Almost seven years after a new state prison opened in Jamestown, Sen. David Nething is proposing that another be built there - financed by a payroll change that the state budget director calls "an accounting gimmick."

The Jamestown Republican has introduced legislation to set aside $12 million for the project, which would be located next to the present James River Correctional Center, on the campus of the state mental hospital.

The prison could be constructed as a new building, or fashioned by remodeling an existing structure, Nething's legislation says. Among the offenders it could house would be "those in need of mental health, drug addiction, or aging-related services," the bill says.

"We know that we've got real problems in corrections with those who need mental health treatment, who need drug addiction treatment," Nething said. "And we have a real problem coming with those needing aging-related services … This would provide additional flexibility, and at the same time, provide an appropriate location and facility to provide those kind of treatments."

Locating the prison in Jamestown makes sense, Nething said, "because we have the facilities to do what we need on the State Hospital grounds. It's easy to accomplish the objective of providing the treatment that is necessary."

His proposal for financing the new prison is certain to stir debate. Nething, a budget expert and former Senate Appropriations Committee chairman, is suggesting that state government's June 2005 payroll expense be recorded in July, after a new budget period begins.

North Dakota government has two-year budget cycles. The current 2003-05 period began July 1, 2003, and ends June 30. State workers are paid twice a month, and Nething says his idea would not affect when employees get their paychecks.

Normally, a July 2005 paycheck for state workers would be accounted for during the previous month, in the 2003-05 budget cycle. Nething's proposal would "save" $17.5 million in general fund spending during the 2003-05 budget period, by recording the expense in the state's 2005-07 budget.

The idea first cropped up during the final days of the 2003 Legislature, although it was never formally proposed.

Pam Sharp, the state budget director, wrote an April 22, 2003, memo saying the switch would cause a number of accounting problems, and that the Office of Management and Budget did not have time to set it up before the biennium ended on June 30, 2003.

"This is an accounting gimmick that would be purposely misleading to the public," Sharp wrote. "Overall, we believe this would portray a poor financial image for North Dakota."

Nething said Sharp's objections were policy issues that the Legislature should decide. The project is important enough to be worth the trouble, and establishing a new prison in Jamestown would give the state corrections department more inmate housing options, Nething said.

The state psychiatric hospital's campus has hosted a prison since June 1998, when the James River Correctional Center opened there. The building was formerly used as a medical hospital, and was converted to prison use.

Two years ago, Gov. John Hoeven proposed remodeling another building on the campus, called the LaHaug building, to use as a women's prison. The idea stirred heated opposition, and lawmakers settled on an alternative - using a former Roman Catholic convent and boarding school in New England, in rural southwestern North Dakota, as a lockup for women.

The new women's prison missed several deadlines for housing inmates, and its administrator was eventually forced into retirement. It has also proven to be more costly to operate that state prison facilities.

Nething said his proposal was not intended to affect the New England prison. His legislation does not specify that the proposed new lockup in Jamestown be reserved for women.

"I think a lot of people will misread it to think, oh, it's just a play to get the women's prison in Jamestown, but it really isn't," he said.

The bill is SB2350.