Scott County Council holds special meeting on $6 Million judgment funding bonds

The Scott County Council convened a special meeting Friday evening, August 29, 2025, to consider two ordinances connected to a proposed bond issue: an additional appropriation ordinance and a bond ordinance. The measures, if adopted, would authorize the county to issue judgment funding bonds under Indiana Code to cover settlement obligations and related expenses.

Legal Process Outlined

Attorneys explained the statutory process, noting that the council’s action would begin with first readings and advertising of the ordinances. Final adoption could occur at the council’s September 9th regular meeting, after required public hearings on both the appropriation and the bond issue. It was emphasized that similar steps were taken in neighboring Clark County, which issued judgment bonds in consecutive years.

Financial Details

Bond estimates were presented.

• The council authorized advertising for a maximum bond size of $6 million, though current calculations center on approximately $4.825 million.

• This figure covers the $4.491 million judgment order, $85,000 in legal fees already paid, plus underwriting and professional costs.

• The bonds would be taxable, carrying an assumed 6.25% interest rate, with repayment spread over 20 years.

The debt would be serviced by a new property-tax levy, not income taxes. Illustrations showed:

• A $150,000 home would see an annual increase of about $28.

• A $300,000 home, about $70.

• 100 acres of farmland, about $91.67.

Most Scottsburg and Austin residents would not see increases due to tax caps.

Budget Challenges

Council members reviewed grim budget projections. Even after days of budget hearings and line-by-line departmental cuts, shortfalls remain:

• Nearly $600,000 over in the General Fund,

• $300,000 over in Special Purpose LIT,

• Sheriff’s payroll and jail staffing costs not yet fully included.

Several members warned that further reductions may require cutting staff, not just operating expenses.

Senate Bill 1 Concerns

Discussion also turned to Senate Bill 1, which will restructure local income tax (LIT) systems in 2027 and cap property-tax bills with up to $300 in homeowner credits. While residents may see tax relief, county officials worry about lost revenue and volatile income-tax streams. Consultants advised against depleting rainy-day funds, stressing the importance of healthy balances under the new system.

Council Action

The council took first readings of:

• Ordinance 2025-OR-48, authorizing issuance of judgment funding bonds.

• Ordinance 2025-OR-49, appropriating the bond proceeds.

Both measures passed initial votes by 4-2 margins, setting the stage for public hearings on September 9. Final adoption could follow the same evening, though several members cautioned that more budget trimming may still be necessary.