The remaining 30-odd dollars would be slashed from counties; cities and villages; townships; and the numerous local entities – such as Developmental Disabilities boards; parks; and libraries.
Backdrop: Anti-property-tax activists are asking registered voters to sign petitions that, assuming enough valid signatures are gathered – minimum: 413,487 statewide – would place on Ohio’s ballot a measure to abolish property taxes.
You can tell that’s not an idle threat because even Ohio’s La-Z-Boy legislature heaved itself out of its naps long enough to pass a freshet of property-tax changes late last year, though that looks more like public relations than reforms.
And trying to fashion tax policy at the polls is a little like trying to repair a watch using a sledgehammer. But it wouldn’t be unprecedented,
In 1983, spearheaded by the late conservative godfather Thomas A. Van Meter (1943-92), of Ashland, Republicans tried to roll back steep tax increases passed by the Democratic-led General Assembly and OK’d by then-Gov. Richard F. Celeste, a Greater Clevelander.
Issue 2 of 1983 would’ve required a two-thirds vote of the General Assembly to raise taxes. Voters rejected that, 41% “yes” to 59% “no,” and the plan (narrowly) carried only three counties, including Warren counties. Tandem Issue 3 would have repealed all state tax increases passed after Celeste took office. Voters also vetoed that, 44% “yes” to 56%, with voters in just 10 counties supporting it, including Butler (Hamilton), Clark (Springfield), Clermont (Batavia) and Warren (Lebanon).
Policy Matters’ Schiller reported that the property tax is Ohio’s largest tax, producing $21.4 billion annually, providing almost 64% of schools’ funding, 16% of counties’ funding; 7% each for municipalities and townships; and 6% for libraries, parks, fire districts “and other special districts.”
There are two wide eye-openers in Schiller’s report. First, almost a third of Ohioans live in the state’s 1,308 townships, which can’t levy sales or income taxes and so depend on property taxes. Ten of them have more than 40,000 residents, led by Butler County’s West Chester Twp. (62,000-plus).
Second, citing Legislative Service Commission research, Schiller said “(doubling) the state income tax would still (require boosting) the state’s sales tax by more than half to (produce) the necessary revenue.” Franklin and Cuyahoga counties are now at 8%, Ohio’s highest; the lowest combined rate – 6.5% – applies in four counties, including Butler (Hamilton).
According to the Tax Foundation, “nationwide, the population-weighted average combined sales tax rate is 7.53 percent ... (with) the five ... highest average combined state and local sales tax rates (in) Louisiana (10.11%), Tennessee (9.61%), Washington (state), 9.51%, (and) Arkansas ... and Alabama (both 9.46%).”
In January, Fitch, the bond-rating agency, praised Ohio’s “high level of financial resilience and superior budget management” – management well-led for almost eight years by Republican Gov. Mike DeWine, of Greene County’s Cedarville.
But Policy Matters research strongly suggests repealing the property tax – because the General Assembly is too lame to properly reform it – could make shambles of Ohio’s now fortress-strong state finances. That, Ohioans don’t need.
Thomas Suddes is a former legislative reporter with The Plain Dealer in Cleveland and writes from Ohio University. tsuddes@gmail.com.
