CLEVELAND, Texas (AP) — Standing in a prison chow hall, Richard Chavez Jr. outlines his past: violent felon, former gang member, the fourth member of his family to go to prison. Then his future: owner of a mobile counseling youth service that goes where the troubled kids are.

Arching a tattooed eyebrow, Chavez credits an innovative program run out of the Cleveland Correctional Facility, about 50 miles northeast of Houston, with helping him develop the skills needed to run a business — from character-building and how to carry himself to writing a business plan and finding financing.

"Man, my life was just selfishness," says Chavez, who is serving an eight-year sentence for aggravated assault. "That's all my life was. I had a daughter, a beautiful little girl, and I couldn't do it. I wasn't the father I needed to be. I joined a gang. And, you know, it hurts my heart, to say that. But that was comfortable for me. That was life."

The Prison Entrepreneurship Program (PEP) is based on a philosophy that making inmates such as Chavez business savvy will reduce the likelihood that they will end up back in prison. It emphasizes reforming behavior while also working on a broader goal of reducing the prison population.

With 1.5 million inmates, the U.S. has the world's largest prison population. Costs are soaring at the federal and state levels.

In Texas, it costs about $18,200 a year for each of the 150,000 inmates in a state prison.

Lawmakers in Washington are looking at ways to reduce prison costs, including trimming mandatory federal sentences and creating incentive programs for model inmates. PEP tackles the problem from a different perspective: What happens when inmates are released?

Since it began operating in 2004, the program has graduated more than 1,100 students. About 165 have opened businesses, and at least two are grossing more than $1 million. Within 90 days of their release, nearly all the ex-inmates had found jobs. This year, the program is looking to expand to a prison near Dallas.

But that's not the only way to measure success. PEP's graduates have a recidivism rate of less than 7 percent, compared with 23 percent of the overall prison population in Texas.

The cost to the state: nothing. Operating on about $2 million from private donations, PEP uses a mix of permanent staff and volunteers, including Texas business leaders.

In Washington, the Senate's No. 2 Republican, John Cornyn of Texas, has introduced legislation, sponsored with Sen. Sheldon Whitehouse, D-R.I., that would require the federal Bureau of Prisons to offer more such programs to inmates. After a visit last year to PEP's Houston office, Cornyn called it as a model worth replicating.

All inmates within the Texas state prison system who have less than four years to serve and were not convicted of a sex crime are eligible for the program. Those who apply face a rigorous interview process. If selected, the inmates are transferred to the Cleveland facility.

In time, inmates essentially will become full-time business students. They will go through course work that is sufficiently demanding that, last year, Baylor University's Hankamer School of Business began awarding a certificate of entrepreneurship to each graduate. Inmates learn how to finance a business, how to market products and how to sell themselves and their stories.

But not before they learn how to get along, and, in some cases, learn how to use a computer. With participants serving sentences that range from a few years to more than 20, tech skills vary greatly.

To break down prison cliques and lingering negativity, the program co-opts the culture. The class gives itself a nickname — "The Transcendent 22," for example. They, the staff, and the regular volunteers also get "sweet names." Bert Smith, CEO of the Houston-based program, is "Chocolate Truffles." Some of the classmates are "Humpty Dumpty," ''Pringles" and "Instant Potatoes."

Arturo Martinez Jr. — sweet name "Selena Gomez"— was convicted of aggravated assault and escape charges. He got his GED while in prison, and "I thought I was set," the 27-year-old said.

But he wanted more and was admitted to PEP.

The classes forced him to look internally and focus on the flaws in his personality. This was nothing like memorizing for the GED.

He was critiqued by his peers. Classmates told him they liked him, but they also said they found him manipulative and self-centered. "You start finding things out about yourself you didn't know," he said.

There are also exercises designed to help inmates put their life in perspective.

On a day when volunteers visit the program, inmates in dark blue jumpsuits and business leaders dressed for work stand on one side of the room, behind a blue line. Smith or another PEP leader reads out a series of personal characteristics such as, "you were raised by a single parent" or "you did drugs."

For each one that applies, participants step toward the line. By the end of the exercise, inmates and business leaders may stand shoulder to shoulder, close to the line. The idea is to dissuade them of the idea that who they are can prevent them from succeeding in business.

Not everything is quite this serious.

There are musical interludes. One day, a DJ plays the "The Chicken Dance" and Smith playfully orders inmates to find a business volunteer to dance with. They do, locking arms and twirling in a circle while clucking at one another.

"Heyyyy," inmates shout.

After a comfort level is established and computer skills are locked in, the program intensifies to 40 hours a week, focusing on business skills.

Paired with a volunteer, inmates work to develop a business idea, determine pricing, financing and realistic growth rates. There are lessons on business jargon, how to sell, the importance of a five-year projection and so on. The process culminates with a two-day business plan contest, where inmates pitch their ideas to volunteer judges. One inmate is selected the class winner.

This is how Chavez, "Sweet Sugar," decided to become a youth counseling entrepreneur.

PEP volunteers encouraged him to make his own story part of his pitch. They helped him find research that showed youth counseling was a potential growth industry in the Houston area. (None of the inmates can use the Internet, so volunteers often provide market data.) Making himself mobile, going to wherever the kids need counseling, was Chavez's tweak.

"Off the Streets Youth Counseling" was born.

A charismatic speaker, Chavez also has a distinct look. In a Texas prison system filled with tattoos, his ink stands out because it stretches across the hairline of his shaved head and all the way down his neck and shoulders. There are tattoos over each eyebrow and all over his arms.

He joined a gang in prison, which gave him friends and protection. Eventually, he said, he thought about his young daughter and pushed himself to change.

The decision wasn't easy. Quitting, he said, meant enduring a brutal beating by former gang members. The threat only eased after he was put in solitary.

After time in a lockup, Chavez saw one of PEP's postcards. He decided to apply. Once he got in and transferred to the Cleveland prison, the structure and the course work made sense to him right away. The mix of discipline and humor was something he had lacked.

His story, he thought, could be an asset.

"I've realized I have to give that away," he said. "It's not meant for me to keep. It's meant for me to tell."

Now Chavez has a business plan. His final proposal seeks about $50,000 in funding. He wants to open in 2020, perhaps sooner if he is paroled.

Entrepreneurship programs such as PEP are especially useful because they equip inmates with a range of skills, said Lois Davis a senior researcher at the RAND Corporation who has studied prison education programs and recidivism. "It's teaching them not only hard concrete skills on the business side of things, but also soft skills that are important."

On graduation day, Cedric Hornbuckle, who completed the PEP program while finishing a term for drug trafficking, tells the current class, "Business is good. This program gave me discipline I absolutely needed."

His business, Moved by Love Moving, based in Houston, is now transitioning into trucking. It also employs a handful of program graduates.

Another PEP alumnus, Charles Hearne, who now works for the organization, reminds the graduates that they will have a network to rely on, including transitional housing in Houston and Dallas, and post-release courses to continue their business education.

Family members watch from rows of folding chairs inside the cavernous prison gymnasium. Small children crawl up and down on chairs, giggling and crying. At the back of the room, there are buffet tables of gourmet cupcakes, high-end snacks and sandwiches.

PEP pays for many of the families to get to Cleveland because it helps close another post-release loop. But there are disappointments. A day before graduation, one family cancels — their car broke down. While several members of Chavez's family, including his mother, do make it, his daughter has to cancel at the last minute.

The graduation ceremony has all the trappings of a school ceremony: a valedictorian and salutatorian, class superlatives and award winners. Inmates have traded drab prison jumpsuits for shimmery, royal blue graduation gowns.

"Pomp and Circumstance" pumps through the gym. John Wesley, also known as "Oompa Loompa," a 28-year-old serving five years for robbery who plans to open a music business, sings a song dedicated to family and teachers. The rest of the class, on and off key, provides backup vocals.

Smith announces the winner of the business plan contest — a company that will service and maintain man-made lakes in the Houston area.

Then, inmates are called to the stage individually and Smith hands each a diploma.

As Chavez's turn approaches, he shows a mix of excitement and been-there cool. He pumps his fist as he walks across the stage.

For the new graduate, opportunity awaits.

___

Online:

Prison Entrepreneurship Program: http://www.pep.org/