Council OKs land purchase
County drops land swap, moves to buy new jail site despite cost concerns
County officials voted to pursue a new site for the proposed jail last month, abandoning a previously discussed and criticized land swap in favor of purchasing approximately 17 acres near Walmart.
President of the Board of Commissioners Sam Hobbs presented the request during the March 9 County Council meeting.
He began the proposal by reiterating that the county has discussed trying to build a new jail for more than a decade and the deplorable conditions of the current jail.
The county was considering a potential land swap of 96 acres owned by the county on Franklin Road and State Road 43S for 10 acres at the quarry behind Walmart and the Owen County Family YMCA owned by Brett Franklin. Because of the cost difference, the swap needed to be completed by the county's Redevelopment Commission. Two environmental studies have already been completed on the quarry property.
Hobbs said he reached out to Tilden Keith to inquire about the property west of Walmart, between the Walmart and YMCA and in front of the quarry property. The property is approximately 17.4 acres and is owned by Susan Sherfield and Deborah Harkrider.
The cost is $90,000 per acre, amounting to approximately $1.5 million.
If the county wants to purchase the property, they will be responsible for the survey, zoning requirements, the environmental study and two-percent commission paid to Keith in addition to the price per acre.
The sellers are responsible for the title insurance policy.
"It's a lot of money to purchase a piece of property. We understand that, but the utilities are on the property," Hobbs said. "And we also gain seven acres."
Though it later was shared that the only sewer utility cost savings is the difference between running sewer another 300 yards to the quarry property. The vast majority of the approximately $2 million in sewer upgrades comes from increasing the capacity of the lines to the lift station through a 12-inch sewer main.
Hobbs said the new property would also allow for future expansion or the addition of other county services on the property such as the coroner's office and the health department.
"I think it's definitely in the best interest of the county to move forward with the purchase of this property pending core drilling, environmental study and the samples that need to be done because it's going to save us a lot of money right out of the get-go," Hobbs said. "Just to get an easement on the property is very expensive, plus routing the utilities to the quarry would be very expensive, so the cost savings."
Hobbs didn't provide dollar amounts for the cost savings, but Council President Chesser did. She said that with the quarry property, there is a cost of $200,000 for an easement and $400,000 for retaining walls, leading to a cost savings of $600,000.
"Basically the negotiations on this was that they would even sell it, that they would even consider selling it because they've been approached several times on this, and it wasn't even in the ballpark whatsoever," Keith said of the property.
He then said he pulled information from various sales of the properties across the street over a period of time.
"But when they got down to $90,000 an acre, I mean you're $50,000 less than the average acre was on a smaller acreage back between 2006 and 2018 across the road," Keith said, adding that the owners have been approached about the property multiple times. "At this time, that is the least that they would be willing to take per acre. No doubt about it."
Hobbs urged the council to take action and referenced an executive session in which an insurance agent told the county that insuring the current jail would be a challenge and costly.
"I've said this term for many years, and I'm going to say it again whether people like it or not, the county is wasting hundreds and thousands of dollars polishing a turd. To refurbish this jail would cost us $15 million to refurbish, and it doesn't gain the sheriff any more bed space," Hobbs said.
Chesser said that refurbishing the jail would only gain about another 10 years of use out of the current jail.
County Councilman Joe Frye said that he would have liked to have seen some solicitation asking if others would like to sell property for a jail.
"I don't think there's a better piece of land than what you guys are talking about tonight. But moving forward, if there's ever a time where we need to purchase more, a solicitation should be issued in my opinion," Frye said, which Hobbs agreed.
Frye also acknowledged that there is a need for at least two access points for the jail from a safety perspective. He also asked if there was a possibility of selling the 96 acres on Franklin Road.
"We're money ahead with the money that we're going to save right out of the gate," Hobbs said.
Frye voiced a concern about the purchase raising property taxes and asked that there be an effort to not have it impact property values. It was noted that that could happen if the property was sold at all, and Frye said he didn't want the county to be the cause of it.
"I do understand, but the fact of it is the taxpayers are paying for a turd right now. We're spending taxpayers' money on a jail that we cannot do nothing with," Hobbs said.
"And you're right, we're using taxpayers money here, but 99 percent of taxpayers in the county are funding something they will never use, which is a jail. It's the largest cost to our county, and it's not an asset to anybody in this room," Frye said.
Sheriff Ryan White also spoke about the burden to taxpayers.
"I will say that if we get a lawsuit in the jail, and they win the lawsuit, then everyone's property taxes are going to go up too. The longer we wait, the jail keeps getting more and more expensive, about $1.5 million per year that we wait," White said. "The jail is going to get more expensive, if we don't find something sooner than later. We're not going to get any richer as a county anytime soon. It's not like we're going to just find tons of millions of dollars out of the sky."
Hobbs requested that they move forward with the transaction pending the environmental study.
He also reiterated that the land swap has not already taken place.
"I think we're in the absolute best possible situation we can be in right now," he said.
Councilman Nick Robertson said that he believes that it is the best deal they've been offered and that they are at a place where they need to proceed. He moved to approve the request, pending the environmental study results, and Councilman Steve Carrell seconded the motion.
It was then opened for discussion.
Councilman Anton Neff said that while it is a great location, he always asks about the net cost changing toward the county's favor.
"It's absolutely not going to change any net cost. It's going to cost us more money when we already were over our financial capacity before this discussion even occurred. So now we're moving in the wrong direction in my opinion," he said.
He explained, saying the cost for the sewer is the same, save 300 yards.
"So of that I'm just going to say $2 million, throw an easy figure out there, most of that $2 million was that. Now yes, you save 300 yards; that is some money to our favor. The retaining walls, $400,000, excellent. No easement, $200,000, excellent," Neff said. "But even if you subtracted that out, we're still talking another million dollars in cost for a project that still does not have a clear end point in terms of whether we can financially pay for it or not. That concerns me."
He said that to him it signals the need to scale back the project, which is already at a bare minimum design.
"I just am not comfortable with this at all," Neff said.
Councilman Daniel Browning asked if they could list the 96 acres on Franklin Road for sale ASAP to help with the cost.
Since the meeting, a notice of a public hearing of the county plan commission was placed in the Spencer Evening World on March 25. It says that a request made by the Owen County Commissioners to rezone nearly 87 acres on Franklin Road from agricultural to light industrial.
While the public notice says a copy of the petition is on record and could be requested from the Owen County Building and Planning Department, when asked for a copy of it, department administrator Heather Huntington said she did not have a copy of it.
She added, "The cart was placed before the horse, and the notice was advertised before any proposal was submitted. If a proposal becomes available, I am happy to share that with you. That proposal and meeting date has been cancelled."
During the council meeting, Hobbs said the current jail site and the county owned storage units will help save most of the money for the project.
"The million that we're going to spend for the property is child's play as far as I'm concerned because we're going to save almost a million dollars out of the gate," Hobbs said, adding that he is working with the Town of Spencer to see if they can get the sewer upgrade bonded so the county could pay it back over time.
Hobbs said selling the land that the current jail sits on was the priority.
"If it's already the minimum project, there is no way you're going to cut back any costs. Plus the property that the current jail is on, we were already banking on that sale to cover the year two payment for the bond, a bond based on $27.5 million," Neff said. "So we were already banking on the value of that sale financially in the big picture. You can't double count it or count it up front now to offset the cost of the property and claim to save money with it. It doesn't work that way."
Hobbs said that he did not know that the property had to be sold to make the payment in year two, and Neff said it was talked about with Peters Financial.
"It's going to be what it's going to be here. We're at the crossroads. We're at 14 years of rebuilding a jail," Hobbs said. "I can't sit here and agree that the taxpayers should fund a bill, a payment on a turd."
Neff stressed that the project was already something the county couldn't afford and that he wasn't suggesting they pay to refurbish the old jail.
"Now we're going to have another $1.5 million on top of all this," he said. "We're going in the wrong direction in terms of cost. That's all I'm saying."
Frye suggested that they could build on the back half of the property and resell the prime commercial spot near the road if needed.
It was unclear as to whether or not resale would be restricted in the purchase agreement.
Robertson called for a vote.
"I think we got an opportunity tonight to buy something that is absolutely beneficial to this project and to this county," he said.
Frye said he had more discussion on the matter, and that is when County Attorney Tony Overholt chimed in.
"Having represented the sheriff's department for 30 years and been involved in these kinds of fights over jail construction and building new jails and over capacity claims and things like that, as you think about all this, remember delay is not your friend," Overholt said.
Frye said it was hard to agree to anything without a clear purchase agreement.
Carrell asked about the cost of building a jail in 2020, which was approximately $21 million. He spoke about the rising costs, the lawsuits in Vigo County and the insurance information the county received.
Chesser said that the RDC looked at it and that they are not sure the quarry property would work for a jail. She called it "problematic."
Carrell urged the council to take action.
"Since I've been on this council, we've kicked this can, and I remember when I first got here, [the project] was in the $20 to $22 million [range]. This can is going to get larger and larger till it's a damn oil drum, and we're not going to be able to kick it," he said.
The council took a vote on the motion, which passed 5-1-1, with Neff voting no and Councilman Verl Keith abstaining.
County Auditor Sheila Reeves asked for better communication from the council and commissioners, to which Chesser and Hobbs agreed.
"It's going to take all of us working together for this to work," Chesser said.
The topic of the jail came up again during the council comments portion of the meeting. During that time, Neff suggested that it might be cheaper to "get out of [the jail business] entirely." It was pointed to the fact that Benton County does not have its own jail and houses inmates elsewhere.
Chesser pointed out that there were no other facilities wanting to take Owen County's inmates.
"Quite frankly, I just do not see at the current trajectory no matter how hard we try on reducing cost and the size of the building and all, that I don't see how we're going to be able to, I don't know how we're going to fund this just on income tax alone, and we've been saying for years, no property tax, work within our means," Neff said. "But we keep going deeper down this path where we're not within our means and we're not going to be able to avoid property tax and so on. And that concerns me. I'm just not comfortable with that. I just think we need to think about as many alternatives as we can think about to avoid a financial issue."
