Commissioners begin jail bond and ballot proposal

By 
Eleanor Guerrero
CCN Senior Reporter
Thursday, February 13, 2020
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Photo by Eleanor Guerrero

(Left to right) Bond Attorney for the County, Nathan Bilyeu studies the proposed jail center design while Commissioners Pits DeArmond and Scott Blain observe. 

On Tuesday, Feb. 4, the Commissioners met with bond attorney Nathan Bilyeu of the Helena firm Jackson, Murdo and Grant, P.C., at their offices to discuss the preliminary requirements of drafting the jail bond measure plan and related ballot. 

Carbon County residents will have the opportunity to vote in August on a mail-out ballot to determine whether there will be a jail facility for the county.  On the ballot will be a detention facility bond proposal to finance the facility. If you vote to approve the bond financing, you vote to approve the jail. 

The Commissioners foresee a 103-bed facility for only prisoners to stay in. 

There will also be a meeting room for attorneys to meet with their clients and later, some possible storage areas on the property for the county. These uses in addition to housing prisoners, would be termed “ancillary activities” which would be provided for in the bond description. At this point, the facility could not only house state prisoners but there is the potential for federal prisoners. 

Bilyeu said the first priority is drafting a ballot that is absolutely clear to voters: “…Bond: Yes or No.”

Only if approved by voters in August, the facility will be located in Joliet, at a site chosen by the Commissioners last week, after months of public meetings, studies, reviews and committee recommendations. 

Likewise, Bilyeu stressed that public education at this next phase is crucial and gave the opportunity for public meetings and flyers to be reimbursed, if the commissioners wished, from the bond if approved. 

The Commissioners need to “reasonably inform the public as to the impact,” said Bilyeu. Should a property mill levy be needed to augment the bond, he suggested not using a mill comparison of estimated assessed value for possible levy. It is more common when building such facilities to explain the impact on homes valued at $200,000-$400,000 vs. a $100,000 value.” He advised the fewer surprises to the public, the better. “Since you go to the people once (with the ballot). You want to give a good sense of that.” 

Regarding the bond he observed that if they wished they could have included the architectural and design plans in a timely request for reimbursement. The Commissioners demurred saying the architectural and design plans were already budgeted.    

Commissioner Bill Bullock said they are “60-70 percent sure of pricing” for the site although the figure still needs “some refinement.”

Commissioner Scott Blain explained that the “big unknown” is the cost of bringing “services to that site.” The jail is expected to hook-up to Joliet’s town water and sewer. 

A mail ballot has turn-out requirements. Bilyeu said this is why it is so important “to create enough knowledge of the project.”

If over 40 percent respond to the mail-in ballots, then a simple majority can approve the facility. However, if there is under 40 percent response, say 30 percent responding, then approval must exceed 60 percent. “So if you have 30 percent turnout and 52 percent (a majority) approve, it (the jail bond) fails.”

He urged more education regarding this fine point of the mail-in ballot. “Build awareness. ‘Fill out and return them.’”

Asked what is the usual return on mail-ins for the county, Elections Adminstrator, Macque Bohleen said, “In Red Lodge you can have one precinct with 70 percent (turnout) and another precinct with 40 percent. It’s usually between 40-50 percent turnout.”

“That’s great!” said Bilyeu. 

Bilyeu said the bond can be used for three things: 1. Capital expenditures like building the facility; 2. Cost up to 20 percent towards design and architectural planning costs; and 3. De minimis exceptions-for other related costs. These related costs can be used for outreach he advised. “Not lobbying.” He noted, “Here’s the project, here’s what we’re doing. You can host meetings. You have some latitude to front and be reimbursed when the bond issue closes.” He again warned, “Facts, not advocating.” 

Bilyeu said informing the public of the current expense of transporting and housing prisoners would be along the line of factual information. Besides the availability of using the bond for reimbursement of architectural and engineering plans, he said it can also include “specialty equipment” that must be ordered in advance to arrive in time for site completion. He suggested adding such details to the bond request and if not used, “no harm, no cost.”

Next, Carbon County Attorney Alex Nixon gave an update on Stillwater County and Sweetwater County’s involvement. “Stillwater preferred at this point an MOU (Memorandum of Understanding).” He said Sweetwater County was “working on it.” 

Bullock noted, “They basically want to participate.”

Bilyeu advised, “To the extent the county wants to rely on revenues for the facility, if the bond passes, don’t wait six months with no levy because if you’re expecting revenue for O/M (operations/maintenance) and now have no money to operate and pay for a facility that you can’t use, then you have to go out and get the levy. It complicates it. You want that aspect ironed out.” 

Nixon said, “It’s pretty much given that there is DOC and federal interest as well.”

Bullock said, “There are some pretty established rates, especially for state vs. federal rates.” Federal rates were higher to house their prisoners potentially at a facility. 

Nixon said, “We had the cost rates worked out.”

Carbon County Administrative Officer Angela Newell said there have been “no formal conversations” by the county to discuss the possibility of accepting federal prisoners at the jail but that a U.S. Marshall has “expressed some interest.”

It is expected that the bail bond will be largely finalized in May. By then, Bilyeu said, “You’ll have a good sense whether to ask the taxpayer for a levy and if not, how much you are reasonably expecting from others.” 

Again, Bilyeu cautioned against waiting too long and the resulting “lag time” between seeking funds and having it.  “Don’t wait to build a facility you can’t use. Get the numbers, the closer you can get to formalizing those terms, it mitigates the likelihood of that contingency. The closer to a hard number…run the numbers and make informed decisions as to whether there should be a mill levy. It’s also good for public outreach. ‘This is what we’re doing to lower payments…we’re looking at other means…’ (You’re) not seeing the taxpayer as a limitless piggybank. It really puts you in a good position and speaks well to your reaching out.”

Once the exact amount for the bond is known the following steps take place: The Commissioners pass a Resolution to submit the bond proposal to the residents of Carbon County. A formal finding of the percentage rate for that bond is made and a term given of not more than 20 years.  At that point, strict time lines apply for the proposition to go on the ballot as defined by statute. If there is to be a levy, there must be an estimate what it will cost per household-at least for a $100,000-$200,000 property. 

If the jail bond passes, Bilyeu said, “It’s pretty straightforward.” The Commissioners pass an issuing bond resolution; the underwriters review it and it goes out to market in about 1-2 months. 

Here, Bilyeu noted another opportunity. “These government bonds are usually ‘premium dollars’” and investors want these bonds. 

“There could be a $4 million dollar premium and it could be used to reduce the amount you borrow and other uses (limited by statute),” he noted. “It is also very useful if bids come in higher,” it could go towards funding those needs. To find out the value of that bond, said Bilyeu, numbers would be available around October.PULLOUT: 

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