In August, the Jefferson County Council approved the purchase of 50 acres to build a new jail.  (Courier file photo)
In August, the Jefferson County Council approved the purchase of 50 acres to build a new jail. (Courier file photo)

By MAGGIE HILLERY

Courier staff writer

With state deadlines approaching, six members of the Jefferson County Council voted Tuesday night after a public hearing to add two new county income taxes to fund construction of a 300-bed jail at a cost of $36.7 million.

The unanimous decisions from six council members — President Judy Smith, Ray Black Jr., Pam Crozier, Ray Denning, Heather Foy and Chris Shelton — came after about a two-hour meeting. Councilmember Joe Craig was absent.

Several council members expressed their distress at having to make the decision on a project that will move Jefferson County from the county with the lowest personal income taxes in Indiana — 0.35 percent — to the 86th spot among 92 counties at 0.90 percent.

But, at the same time, they acknowledged they had to respond to a 2017 inspection from the state that found the current jail not in compliance with state regulations. That inspection originally gave county officials 180 days to make an action plan to correct the non-compliance.

On Aug. 13, all seven members of the council had voted unanimously to exercise an option to purchase 50 acres at a cost of $400,000 to build a new jail on Madison’s hilltop just days before state inspectors revisited the jail. That land commitment set them on a path to the actions taken Tuesday night.

Council members faced making decisions Tuesday night based on the best information available now ­— not necessarily the precise figures.

If the jail project is to begin next year, the decision to add the two income taxes ­— which is the funding mechanism allowed under state regulations ­— had to be made last night to meet the state deadline of Oct. 31 so the taxes can begin to be collected Jan. 1, 2020. That decision also had to be made before the county can seek the bonds necessary to go ahead with design, engineering and other specific planning for construction. That is why costs the council members grappled with Tuesday night were estimates based on the current market, not the specific numbers that can be obtained once requests for proposals can be returned and companies hired.

The council waited to vote on the taxes until this meeting because, Smith said, it wants the taxes to take effect Jan. 1. If they had voted earlier and submitted the income taxes to the state, under the law, the taxes would have begun Oct. 1, 2019. Smith said they did not want to make it difficult for taxpayers to have to change tax rates and computing at the end of a calendar year.

The first new tax approved Tuesday night is a countywide tax, referred to as a local income tax, that would be used only for the jail. The proposed rate for that tax is 0.20 percent. The second tax, also a local income tax, but this one under public safety, must be approved by and shared with the other incorporated entities in the county ­— Madison, Hanover, Brooksburg and Dupont. The proposed rate for that tax is 0.35 percent.

There is an existing local economic development income tax that funded the jail that is now in use. That tax of 0.35 percent was put in place without an expiration date. The total distribution of that tax from the state to the Jefferson County entities is $2,475,317 annually. Specifically Jefferson County receives 50.9 percent or $1,259,108; Madison receives 36.9 percent or $913,473; Hanover receives 10.9 percent or $270,676; Dupont receives 1.05 percent or $25,877, and Brooksburg receives 0.25 percent or $6,183. The amounts are based on population.

The income tax proposed for the jail facility to begin in 2020 would be 0.20 percent and would end in 22 years. That is estimated to be a total annual distribution from the state of $1,414,467 with all funds going to the county for the jail.

The tax proposed for public safety to begin in 2020 would be 0.35 percent. The public safety tax does not have an expiration date and would remain in place unless changed by the local units of government. The public safety tax is estimated to be a total annual distribution from the state of $2,475,317. Unlike the tax already in place, however, Jefferson County would receive 63.4 percent or $1,570,217; Madison would receive 35.2 percent or $870,506; Hanover would receive 1.36 percent or $33,672; Dupont would receive 0.02 percent or $533, and Brooksburg would receive 0.02 percent or $389. The amounts are based on population.

The public safety tax must be voted on by the governing body of each of the other incorporated areas in the county. Under state law, those incorporated areas have 30 days from the time they receive notification from the county to make a decision. Those votes must be taken for the county council to meet an Oct. 31 deadline to submit the public safety tax to the state for the tax to begin Jan. 1, 2020.

County Commissioner David Bramer, who has been the point-person for the commission on the jail committee, was asked by council members about his discussions with City of Madison officials on the possibility of Madison contributing half of its share of the new public safety tax to the cost of the jail. Bramer said he thinks that will happen and that lawyers are working now on a proposed interlocal agreement.

When asked Tuesday night about the inmate count at the jail, Sheriff David Thomas said the total inmate count hovers between 175 and 183, which includes those in the county jail and those housed in other jails..

Thomas, who asked for and received at the August council meeting an additional $65,000 to cover expenses of having to house inmates in other jail facilities to relieve the overcrowding, noted he was just starting to get bills from last month and those costs are “going to be at least $20,000.”

“It’s a continuous cost,” he said. “Those numbers are not going to go down.”

It’s a problem a number of Indiana counties face.

The Greenfield Daily Reporter in an April 2019 story about Hancock County’s struggle to deal with building a new jail, reported the Indiana Sheriffs’ Association had estimated that 96 percent of jail cells statewide are full. Forty to 45 counties are looking at building new jails or renovating existing facilities, the association said.

Part of the jail crowding problem also involves the changing nature of the crimes charged and the length of time a defendant is jailed.

“Our community has seen an increase in methamphetamine cases over the past several years,” said Jefferson County Prosecutor David Sutter in response to an inquiry from the Courier. “In 2012, the Jefferson County Prosecutor’s Office filed a total of 18 possession of methamphetamine cases. In 2018, a total of 159 possession of methamphetamine cases were filed, and so far in 2019, we are on pace for just shy of 200. The charge of possession of methamphetamine is now outpacing the charge of driving while suspended as the most commonly filed criminal charge in Jefferson County. That trend is also being seen in other counties throughout the State of Indiana.”

In a meeting that lasted about two hours, council members were given a bottom line figure of $36,727,272 for a new jail. That figure, based on the best estimates now includes among other things hard construction costs, architectural/engineering costs, the land costs and capitalized interest and costs associated with the bonds that will be necessary to finance the project.

Andrew Lanam of George K. Baum & Company, financial consultants for the county, provided council members with estimates of how the added taxes would impact a household income of $35,000, $51,000 and $80,000. The median household income for Jefferson County in 2017 was $51,163. The median is a figure that indicates an equal number of households above and below that number and is not an average.

Lanam emphasized that the numbers he was providing were based on adjusted gross income and that taxpayers who are exempt now would not be affected. He said that for a household with an annual income of $35,000, the estimated annual increase would be $192.50; for an annual household income of $51,163 — the median income for Jefferson County — the annual increase would be $281, and for a household with an income of $80,000, the annual increase would be $440.

One member of the public, Madison resident Rick Reuss, spoke to the council. Reuss voiced concerns about whether the council had the information it needed to be making the decision at this time without final costs.

“You’re talking about people’s lives,” he said. “I’m a taxpayer. I need my money.”

Councilmember Foy responded that no one at the table took lightly increasing taxes.


For a household with an annual income of $35,000, the estimated annual increase would be $192.50; for an annual household income of $51,163 — the median income for Jefferson County — the estimated annual increase would be $281, and for a household with an income of $80,000, the estimated annual increase would be $440.