County commissioners across southwest Ohio have been handed a tax break they can choose to give — and a bill they would have to absorb to give it. A provision in Ohio’s recently passed state budget empowers county commissioners to double certain property tax exemptions for homeowners using local dollars, and none of the region’s counties has acted on it yet, the Dayton Daily News reported.
The authority covers two existing breaks: the Homestead exemption for eligible homeowners and the state’s 2.5 percent owner-occupancy credit. Doubling them locally would put real money back in homeowners’ pockets, but the cost would land on the schools, counties, cities, villages and townships that share the property tax base, according to the Daily News.
The scale in southwest Ohio is significant. Collectively, five counties — Butler, Greene, Miami, Montgomery and Warren — could provide $40.4 million in additional Homestead exemptions and $33.6 million for the owner-occupancy tax credit, according to calculations by the Dayton Daily News using information obtained from county auditors.
Montgomery County shows the trade-off most sharply. Auditor Karl Keith told the Dayton Daily News that if his county’s commissioners approved the piggyback credits, the combined revenue loss would be roughly $32 million — about $18.2 million of it to schools, $5 million to the county itself and $4.7 million to cities, villages and townships. Centerville schools, Dayton Public Schools and Kettering schools would see the greatest losses, and the biggest single cut in the county would fall on human services, Keith said.
“Our county is faced with a difficult decision,” Keith told the Dayton Daily News. “The same families who need tax relief are also the ones who rely on the essential local services that could be impacted, like police and fire, human services and public schools.”
So far, the new tool sits unused. Given how novel the approach is, none of the counties has taken action on the tax break, the Daily News reported, and in Montgomery County the subject has not yet reached the commission table. Commissioner Mary McDonald told the Dayton Daily News the board hasn’t discussed the issue yet, but that “it is very much worth having the conversation.”
The local debate is unfolding inside a larger statehouse argument over property taxes, where former Ashtabula County auditor Rep. David Thomas was tapped by House leadership to lead reform efforts, and a constitutional amendment question could be placed before statewide voters next year, the Daily News reported. What happens next is up to each board of county commissioners: any of the five southwest Ohio counties could take up the piggyback exemptions in the coming months, and the first one to do so will have to show both the relief and the cuts side by side.