INDIANAPOLIS -- Prison officials say a massive sentencing reform law that was supposed to save taxpayer money is actually costing more.

The Department of Correction reports costs have more than tripled since it began diverting low-level offenders out of state prisons and back into their communities, as required by the new law.

Its report, which has yet to be released publicly, is alarming to some lawmakers who’ve seen it.

Senate Judiciary Chairman Brent Steele, R-Bedford, calls it “ridiculous” and says the report contains “phony-baloney numbers.”

Lawmakers who pushed to lower penalties for drug-related crimes, such as drug possession and theft, vowed to return anticipated savings from prison costs to communities for treatment programs, community corrections and local lock-ups.

But, according to the department's report, there's no money to send.

This despite a reduction in the prison population of more than 5,000 inmates – a 17 percent drop - since the law went into effect in July 2014.

Local sheriffs who supported the sentencing reform law are unhappy.

“We supported the reforms because we knew it was the right thing for our communities,” said Daviess County Sheriff Jerry Harbstreit, former head of the Indiana Sheriffs Association. “But this like a slap in the face."

The new law requires prison officials to report to lawmakers on its financial impact. The numbers are slated to be released at an early April meeting of the Justice Reinvestment Advisory Committee, a group created by the law to help distribute the anticipated savings.

The new law prevents anyone convicted of a Level 6 felony, the lowest level, from being sent to state prison.

According to the Correction Department, just under 60 percent of low-level offenders are now being placed in a county jail, while the other 40 percent are in community-based corrections programs such as work-release or supervised probation.

Corrections officials say the new law will cost an additional $400,000 in the first six months of this year - for jail costs alone.

That expense is expected to climb before the year’s end.

That’s because the state spends about $35 a day to house a convicted, low-level offender in a county jail, according to the Correction Department report.

The department claims it can house the same inmate in a prison for just under $10 a day.

Steele and other lawmakers who were deeply involved in crafting the sentencing reform law are irked by those claims.

Two years ago, when Correction Department officials asked lawmakers for money, they reported it cost about $60 a day to house a state prisoner.

A year ago, prison officials said they needed an additional $51 million to build a new state prison. Steele and others rejected the proposal, predicting that the state would be able to close a prison – and save millions – as sentencing reform took hold.

Steele said the department now is refusing to cooperate with the intent of the sentencing reform law.

Corrections officials don’t see it that way. The department's legislative director, Jon Ferguson, said the $10-a-day rate used in the report is a “marginal per diem” that doesn’t include the fixed, operational costs associated with running big prisons. And the number of those prison facilities the state operates hasn’t gone down since the sentencing reform law was put into place.

Promised savings from sentencing reform was key to getting it passed and to winning support from sheriffs, judges and local officials who feared it presented another unfunded mandate by the state.

The Legislature set aside an initial $60 million for communities to offset initial costs.

But lawmakers assured critics that the sentencing reform would eventually pay for itself.

House Judiciary Committee Chairman Greg Steuerwald, R-Avon, who helped craft the sentencing reform law with Steele, also questioned the validity of the Corrections Department's report.

But, he noted, “We’re in a transition year.”

“I expect to see much different numbers by next year," he said.

Concern about the numbers also comes from Steve McCaffrey, head of the Indiana chapter of Mental Health of America.

He was key in convincing reluctant lawmakers that they needed to shift prison dollars into local jails and community-based programs where offenders – whose crimes are tied to drugs and mental illness – could be better treated.

“If we don’t get the money in place, it’s not going to work,” he said. “It’s critical we get those resources in place.”

Maureen Hayden covers the state for the CNHI newspapers in Indiana. Reach her at maureen.hayden@indianamediagroup.com. Follow her on Twitter @MaureenHayden

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