‘Some action must take place:’ County commissioners pen letter urging councilors to pass tax increase to fund $316M jail
Commissioners are proposing a .15% LIT increase, down from the original .20%
ALLEN COUNTY, Ind. (WPTA) - The Allen County Board of Commissioners submitted a letter to Allen County Councilors on Tuesday, laying out a new plan to increase local income tax rates to fund the building of a new Allen County Jail.
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Commissioners announced in May that they were proposing a .20% increase in local income taxes (LIT) to fund the construction. They say following several discussions with both constituents and councilors, they want to ensure they are not overtaxing residents while also securing enough funds so they wouldn’t have to raise rates again.
Commissioners said there are many variables that complicate the issue of finding the most appropriate LIT rate, laid out in the letter below. They say given those variables, they must take a more conservative approach to fund the roughly $316 million project.
They then submitted the following proposal to fund the jail, which includes a Correctional LIT rate of .15%:
- Put $15M of ARPA Revenue Replacement toward the project cost
- Put $10M of General Fund Cash toward the project cost
- Adopt a Correctional LIT rate of .15% to generate Net Proceeds of between $270-288M
- Pledge $1M annually from CEDIT toward annual bond payments
- After construction is complete, evaluate Correctional LIT rate, and lower if prudent
Board members say they believe this option gives them enough room to work with the unknown bidding environment and interest rates, leaving enough money in the General Fund to handle other upcoming projects.
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