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New jail would cost $340K per year to finance

Tuesday, September 13, 2011

McCOOK, Nebraska -- It would cost Red Willow County an average of $340,000 per year for the next 20 years, if the county decided to use bonds to finance a new jail.

Red Willow County Commissioners discussed financing options for a proposed jail at their meeting Monday morning, with Paul Grieger of D.A. Davidson and Co., the bonding company that worked with the county the last time a new jail was proposed in 2005.

Grieger said with the current county valuation at $7.62 million, the county could do bonds up to the principal sum $5.1 million. The levy to re-pay the bonds would vary over the next 20 years, he said, beginning with $0.008524 in 2012 (eight tenths of a cent per $100 property valuation) to $.044135 (four tenths of a cent) in 2032.

That would amount to an average of $340,000 per year for the next 20 years, he said.

Grieger also explained that as D.A. Davidson is in partnership with Edward Jones, the bonds can be sold to local taxpayers, unlike some other bonds.

Ron Friehe of Edward Jones added that several issues have changed since a new jail was first proposed, such as lower interest rates and that the county now owns property north of the Red Willow County Courthouse.

Commissioners took no action, but a jail planning committee meeting is scheduled for 7 p.m.,Wed., Sept. 7, at the courthouse, open to the public.

The committee will review the recently-completed feasibility study for a new jail and present its recommendations to Commissioners.

The feasibility study, done by Prohaska and Associates from Omaha, includes several options concerning costs and location of a new facility.

Commissioners also conducted a special hearing Monday to set the final tax request for the 2011-2012 budget.

The 2011-2012 budget calls for $2,903,094.79 in property taxes, based on a levy of 0.380743. That would be .38 per every $100 in property valuation.

Last year's tax request was $2.7 million, but the levy was slightly more. Property valuations have changed since then.

After the hearing was closed and commissioners re-convened in a regular meeting, they voted to increase the tax request from $2.7 million from last year, to $2.9 million for the current year.

In other action, Commissioners, acting as the Board of Equalization, unanimously voted to deny tax exemption status sought by the First Church of God and the McCook Church of the Nazarene.

The tax exempt status was denied to the First Church of God as the property was sold to Rod Spencer, a non-exempt property owner. A tax exemption status was denied to McCook Church of the Nazarene as the non-profit organization purchased the property May 18, 2011 from a non-exempt owner and the church failed to file the tax exemption application by the July 1 deadline.

In other action, Commissioners approved:

* to increase the handling charge of returned checks, from $15 to $25

* to increase the base of restricted funds in the 2011-2012 budget by an additional one percent.

* to table all bids received to repair the county bridge north of the former Republican Valley High School. Gary Dicentra of Miller and Associates Consulting Engineers told the board that Stan Johnson, an engineer, would look over all the bids to make sure everything is correct. Commissioners will award the bid at their Sept. 19 meeting at 10:45 a.m.

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Glad to see Lorri is back writing for the Gazette

-- Posted by dennis on Wed, Sep 14, 2011, at 10:53 AM

Just wondering if the meeting scheduled for Sept. 7th, 7pm, is for next year, since this article came out on Sept. 13th??

Plenty of notice I guess.

-- Posted by goarmy67 on Wed, Sep 14, 2011, at 7:42 PM

What does the county sped per year to transport?

-- Posted by dennis on Sun, Sep 18, 2011, at 1:13 PM

The $340,000.00 per year to build the jail doesn't include the cost to maintain and run the facility assumedly. The cost per year to transport, and the bed rent paid plus whatever else is involved cost wise with housing Red Willow Prisoners needs to be weighed against the cost to facilitate the prisoners in McCook. There is also the variable of what the county could stand to benefit from the county run jail in the way of renting out beds to other counties.

If the bond will take 20 years to pay off, what will the condition of the facility be by the end of that pay off period? 20 years is nothing for a facility of that type yet there will be standard maintenance items that will need to be figured in such as HVAC and re-roof issues.

Purchasing / building the facility is no different than buying a car. If one feels that they can manage the car payments and even annual taxes and insurance but fail to figure in the cost of new tires, and maintenance at 100,000 miles then undoubtedly things will not turn out as expected.

I have always felt that the value of a county run jail was beneficial to Red Willow County, but things have changed economically and I don't know what that really means if anything, to the construction and maintenance of such a project.

I'm just saying there are a lot of considerations involved here and the building of the facility is just the beginning.

-- Posted by Nick Mercy on Sun, Sep 18, 2011, at 8:27 PM

$340K is just the cost of the bonds to build the facility. They'll still have to staff the jail which will be hundreds of thousands, easily, once you add in salaries and benefit packages, overhead expenses such as utilities, meals, etc. It adds up really quick. McCook's taxpayers will be the ones paying the majority of the bill by a direct raise in their property taxes. Unfortunately, their options to reduce the cost to the McCook taxpayer is limited. Hopefully, they figure something out despite the circumstances.

-- Posted by McCook1 on Mon, Sep 19, 2011, at 1:35 PM

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