Ventura County Board of Supervisors Approves Todd Road Jail Expansion Funding

By Sheryl Hamlin

In 2014, the Ventura County Sheriff had applied for a grant to build an extension to the Todd Road Jail located just outside the city limits of Santa Paula, but was turned down due to an application error. Also in 2014, the sheriff hired a consultant to provide a Needs Assessment Analysis for the project which was submitted to the Board of State and Community Corrections BSCC with the application as justification for the expansion. The application was resubmitted successfully in 2015.  

Requests to the consultant, the BSCC and the county Sheriff for a copy of the Needs Assessment Analysis were unsuccessful. It is not clear who in local government has a copy of this report or if the entire decision to build the extension was based on Sheriff Dean’s PowerPoint presentation. Additionally, the June 2015 Report of the Ventura County Grand Jury recommended in favor of the Todd Road Jail expansion.  A summary of the Grand Jury report was provided here.

One of the first items of business for the new Santa Paula council in 2015 was to revisit the previous council’s opposition to the Todd Road Jail expansion. In January 2015, Sheriff Dean presented to the new council the presentation previously given in 2014 to a different council. The summary of that meeting can be read here. No action was taken at the January 2015 meeting, but in a procedural sleight-of-hand, newly elected Mayor Procter included the issue on the March 2015 Consent calendar three months later. When the item was pulled for discussion, the council voted 3-2 to overturn the previous opposition with Council Members Tovias and Crosswhite opposing. The summary of that meeting can be read here.

With a 64 bed expansion, it is not clear if this will be the facility for the entire county to house and treat chronically and mentally ill inmates or just for a part of the county. Presumably this is one of the items to be learned from the Needs Assessment Report.

What is noteworthy is the financing arrangement. The type of financing is called Lease Revenue Bonds. The Public Policy Institute says this about Lease Revenue Bonds:

The state could fund construction of a prison by agreeing to lease the prison and selling shares in the flow of lease revenue, an arrangement called a lease revenue bond, a leaseback, or certificates of participation. The state tends to use revenue and lease bonds for projects which are necessary but not particularly popular, such as state office buildings and prisons. Governments typically pay higher rates when they borrow through revenue bonds rather than general obligation bonds.  

Such bonds do not need voter approval, so as the article says, are used for projects “not particularly popular, such as state office buildings and prisons”.

This diagram below attempts to show how convoluted this particular type of bond transaction is and how the county can finance this entire $61 million project with only ten percent down or $6,127,000.

The CDCR is the California Department of Collections and Rehabilitation which is charged with implementing SB 863. From the Sheriff’s report:

SB 863 authorized a $500 million financing program to assist counties in meeting local needs for local jails, including those relating to the housing and care of mentally ill and chronically ill inmates under the counties’ care.

The bonds are considered higher risk than other state issued bonds because the revenue source may be compromised, as any county could incur financial difficulties in the future. The bond revenue stream is based on the county’s ability to pay the sublease. There is no “enterprise” situation created, as in the case of a water treatment plant where ratepayers guarantee the payments. Secondly, these types of bonds DO NOT require voter approval. In this case, the legislature created the program with the Governor’s approval.

Upon the maturity of the bonds and all interest has been paid to bondholders, the leasehold which was given to the state of California no longer exists and the land reverts to ownership of the county.

At 64 beds, the $61,263,964 jail expansion equates to $957,249 per bed, more than the cost of most homes in Ventura County. The Sheriff has estimated the 30 year cost to operate the facility at $134,065,000 or $2,094,765 per year or $32,730 per year per inmate.

This item was approved by the Board of Supervisors via the Consent calendar with no discussion on September 22, 2015. To see the meeting and download the documents, click here.

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For more information about the author, visit sheryhamlin.com

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