Cornell's Texas Adolescent Treatment Center Accepts First Clients Sooner Than Anticipated.

Business Editors

HOUSTON--(BUSINESS WIRE)--Nov. 6, 2003

Cornell Companies Inc. (NYSE:CRN) announced that the Texas Adolescent Treatment Center in San Antonio, Texas, received its first clients Oct. 27, 2003. The new 124-bed center provides intensive juvenile drug treatment and behavioral health services for 12-17 year old male and female adolescents referred through the Child Protective Services Division of the Texas Department Protective and Regulatory Services and various county juvenile probation departments. The program is expected to generate approximately $6 million in annualized revenues and operate at capacity by the end of the year.

Tom Jenkins, president and chief operating officer, stated, "We know the need for juvenile drug treatment and behavioral health services in Texas is significant. This program is helping some of the most vulnerable children in the state. The clients have classifications ranging from Level 4 to Level 6, the latter of which requires acute care."

Across the country, Cornell has demonstrated the substantive role it can play in developing programs to meet the drug treatment and behavioral health needs of young people. Jenkins explained, "Our programs incorporate the latest professional approaches to the complex problems presented by these clients and their families. Additionally, Cornell works cooperatively with government and community agencies to foster a network of care and with local organizations to strengthen the ties of both our program and our clients to the community."

Jenkins continued, "As with all Cornell programs of this nature, there is an emphasis on developing relationships with other community-based agencies to establish a continuum of care for each client. This insures the highest opportunity for a successful transition back into society."

Cornell Companies Inc. is a leading private provider of corrections, treatment and educational services outsourced by federal, state and local governmental agencies. Cornell provides a diversified portfolio of services for adults and juveniles, including incarceration and detention, transition from incarceration, drug and alcohol treatment programs, behavioral rehabilitation and treatment, and grades 3-12 alternative education in an environment of dignity and respect, emphasizing community safety and rehabilitation in support of public policy. Cornell (http://www.cornellcompanies.com) has contracts to operate 70 facilities with a total service capacity of 16,514. Cornell's facilities are located in 14 states and the District of Columbia.

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current plans and actual future activities and results of operations may be materially different from those set forth in the forward-looking statements. Important factors that could cause actual results to differ include, among others, (i) the outcomes of pending putative class action shareholder and derivative lawsuits, and related insurance coverage, (ii) risks associated with acquisitions and the integration thereof (including the ability to achieve administrative and operating cost savings and anticipated synergies), (iii) the timing and costs of expansions of existing facilities, (iv) changes in governmental policy to eliminate or discourage the privatization of correctional, detention and pre- release services in the United States, (v) the availability of debt and equity financing on terms that are favorable to the Company, (vi) fluctuations in operating results because of occupancy, competition (including competition from two competitors that are substantially larger than the Company), increases in cost of operations, fluctuations in interest rates and risks of operations, (vii) significant charges to expense of deferred costs associated with financing and other projects in development if management determines that one or more of such projects is unlikely to be successfully concluded, (viii) results from alternative deployment or sale of facilities such as the New Morgan Academy, and (ix) the Company's ability to negotiate a contract amendment with the BOP related to the Moshannon Valley Correctional Center.