Taxpayers in Johnson County will have the chance to hear the details of a proposed income tax that could cost them hundreds of dollars annually at a meeting next week as the county council moves toward getting funding for a jail expansion estimated to costs tens of millions of dollars.
The Johnson County Council will conduct the first reading and vote on an increased income tax on workers who live in the county that would help pay for a needed jail expansion that is expected to cost about $20 million. Any explanation or debate and vote, will take place at the council’s regularly scheduled meeting at 6 p.m. Monday.
The council must approve the tax by the end of June for the money collected to also be used without any limits on operational expenses at the jail. After June, that would no longer be allowed due to a change in state law. If the tax is not approved by the deadline, the county is limited to using 20 percent of the money from the tax on operational costs, Johnson County Council member Rob Henderson said.
The proposed tax is a .20 percent increase for Johnson County residents and workers to cover the cost of the jail and the increased operational costs. A person who makes $75,000 annually will pay about $150 more a year. If the tax passes by the deadline, the tax would be enacted beginning in October.
And another tax hike could be considered later this summer. The county council is also considering income tax options to pay for road work, including roads and bridges, at an estimated cost of $110 million over the next five years. Much of the work is needed because of increased traffic as Interstate 69 is built through Johnson County.
Decisions on those taxes could be made later this summer, Henderson said.
A second and final vote on the jail income tax is tentatively scheduled for the last week of June. County council members could vote to adopt the tax immediately after the second reading, Henderson said.
The public will have the chance to comment on the tax at both readings. It is encouraged, Henderson said.
"The more the better," he said.
Residents who receive Social Security income would not pay an increase, because that income is exempt from the local income tax.
In the first years, that tax hike would bring in about $9 million more per year, and the county could use the money to pay for the added costs of staffing and operating a bigger jail.
In future years, the money could be used for other correctional facilities, such as community corrections. The tax would be in effect for 20 years, but the rate would drop to .1 percent in 2023, although the current county council cannot make such stipulations for the money, according to the Department of Local Government Finance. The current council can announce its intent for the money to future councils, Henderson said.
The tax would bring the county’s tax rate to 1.20 percent. The current income tax rate is 1 percent, which is competitive for the region, Henderson has said.
The county has been facing a crowded jail for years, and voters at one point said no to a property tax increase to fund the expansion. Now, Johnson County is under a state order to relieve overcrowding, and a study has explored options other than an expansion. A committee has spent two years studying the issue and reviewing other jails across the state.
County officials released a jail feasibility study in May, which the state required the county to do. The study details dozens of options committee members explored, including housing inmates in another county, building a regional jail and remodeling other community corrections buildings.
The county’s Board of Commissioners have a special meeting at 2 p.m. Monday to consider the jail feasibility study and hear public comment on the matter.
The proposal for the jail expansion includes a 250-bed facility connected to the current jail by a sky walk.
Some decisions to move forward with a jail expansion have already been made.
In March, the county commissioners approved hiring RQAW Corp., a Fishers-based architect and engineering firm, to design the expansion.
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Here is what a .20% percent income tax increase would cost county residents, depending on your salary:
$30,000: $60
$50,000: $100
$75,000: $150
$100,000: $200
$150,000: $300
$175,000: $350
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The Johnson County Council is conducting a first reading and vote on a proposed income tax to pay for a jail expansion.
When: 6 p.m. Monday
Where: Johnson County Courthouse Annex, 86 W. Court St., Franklin.
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