That’s good news for property owners, but for governments that count on property taxes likes schools and cities, it means a drop in the amount of revenue they receive.
Auditor Roger Reynolds released on Dec. 30 a property value update required every three years. The 2011 update dropped residential property values on average in the county 4.3 percent from 2009 and 2010.
The greatest declines in residential property values were in Middletown, 8 percent; Hamilton, 6.9 percent; and St. Clair Twp., 5.9 percent.
With property worth less, the tax base for school districts, cities and counties will shrink more, Reynolds said.
Budget pressures have forced schools and governments to do layoffs and cut services.
“They were planning for it, they were expecting drops,” Reynolds said.
James Marcum said he’d rather pay higher taxes on his Millville Avenue home in Hamilton if it meant his community was better off.
Marcum, a Middletown special education teacher, said “I’d rather see the property values go up. I don’t mind paying a little more in taxes.”
Reynolds has said the property value declines are driven by economic factors, including unemployment and foreclosures. Property owners should receive a letter in the mail from the auditor about their values around the first week of February.
School districts will feel the most pain, Reynolds said.
“School districts get the most property tax dollars,” he said.
Lakota Local Schools in Liberty and West Chester townships has the biggest change in property taxes to be collected this year. Property tax collections are expected to decrease more than $854,000, according to the uditor’s office.
Middletown City Schools will see an estimated drop of nearly $325,000, according to the auditor.
Property taxes from residential, agricultural, commercial and industrial properties make up about 40.5 percent of Middletown Schools’ general fund revenue, according to Treasurer Kelley Thorpe. That’s second to funds from Ohio Department of Education, about 43 percent of general fund revenues, according to Thorpe.
The school district received approximately $27.5 million in property tax revenues in fiscal year 2011 and expects to receive about $26.6 million this fiscal year, according to Thorpe.
“We had planned on a 5 to 6 percent reduction in property values, but values actually dropped 8 percent, so the expected revenues will be less than anticipated,” she said.
The district is beginning budget discussions this month to last through March.
“Our goal, as clearly stated by the community last year, is to protect the programs that directly impact students and at the same time be fiscally responsible,” Thorpe said.
The impact on Hamilton City School District is more than $275,000, according to the auditor.
Fairfield residents will see an increase in their tax bills of about $150, for an approximately $100,000 house, according to the auditor. Even though Fairfield’s total residential property values dropped an average approximately 3 percent, property owners still pay more because a 6.5-mill school levy passed last election.
Property taxes are the second largest source of income for Butler County behind sales taxes, according to Pete Landrum, assistant county administrator and Office of Management and Budget director. The county received in 2011 almost $13 million in property tax revenues and is planning to receive about $12.5 million in 2012, according to Landrum.
“The decrease was already budgeted because the Auditor’s Office and OMB work very closely together. One thing that helped offset some revenue declines was the expected $1.3 million of casino revenue for 2012,” according to Landrum.
Property taxes are about the fourth largest source of revenue for the city of Middletown, behind income taxes, services and funds from state and other governments, said Russ Carolus, finance director. Middletown received in 2011 about $4.1 million in property tax revenues and has budgeted to receive about $3.7 million this year, a decline of nearly $387,000, according to Carolus. That’s more than the $180,245 drop the auditor estimates, in part because Middletown’s figures also include revenues from Warren County.
“It’s a little cut,” Carolus said. But it’s “one of many cuts.”
Hamilton should collect in 2012 about $255,000 less than 2011, according to the auditor’s office.
“That obviously is revenue that we don’t have to offset the expenditures of the city,” said Peg Bradner Hancock, finance director.
But looking for ways to increase revenues and cut expenses isn’t new.
“That’s not something the city is unfamiliar with,” she said.
The auditor calculates taxes that should be collected based on property values. Actually collections may vary due to delinquencies, according to Reynolds.
Contact this reporter at (513) 705-2551 or clevingston@coxohio.com.
About the Author