CSCQ Correctional Services (MM)

Correctional Services Corporation (Nasdaq:CSCQ) today announced the signing of an inter-governmental agreement between Jefferson County Texas and the Texas Department of Criminal Justice (TDCJ) to house and provide services at the Jefferson County Detention Center for up to 250 TDCJ inmates for a two (2) year period commencing July 1, 2005. Correctional Services Corp. has been managing the Jefferson County Detention Center for the County since June 1998, and previously provided services at the Jefferson County facility to TDCJ. The Company expects TDCJ inmates to begin arriving the first week of July with the final transfer occurring in early August. The facility is expected to be at full capacity in August, as it will continue to house Immigration & Customs Enforcement & United States Marshal Services detainees in addition to the TDCJ inmates. In the event the 250 TDCJ inmates are transferred to the facility, they are expected to generate $3.6 million in additional annual revenue for the Company. Commenting on the new contract, James F. Slattery, President and CEO, stated, "TDCJ has been preparing for some time to renew their placement of inmates in county facilities as part of their plan to manage their growing inmate population, which now exceeds the capacity of the state system. We are pleased TDCJ has chosen the Jefferson County facility as their first placement alternative." Slattery further stated, "We have a very strong track record of providing quality services in Jefferson County to various federal, state and local agencies and look forward to renewing our relationship with TDCJ under this new contract." Through its Youth Services International subsidiary, the Company is the nation's leading private provider of juvenile programs for adjudicated youths with 17 facilities and 1,300 juveniles in its care. In addition, the Company is a leading developer and operator of adult correctional facilities, operating 14 facilities with approximately 5,500 beds. On a combined basis, the Company provides services in 12 states, representing approximately 6,800 beds including aftercare services. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Certain statements contained in this press release are not historical but are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These include statements regarding the expectations, beliefs, intentions or strategies regarding the future. The Company intends that all forward-looking statements be subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company's views as of the date they are made with respect to future events and financial performance, but are subject to many uncertainties and risks which could cause the actual results of the Company to differ materially from any future results expressed or implied by such forward-looking statements. Examples of such uncertainties and risks include, but are not limited to: fluctuations in occupancy levels and labor costs; the ability to secure both new contracts and the renewal of existing contracts; the possibility of unforeseen costs relating to facility closings, the ability to achieve profitability and public resistance to privatization; ability to obtain construction financing; and ability to complete new construction projects within budgeted amounts. Additional risk factors include those discussed in reports filed by the Company from time to time on Forms 10-K, 10-Q and 8-K. The Company does not undertake any obligation to update any forward-looking statements.