Records reveal lucrative spending account for jails with little oversight

During the past three years, nine central Indiana jails have made more than $16 million off inmates through commissary sales, according to an I-Team 8 analysis of county financial records. (WISH photo)

INDIANAPOLIS (WISH) – An I-Team 8 investigation has uncovered a lucrative spending account for Indiana sheriffs’ departments with loose regulations and little oversight.

During the past three years, nine central Indiana jails have made more than $16 million off inmates through commissary sales, according to an I-Team 8 analysis of county financial records. Much of that money, the sheriffs and records indicate, went directly back into the jails to help maintain the facilities’ upkeep.

But some of it did not.

I-Team 8 uncovered millions of dollars flowing to private attorneys, hotels and car washes – expenditures that don’t necessarily have an immediate impact on the inmates.

Our investigation comes at a time when sheriffs’ departments across the state have raised concerns about finances and overcrowding because of changes to the Indiana criminal code.

Marion County officials are also weighing how to pay for the construction of a new jail and criminal justice complex in Indianapolis.

While sheriffs regard the accounts as necessary in order to maintain their facilities and lessen the burden on taxpayers, families of inmates say the high-priced items put them in a financial hardship.

Laws in other states like Illinois and Kentucky state that commissary proceeds “should benefit the committed person.” In Michigan, county boards must first approve any use of commissary profits before sheriffs’ departments can spend them.

In Indiana, sheriffs have wide discretion over how those monies can be spent. Indiana law states that commissary proceeds can be used for computers, weapons, attire, vehicles, training and “any other purpose that benefit the sheriff’s department.”

What we found:

On average, Marion County has made $3.26 million each year from commissary sales to inmates, according to an I-Team 8 review of commissary fund financial records from 2014 to 2016.

In each of the past three years, Marion County’s Sheriff’s Department has also spent an average $3.26 million of that money.

I-Team 8 also found the Marion County Sheriff’s Department spent:

  •  $2.6 million for commissary supplies
  •  $2.6 million on private attorneys’ fees
  •  $191,000 on uniforms
  •  More than $13,000 on car washes
  •  More than $3,000 on trophies/plaques for fellow officers

Marion County Sheriff John Layton acknowledged that the $2.6 million that went to private attorneys’ fees at Frost, Brown, Todd, a large Indianapolis legal firm, were also coupled by legal fees paid to the city’s corporation counsel.

In other words, the sheriff’s department often had two law firms representing it for civil litigation.

When pressed about this during a recent news conference, Layton said:

“Millions have been spent with Frost, Brown, Todd, over the past say 12 to 14 years. If we had not spent a few million with Frost, Brown, Todd, the citizens of Marion County would’ve been giving out tens of millions in liability. It’s a good trade off. A very good trade off,” Layton said during a recent interview with I-Team 8. “We do use city attorneys whenever possible. They work very closely with Frost, Brown, Todd on litigation. But you can imagine, if you ever look at the litigation list for the Marion County or the police department, it’s quite long. It’s longer than Santa’s list, believe me.”

Dr. Crystal Garcia, an associate professor of criminal justice at IUPUI – and a former corrections officer in California – said she has a problem with how Indiana sheriffs use commissary funds – especially using inmate monies to pay for private attorneys’ fees.

“It causes me pause. It causes pause with how they do this,” Garcia said. “My gut tells me they should not be doing this.”

Garcia said she doesn’t fault the sheriffs’ department for using Indiana’s law to their advantage. But she says Indiana’s law needs to be changed.

“Ethically I don’t know that everybody thought through this,” she said.

Kevin Murray, the attorney who represents Layton, told I-Team 8 by phone that the costs were justified because his firm handles “complex litigation.”

One Marion County inmate, who asked not to be identified for our report, told I-Team 8:  “They’re making a fortune off of us. I do know that much.”

What are commissary accounts?

Commissary accounts act like spending accounts for inmates. When a person is booked into jail, their loved ones can deposit money into their commissary accounts. From there, the inmates can buy personal hygiene products, phone cards to call home or convenience store snack foods. The items are usually sold at a marked up price, which allows the sheriff’s departments to recoup expenses and maintain the operating costs of the jails.

The families of inmates’ tell I-Team 8 the high prices put them in a financial hardship, but sheriffs argue the accounts relieve some of the burden off taxpayers and allow them to maintain the upkeep of their operations at a time when more low-level offenders in Indiana are serving out sentences in county jails rather than state prisons.

“Yes, we are supplying it. Yes, there is a mark up and yes we do use those proceeds for things that we may be struggling with here, as in washers and dryers, as in kettles as in metal detectors for the jailers. It’s used for many different things at the sheriff’s office,” Johnson County Sheriff, Doug Cox told I-Team 8 during a recent interview.

“Especially now with the populations up throughout the various jails in Indiana, these commissary funds help the county taxpayers quiet honestly,” he said.

But for those like Melissa Hostettler, a former inmate at the Rockville Correctional Facility, she says the financial burden is rarely on the inmates themselves.

“It’s the families, it’s completely the families,” she said.

In the private sector, Keefe Commissary Supply, one of the largest suppliers of commissary goods in Indiana and the U.S., reported in recent years to make as much as $375 million in annual sales, according to a financial disclosure form obtained by I-Team from the Missouri Department of Correction website.

An email seeking comment from Keefe was not returned.

During recent years, concerns about mistaken releases, jail suicides and drugs have plagued the Marion County Jail.

A current federal lawsuit filed against the Marion County Sheriff’s Department alleges that the sheriff’s department was responsible for an inmate who hanged himself, according to a copy of the complaint filed by I-Team 8. Our interview with Layton happened before the suit was filed. The county does not typically comment on pending litigation.

Layton contends the commissary funds are being spent correctly.

When pressed on if $200,000 on uniforms and $13,000 on car washes was really the best use of those monies, Layton said: “Yes, because in a para-military situation you have to have espirit de corp. You have to have command presence. To have a sloppy police department, to have a sloppy uniform, you command no respect.”

When pressed again about the car washes and trophies, he said: “I don’t believe there were any trophies in there, there might have been some plaques in there for men and women who spent time like myself – 30 to 40 years – dedicated to the citizens of Marion County. I don’t think the citizens would be too mad at us buying some plaques for a piece a paper to go on to say thank you for what you did for us.”

But Layton is not alone in using private counsel. Several central Indiana counties including Boone, Johnson, Hendricks and Madison – to name a few – have all indicated in financial records that they have commissary proceeds to pay for private legal counsel.

Johnson County Sheriff Doug Cox says his department hired private attorneys to handle litigation, but also uses them in an advisory role to handle policy questions.

State Sen. Liz Brown, R – Fort Wayne, filed a bill in the Indiana General Assembly that would call for more oversight over commissary funds. The bill would require that sheriff’s report their commissary books to the Indiana General Assembly twice a year. The bill passed the Senate unanimously and has moved onto the House.

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