Bill links tax levies to inflation

Joanne Bello

Gov. Bob Taft signed a bill that will allow school districts to seek property tax levies with income that would increase with inflation.

As long as property values in the district are increasing, the district will be permitted to tie the amount the levy raises up to 4 percent a year.

Previously, the schools would have to go back to the ballot whenever the property value increased, however, the income for the schools would not change.

“This is another tool in the tool box that school boards can put on the ballot for inflationary growth,” said Kent Board of Education treasurer Deborah Krutz. “This is a valuable option for school districts.”

The bill also made minor changes in the school voucher program and is primarily reappropriating money from the state budget over the next 14 months, said Paul Marshall, administrator with the Ohio Office of Budget and Management.

Krutz said if this type of levy is passed, it would not change how the money is spent, but rather how often the levy returns to the ballot. The districts do not have to use this type of levy, but it is there for them if they want, Krutz said.

“It is important to know that the new bill does not retroactively apply to previously voted-upon levies and will not apply to the levy that is on the Kent ballot on May 2,” Krutz said.

Voters would not have to go back to the ballot each time the property value increases with the new type of levy, Krutz said.

“As it stands right now, when the property value increases, the voted millage on the levy has to get lowered so that the money on the levy can stay the same,” Krutz said. “With the new levy, that would not have to happen.”

Some county officials do not think this new bill would help solve the ongoing funding problem school districts are facing.

“State legislatures are using this bill as a total copout for fixing the property taxes,” County Auditor Janet Esposito said. “The state can’t continue to use property taxes to fund the schools.”

Esposito, who is a member of the County Auditor Association of Ohio, said other auditors are having a problem with this new levy option because state officials have not determined how much the property value is going to have to increase before the levy can be effective.

“There are no guidelines in the bill. This just causes us to have to do more paperwork,” Esposito said. “We (auditors) suggested they look at this bill before they implemented it.”

Esposito said she feels to solve the school funding problem, the state needs to use other means of funding besides property taxes. She said the state needs to reallocate funding that is spent on less important things and also use funds from sales tax and more from federal funding.

According to the Associated Press, state Sen. Kevin Coughlin, R-Cuyahoga Falls, created an amendment to the bill that would require it to specifically state the terms of these new levies on the ballot, so that voters would know that the tax would increase with their property values.

Contact public affairs reporter Joanne Bello at [email protected].