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Commissioners Vote 2-1 on Joint Special LIT Resolution

December 27, 2020
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NewsThe Marshall County Commissioners passed a joint resolution with the County Council during their meeting last week that will send a message to the Indiana legislation concerning the Special Local Income Tax (LIT) used to pay the jail bond and operate the jail.

The Special LIT captures a quarter-of-a-percent on income from the county and those funds are used to pay the bond payments for the jail.  A portion of the excess funds from the Special LIT have been used for operating cost of the Marshall County Correctional Facility for years.

The Commissioners and Council members are seeking approval from the legislation to allow the county to continue using Special LIT funds for operating expenses at the jail after payment of the bonds for the construction of the jail are over.

During the meeting, Commissioner Kevin Overmyer said the county uses $750,000 to $1 million dollars of the excess funds to offset the operating cost at the jail. He went on to say, “To bring that back into the General Fund budget would be devastating for services here that we have in the county.”  He said Representative Jack Jordan will carry the resolution down to the statehouse.

Commissioner Stan Klotz said, “I agree we need a special piece of legislation but I don’t think we are going far enough. We have the option to pay this off in 2022.  The problem is that if we pay it off it sunsets that tax. I think we need to do a proposal asking for a piece of legislation that will allow us to pay it off and keep that quarter-of-a-percent.  We free up $1.1 million, of which $300,000 to $400,000 is interest we are just wasting.”

Commissioners Mike Burroughs asked, “Does that bond have a pre-pay?”

Klotz said it’s in 2022 and is estimated to be $5.5 million up to $6 million depending on who you ask what the pay-off is.  He said that would give the county flexibility if the council would need more.  He said property taxes cannot fund all the operating costs of the jail.

Commissioner Overmyer said timing is the issue.  This resolution is what the legislators said they needed to give us an option to use the Special LIT for jail operations.  He went on to say, “We may be building another pod so the Special LIT wouldn’t go away.  If it does go away we need to ask the legislators to reduce that from a quarter of a percent to maybe .15% because we are collecting $2.3 million annually.  Overmyer suggested working with our legislators over the summer on crafting additional legislation to help with jail operation costs.  It was noted in the past that Marshall County isn’t the only county needing additional funds for operating costs of county jails.

The Commissioners passed the joint resolution by a 2 to 1 vote with Commissioner Klotz voting no saying, “I think we need to delay it and make sure we get it right. I don’t want to go to the legislature twice.”

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