Marshall County Commissioner Stan Klotz scheduled a joint meeting of the County Commissioners and County Council on Monday afternoon, September 20th to discuss the Special LIT that was enacted in 2007 to pay the bond payment on the construction of the Marshall County Jail.
The Special LIT captures a quarter-of-a-percent on income from county workers and those funds pay the bond payments for the jail. A portion of the excess funds from the Special LIT have been used for operating costs of the Marshall County Correctional Facility for several years.
The Commissioners and Council members received approval from the state legislature this year 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. Previously the excess funds were to be transferred to the County Highway Department.
The jail bond is scheduled to be paid in full in 2027 but could be paid off as early as August 2022. Once paid off the quarter-of-a-percent Special LIT tax would cease. The issue facing the county is the excess funds raised by the tax are needed to assist with funding operations at the jail. If the tax were to cease, the county would lose the nearly $3 million it generates each year and the $2 million that is being used for daily jail operations.
Commissioner Klotz said, “I think waiting until the bond expires, we need to look at the options we have.” He continued, “We could pay it off early which would save a bunch of money in interest and options on daily operational costs that could cut taxes. We just need to come together for a long-term solution.”
The joint group discussed reducing the .025 tax rate even though the impact would be minimal to workers. Councilman Jim Masterson said at a $1,000 a week paycheck at .0125 the tax is $12.50. and at .0120 the tax is still $12 so they would only be saving $.50.
Councilman Heath Thornton suggested taking more of the jail operations out of the General Fund and moving them to the Special LIT and have that tax continue on with no sunset.
Commissioner Overmyer said maintenance costs at the jail are beginning to grow. Replacing HVAC systems, hot water heaters and dispatcher counsels are items the county has or are working to replace. He suggested not cutting the tax to just meet the operating expenses but looking at leaving it the same to assist with maintenance costs too.
The commissioners and council discussed for about an hour but since they were in a work session no decisions could be made.
Councilman Tim Harman said he prefers to lower the tax rate even if it is only slightly. He said he wasn’t sure he could support the tax if it isn’t reduced.
Councilman Jon VanVactor said, “Why don’t we just leave it at a quarter-of-a-percent and move the operating expenses for the jail out of the General Fund and lower property taxes.”
They did ask the County Attorney Jim Clevenger, who attended the joint work session to create a joint resolution asking the state legislature to allow Marshall County to enact a quarter-of-a-percent tax to replace the Special LIT to fund operations at the jail when the jail bonds are paid off.
The resolution will be presented to the County Council at their October meeting on 11th. The County Commissioners will consider the joint resolution