The Daviess County Jail needs more space due to overcrowding issues.
Officials say staff are preparing to renovate the main building.
Currently, the jail has been housing over a hundred federal inmates, 53 of whom are ICE inmates.
The expansion will allow the jail to stay operational with an additional 125 bunks.
The $43 million project is expected to start in the spring and take up to three years to complete.
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