Cost-saving requirements.

(1) The department may not enter into a contract or series of contracts unless the department determines that the contract or series of contracts in total for the facility will result in a cost savings to the state of at least 7 percent over the public provision of a similar facility. Such cost savings as determined and certified by the Auditor General must be based upon the actual costs associated with the construction and operation of similar facilities or services as determined by the department. The department shall calculate all of the cost components that determine the inmate per diem in correctional facilities of a substantially similar size, type, and location that are operated by the department, including administrative costs associated with central administration. Services that are provided to the department by other governmental agencies at no direct cost to the department shall be assigned an equivalent cost and included in the per diem.

(2) Reasonable projections of payments of any kind to the state or any political subdivision thereof for which the private entity would be liable because of its status as private rather than a public entity, including, but not limited to, corporate income and sales tax payments, shall be included as cost savings in all such determinations. In addition, the costs associated with the appointment and activities of each contract monitor shall be included in such determination.

(3) In counties where the department pays its employees a competitive area differential, the cost for the public provision of a similar correctional facility may include the competitive area differential paid by the department.

(4) The department shall provide a report detailing the state cost to design, finance, acquire, lease, construct, and operate a facility similar to the contractor-operated correctional facility on a per diem basis. This report shall be provided to the Auditor General in sufficient time that it may be certified to be included in the competitive solicitation.