The first official action of the Daviess-DeKalb Regional Jail board in 2011, in emergency session, was to fire the jail administrator. However, at the four-hour board meeting held Jan. 7, there was very little discussion about the firing of Larry Hadley.
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The meeting instead focused on financial woes of the jail.
A down economy and the loss of two major contracts will probably force members of the Daviess-DeKalb Regional Jail Board to forego any notion of having the jail’s 10 year bond paid off early, according to budget manager David Tolen.
In 2005, Daviess and DeKalb counties passed a bond to allow for a half cent sales tax to purchase Midwest Security Housing in Pattonsburg for $3.5 million. Midwest Security was privately owned by Ron and Pam Huston.
Collection on that sales tax began in April of 2006. For the first several years, the jail as a business did well enough to pay for itself. The sales tax money was used to pay off the interest and principal on the bond. Any money over expenses was placed in interest-bearing certificates of deposit.
When the jail was brimming with prisoners and flush with funds, the goal was to have the bond paid off in six years.
Times change. The jail lost two major contracts for prisoners last year, Wyandotte and Polk Counties. Since then, the jail has been having trouble making ends meet. It became necessary to use $500,000 of sales tax money to pay for operational expenses. In addition, a certificate of deposit worth $400,000 was cashed in to run the jail.
Even with transferred money, the jail saw a net loss of $324,660 in 2010, and the sales tax funds saw a net loss of $131,000.
The regional jail does have money on hand from the sales tax fund. It has $479,593.18 in one CD and $807,735 in another CD and a checking account balance of $329,679. That’s a total of $1.6 million.
In addition, the option is being explored to prepay $480,000 in principal this year, that would save the taxpayers about $112,800 in interest.
How long that money will last in the face of debts remains to be seen.
If finances continue to deteriorate, board members may have to consider the onerous task of asking taxpayers to renew the sales tax. The sales tax proposal included a 10-year sunset clause, meaning sales tax collections would end unless voters choose to renew and continue the tax.
It was pointed out that the jail’s debts would have to be met, even if that meant taking money out of the two counties’ other operating funds.
Board members said the search for contracts with other counties and municipalities for inmates to fill the jail continues. The jail must house 100 out-of-county inmates to break even. It presently houses between 55 and 60 out-of-county, a little over half the number it needs.
The 2010 budget showed total revenue for the jail at about $1.6 million. Total expenses came to about $2 million.
Here’s an overview of the jail’s 2010 expenses, rounding off.
Total automobile expenses came to $77,000. The jail has 15 vehicles that run. Most have over 200,000 miles. Total commissary expense was $126,000. Food expense at the jail was $143,000.
Employee medical is one of the biggest expenses for the jail at $187,000 with 90% paid by the employer and 10% by the employee. Total insurance comes to $256,000.
By far the biggest expense for the jail is employee payroll, at $920,000, with payroll tax of $88,000.
The board discussed the level of employee turnover. The jail presently has 49 employees. Only 10 of those have been with the jail since it opened. Half of the employees have been there for less than a year.
Total utilities came to $94,000. The switch to natural gas did not show notable savings, Tolen said.
The 2011 budget for the jail will be finalized by the board at another meeting on Friday, Jan. 14.
Signature cards were signed at the meeting.
The board reorganized with Harold Allison as chairman, Ben Becerra as secretary, Randy Sims as vice-chairman and Wes Raines as treasurer.