BY KRISTEN BUCKLES
Greene County Commissioners found that the vast expanse of the onetime Magnavox Plant #3 building proved a sharp contrast to the confined spaces in the Greene County Detention Center in its largely boxed-in location downtown.
However, owner Charles White's proposed 20-year, $16.65 million lease followed by a purchase option of $8.75 million was more than the commissioners of the Courthouse/Workhouse Committee were ready to tackle.
The committee met on Monday morning with commissioners from the commission's Budget & Finance Committee and Law Enforcement Committee at the former Magnavox building, at the intersection of Industrial Road and Kiser Boulevard.
The joint meeting was held in response to the Tennessee Corrections Institute Board of Control's recent decision to decertify the Greene County Detention Center due largely to overcrowding.
Decertification does not prevent the jail from operating but potentially threatens substantial revenues that the county currently earns from the boarding of state and federal prisoners.
In addition, decertification increases the county's vulnerability in the event of lawsuits filed by inmates. A $3 million federal lawsuit was filed by a current inmate a few days before the jail was decertified.
While most of the commissioners attending the joint meeting were enthusiastic about the possibilities of converting the massive former industrial building for use as a county jail, financial adviser Rick Dulaney, of Morgan Keegan & Co., agreed that the only way for the county to issue another bond is to increase county revenue.
For the county, he said, that could possibly mean housing more prisoners in order to increase the revenue the county receives from the housing of state and federal inmates -- or it could mean a property tax increase.
In order to use revenue from the housing of more inmates to provide collateral for the issuance of a new bond, however, the county would need to use the method of "capitalized interest," Dulaney explained.
Under that approach, the county would need to defer payments on the bond issued until six months after the jail project is complete and revenue is being received from the housing of inmates.
Such measures are usually best avoided because of the interest payments involved, Dulaney added.
"There are no magic solutions," he told commissioners.
QUESTION ABOUT HOUSING INMATES
Commissioner Jan Kiker noted that the County Technical Assistance Service (CTAS) tells commissioners that there is no money to be made in the housing of prisoners.
Dulaney agreed that he, too, has heard this from CTAS, and he recommended the board have an impartial party study the issue to fully determine if this would be a possible revenue source.
He also cautioned, and all commissioners and officials agreed, that this would not be a 100-percent reliable source of revenue, since it would be dependent on maintaining a certain number of inmates in a local facility.
Kiker also raised questions both about the county's Debt Service Fund, which will be at a deficit next year, and about the appraised value of the Magnavox property, which she said was at $8.07 million.
Commissioner Robin Quillen also questioned the timing of the notification to commissioners concerning the certification and overcrowding, saying that more notification could have helped to have potentially "dodged this bullet."
Sheriff Steve Burns, however, said that the commission was aware of the issue since 2007, when the TCI last threatened decertification because of overcrowding.
The Magnavox building was brought before the committees on Monday because the community has frequently suggested it as an option, County Mayor Alan Broyles explained.
"If we could succeed in some way in having a Plan of Action [to present at the next meeting of the TCI board], something to be acted on by the County Commission, we do stand a good chance of having our jail certified," the mayor said.
"Of course, there are no guarantees," he added.
"Many people know what a good facility this building is. We decided to bring the Magnavox building to you as an option."
Although he is not currently employed by the county on the project, architect Dave Wright attended Monday's meeting to offer his suggestions on the building and to help the committee as they recalled the many options explored when overcrowding became an issue in 2007.
Sheriff Burns explained that the commission thoroughly explored more than two dozen options at that time, many of which were hampered by the limited space for expansion at the current jail and workhouse.
At that time, the Magnavox building was also one of those options, but in the end, the commission became overwhelmed and did not make any decisions, Commissioner Rennie Hopson said.
'NEST OF BAD EGGS'
"The whole point is, nothing happened," concluded Hopson, a deputy sheriff and a farmer. "We just went on, sitting on a nest of bad eggs."
He cautioned that to continue doing so now, without making any real decisions or progress on the matter, could lead a federal judge to rule against the county, forcing them to build a new facility and dictating the number of prisoners it could house.
Commissioner Hopson noted the $3 million federal lawsuit already filed against the county from an inmate who was severely beaten by other prisoners. Hopson suggested that a new facility could be part of a judge's decision in that case.
Such a mandate has happened to the county once before [in the mid-1980s]-- and in fact prompted the building of the current jail facility, he reminded commissioners.
Sheriff Burns explained that he was able to keep certification in 2007, thereby avoiding any such mandates, by reducing the number of federal inmates.
Now, five years later, the sheriff said, even without state and federal inmates, pre-trial inmates and county inmates in violation of probation would crowd the jail.
Wright estimated that the necessary facilities to house prisoners average about $45,000 per inmate. The county would likely need to house about 800 inmates to have the necessary increase in revenue, officials estimated.
Starting with the Magnavox building rather than building a new facility could save about 20 percent of the costs, he said.
The 500,000-square-feet proposed in the lease could have growth potential to house up to 1,700 prisoners, plus Sheriff's Department Offices and, with the 20 percent savings applied back into the facility, a justice center with offices and courtrooms, he said.
Tentatively, without an updated cost analysis, housing for 800 inmates, offices and a justice center would come with a $38 million price tag, officials estimated.
Burns also noted, however, that this may not require additional deputies, since staffing would not be split between so many levels as it is at the current multi-level facility.
NEGOTIATIONS TO CONTINUE
Although all agreed some decision needs to be made, Commissioner Tim White offered some skepticism that the Magnavox plant, built in 1963, would ever be anything more than an old building, despite what Wright assured the commissioners has been "excellent" maintenance and upkeep.
With all these thoughts in mind, the committees agreed that the price for leasing and then purchase of the Magnavox building is not something that they would recommend the county pursue at this time, although they expressed willingness to negotiate with the owner.
"I think we're sitting in the best-case scenario for Greene County," Broyles noted, arguing that well-maintained steel, brick and cinder block is just as good now as in 1963.
"Whether the financing could be worked out or not is another matter," he added.
Broyles agreed to continue discussions and negotiations with the owner and report back to the committee at their next meeting on Monday, Oct. 1, at 9 a.m. at the Courthouse Annex.