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Thomas says there is no irregularity in how Boys Ranch uses federal funds.
Now the dispute over Boys Ranch threatens to spill over into the operations of other camps, including VisionQuest.
California State Senator Mike Thompson has sponsored a bill to force out-of-state facilities to follow California regulations--which are much more demanding than Arizona's--if they house California's kids.
VisionQuest has its own political ties. Founder and CEO Bob Burton and his wife have given $400 to current House Speaker Jeff Groscost. VisionQuest, however, has a cordial, even pleasant relationship with regulators--both the company and the state praise the easy communication with the other.
VisionQuest and Boys Ranch both say they play by the rules. They generally fire any staffer who hurts a kid. And accordingly, the regulators let them stay open.
But when a kid dies, there are new rules, and the blame game begins.
California and Arizona authorities are quick to pass the buck back and forth about who's responsible for the teens sent to the camps.
While California has been content for years to send its problem youth away, when Contreraz died, CDSS blasted Arizona for not doing enough to protect them.
However, Hart says, there is a simple solution if California doesn't think Arizona can keep its kids safe.
"If California really has a problem with Boys Ranch, then they don't have to send anyone to them. We're not the ones sending kids here," the DES deputy says.
California won't solve its problems by pulling its kids from Boys Ranch.
That's because there's no room back in California. Juvenile facilities are full, and California's group homes usually can't handle the violent offenders who come to Arizona.
Boys Ranch is also taking the fight to California. Two weeks ago, parents and supporters of Boys Ranch gathered in Sacramento and held a march on the state Capitol to protest the CDSS action. They also met with state Senate Majority Leader Richard Polanco, a Boys Ranch supporter who is questioning the authority of CDSS to make decisions about where California kids can be placed.
Counties that rely on out-of-state placements are also questioning CDSS' right to decide where their probationees should go.
Ray Wingerd, the chief probation officer for Boys Ranch's biggest client, San Bernardino County, says his office is doing legal research on the question. And, as head of the Chief Probation Officers of California, he says his colleagues are also worried about Thompson's legislation to force out-of-state facilities to comply with California's regulations.
"The state Social Services Department has already clearly made it known that Arizona's regulations don't meet California standards," he says. "So we're a little concerned about our options."
With the spotlight on its competitor in Arizona, VisionQuest is calling for more regulation of its industry. Ranalli says VisionQuest supports the California legislation because he believes VisionQuest can meet those standards.
"We have no problem with regulations," he says. "Regulations protect us and the kids."
The death of Nicholaus Contreraz, Ranalli says, is an argument for opening camps in California--something VisionQuest and Boys Ranch have both wanted to do for years.
"We totally believe that you should work with kids in their own state," he says. "And from their point of view, I can see them asking, 'Why the hell should we spend all this money in Arizona for our kids?'"
No matter what happens, the controversy has already taken a heavy toll on Boys Ranch.
On a recent afternoon, the main campus of the Arizona Boys Ranch was silent. The neatly manicured lawns and playing fields were empty. As CEO Bob Thomas toured the grounds, the place appeared deserted.
Thomas recently took a drastic step to keep Boys Ranch's biggest clients: He's offering California counties a discount on Boys Ranch's services for about $2,400 per kid (down from $3,600), the amount that the State of California no longer pays.
"We can't afford it," he says. "We did it out of our hearts, not our brains."
Thomas thinks Boys Ranch will weather this storm.
"I believe this is a short-term political exercise," he says. "These counties need Boys Ranch. . . . Without Boys Ranch, they [the teens] end up in the California Youth Authority."
Thomas believes the CDSS decision won't last much past the California governor's race, when a new administration will come into office.
And even if it does, he adds, there are other states that want to contract with Boys Ranch, though he declines to name them.
"We're not going to turn our back on the kids," he says. "We might be going through a rough time for a while, but we'll be around."
Thomas concedes things are going to get worse. Some key personnel--Thomas calls them his "real blue-chip people"--will be let go; some out-of-state offices will be closed; and some unspecified Boys Ranch programs will be shut down. And some donors have told him they will no longer contribute because of what they've seen in the news.
Wrapping up the tour of the campus, Thomas visited one of the dorms where the remaining boys are housed. One kid sat playing Nintendo, blowing away his enemies with a giant, black revolver that filled the screen.