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The Department of Homeland Security has acquired two of California’s largest immigrant detention facilities from CoreCivic for $1.5 billion, shifting more than 4,500 beds to federal control.
The acquisition expands the Trump administration’s detention capabilities within a state that has spent years attempting to eliminate private detention operations.
CoreCivic announced Monday that the transaction, which closed July 2, included the 2,560-bed California City Detention Facility for $732.6 million and the 1,994-bed Otay Mesa Detention Center in San Diego for $739.2 million.
The Tennessee-based corporation stated it anticipates approximately $1.1 billion in net proceeds after accounting for taxes and transaction expenses. CoreCivic intends to continue managing both locations under its current operational agreements with U.S. Immigration and Customs Enforcement (ICE).
However, those contractual agreements could face renegotiation now that the properties are owned by the federal government, according to company disclosures filed with the Securities and Exchange Commission.
DHS officials stated that the acquisitions were financed through President Donald Trump’s One Big Beautiful Bill Act, a tax-and-spending package enacted last summer. The department noted the legislation “allowed ICE to expand detention space to fulfill the president’s promise of mass deportations.”
An agency spokesperson cited California’s political climate as the primary motivation for the purchase. “Unlike in states like Florida and Oklahoma, ICE cannot rely on local state and county partners for detention space in California,” the spokesperson said, adding that federal ownership ensures essential capacity remains secure on the West Coast.
The transaction effectively circumvents a decade of California legislative efforts to outlaw for-profit detention centers.
Assembly Bill 32, a 2019 state law intended to ban private immigration detention, was struck down by the 9th U.S. Circuit Court of Appeals in 2022, which ruled the measure was preempted by federal law and barred by intergovernmental immunity.
In response, state lawmakers enacted narrower regulatory laws granting the state attorney general and county health agencies authority to inspect the facilities. Those oversight mechanisms are now complicated by the transition to federal property.