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In the jailhouse now

Do you remember that jail addition that was supposed to make money for the county?

Well, not so much.

The financial health of the county has actually gone from bad to worse.

And according to the certified audit, the jailhouse amounts to 70 percent of the county’s worsening finances over the past two years.

In fact, if it weren’t for the money the county brought in from disposing of its hospital, nursing home and airport (which is a tale in itself), the county would be another $2.7 million short. Can anyone spell “bankruptcy?”

Now the original financing agreement for the jail addition allowed for the possibility of it going back to the bank. We will forestall retelling the unpretty tale of how we got to this point, but let it be said that now that we’re here, no one relishes the prospect of losing what we’ve already invested. Nevertheless, the possibility is very real, and there is such a thing as cutting one’s losses, so this “escape clause” offers some protection to the county property taxpayers – they won’t necessarily be stuck with sky-high taxes to pay for an empty jail. Should the worst happen, what’s the bank going to do with an empty jail addition? Why would the bank not seek some arrangement not unfavorable to the county.

Refinancing should save more than a half-million dollars in total costs for the jail addition. Savings are good, right? Not so fast. The new financing agreement gives no possibility of withdrawal. In real terms, that opens the very genuine probability that property taxes in Mercer County will rise – with the possibly that they will rise dramatically.

What the Republicans, led by Ted Pappas, are proposing is a policy that basically amounts to this: Make the jail expansion pay for itself – if it is more than paying for itself, then put some of that extra aside, either for times when it may not do so well, or if enough money accrues, for paying off the jail faster; if the jail expansion is coming short of paying for itself, then cut expenses in order to lessen the losses. This is a businesslike model, and it offers about as much protection as is possible for the Mercer County property owner, and includes incentive for making the most use of the jail addition.

What the Democrats, led by Dan Schroeder and Jeff McWhorter, are proposing is that property taxes be raised to make up for any deficiency in paying for the jail. Period. There is no policy to protect the taxpayer from footing the bill and no incentive for making the most use of the jail addition. They have actually argued passionately that the jail addition must remain fully staffed even when it stands empty. This is a going-out-of-businesslike model.

The Democrats have tossed about some numbers, and one must wonder whether they are confused themselves, or whether they seek to confuse others. One thing is certain: Their numbers are a tangled mixture of payments and periods and assertions and assumptions.

This is what the auditor says in his report:
All proceeds from nursing home, hospital and airport have gone to basically keep the county running.
In 2012, there was a $460,000 combined net operating loss for the county. The jail lost $594,949.
In 2013, there was a $900,000 combined net operating loss for the county. The jail lost $356,980.
The jail accounts for 70 percent of loss for 2012 and 2013 combined.

We can look at it all this way:
The old lease for the jail has an escape clause – a “get-out-of-jail-free” card.
The new lease holds us all captive in the county jail with no possibility of parole.
We’re being offered a half-million-dollar bribe to take the new lease.

To Mercer County property holders we say:

Without Ted’s protection policy, don’t take the bribe, or we may all end up in the jailhouse serving a 17-year sentence.

There once was a county named Mercer,
Whose finances got worser and worser.
The donkeys all say,
Make the taxpayers pay.
But the elephants have one more verser.

This plan gathers dust on the shelf:
“The jail should pay for itself.”
What an idea,
We all should agree-a.
But to donkeys this seems much too tough.

We suggest you contact your two county board members to let them know what you think.

Harvey Bluedorn
New Boston