The Baldacci administration and county officials agreed, in principle, to replace competing proposals with a melded package.
A new board appointed by the governor would oversee an integrated system of county jails and state prisons. The board would look at budgets and expenditure trends.
The state would be expected to pick up debt service burdening counties now.
Systemwide bed space would be managed by the state Department of Corrections and the department would recommend a downsizing plan to the board.
According to the administration, jail employees would remain county employees, and day-to-day operations would remain under the control of sheriffs.