey, we will encounter numerous challenges and opportunities. By embracing the lessons learned from jails, we can develop the skills necessary to navigate the complex world of business and finance. So, let’s start early, stay curious, and keep exploring new avenues for growth and success!

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