County hears new financing option for jail
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BY KENDRA WALTKE / Lincoln Journal Star
City Councilman Dan Marvin, a good-with-numbers guy, has come up with another option for paying for Lancaster County’s new $65 million jail.
Under the plan the city would no longer pay the county $1.4 million a year to house its inmates. As well as picking up that tab, the county would assume the risk for higher operating costs at a larger jail.
In exchange the city would lend the county its authority to levy up to 5 cents per $100 valuation.
On Thursday, the Lancaster County Board heard a new option - establishing a Joint Public Agency with the city - for financing a $65 million jail. The option would:
* Allow the city to lend the county its authority to levy a maximum 5 cents per $100 valuation to create a new political subdivision to build the jail. The interlocal tool is one the city is not using now.
It had been used by the county and the Lancaster County Ag Society to build the Lancaster Event Center.
* Extend the bond repayment over 20 years or more.
* Take the jail’s construction costs out of the county budget. As it’s understood so far, the tax collected would not be included under the county’s levy lid as other proposed options are.
* In exchange for the authority to finance the jail this way, the city would no longer pay the county its average $1.4 million annually to jail city prisoners.
The taxing authority, known as a Joint Public Agency Agreement, virtually takes the jail off the city’s budgeting plate.
That may be more palatable to the City Council, which has so far been reticent on the county’s proposed jail financing option.
But it’s not such a bad deal for the county either.
The new option would create a separate line item on taxpayers’ bills for the jail construction. This tax would not be part of the county budget — or need to be included under its tax levy lid.
It also would allow the county more than its legally allotted 10 years to pay off the project.
The carrot for the taxpayers?
Marvin’s option would provide taxpayers with a clear number on their bill for the jail’s cost, as well as allowing them to pay for the jail over 20 years.
More time would lower initial annual bond payments, as well as spread the jail’s cost over more population as the county grows.
The county anticipates adding 2.8 cents per $100 property valuation to build the jail.
But whether Marvin’s option is even available, legally speaking, was still unclear after he and bond experts spoke at Thursday’s county board staff meeting.
“The statute is a little ambiguous. It doesn’t address the questions we’ve been talking about,” said attorney Lauren Wismer, the county’s bond counsel.
After the briefing, the county directed its jail finance committee — made up of city and county officials and bond experts — to further research the option while still working full speed ahead on its prior plan.
After voters rejected a jail bond issue in May, the county board came up with a plan to lease a new jail through the Public Building Commission. In that bond payment plan — which also stretches over 20 years — the “rent” is the variable debt payment.
The city now pays an average $1.4 million per year to house its inmates at the county jail. Under the Public Building Commission option, that money would go toward the jail debt. The county also would raise its taxes, within its levy, to pay off the debt.
Because the Public Building Commission option requires participation by two entities, the city would need to sign a 20-year deal.
Whether the city would agree to do that is a murky unknown.
Marvin said he had concerns about the Public Building Commission deal:
* If operating costs skyrocket, the city could be asked to chip in more each year to cover jail costs.
* If the city jails fewer people, by using house arrest or ankle bracelets, the money it contributes might not reach the expected $1.4 million contribution toward the debt — leaving the county in the lurch.
Marvin said those concerns could be resolved.
“Would you be so excited about using the JPA agreement if the $1.4 million was not going to be transferred onto the county's ledger?,” County Board Chairman Bob Workman asked Marvin.
How does this plan benefit the taxpayer, Workman wanted to know.
Marvin said the JPA plan would eliminate a possibly messy system of debits and credits between the city, county and Public Building Commission.
Board members expressed concern that while they discuss how to pay for the new jail, the cost of building materials is going up.
“I think there may be advantages to this approach, but I want to make sure this is a legally available option,” Commissioner Ray Stevens said.
The county tentatively built a $5 million bond payment into its new budget year for the jail.
After the meeting Workman said he’s open to the newest idea, but needs to know more about the legality.
Switching the $1.4 million tab from the city to the county is not unfair, he said, because about 85 percent of jail inmates are city prisoners, and city residents pay 85 percent of the county budget.
Commissioner Deb Schorr, also speaking after the meeting, said the JPA tax showing up as a separate item on bills was a good thing, though she acknowledged its place outside the levy lid might concern taxpayers.
“We need to be very transparent in how we communicate this to the taxpayer.”
Reach Kendra Waltke at 473-7303 or kwaltke@journalstar.com.
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That city income tax is starting to sound pretty good...at least then all the people who work in Lincoln but live outside would have to help pay for the benefits they receive. "
Outside Lincoln wrote on July 25, 2008 7:41 am:
Mark wrote on July 25, 2008 7:57 am:
Hank wrote on July 25, 2008 8:30 am:
Oh come on wrote on July 25, 2008 8:46 am:
Should have done that from the start, Commissioner Schorr and company! The whole reason why residents in Lincoln and in the rest of the county are upset is because the board of crooks decided to not be honest about anything towards financing the new jail. If they just took the time to be open about this and as well include key voices into the discussion (like the county attorney, county sherriff, LPD chief, the people, etc) then maybe some of us wouldn't be so frustrated and angry about how things are? But no, the good ole boys of the board of crooks decided to scheme up a plan to have a nice and new shiny jail with all the bells and whistles in it so then they can punish those who can't afford to be a resident of the county. P-ah-lees!
We really need to replace Hudkins and Heier with Baier and Intermill come November. At least the two women would provide a voice for those who aren't happy with the way things are. "
Elvis wrote on July 25, 2008 10:16 am:
These blogs have people spewing a lot of retoric, but they offer little specifics.
To Hank: it's all good and well to talk about reducing incarceration rates but as Lincoln's poplation grows the old jail simly won't be adequate. That's not just my opinion, several independant consultants have said so as well. Alternative programs have been in place in this county for YEARS. They have been affective, but it will not solve the problem. Also, you're going to have to explain to me how building a new jail is socially harmful. The fact remains that some people simply deserve to go to jail for their crimes.
To come on: the sheriff and police chief have spoken out on several occasions in SUPPORT of the new jail. They don't seem pleased with the location, but they are in favor of the new facility. You have had your opportunity to have your voice heard by attending a County Board meeting. Also, I am curious what these supposed whistles and bells are. I have followed this story closely and I have not seen any specifics in design or equipment that would seem fivoulous to me. Perhaps you can enlighten us.... "
Dont Vote wrote on July 25, 2008 10:18 am:
Hum wrote on July 25, 2008 10:51 am:
county or state. All any Nebraskans' know is spend spend most dollars
they can and then tax tax tax all they can. The state song should be called, "Raise Taxes." And the flag made like a trillion dollar bill. All
I can say is, if my "out of stae" company operated like this town they
would be bankrupt. Leadership of any kind in Nebraska is NIL, and it
shows to the rest of the country!!!! "
Shady wrote on July 25, 2008 12:13 pm:
LarryDC wrote on July 25, 2008 12:20 pm:
Monte wrote on July 25, 2008 12:39 pm:
The county needs 2.8 cents per 100.00 of evaluation to fund the jail.Mr.Marvin wants to "lend" them 5 cents per 100.00 to fund the jail.Exactly where does the difference of 2.2 cents per 100.00 evaluation go? Does this 2.2 cents per 100.00 go back to the city of Lincoln's coffers and isn't this just a backdoor property tax increase for Lincoln property owners and renters? It appears like another of Lincoln's long running 3 card monte games of tax increases.Much like spending unspent water and sewer bond money on projects unrelated to water and sewer.Like funding the Childrens Zoo via LPS's Zoo School and the "ice" tax levied to pay for storm damage covered by FEMA a couple of winters ago.
It's these types of smoke and mirror games that erode and creditability that this city once had. "
Alan wrote on July 25, 2008 1:16 pm:
Frustrated wrote on July 25, 2008 1:47 pm:
What I believe Dan Marvin is trying to do here is to appease both sides of this deliberatly misconstrued public debate that is still being set up by the county board. I don't trust the county board as far as I can trust my own 16 year old son when he asks me if he could borrow the family car for the night with out either me or my wife supervising. The county board needs to quit acting like a bunch of spoiled ignorant children who pitch a fit when things don't go their way. The bottom line here is we need new leadership and come November, I'm voting for their opposition. "
Kendra wrote on July 25, 2008 5:22 pm:
Monte wrote on July 25, 2008 7:43 pm:
guy wrote on July 25, 2008 11:41 pm:
Any changes to the way we house people in jails could have been handled in a much more reasonable way with less cost. The Sheriff and the Chief of Police have said as much and there was a plan to do this. The County Board, which asks for a lot of money from property owners with little to no oversight, made a terrible decision.
I wonder all the time why they make these decisions. If you are terribly worried about where your tax money goes, you should be calling your County Board members and asking them. They rarely get the coverage in the press that the City Council gets and they are so terribly irresponsible. "