When Ohio adopted an income tax, lawmakers struck a deal with local taxpayers: The state would pick up a share of their property tax bills. That was four decades ago, the state paying 12.5 percent. Then, in a matter of days, Republicans in charge at the Statehouse changed the arrangement, slipping into the final version of the new two-year state budget a last-minute provision eliminating the “rollback” on property tax increases approved in November and beyond.
Property owners will pay the full share. That may be sensible policy-making. Other governors and lawmakers have looked at erasing part of the rollback for wealthier property owners. In 2005, the rollback was ended for commercial property. What should trouble Ohioans is the process — no hearings, little discussion, a change with significant fallout for schools and other local organizations hustled to passage.
Republican lawmakers, along with Gov. John Kasich, would have done well to give local officials more time, putting off, say, the effective date until next year. They didn’t bother. Thus, districts that already have calculated levy requests for November may have to rethink. They certainly face the task of explaining to voters how a complicated system has gotten more complicated.
This marks the second time the governor and his fellow Republicans have backed away from a longstanding commitment. Two years ago, they slashed the local government fund, the state having routed revenue to communities through such a fund since the 1930s.
In another way, the change in the rollback runs counter. The Ohio Supreme Court ruled, starting in 1997, that the school funding formula relies too heavily on local property taxes, leading to inequities and inadequacies in public education. The court held that the state must do a better job addressing the shortcomings. Yet, in altering the rollback, the governor and lawmakers head in the other direction, adding to the burden on districts, the court mandate still unfulfilled.
To be sure, the new budget includes an additional $1 billion for public schools. That amount still leaves districts trailing the rate of inflation in recent years. And now the task of gaining local property taxes has become more difficult.
Republican lawmakers have reasoned that the change in the rollback brings improved transparency to school financing, taxpayers more aware of the source of funding. Does that mean they are ready to abandon House Bill 920, which dates to the 1970s and artificially holds property values in check? What the defenders miss is that the process lacked transparency. With so much at stake, schools and property owners deserved better from their elected representatives.