The sighting happened at U.S. Highway 12 and North Karwick road near the Long Beach area.
Lance Battreal, Charles Smith and Mark Booher escaped from the prison on Sunday.
Smith was arrested in Grand Beach, Michigan the next day near Mayor Daley's vacation home .
Three officers who were supposed to be overseeing the inmates when they made their escape through a tunnel have been suspended.
Reward established for prison escapees information
An anonymous tip line has been established for anyone with information regarding the two felons who escaped from the Indiana State Prison Sunday morning.
Individuals can call toll free to 1-800-78CRIME (1-800-782-7463) or can go online to www.wetip.com and click on "Submit a tip" near the top of the page.
If the information leads to their capture, the individual could receive up to $6,000. Individuals reporting information will remain anonymous.