Fallout from North Park jail site vote: Commissioners want huddle with council on ED LIT plan

Monroe County commissioners have invited county councilors to their meeting next Thursday (Dec. 4) to talk about the economic development local income tax (ED LIT).

The backdrop to the invitation is the county council’s vote in late October to reject the appropriation needed to purchase the North Park property as the location of a planned new co-located jail and justice center.

But a clear understanding of the invitation requires a rewinding of history at least back to 2022. That was the year when Bloomington’s city council enacted the ED-LIT.

Enactment of the ED LIT

The city council’s action was analyzed at the time as something like an unsolicited political favor to Monroe County’s elected officials. The additional ED LIT revenue was expected to cover the cost of the county’s planned new jail and justice center. That meant county councilors would not have to assume the political risk of approving a separate jail tax themselves.

As it turned out, the planned co-located jail and justice facility had a price tag big enough that county councilors still enacted an additional local income tax rate dedicated just to the jail. The most recent working number for the jail and justice center construction budget is around $225 million.

One impact of SEA 1 is that the ED LIT will disappear from state law, to be replaced by a completely different local income tax structure in 2027. But until then, expenditures made by the county government from the ED LIT still have to meet certain requirements.

A capital improvement plan

Indiana state law requires that the county commissioners put together a capital improvement plan with specific components, like a description of each proposed project, its total cost, the sources of funding, and the expected planning and construction schedule, among other things. The capital improvement plan has to cover 75% of the anticipated revenue.

It’s the capital improvement plan that is the current focus of county commissioners, which led them to invite county councilors to attend their regular Dec. 4 meeting. Under state law, it’s the commissioners who are responsible for putting together the ED LIT capital improvement plan.

From the perspective of the commissioners, the county council’s unanimous vote against the appropriation for North Park wrecked the capital improvement plan that the commissioners previously adopted. That’s because the previous plan called for 100% of the ED LIT revenue to be spent on the jail and justice center project. At the time, the project had an estimated cost of $100 million, which is less than half of the current working number for the construction budget. State law requires that the plan account for 75% of the estimated revenues from ED LIT.

For 2025, the certified amount of ED LIT revenue to Monroe County by Indiana’s DLGF (Department of Local Government Finance) is about $11.7 million. The jail LIT is expected to generate another $7.5 million.

Impact of North Park vote on the capital improvement plan

Given that the county government will not be following the plan’s allocated expenditures (of around $33 million) from 2023 through 2025 on the jail and justice complex, the county’s legal department has flagged the issue. The county council did use about $4.67 million in ED LIT in order to balance the 2026 budget.

But as county attorney Jeff Cockerill put it in a Nov. 17 email message to county councilors: “Even if we considered a plan to incorporate the $4.667 Million appropriated in EDIT for county operations in 2026, it would not meet the requirement to develop a plan which accounts for 75% of expected revenue in EDIT.”

There are consequences for not having a capital improvement plan in place by year’s end: The money received in revenue from the ED LIT would be set aside by the county treasurer in a sequestered account, unavailable to the county government to spend. If no statutorily compliant capital improvement plan were adopted after three years, the money that accrued would be distributed to the other jurisdictions receiving ED LIT money—Bloomington, Ellettsville, and Stinesville.

Nov. 18, 2025 county council discussion

The topic got some discussion at the county council’s Nov. 18 meeting, when county council president Jennifer Crossley read aloud Cockerill’s email message with the invitation to attend the Dec. 4 meeting. She expressed reservations about the dynamic between the commissioners and the county council, saying “it feels a little retaliatory, in my personal opinion, just one person saying that.” She indicated that she did not want to see the issue ignored.

Councilor David Henry deadpanned a statement about the $100-million estimated cost of the new justice center project when the original capital improvement plan had been adopted: “I think we’re north of that now.” Henry indicated his view that the current challenge is not a substantive one—that what’s needed is a “technical fix” to make a plan that is compliant with state law. Henry said that the 2026 budget that had been approved, with ED LIT money appropriated for some of the expenditures, met the legal requirements of a balanced budget.

Councilor Trent Deckard added that the situation was correctable and not a cause for drastic measures, commenting, “As I looked at that, I see something that would be correctable by the county executive [the county commissioners] to reflect what [the county council] did …” Deckard said it is not possible to reverse the expenditures for the 2026 budget, which had already been approved. Deckard also questioned the county's use of the legal department to handle what are essentially project management responsibilities for once-in-a-generation projects like the jail and justice center.

Councilor Marty Hawk was critical of the fact that the legal department had not raised the issue of the capital improvement plan earlier, when the county council was considering the 2026 budget. “We have a rather large legal department. There's four attorneys in that legal department, and that is at least three more than what most counties would have,” Hawk said.

Hawk pointed out that the state law on ED LIT expenditures lists out the allowable purposes with a catch-all final item. The exact wording of the state law says that ED LIT revenue can be used “[f]or any lawful purpose for which money in any of [the county government’s] other funds may be used.”

On Friday this week, Crossley told The B Square that no formal message had been sent by the council in response to the Dec. 4 invitation from county commissioners. But Crossley said that some members of the county council would be present at the Dec. 4 meeting, either in person or virtually.