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New York's highest court today ordered the state prison system to stop keeping convicted state pris oners in county jails for long peri ods, a decision that could relieve dangerous overcrowding in the Ni agara County Jail and mean huge financial savings for Erie County.

While attorneys today were studying the ramifications of the ruling, Erie County Sheriff Thom as F. Higgins indicated that it could save the county up to $800,000 a year. The ruling also is expected to have a significant effect on over crowding in Niagara County, where local law-enforcement offi cials have called the jail over crowding a "potential time bomb." Niagara County today houses 241 inmates, including 40 from the state, in a jail that was built for 176, Sheriff Francis L. Giles said. County officials have had to open a dormitory in a chapel to house the overflow. With the ruling, however, the 40 state inmates should soon be transferred. "It's going to alleviate a lot of pressure on everybody, specifically the guards and the inmates," Giles said. "I'm ecstatic," Raul Russi, su perintendent of the Erie County Holding Center, said of the ruling. "It helps Erie County control its own destiny in the way it handles inmates." The Erie County Holding Cen ter was not overcrowded today but was at full capacity. The new ruling, which allows the state to house its prison-ready inmates in county jails for only 10 days, will open space in Erie County jails for other inmates from downstate counties that pay higher prison fees than the state. For example, if the ruling frees 50 to 60 beds on the average day, Erie County can accept that many downstate county prisoners, who generate $85 per day. The state pays only $40 per day for its pris oners. With 50 prisoners each generat ing an extra $45 per day, the dif ference snowballs to more than $800,000 per year, according to Higgins' staff. State officials today were trying to determine the effect of the new ruling, as sources predicted it might cause the state to increase its per-prisoner fee from $40. Department of Correctional Services spokesman James Flateau was not immediately available to comment. The department's practice of housing state prisoners indefinite See Jails Page A-2, Column 4 Jails Continued from Page 1 ly in county jails was challenged by 50 of the state's 58 county sher iffs, who said their own jails also are frequently overcrowded -- largely because the state prison system refused to take transfer- ready inmates off their hands. The Court of Appeals ruled unanimously in two related cases that the system must take crimi nals ready for transfer out of the local jails "without delay," al though it said the state could have up to 10 days in most cases to accept the transfer-ready inmates. The decision came down to a debate over the meaning of one word in state law -- "forthwith." Although Correctional Services Commissioner Thomas Coughlin argued that his system should not be forced to take transfer-ready in mates when his own facilities were overcrowded, the court's seven judges said flatly: "'Forthwith' means that it is to be done without delay, at once, promptly." The words "without delay, at once, promptly" were underlined in the decision written by Judge Judith Kaye. The ruling deals a big blow to the state corrections department, which has stalled on taking hun dreds of inmates because of prison overcrowding. According to the court: "The Legislature did not pro vide for transfer to state custody in the commissioner's discretion, upon his conclusion that state fa cilities were safe, healthy and hu mane, and inmates classified ac cording to their needs; it said 'forthwith.'" However, the judges also said the prison system can have up to 10 days to take inmates from most counties and up to 14 days in Suf folk County. New York City's jail-to-prison transfers must take place in an even briefer time peri od set by a federal court. The time is for local and state officials to make sure the inmates' transfer papers are in order.

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