Correctional Services Corporation Does Not Expect Write-offs With Regard to the Facilities At Which It Will Discontinue Operations.

SARASOTA, Fla.--(BUSINESS WIRE)--Aug. 25, 1999--

Correctional Services Corporation (NASDAQ NMS:CSCQ), as a follow up to its earlier release of today, clarified it does not expect write-offs relating to the facilities at which it expects to discontinue operations. Of the four facilities which will cease operations, only the Los Hermanos facility was owned by the company. In anticipation of its possible closure, adequate provisions where taken in the first quarter of 1999 at the time of the merger with Youth Services International. The other facilities were either leased or managed by the company and proper notices have been given.

The four facilities all lost money in the second quarter of 1999 and were not expected to show material improvement in the foreseeable future. The loss associated with the facilities was approximately $0.02 per share in the second quarter.

Commenting on the discontinuance of operations at the Pahokee Youth Development Center, James F. Slattery CEO & President stated, "In the discussions with the Florida Department of Juvenile Justice leading to our decision to discontinue operations in Pahokee, the State reaffirmed to us their satisfaction with the company's services in it's Florida facilities. The company expects its decision in Pahokee in no way to impact its other Florida operations."

Through its Youth Services International subsidiary, the Company is the nation's leading private provider of juvenile programs for adjudicated youths with 38 facilities and 4,909 juveniles in its care. In addition, Correctional Services Corporation is a leading developer and operator of adult correctional facilities operating 20 facilities representing approximately 7,300 beds. On a combined basis, the company provides services in 22 states and Puerto Rico, representing approximately 12,109 beds including aftercare services.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION 

REFORM ACT OF 1995

Certain statements contained in this press release are not historical but are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These include statements regarding the expectations, beliefs, intentions or strategies regarding the future. The Company intends that all forward-looking statements be subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company's views as of the date they are made with respect to future events and financial performance, but are subject to many uncertainties and risks which could cause the actual results of the Company to differ materially from any future results expressed or implied by such forward-looking statements. Examples of such uncertainties and risks include, but are not limited to: the integration of Youth Services International; occupancy levels; the renewal of contracts, the ability to secure new contracts; availability and cost of financing to redeem YSI's debentures and to expand our business; and public resistance to privatization. Additional risk factors include those discussed in the Form 10-K as well as those set forth in the Company's joint proxy statement/prospectus, dated March 4, 1999 and those set forth in reports filed by the Company from time to time on Forms 10-Q and 8-K. The Company does not undertake any obligation to update any forward-looking statements.