Ohio services will face a serious financial issue next year when voters are asked to decide whether property taxes in Ohio should be eliminated.
The group leading this property tax repeal effort, Ax Ohio Tax, admitted recently they didn’t feel they had enough valid signatures to force a ballot vote this November. Fearing that may happen (and require them to start the process all over again again), they decided to delay submitting the initiative to the secretary of state’s office until 2027.
Not addressed in the proposed ballot initiative is how Ohio will fund schools, libraries, county and local governments, police and fire, parks, and many other services that are funded by local property taxes.
Ax Ohio Tax is perhaps unaware that Ohio has already provided relief, at least on the school side of the issue, years ago. In 1976, during a period of very high inflation, the legislature enacted HB 920, designed to protect property owners from unvoted tax increases. They did this by reducing the actual voted millage down, employing a reduction factor to ensure that the same amount of revenue from taxes does not increase for schools unless a school district votes additional millage.
This is the reason property tax bills show voted millage number and the effective millage indicating how the taxes for schools are actually computed, which includes residential and other growth in the taxing areas.
It’s important for anyone proposing property tax repeal to be aware that this law is still in place today, and it prohibits school districts from gaining additional revenue from existing school levies.
Property taxes in Ohio are difficult to understand, as anyone who has ever received a property tax bill knows. With certain deductions, inside millage growth permitted, 2.5% rollback for owner-occupied residences and other factors, most property owners concerned with the bottom line are understandably upset with the increases we have experienced lately.
This question remains: how does the state or local government fund these services if property taxes go away? It doesn’t appear that the supporters of this initiative have a real answer for this. They suggest “the state will figure it out” or “the state can just eliminate waste and that will pay for it” or “ raise the sales tax a little and that should cover it.” None of these ideas seem to have an actual cost associated with them or figures to support what they are suggesting.
Economists and state politicians warn that the cost may be much higher than these supporters have ever imagined.
Learn more about this initiative here.
– By Fred Ross
Fred Ross has served as Assistant High School Principal at New Richmond Exempted Village School District; High School Principal at Van Buren Local School District; Business Manager at Eaton City Community School District; Assistant Superintendent at Deer Park City Schools; and for 16 years as an Area Coordinator in Fiscal Assistance for the Ohio Dept. of Education.
