Monroe County council adds $1M in support for Beacon Center to proposed 2027 budget, after $4M financing setback

Monroe County’s proposed 2027 budget now includes $1 million for Beacon Inc.’s planned housing and shelter complex on West 3rd Street, after the nonprofit lost a key piece of financing this summer.

The Monroe County council voted Tuesday night (Sept. 22) to add the $1 million to expenses to be paid out of the economic development local income tax (ED LIT) fund.

The county government’s 2027 budget is scheduled for a first reading on Oct. 6, with adoption set for Oct. 20.

County commissioners Jody Madeira and Julie Thomas were present for Tuesday’s discussion. The council and commissioners worked through the division of expenses among funds like ED LIT, county general, cumulative capital, and a proposed general obligation bond.

On a separate vote from the one the county council will take on the budget, the commissioners will still have to approve the ED LIT spending plan. But it was Thomas who essentially proposed the $1 million contribution to the Beacon project. So the approval by commissioners of an ED LIT spending plan with support for Beacon seems all but certain.

For Beacon, the county money would help fill a $4 million hole that opened this summer, when anticipated New Markets Tax Credit financing fell through. Commissioners talked about the possibility of $500,000 this year and another $500,000 later, or putting the full $1 million into the budget now. But they said they preferred making the full amount available sooner. They said they have also asked Bloomington city government to contribute.

Beacon executive director Forrest Gilmore told councilors the larger point of the new Beacon Center is not simply to increase the number of shelter beds, but to improve how housing and other services work together.

Gilmore said, “While there is some expansion of shelter beds, for example, the real focus was on what are the solutions that our community needs, and how can we bring together a center that truly includes quality of service for people struggling with homelessness, so that they get out of homelessness, not just sit there and remain.”

$4 million financing gap

Beacon’s plans call for a new center on 3rd Street south of Rose Hill Cemetery, which would consolidate permanent supportive housing, an overnight shelter and a daytime resource center in one location. Beacon says community partners will provide services including health care, mental health treatment and legal assistance at the center.

The project had already received a $7 million grant of federal American Rescue Plan (ARPA) money through the Indiana Housing & Community Development Authority (IHCDA). When Bloomington’s plan commission unanimously approved the site plan in April 2024, it called for a roughly 45,000-square-foot, two-story building with a day shelter, a 50-bed overnight shelter, 20 one-bedroom permanent-supportive-housing apartments and five work-to-live units for staff.

Even then, fundraising remained unfinished. Gilmore told The B Square after the 2024 plan commission vote that nothing was a “done deal” until the financing was complete.

By June of this year, Beacon reported a project budget of $20 million. In a June 3 update, the nonprofit said it had raised more than $16 million, more than half of it from local donors, governments and organizations. But $4 million, which Beacon had expected through the federal New Markets Tax Credit program, was no longer available, leaving a corresponding gap in the financing plan.

Beacon attributed the loss to changes in the federal funding and economic landscape. At that point, Beacon’s board was considering additional fundraising, financing and changes to the project, including building it in phases.

By late August, Beacon had settled on a two-phase approach rather than waiting to raise the entire amount.

Phase 1, which Beacon said in an Aug. 27 update is scheduled to begin in December, calls for construction of 20 permanent-supportive-housing apartments and two work-exchange apartments in the west wing of the building. Phase 2 would complete the day center, kitchen, and overnight shelter in the east wing, after additional money is raised.

Gilmore told the county council Tuesday that without closing the remaining funding gap, the second phase cannot move ahead. “Right now phase two is completely off the table until we close that money gap.” He said a successful fundraising push could still minimize the delay between the two phases.

So the county’s $1 million would not be the money that gets the first 20 supportive apartments started in December. Instead, it would help Beacon get closer to finishing the rest of the center, which means the overnight shelter, day center, and kitchen.

Gilmore also told councilors Beacon is pursuing several other sources. Gilmore said Beacon plans to return to existing campaign donors about extending their pledges by one year from five years to and is talking with local foundations.

Project background

Beacon’s effort to consolidate services on West 3rd Street dates back to at least 2023.

The project required a conditional-use approval for supportive housing from Bloomington’s board of zoning appeals, which approved the request in October 2023. The plan commission followed with unanimous site-plan approval in April 2024.

The central idea has been to move Beacon’s currently separate facilities under one roof. Beacon currently operates the Shalom Community Center day shelter and Friends Place overnight shelter in separate locations.

Beacon has also emphasized permanent supportive housing, which are apartments combined with continuing services intended to help people who have experienced chronic homelessness remain housed.

That part of Beacon’s work is also at the center of an unrelated dispute involving Crawford Apartments on South Henderson Street.

Crawford dispute remains pending

Gilmore alluded Tuesday to Beacon’s situation at Crawford Apartments, where Beacon provides supportive services but does not own the 61-unit complex.

He was responding to a question from council president Jennifer Crossley about whether Beacon had approached the city of Bloomington with a funding request. Gilmore was circumspect, saying that litigation between the city and the nonprofit he leads precludes certain kinds of negotiations.

In August 2025, Bloomington sued the Crawford ownership entities, and named Beacon one of the defendants, alleging breaches connected with agreements governing the federally supported housing development, and asking for recovery of $685,000 in federal HOME money. Gilmore said at the time that Beacon had no ownership or financial interest in the property and said the nonprofit was “completely befuddled” about why it had been named as a defendant.

The lawsuit remains pending. Meanwhile, 32 of Crawford’s 61 apartments were vacant as of July, but could not be leased because the two buildings had not passed the city inspections required for renewal of their rental permits. Beacon continues to provide supportive services there.

Next steps for county money

Tuesday’s council vote does not immediately transfer $1 million to Beacon. It puts the amount into the ED LIT portion of the 2027 budget, which will come back in a few weeks for formal action.

The move to tap ED LIT money to help fund Beacon’s project reflects a change in basic policy that was already evident last year. After the ED LIT was enacted by Bloomington’s city council in 2022, the county council took a hand-off approach to revenues from the new tax, treating the new money stream as a way to accumulate money for construction of a new jail.

But last year, the council departed from that approach, choosing to move $4.6 million in expenses for the 2026 budget out of previously budgeted lines into the ED LIT fund. The 2025 year-end fund balance for Monroe County’s ED LIT was $23,475,065.

The county government’s 2027 budget is scheduled for a first reading on Oct. 6, with adoption set for Oct. 20.