Property Taxes: A Primer

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Many residents feel the weight of our property taxes. I get it—our family would love to pay less too.

But what can elected officials for the CITY do about it? Short answer: NOT MUCH. At least nothing immediately and directly.

Let’s break it down.

According to the most recent Cleveland Heights Comprehensive Annual Financial Report (2019 CAFR, page S12), and adding in new levies voted in last year, most Cleveland Heights property owners pay property taxes on around 444 millage.

What’s millage? Millage is $1 collected for property taxes for every $1,000 of your assessed property value.

What is assessed property value? In Ohio, the assessed value is 35% of the appraised value. So if your home’s appraised value is $166,500 (the median home price in Cleveland Heights), your assessed value is $58,275.

So let’s go back to that ~444 millage. The amount that goes to the city is 12.42 millage. The rest of the millage is for the public schools, the libraries, the county, Cleveland Metro Parks, Port Authority, and Cuyahoga Community College. So roughly 97% of our property taxes are not the city’s domain.

Of that 12.42 millage that goes to the city, 8.1 of it was voted in by the people (in 1976, 1997, 2004, and 2014), which means—for those who want to “cut” property taxes—it can’t be simply cut by a city elected official. The city’s 4.32 (~1% of your property taxes) inside millage—a tax levied without the vote of the people, which the state of Ohio allows up to 10 millage—goes to Fire and Police pensions, debt, and a small amount of operating expenses.

Will my property taxes balloon if my property value goes up? For the most part, NO. Most of the millage is not a fixed rate but instead set to collect a fixed overall dollar amount. For the fixed-dollar millage, as property values rise, the millage is actually adjusted downward so as to collect only the set dollar amount of the original levy. All of the city’s millage (about 3% of your property taxes) is a fixed rate, so it does rise with property values. All of the school district’s millage (about 77% of your property taxes) is set to a fixed dollar amount, so as property values rise, the amount collected remains the same and the actual millage is adjusted downward over time. The other taxing bodies are a combination of the two for different funds.

So how can we lower property taxes?!?! Basically, because most of the millage is set to collect a fixed amount, we can, over time, lower individuals’ property tax bill by easing the millage down and spreading the burden around. How do we do that?

1.     We come together to advocate for the state to fund public education thoroughly, as it is required by the state constitution to do.

The state’s system of funding public education has been ruled unconstitutional FOUR TIMES. The Fair School Funding Plan, which Republican State Senators are blocking, would, among other things:

  • increase the base cost per student, and more so for districts with higher numbers of students in poverty and students with special needs (like ours);
  • calculate the state-local funding ratio differently, factoring in income as well, which for Cleveland Heights, would very likely result in the state paying much more of this base cost; and
  • fund private school vouchers directly from the state.

It’s important to note that last year, EdChoice vouchers for private schools pulled almost $10 million from our district’s budget. That amount goes up each year, though it’s impossible to predict just how much it will rise, making budgeting and financial planning increasingly difficult. Each voucher takes about 2 to 3 times (depending on the grade level of the student receiving the voucher) the amount that state funding provides per student. Last year, vouchers took almost half of the state funding for our school district. That last levy that passed? That money isn’t going to the school district; it’s going through the school district.

2.     We attract new residents and homeowners to spread that fixed-dollar millage around more, lowering the amount that individuals see on their property tax bill.

How do we attract new residents? We make our city a place where more people would LOVE to LIVE.

  • Focus on improving quality of life—create more quality community green spaces; increase walkability; make room for safe bike lanes; invest in dynamic and diverse business districts; build community cohesion; and work to address poverty and other root causes of crime so as to increase public safety.
  • Support our schools—change the narrative by celebrating our schools’ successes and strengths, and come together as a community to fight for and win sufficient state public education funding.
  • Embrace and enact our values—truly be a city that is welcoming for all; invest in becoming sustainable, regenerative, and adaptive; identify and alleviate inequities wherever they may be.

As I said, I understand wanting lower property taxes. But we also need to understand WHAT our property taxes fund and HOW we can ease them down over time without sacrificing what our community needs.

What our city can do to ease down your property tax bill is:

  • advocate at the state level for public education funding reform, and
  • work toward a variety of programs and initiatives that will make our city more attractive and increase our population.

As your representative on City Council, I will continually advocate for our city and work to make it a dynamic, livable, welcoming place for all.