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A resolution regarding the preliminary determination to enter into a lease, approving a form of lease and related matters for the Kosciusko County Justice Building expansion was approved by the Kosciusko County Commissioners Tuesday.
The resolution is the preliminary determination of the commissioners to enter into a lease with the building corporation of the project for financing.
The term of the lease is limited to 25 years with a maximum annual lease rental not to exceed $1.9 million. Estimated interest rates on bonds issued by the building corporation are expected to not exceed 5.5 percent, with the total interest cost of bonds not to exceed $15.5 million.
"This is the high side estimate," said Randy Rompola, attorney with Baker & Daniels, South Bend. He said by going with the high side, it leaves room for flexibility.
"Once the bonds are sold," said Rompola, "we would come back to you (the commissioners) to set the term and lease to meet the cost of the bonds."
He said he expects the annual lease rental to drop to $1.68 million and the term of the lease to drop to 21 years.
A public hearing on the lease will be held July 6 at 9 a.m. Commissioners also directed the county auditor's office to seek the approval of the State Board of Tax Commissioners for the lease.
Rompola said a meeting with the state tax board should take place in August.
Estimated figures for the Justice Building expansion project were given to the commissioners by H.J. Umbaugh & Associates, Certified Public Accountants, LLP, Plymouth.
Construction costs are estimated to be $21,206,850. With project-related costs added in, the expansion will cost an estimated $25,277,446. Related costs include furnishings, plan approval, code revisions, soil borings and others.
Soft costs, including bond counsel, bond insurance, administrative and other expenses, raise the total estimated cost to $27,136,480.
The county's cumulative jail fund will provide $1.82 million of the estimated cost and the cumulative capital fund will pay $3.6 million. Estimated interest earnings will provide $1,241,480. Building corporation bonds of 1999 will provide the majority of the funding for the project, at $20.475 million.
Preliminary plans and specifications are expected to be available for public review by the July 6 hearing.
The public was given a chance to voice their opinions on the Justice Building expansion project Tuesday.
"The county hasn't made it clear what we're getting for $23 million," said Herschel Rainwater. He said an entire block is being torn down and the public really hasn't received a good look at what they're getting for their money.
Plus, he said, putting the community and the county's children in debt is a concern to him.
"These bonds, it seems, seem to perpetuate debt. We would like to know, before anything is signed, what we're getting," he said.
Marvin Gunter repeated Rainwater's opinion that the county needs to know more about what they're getting for their money before anything is decided.
"Since the first of the year, there have been figures put out - $7 million, $14 million, this morning we've heard $27 million. The public needs to know what the public is getting," Gunter said.
"For the public to support you, they need to know where you're coming from. They need to know where the county council is coming from."
One remonstrator was against the county buying Lake City Inn for $2.2 million for use as the new work release program.
Bill Moberly said, "I am against buying Lake City Inn for a work release program. I think everything should be concentrated in one area." He said the area near U.S. 30 is a tourist area and to have inmates living out there is a bad idea.
Commissioner Eddie Creighton told those present at the meeting that Tuesday's action does not finally decide any construction or costs. He said when plans are finalized, they will be heavily scrutinized. He also said the public will be able to view the plans once they are further developed.
"I don't think anyone would have dreamt we had 12 inmates in the early '80s and have 10 times that number today," he said.
Only Creighton and Commissioner Avis Gunter approved the resolution. Commissioner Brad Jackson abstained, saying he was not opposed to the resolution or project, but he was concerned about the construction costs. Jackson abstained.
Commissioners appointed Sue Charleton, Terry Klondaris and Neil Carlson to the building corporation board.
