The Ohio State Senate has approved a series of reforms to the state’s property tax laws, aiming to address concerns over rapid increases in property taxes without voter approval. Senator Bill Reineke (R-Tiffin) supported the measures, which are expected to save Ohio property taxpayers $2 billion over three years as the changes are implemented.
The reforms focus on five main areas. Homeowners who live in their properties will see an increase in the owner-occupied tax credit from 12.5% to 15.38% over four years, providing an estimated $350 million to $400 million in additional relief for these residents while phasing out the nonbusiness property tax credit. Other changes include capping automatic growth of inside millage and limiting increases from reappraisals so that neither can exceed the cumulative rate of inflation over the previous three years. County Budget Commissions will have more authority to reduce unnecessary or excessive collections, and existing emergency and substitute levies will now be subject to tax reduction factors.
Senate President Rob McColley commented on the motivation behind these reforms: “We stand for the taxpayers and not for runaway revenue that is undermining homeowners and the American Dream,” he said. “While home prices have skyrocketed and outpaced the rate of inflation, we’ve heard the complaints from homeowners and are not only granting tax relief in the near term, but we are making sure that these unexpected and unwanted spikes in property taxes won’t happen again.”
Senate Pro Tempore Bill Reineke highlighted how these efforts fit into broader legislative actions: “These reductions compliment tax reductions in income tax and the creation of a flat tax, as well as other tax reductions passed in the operating budget this year,” added Senator Reineke.
A significant portion—over 70%—of all property tax revenue is allocated to schools across Ohio.
Earlier this year, lawmakers also passed two veto overrides prohibiting future substitute emergency and substitute replacement levies. These types of levies were previously outside anti-inflationary limits set by law and had contributed to unexpectedly high bills for some taxpayers.
Senator Reineke indicated that further examination of Ohio’s property tax system would continue into next year.
