12-17-2002Minutes - Laserfiche WebLink

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(200201121 17 DISCUSSION AND ACTION WITH RESPECT TO FINANCING A COUNTY JAIL BUILDING PROJECT - County Attorney Jerry Janulewicz introduced Curtis Christensen and Charles Bunger with Kutak Rock LLP. They are here to review the financing options and the private operation of a jail facility for Hall County. They will present the pros and cons of the options and they need to know what type of request for proposal that the county board wants them to prepare. They stated that there are three options - 1. a. the traditional facility that the county builds, operates and finances with a general obligation bond. This bond is approved by a vote of the people. b. The lease purchase process where the bonds are sold and the proceeds are used to build a facility. This is a little more flexible but the bad part is that it falls under the lid law and this would be run by the corrections department. 2. The lease purchase could have the operations farmed out to a private operator but by Nebraska law discipline and jail standards must be done by government and there would still be significant county supervision of the inmates. 3. A combination of 2 and 3 would have another party build and secure the financing and have a private operator. The private operator could possibly run it more efficiently than the county could and make a profit. The county would form a non-profit corporation and turn it over to the corporation and sell the bonds. The county would enter into an agreement with the private operator. The county is tax exempt and could sell the bonds at a lower rate but there are restrictions according to the tax laws. Discussion was held on the bonds and how they are financed and sold. On the design build option there is a guaranteed cost but the disadvantage is that the architect has control on the construction. This could eliminate the smaller contractors but there would also need to be manager to over see construction. On options one and two the county owns the facility, but under option three the building is not owned by the county the building is leased and the county owns the land. At the end of the lease the county could lease it out again. Jeffries expressed concern on jail standards and what would happen if new standards were mandated. They stated that the agreement would have to address future requirements and the per diem rate could be adjusted. Logan expressed concern on legal liability, but the county would still be responsible. Mr. Bunger and Mr. Christensen distributed information to the board members on the tax exempt financing. They reviewed and explained the different options. They stated that the county would form a non-profit corporation and the corporation leases the ground. The county would need to make sure that the site is clean and prepared for construction. The corporation is the owner of the project and they would design and build and there would be a construction manager to oversee the construction. 8