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As California officials try to block immigration facilities across the state, the Trump administration is deploying a new strategy to secure detention capacity on the West Coast. It’s buying up the real estate outright.
The Department of Homeland Security’s $1.5 billion purchase of the Otay Mesa Detention Center and the California City Detention Facility from the private prison company CoreCivic is a direct response to the state’s political resistance to new and existing ICE detention facilities, government officials said.
Immigration and Customs Enforcement spokesman Jason Sweeney said in a statement that California detention centers are “crucial to ICE’s detention network on the West Coast.”
“Unlike in states like Florida and Oklahoma, ICE can not rely on local state and county partners for detention space in California,” Sweeney said. “The state’s sanctuary politicians continue to push legislation to outlaw or make private prisons financially infeasible.”
The conflict dates to the last Trump administration, when California Democrats raced to adopt policies that would counter his first deportation push.
Gov. Gavin Newsom in 2019 signed a law aiming to phase out all private for-profit prisons and immigration detention centers by 2028. Private prison operator GEO Group and the federal government sued, arguing the law violated the Supremacy Clause of the Constitution, which bars states from interfering with federal authority. They won, with the 9th Circuit Court of Appeals in 2022 striking down the ban on privately run immigration detention facilities.
Since then, California lawmakers have pushed newer measures, such as imposing heavy taxes on private detention centers to make them financially unviable.
The federal government’s purchase of CoreCivic properties comes in the middle of a showdown between California Attorney General Rob Bonta and the Trump administration over the controversial construction of new ICE offices near Gilroy, a former farm town south of San Jose. The city has grown to about 60,000 people and is ringed by garlic fields and vineyards in south Santa Clara County.
The state argues the land has been designated exclusively for agricultural uses since 1967.
“ICE’s plans to construct a facility near Gilroy violate multiple federal laws,” said Bonta, arguing ICE failed to examine the potential environmental consequences before beginning construction.
Federal contracting records show in 2025 the General Services Administration leased the property for 20 years from Beverly Hills-based ECG 6 LLC for a total of $26.5 million.
The federal government agreed in July to pause construction on the 26-acre site while the lawsuit proceeds.
California officials are using another law dating to the first Trump administration to demand entry and inspect detention centers. Bonta sent a letter to the Department of Homeland Security in December highlighting “dangerous and inadequate living conditions” at the California City Detention Facility. In San Diego County, local health inspectors are in a legal feud with CoreCivic over inspections of the Otay Mesa center.
Selling the properties to the federal government likely will shield them from California health inspections, said Claire Trickler-McNulty, who was a senior ICE official in the Biden administration.
“It gives them protections from state and local laws, especially from zoning and environmental requirements,” Trickler-McNulty said.
Sales reveal a new strategy
A year ago President Trump signed a spending bill with a huge windfall for immigration enforcement. It gave ICE $45 billion for detention capacity, and the administration had a plan to build new sites all over the country.
The purchases of Otay Mesa and California City mark a significant reversal, according to Aaron Reichlin-Melnick, a senior fellow at the American Immigration Council.
That plan, laid out in early 2026 in a document known as the ICE Detention Re-engineering Initiative, centered on converting warehouses into mega-centers designed to hold 7,500 to 10,000 people — each larger than any correctional facility built in the U.S. since Japanese internment during World War II.
Reichlin-Melnick described the system as one that was never thoughtfully planned out. Todd Lyons, then-acting director of ICE, at the 2025 Border Security Expo in Phoenix said he wanted deportations to run “like [Amazon] Prime, but with human beings.”
“At no point did anyone sit down to intelligently design the ‘Amazon Prime for human beings,” Reichlin-Melnick said.
The Detention Re-engineering Initiative has largely collapsed, undone by lawsuits, an unrealistic timeline, and national shortages of correctional staff and prison healthcare workers, Reichlin-Melnick said.
But that leaves billions of dollars that ICE needs to spend before the money expires.
“We expect them to buy other facilities,” said Reichlin-Melnick.
One former senior Department of Homeland Security official said conditions for immigrant detainees in ICE-owned facilities could be an improvement.
“ICE taking over an actual facility is maybe better than warehouses or putting people in soft-sided facilities or the privately run facilities,” he said.
Prices eclipse assessment rolls
County assessor records show the federal government paid a premium on the real estate. In San Diego County, the Otay Mesa property’s assessed value for the current tax year is $164.9 million. DHS paid $739.2 million for it, or about 4.5 times the assessed value. In Kern County, the California City facility was assessed at $171.5 million; DHS paid $732.6 million or 4.3 times the figure.
A former senior ICE official, who spoke on condition of anonymity because they were not authorized to discuss the matter publicly, questioned whether the price tag matches the actual security need. “So, $1.5 billion just for the facilities and how many migrants are ever going to come in and out of there who are national security and public safety threats? The people that we actually do need to keep off the streets,” the former official said.
A spokesperson for Gov. Newsom, Anthony Martinez, called the administration’s deportation agenda a “reckless and cruel misuse of taxpayer money,” and accused the federal government of pouring billions into contractors while avoiding transparency over conditions inside their facilities.
San Diego County Supervisor Paloma Aguirre connected the purchase directly to CoreCivic’s political spending, noting the company’s $500,000 donation to the Trump’s inaugural committee. That preceded what she called a “billion-dollar taxpayer-funded windfall” that will help erase the company’s debt while letting it continue running the facilities. She said the arrangements treat detained immigrants as revenue streams rather than people.
CoreCivic said the “valuations for the facilities were established through the federal government’s required appraisal process, which is designed to determine objective fair market value.”
“CoreCivic has contributed to presidential inaugural events across multiple administrations, including Democratic ones. The federal appraisal process is conducted independently of any political contribution,” said Steven Owen, the vice president of communications for CoreCivic.
He added that under California law, the assessed values of the properties may differ greatly from their market value. He pointed to California’s Proposition 13, which prohibits most property reassessments outside of sales.
“California's Prop. 13 limits annual increases in assessed value, which means assessed values for commercial properties can diverge significantly from current market value over time. The two figures are not directly comparable,” said Owen.
The company also expects to earn $130 million a year to run the California City detention center, according to its filing with the Securities and Exchange Commission.
Will feds buy more detention centers?
What’s next? Former ICE official Trickler-McNulty said the abandoned plan to buy 24 warehouses under former Homeland Security Secretary Kristi Noem could hold some hints to the agency’s plan under Secretary Markwayne Mullin.
An internal roadmap obtained last year by the Washington Post reveals at least 10 “turnkey” facilities originally targeted under Noem.
They include the California City facility, but not Otay Mesa. The rest of the facilities are in Texas and Oklahoma.
The purchase of an immigration detention facility eliminates risk for both the private prison companies and the Trump administration’s deportation program, said R. Andrew Free, an immigration lawyer and writer, pointing to divestments California’s two biggest pension funds made from CoreCivic and GEO Group in 2019 that contributed to the companies’ spiraling liquidity crunch and cratering stock prices five years ago.
If private prison investments become politically toxic on a national scale, Free said, federal purchases of the detention facilities safeguard the companies and the detention space itself from divestments and the kind of environmental reviews that have ended similar projects in other states.
“This is a big upfront cash award from the federal government,” Free said.
Local governments and the state will be essentially locked out of the facilities, but will still have some contact with the people inside, Free said.
The detention centers are “still going to need police and fire, they’re still going to need coroners,” Free said, but noted that the majority of traditional inspections from the state are probably over.
Free said there are two ways to look at ICE’s detention expansion. One is, to him, optimistic: They’re simply gifts from a friendly government to their valued contractors. The other is more cynical.
“The cynical view is this definitely will be used to hold people who are not migrants,” Free said. “That it will be used to hold U.S. citizens.”
This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.
