What will a new jail really cost? $200 million? $300 million? Even more?

Allen County has $50 million in rollover money and another $25 million potentially from ARPA, money from the American Rescue Plan, according to one county councilman who says the $300 million figure thrown around is out of sync with what other counties are spending on new jails.

Baker Tilly municipal advisors, designated by the Allen County Commissioners as the firm that will lead the county in jail financing decisions, laid out options at last week’s County Council meeting. Basically, the county can finance the jail through property taxes which would call for a referendum or income taxes through the “jail LIT,” a local income tax financing option developed and passed by the state legislature in 2018 to allow for municipalities to fund their jails through the Corrective and Rehabilitative rate.

County Councilman Paul Lagemann, 3rd district, says all stakeholders now need to get together to discuss location and cost of a new jail.

Paul Lagemann, the 3rd District county councilman, said the typical cost for a new jail is between $90,000 and $140,000 per bed. At a projected 1,200 beds needed here, that would place the cost at between $108 million and $168 million – nowhere near the $300 to $350 million projected by a study commissioned by the Allen County Commissioners for a justice center.

Close to $200 million is a more likely figure for a new jail, precipitated by a March 29 decision handed down by a federal judge Damon R. Leichty, ordering major changes to the Allen County Jail, a 40-year-old structure with rotting pipes and infrastructure.

Leichty rendered his decision after the ACLU and inmates sued in January 2020 over inhumane and overcrowded conditions caused by understaffing and the need to segregate jail populations in a jail designed for fewer inmates.

Under pressure from a July 14 deadline to choose a site for the new jail, the Allen County Commissioners landed on 70 of the 200 acres at the Allen County Sheriff’s training grounds at Adams Center and Paulding roads, eliciting an outcry from Democratic City Council members and community leaders on the city’s southeast side.

Lagemann called the commissioners’ decision “unilateral,” while allowing that the federal judge’s order expedited the decision. But he says the time is now to get everyone (the sheriff, the judges, prosecutor, mental health folks and other community stakeholders) together to look at the location, make sure the cost is correct and that the construction will be right “so we don’t have to go back and revisit it like the last jail 50 times.”

“It’s time for our team to come together so that we have community buy-in and if he (the judge) doesn’t understand it, I’ll be surprised,” Lagemann said. “I think any reasonable individual is going to understand with a project this size you have to have a cohesive understanding within your community where not only the public and the elected officials come together, but even just the elected officials themselves have the opportunity to come together and at least have agreement on what the project looks like.”

Lagemann says the county has a “significant amount of cash on hand,” almost $50 million in rollover by the end of the year and another possible $25 million in the ARPA funds. “That makes almost $75 million in cash to start this thing off.”

Shower door trim is representative of the rot inside the walls of the Allen County Jail. Courtesy photo, Allen County Sheriff’s Department.

Lagemann said income taxes are less regressive because they don’t hit fixed income taxpayers like property taxes do.

According to the Baker Tilly advisers Thursday, most municipalities have chosen to finance jails through the “jail LIT.”

LIT taxes allow municipalities to tax up to .25% of personal income. Allen County has a total combined LIT rate of .148%, Baker Tilly’s Emma Adlam told the council on Thursday. Out of 92 counties in the state, 66 have rates higher than Allen, she said.

LIT rates are allowed up to 0.2% per dollar, but are used in increments of 0.01% per dollar of income tax and cannot be in effect for more than 22 years, earlier information revealed at a February commissioners’ meeting.

Going with the lower rate 0.1% on issuance of $234.8 million for bonding would generate $21.6 million annually, leaving about $2 million for additional operating costs, Adlam said. Debt service payment would be about $19.7 million.

Adlam and Jason Semler recommended approving the “jail LIT” this October in order to start “banking dollars” for the eventual bonding and construction.

“Go ahead and adopt that rate,” Adlam counseled. “Go ahead and accumulate it, and then that’s that much less you have to borrow.”

But County Council is still stuck on the actual cost of the jail.

“That’s what the public is most interested in,” Councilman Ken Fries said. “What’s this going to cost?”

Councilwoman Sheila Curry Campbell echoed that: “They probably want to hear a number, not size,” she said.

What bothers Councilman Tom Harris is what put Allen County and so many other counties in a position they had to build a new jail.

“My main beef is that the state caused this problem initially,” Harris said, referring to 2014 legislation that mandated Level 6 felons be housed in county jails.

As of Monday, 135 sentenced Level 6 felons were housed at the Allen County Jail, the lowest felony category in the state. The number rarely budges and represents a large chunk of the inmate population (685 as of Monday).

The jail staff, working with the Indiana Department of Correction, has managed to send higher level felons to state prisons so that the number now hovers around 685 instead of 800. However, the number of probation violators is static and there are nearly 250 in jail on pre-trial felonies. There are 314 inmates classified as Level 6 felony, and once they are sentenced, the county believes they will be able to send newly sentenced Level 6 felons to state prisons because of a state reversal on the mandate.