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The Indiana Department of Correction has run out of money to pay county jails for holding low-level felons and state prisoners.
County jails haven’t received payments in months, and there are still four months left in the July-to-June fiscal year.
“It’s very disappointing,” said Tippecanoe County Sheriff Robert Goldsmith, who is also president of the Indiana Sheriffs’ Association. “As far as on their end, and why they’re not able to pay, I don’t understand that part of it enough to even get mad.”
Indiana Department of Correction Spokeswoman Annie Goeller confirmed Monday that “funding for this expense has been exhausted for State Fiscal Year 2025. IDOC is working with the State Budget Agency on available options. We are continuing to communicate with counties about this issue.”
The appropriation in the current state budget, which ends June 30, was $34 million annually for the county jail maintenance contingency fund. The fund reimburses sheriffs for two groups of offenders: anyone convicted of a Level 6 felony, as well as anyone being held on higher felonies or parole for IDOC.
Of that amount, up to $25.3 million was set aside for the Level 6 felons at a rate of $40 per day. This group of offenders used to be sent to state prisons until a criminal justice overhaul in 2013. After that, low-level felons were kept in local jails at state expense.
IDOC said it spent $34.6 million in fiscal year 2024 and $34 million already in fiscal year 2025.
Rep. Greg Steuerwald, R-Avon, said he was surprised to find out Monday, during a committee hearing for unrelated legislation, that IDOC had run out of money. He told that Capital Chronicle on Tuesday that lawmakers will offer back pay and increase the per diem rate.
“Everything owed will be paid,” he said.
Ongoing issue
Goldsmith just found out about the lack of money last week. The last time his county was paid by the state was in August, which was the March billing.
He said on Tuesday that his jail currently has 30 offenders waiting to be transferred to IDOC or serving their Level 6 sentence — and the county is getting no reimbursement.
Goldsmith said he is glad to hear lawmakers are considering an increase in the per diem rate of $40 in the next state budget. The House Republican version hikes the rate to $43 a day.
“I’m just appreciative that they’re willing to sit at the table and have these conversations,” he said.
Steve Luce, executive director of the Indiana Sheriffs’ Association, said he is focusing on getting a new billing system in place for the next fiscal year. Luce said the current system involves a formula instead a true billing system using actual counts.
He’s also seeking an increase. Luce noted it costs the state $79 a day to house a prisoner, so IDOC is saving money by leaving prisoners in county jails.
He said that overall, there are about 2,500 IDOC holds annually, and they stay for varying lengths of time depending on their sentence.
“I don’t think they underestimated it. I think they did, but not on purpose, because we have had some changes,” Luce said. “We haven’t had a consistent formula.”
The association will continue to push for an increase in the budget “because we are still losing money, and it’s coming on the taxpayers. So, what we’re trying to do is be fair and also work with them through the things that need to be fixed.”
Indiana Capital Chronicle is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Indiana Capital Chronicle maintains editorial independence. Contact Editor Niki Kelly for questions: [email protected].
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