A nonprofit prison in Appleton, Minn., that has been defaulting on its debt service payments due to a lack of prisoners has finally filled up.
Tom Rice, chief financial officer of a nonprofit corporation created by the city to issue bonds for the Prairie Correctional Facility, said earlier this month that the prison has 514 prisoners, just two short of its capacity. The prisoners were sent to Appleton from Colorado, Puerto Rico, and Iowa, he said.
"We anticipate that we will remain at capacity for some while," Rice said.
The influx of prisoners has resulted in an "improved revenue stream," Rice said. However, he declined to comment on what that means for the $28.4 million of bonds issued by, the Appleton Prison Corp. in 1990
The corporation has defaulted on three debt service payments since February 1993. First Trust National Association, the trustee for the bonds, has said that more prisoners were needed at the prison to boost revenues so the corporation could meet its debt service obligations.
While no payments have been made yet, city officials are meeting with First Trust and major bondholders to discuss possible next steps, including the possibility of a bond restructuring, said Robert Thompson, Appleton's city coordinator.
A spokeswoman for First Trust said the trustee has not sent out any information to bondholders on the current status of the prison.