A decision about whether to build a private prison southwest of Kingman would be delayed for at least a year under the budget proposed by Gov.
Janet Napolitano, a spokesman for the governor said.
Paul Allvin, the governor's deputy director of communications, said Napolitano has proposed delaying construction until the 2003-2004 fiscal year to save $13.6 million.
The 1,400-bed prison would house male inmates convicted of felony driving under the influence.
A budget proposal from the Joint Legislative Budget Committee calls for building a 400-bed facility during the current fiscal year and adding 1,000 beds during fiscal 2004, which begins July 1.
The governor and lawmakers are separately drawing budget plans with the intent of cutting about $1.4 billion.
"It is part of the budget plan that the governor put forward," Allvin said about postponing prison construction.
"The alternative is to issue cross-the-board, 3 percent agency cuts.
We just don't believe that is a responsible thing to do with seven months gone in the fiscal year, so we are looking for other options to balance this year's budget without throwing state services into chaos."
Allvin said delaying a contract for the private prison would mean the state Department of Corrections would need to issue another request for proposals.
In November, a legislative committee recommended building the prison on 196 acres next to the Griffith Energy Project off Interstate 40 and Griffith Road.
Department officials, who had expected to choose a contractor in January, drew responses from only two companies by the Sept.
The winning company would have built 400 beds by March and completed the prison by October.
The companies are Dominion Correctional Services LLC of Edmond, Okla., which proposed the prison next to the Griffith plant, and Correctional Services Corp.
of Sarasota, Fla., which proposed a site near Holbrook.
Corrections spokesman Jim Robideau corroborated Allvin's account about a likely one-year delay, while adding, "We are still continuing until we hear about the budget."
Jim Hunter, vice president of a group of companies under the same roof with Dominion, declined to speculate on the ramifications of Napolitano's budget.
"I have no information, and I don't care to speculate on the future of the (prison) procurement," Hunter said.
Hunter said the state Attorney General's Office is reviewing the request-for-proposals process, and Robideau corroborated him.
"We are still in the same place," Robideau said.
"There are legal concerns, so it is still under review."
Robideau declined to say what the legal concerns are.
Richard Travis, a spokesman for Attorney General Terry Goddard, could not be reached for comment
Joe Hart, R-Kingman, said he heard the proposed contract keeps being bounced back and forth between the governor's office and the attorney general.
"I think this is a way for (the prison) to die a slow, miserable death," Hart said.
However, Hart said the chairman of the House Appropriations Committee, Russell Pearce, R-Mesa, is pushing for funding the private prison in the current budget.
"He wants to push the envelope on converting to privatization, and he does not want to back off," Hart said.
"I don't think he is going to have much success because Arizona is one of five states with double-digit (spending increases) in prison construction."
Hart said 10 percent of the state's $6 billion budget goes into prison construction and maintenance.
Pearce could not be reached for comment.