Approximately 90 percent of all State prisoners are eventually released, more than half within 2 years. Two-thirds of incoming inmates are parole violators, and 24 California counties are subject to court-ordered population caps. California has spent more than $3 billion over the past decade to double the capacity of county jails, but these jails are still so crowded that 900 inmates are released daily to make room for high- priority prisoners. Another 2.6 million arrest warrants go unserved, largely because there is no place to put those who would be arrested. California's prison system is equally strained. Prisons are more overcrowded than ever before, and preventing riots and escapes and making room for nearly 100,000 additional inmates each year have become the overriding focus. Recommendations to reform the correctional system in California are offered in three broad areas: (1) create an integrated system; (2) maximize existing correctional facilities; and (3) expand correctional facilities through competitive procedures. Specific recommendations are outlined to relieve systematic jail and prison overcrowding, to maximize existing correctional facilities, and to promote performance-based correctional facility expansion. Additional information is appended on the Prison Issues Advisory Committee of California's Little Hoover Commission (LHC), witnesses appearing at an LHC prison issue public hearing, and prisons toured by the LHC in preparing its report. 133 endnotes and 25 graphics