Franklin County approves up to $2 million in notes to fund jail improvements

The Franklin County Board of Commissioners voted 10–3 on June 24, 2019, to authorize the issuance of general obligation capital outlay notes not to exceed $2,000,000 to fund jail land acquisition, construction, renovation and equipment, along with costs of issuance.

Andrea Smith, the county finance director, presented Exhibit A showing a projected debt-service schedule with $2,000,000 in principal and estimated interest of $403,066.67 for a combined total of $2,403,066.67. Smith also listed estimated costs of issuance of $10,000 (municipal advisor $5,000; bond counsel $5,000).

Contractor Tom Smith of Southeast Contractors described current progress on the jail expansion and called attention to change orders and site work that have affected the project schedule and budget. Bob Bass, Detention Facilities Manager with the Tennessee Corrections Institute, told the commission why specified materials and construction methods are required for state facility compliance, which the county said affects costs and some design decisions. Engineer Tony Gipson provided additional technical explanation of materials and structural work.

The packet included a change-order summary showing approved change orders totaling $641,828 and additional completed change orders of $20,065. A subsequent worksheet prepared by Smith listed pending change orders, furniture and facility items and an "Additional Need" line showing $1,986,921 beyond currently obligated contract sums. The county placed those figures in the record as part of the discussion of financing and appropriation. The resolution notes that proceeds may be used to reimburse previously expended funds for the project and to pay issuance costs.

Resolution 6a-0619, which cites Sections 9-21-101 et seq., Tennessee Code Annotated, authorizes the county mayor to set final terms and sell the notes, appoint a registration agent, and to engage Stephens, Inc. as municipal advisor and Bass, Berry & Sims PLC as bond counsel. The resolution pledges the full faith and credit of Franklin County and an unlimited ad valorem tax levy to secure payment of principal and interest on the notes.

Commissioner David Eldridge moved the measure and Gene Snead seconded. The motion was approved by roll-call vote, 10 in favor and 3 opposed. The resolution was entered into the minutes and supporting exhibits (Exhibit A: estimated debt service and Exhibit B: engagement letter for bond counsel) were attached to the official commission record.

The commission also reviewed an Other Capital Projects Fund worksheet showing prior series bond proceeds and allocations, and the packet included a detailed list of change orders and line-item costs (roofing, electrical, plumbing/HVAC, fencing, security conduit) that county staff said contributed to the increased funding request. County Clerk Phillip Custer certified the minutes and documentation for the public record.

The board adjourned at 8:50 p.m.

Next steps noted in the resolution and exhibits include finalizing sale terms, completing the required approvals by the Director of State and Local Finance where applicable, and applying proceeds to the construction fund as described in the resolution.