Thomas bill would limit unvoted school property taxes
State Rep. David Thomas, a Republican who represents portions of Trumbull County, introduced legislation that would limit unvoted property taxes collected by school districts.
The 20 Mill Floor Inflation Cap bill would limit the revenue districts can receive from the 20 mill floor to inflation, which Thomas said would reduce the tax burden on property owners.
“It’s the big spike” that has caused property taxes in Ohio to significantly increase, said Thomas, R-Jefferson.
“That 20 mills is applied to rising values even if voters have approved less,” he said.
Every school district in the state is guaranteed to receive 20 mills. About 400 of the state’s 611 school districts have an effective rate that is below the guaranteed 20 mills floor, but 20 mills are still applied to the district’s value, Thomas said.
As property value grows, the burden on taxpayers increases, he said.
“I’m a firm believer that if you want more than inflation in tax rates, the voters should approve that, and this bill greatly helps lower the spike in taxes with property value increases,” Thomas said.
State Rep. Jim Hoops, R-Napoleon, is the bill’s other lead sponsor. \He and Thomas were county auditors before election to the Ohio House.
The 20 mill floor rule was put into law for school districts in the 1980s. Since the COVID-19 pandemic, the lack of housing has caused housing prices to dramatically increase resulting in higher school taxes, Hoops said.
School district taxes are usually the largest part of a homeowner’s property tax bill.
The 20 mill floor is a main reason for the large increases in unvoted property taxes over the past few years, Thomas said, as values increased.
“This proposal is like a base layer, something that must be done as a core aspect to property tax reform with other ideas added on top to give additional relief,” Thomas said.
Thomas serves as vice chairman of the House Ways and Means Committee, which is leading the effort on property tax reform. This is the sixth property tax reform bill Thomas has sponsored since he took office in the House in January.
Other property tax reform bills he’s sponsored included an overhaul to the homestead and owner-occupancy tax credit plan that would change the exemption from value removed off the property to a flat credit amount, ensuring school district levies approved by voters are counted toward the minimum guaranteed tax rate districts receive, reforming the process of valuing property during revaluations by putting county auditors in charge of the sales used to determine valuation changes, a total property tax relief for surviving military spouses, and giving school districts the option to not grant automatic property tax abatements for new houses for up to 15 years.
The Ohio House on Wednesday approved legislation to eliminate proposing replacement property taxes on ballots.
Some voters don’t understand that a replacement levy raises taxes as compared to a renewal levy that keeps taxes at the same rate.
The Ohio Senate has to consider the legislation.
If it’s approved, replacement levies would be banned starting with the November general election.
The bill doesn’t affect existing replacement levies.