Question-and-Answer Session
Operator
Thank you. (Operator Instructions). We will take our first question from ManAv Patnaik. Please go ahead.
ManAv Patnaik - Barclays Capital
Hey guys. First question, you talked about in your discussions with several of the states with respect to them looking to maybe reduce per diems. So firstly, can you give us an idea of what sort of declines, like what sort of percentage reductions are they looking for? And with relation to that, you also mentioned that you have a lot of new customers and I guess existing ones too, looking for more bed space. Just wanted your thoughts around... obviously some states give higher per diems than maybe some of your existing states who might be looking for a pricing decrease. What are your thoughts on balancing maybe taking higher customer... I mean a higher per diem customer over an existing low per diem customer already?
Todd Mullenger
First to the first part of your question. We've received communications from about half a dozen states around actions they may be taking to balance their budgets. We would prefer not to identify them as we're in the middle of discussions and negotiations with those states on things we could do to offset any per diem reductions, for example, through the reduction of service levels to offset some or all of those costs. And that's part of the discussions we're having right now. And so that's the part of the uncertainty around estimating the impact those changes could have on our forecast for 2009.
With your question around trying to manage populations towards higher per diems, we may have that opportunity. I think as we said in the past, so we got 20 state customers, those relationships are long-term in nature, don't have 10,000 customers standing behind those... current 20 customers to take those beds, so it's a balancing act. And we're looking at the long-term growth prospects for each one of those customers. So while a current state customer might be experiencing difficulty and might be reaching out towards assistance to help them manage their budget deficits, we want to be mindful not to damage the long-term relationship but it will be a balancing act. That's not to say we won't make some decisions to provide beds currently available to an existing customer to a new or competing customer, but it is a balancing act.
ManAv Patnaik - Barclays Capital
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