New cost estimates revealed for justice center
Public meeting is Tuesday to discuss options
Staff reporter
Progress comes with a big price tag and a county justice center is no exception.
Such was the word Jan. 3 when Marion County Commission met in a special meeting to hear the news from B&G Consultant Dan Hall that a new jail and court services facility could cost several million more than originally projected but creative financing could make the project feasible.
Originally, the plans were for a sheriff's department and retention facility to replace an outdated and non-compliant county jail. The estimated cost of that project was $11 million.
When the commission learned of security upgrades that were in the works for the court system, it decided to include a court room, district court offices, and county attorney offices which would cost taxpayers more.
Hall presented project cost estimates using 2007 figures and 2008 estimates. The total cost projection for the design with 2007 cost estimates was $13,857,894 and $14,782,993 with 2008 figures. These estimates are based on 72 beds.
These estimates did not include any operational costs or contents such as furniture and equipment.
All three commissioners agreed that taxpayers probably wouldn't support a 1.5 percent sales tax increase and commissioner Bob Hein questioned whether a $14.7 million bond issue would pass.
Commission chairman Dan Holub said he didn't want to see any more than a .5 percent increase.
So, how could the county pay for this type of facility?
According to bond counselor David Artebury of George K. Baum Company, there are several options.
The county could impose an additional sales tax of .5 to 1.5 percent, or increase the mill levy which would increase property taxes, or do a combination of both. The revenue from the sales tax and/or property tax and the jail, since the plans include sufficient facilities to house out-of-county prisoners, could pay the bond.
Marion County was granted special legislature last year to implement as much as a 1.5 percent sales tax increase, if voters approve the increase through an election.
Artebury presented information of how an increased sales tax would be used to pay bond debt using 20-year and 25-year scenarios. With the revenue from housing out-of-county prisoners, the bond probably would be retired early. When the bond is retired, the additional sales tax and/or property tax would discontinue. Revenue from the retention center then would be used to operate the facility and provide a revenue stream for the county's budget.
Currently, Hillsboro, Peabody, and Florence have the highest sales tax in the county at 7.30 percent. If a .5 percent were imposed, their rate would increase to 7.80.
Commissioner Randy Dallke asked if there were any other counties or cities in the state with an eight percent sales tax. Neodesha, in Wilson County, has the highest sales tax in the state at 8.3 percent. Wilson County has a one percent sales tax, which is what Marion County currently has.
There are seven cities in Kansas at more than eight percent. Nineteen cities are at 7.8 to eight percent, including Herington.
Counties with a two percent sales tax are Cheyenne, Harvey, Republic, Russell, Sedgwick, and Wichita. Sherman County has a 2.25 percent sales tax. There are three counties with a 1.5 percent and two at 1.25 percent sales tax.
Artebury informed the commission that new legislature, if passed, could affect this project.
Currently cities have a one percent maximum sales tax that can be implemented for a maximum of 10 years. Legislature may be presented that would impose the same limitations to counties. Artebury said he wasn't sure if the county would be "grandfathered" since legislature also approved a special sales tax for the county.
During discussions of financing options, Artebury told the commission that a public building commission would be formed. The PBC would issue bonds.
The City of Hillsboro established a PBC, with members of the city council serving as PBC members, and was used for the construction of its city pool.
Since the indebtedness belongs to the PBC, it would not count toward the county's indebtedness.
Holub asked how grants could be used with the project. Artebury said the question on the sales tax question on the ballot would specify a dollar amount. If after the election a grant was obtained, the bond amount could be reduced.
"Some constituents would rather spread out the payments so property tax increases are lower," Holub said. Artebury said that also was a possibility.
However, the county cannot consider or be considered for any grants until a project has been finalized. Holub noted that he was aware of three grants that could be used for this project.
Sheriff Lee Becker suggested if a combination of sales tax and property tax increases are implemented, the mill levy for the county's general fund could be decreased with surplus revenue from the jail which would reduce the taxed amount.
He also pointed out that with the additional revenue, the county would no longer have to provide five mills for the operation of his department.
"Our original concern was a jail," Holub said. Since that time, a court room was added because of security issues.
"Then we threw in the county attorney's office because it made sense. If we subtract all except the jail and sheriff's department, then we'll have a hauling issue," he said.
Money will have to be spent to fix the jail and address court security issues.
Becker said he currently houses an average of eight to 10 inmates.
"If we want to generate revenue, we need more than 30 beds," he said.
"If we're building this for ourselves, it's just an expense," Holub said.
Hall said the county could just build a jail and sheriff's department and a shell for a future court services area which could be bid as an alternate. Revenue from the jail then could fund the court room and district court offices.
County auditor Scott Loyd of Swindoll, Janzen, Hawk and Loyd, said his experiences have indicated a stressful time for counties during the period when construction ends and full operation begins. He wasn't sure what could be done to alleviate that issue.
The next step
Artebury said the county would need to pass a resolution by early February to authorize the ballot question for a sales tax. A notice of election has to be published two times in the official newspaper.
The commission asked Becker to compile projected operating costs and potential costs for furniture and equipment and present at the public hearing.
A public meeting will be held at 7 p.m. Tuesday in the court room at Marion County Courthouse for public input and the commission will provide more information.
