Lawsuit alleges Clay Co. misappropriating funds from ICE, detention contract should be terminated due to poor conditions

Calling the agreement to hold U.S. Immigration and Customs Enforcement detainees at the local jail a “cash cow,” a federal lawsuit alleges Clay County officials are unlawfully diverting funds required to care for ICE detainees to unrelated county expenses.

Additionally, the complaint claims that detention standards are failing at the Brazil jail, and that county and ICE officials colluded in 2021 to make sure a second failing grade for the facility didn’t happen, as it would’ve ended their contract.

The 70-plus-page complaint, which requests class certification, was filed in the U.S. District Court for the Southern District of Indiana last month by the National Immigrant Justice Center and pro bono attorneys at Chicago-based Sidley Austin LLP on behalf of four ICE detainees purportedly being held in Clay County Jail.

ICE, the Department of Homeland Security and associated federal officials are named as defendants alongside the Clay County commissioners, County Council, sheriff’s department, auditor and treasurer, among others.

Plaintiffs are seeking declaratory and injunctive relief “to stop Defendants from continuing this unlawful detention arrangement.”

Court records show Bradley M. Dick and Andrew M. McNeil of Indianapolis law firm Bose McKinney & Evans LLP as representing the Clay County defendants while Shelese M. Woods of the U.S. Attorney’s Office for the Southern District of Indiana is representing DHS and ICE.

A spokesperson for ICE said the agency is unable to comment on pending litigation. Attorney Eric Somheil, Clay County’s attorney, said the county doesn’t intend to comment on pending litigation.

On Tuesday, Southern Indiana District Court Chief Judge Tanya Walton Pratt granted a request for an enlargement of time on the deadline for response to the motion to certify class, moving the deadline to June 28.

Leading up to the lawsuit

The recent filing came about three weeks after the Clay County commissioners approved moving forward with a jail expansion project estimated to cost $20 to $25 million.

Opponents of the expansion have argued the county is only adding more beds to house additional ICE detainees for profit, among other concerns.

Since 2013, the county has maintained a contract with the U.S. Marshals Service to hold ICE detainees. DHS pays the county is paid $55 per ICE detainee per day, on top of transportation costs for gas and guards.

The Clay County Jail is currently the only facility in the state housing ICE detainees. On average, the jail holds between 50 and 60 ICE detainees per day, with the average stay lasting around 21 days, according to ICE records.

Auditor Jennifer Flater told Indiana Lawyer in November that the Clay County Jail brought in $1.4 million in revenue in 2020 for housing the ICE detainees. The overall jail budget for that year was $1,958,925, she said.

The new jail would almost double the size of the facility and bump the bed number to around 441 beds. During the first week of October 2021, 61 of the jail’s 168 beds were filled by ICE detainees.

Brazil, located east of Terre Haute, has a population of around 8,000, while Clay County has nearly 26,500 residents total, according to the U.S. Census.

In December 2021, county officials were sued in Clay Circuit Court by not-for-profit Mariposa Legal, which represented a coalition of immigrant-rights groups, alleging a lack of transparency in developing plans for the possible expansion. That lawsuit was dropped in February.

Plaintiffs claim misappropriation of funds, poor conditions

The new complaint in federal court alleges the county “has spent hundreds of thousands of federal dollars on County expenses and discretionary expenditures that are unrelated to the care of Plaintiffs and others detained by ICE at the Jail,” including $83,000 for an air conditioner for the local courthouse.

“The County also gives its employees raises and bonuses using those funds, and it publicly proclaims to its residents that it profits from the Agreement, and that those profits allow the County to avoid raising taxes,” the complaint states.

The lawsuit claims the county spent $783,000 of the $1.4 million received from holding ICE detainees in 2020 on expenses outside of jail services, as reported by the Brazil Times.

Plaintiffs point to 8 U.S.C. § 1103 as to how local governments are to use federal dollars received through ICE contracts. The complaint also mentions 18 U.S.C. § 4013, which concerns funding appropriated for the U.S. Marshals.

The county “openly trumpets that it is profiting off of its detention arrangement with ICE,” the complaint states, citing several news articles dating back to 2018.

In 2021, county commissioner Paul Sinders told IL during a phone call that housing ICE detainees, “… is going to increase our income and allow us to do more at the county level. People don’t realize, I believe, that with the ICE inmates it helps keep taxes down. … Without the additional income, if there’s a shortfall, basically taxes are going to go up, and at this time there is no need for that.”

The complaint further claims facilities used by ICE must comply with Performance-Based National Detention Standards to continue operations, which it says is not happening in Clay County. If an ICE detention center fails two consecutive inspections, the contract must be terminated, per the Annual DHS Appropriations Act cited by the plaintiffs.

The Clay County Jail failed an inspection in May 2021, with dozens of deficient components being recognized across almost 20 different detention standards.

In a December follow-up report, issues persisted but the facility passed its overall inspection.

The most recent Nakamoto Group Inc. inspection, obtained by NIJC via a public records request, showed issues persisted with the jail not meeting environmental health and safety standards.

“The jail is filthy,” Mark Feldman, NIJC senior litigation attorney, told IL. “There is mold on the walls and the jail neglects virtually all cleaning responsibilities, leaving it to detained individuals to clean without proper supplies. The jail doesn’t provide enough food and people are constantly hungry. It’s also freezing inside and the jail doesn’t give people enough clothing. The clothing people do receive is often dirty and used, even underwear.

“And the jail isn’t providing adequate medical care,” Feldman continued. “There are no fluent Spanish speakers on medical staff. If a Spanish-speaker needs medical care, they have to rely on other detained individuals to translate. And there is no medical staff at all on the weekends. Guards hand out medication on the weekends, and we have heard from multiple people that guards have given them the wrong pills.”

Despite continued issues, plaintiffs allege county and federal officials conspired to make sure a failing grade wasn’t given this past winter so the agreement between them would stay intact.

“For example, according to documents obtained through the Indiana Access to Public Records Act, after the failed May 2021 inspection, ICE Assistant Director for Custody Management, Russell Hott, directed Enrique Lucero, who was then the ICE Chicago Field Office Director, to make sure that the County was notified in advance of upcoming inspections, giving the Jail a chance to temporarily resolve or hide any issues,” the complaint states.

“Not only was the County notified of the next overall performance evaluation ahead of time, but the inspection was delayed by an additional week at the Jail staff’s request,” the complaint continues. “In addition, ICE conducted two interim inspections in the lead up to the ‘official’ evaluation.”

Clay County Jail should’ve failed the most recent inspection and lost its contract with ICE, according to the complaint.

“… The inspection team failed to report a number of additional violations of ICE’s detention standards,” the complaint states. “For instance, despite observing the conditions described above, the inspection team recommended that the Jail receive an overall rating of ‘Meets Standard’ for environmental health and safety standards.

“In addition, two of the Nakamoto inspectors — including the inspector responsible for the medical unit — were working entirely remotely and thus were not able to physically inspect the facility or speak with people detained at the Jail. Instead, the inspection team continued Nakamoto’s discredited practice of relying on statements from Jail staff and ICE officials to verify compliance.”

Feldman said that while he has worked on similar cases in Illinois, “This is the first time we have brought a case with this constellation of issues in one lawsuit.”

“The law requires that federal funds are going to the right place and that conditions in the jails are maintained to federal standards, and if they aren’t, ICE must terminate the contract with that facility,” Feldman said. “ICE avoided ending the contract with Clay County, not by improving conditions, but by turning a blind eye.”

Illinois recently closed its ICE detention facilities after a law was passed in 2021 to end the arrangements. That law was challenged in the 7th Circuit Court of Appeals, but ultimately passed.

Earlier this month, Indiana Lawyer first reported that an immigration court is planned to open in Indianapolis in 2023. Officials have said the expansion of the Clay County Jail isn’t related to that news.

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