The corpus › Formula Component

Charge-Off Local Share

The mechanism by which Ohio decided, for roughly three decades, how much of a district’s cost the district itself should bear. It multiplies a statutory millage rate by the district’s recognized valuation — a base that defers the inflationary increase in carryover real property over three years and so sits below total taxable value — and subtracts the product from the district’s computed cost; the state pays what remains. verified

formula-component/charge-off-local-share · 8 nodes point here · 2 corrections

Its defect is an assumption. The charge-off treats the statutory millage as revenue the district can raise, but under H.B. 920 a district’s effective operating millage is reduced as valuation rises, so many districts could not levy at the assumed rate against the assumed base. verified A district was charged off against money it did not receive — the phenomenon known in Ohio practice as phantom revenue, which shows up as an unexplained shortfall between what the formula says a district should have and what it actually has. verified

The mechanism is also blind to income. Assessed valuation alone treats a district with expensive housing and modest household earnings as wealthy, and asks its residents to pay accordingly. Replacing that assumption is the specific thing FSFP Local Capacity Measure was built to do.

And the charge-off had no floor Contents

A minimum state share is a Fair School Funding Plan invention; the charge-off simply truncated at zero. Ohio’s answer at the time was the charge-off supplement — gap aid — which reimbursed phantom revenue at about $73.5 million across 145 districts in FY2008, rather than a floor. verified

What this repository computed Contents

Not what Ohio publishes. Figures derived here from committed fixtures, each one citing the test that reproduces it.

The blindness, measured, running both ways Contents

verified crates/regime-diff, holding the Fair School Funding Plan’s own FY2027 base cost fixed and substituting only the local share mechanism, with the charge-off run against recognized valuation at TY2024

Ottawa Hills Local     valuation/pupil  $176,195   (below the state's 40th percentile)
  23-mill charge-off      $3,402.39/pupil
  FSFP local capacity     $6,845.07/pupil          +101%
  base cost aid            $4,963.03 -> $1,520.35

Jefferson Township Local  valuation/pupil  $513,389
  23-mill charge-off     $11,157.75/pupil
  FSFP local capacity     $8,714.77/pupil          -22%
  base cost aid            $2,682.75 -> $5,125.73

Ottawa Hills is a high-income district of unremarkable assessed valuation, and a property-only measure sees an ordinary district. Jefferson Township is the reverse. The mechanism the charge-off treated as the richer of the two is the one local capacity treats as poorer, and that disagreement is the substance of the reform rather than an artifact of two districts. verified

Statewide the change of mechanism is not one-sided, and it does not run in the plan’s favor: at FY2027 base cost, 316 of 606 districts would have done better under the charge-off and 290 do better under local capacity, and the median district is $45 per pupil worse off under the plan. verified

65 of 606 districts would have a 23-mill charge-off exceeding their entire FY2027 computed base cost and would receive no base cost aid at all. verified

The size of that comparison is a TY2024 answer Contents

Recognized valuation defers most where a reappraisal was largest, and Ohio’s TY2023-24 revaluation cycle was extraordinary: the statewide deferral is 8.20% of taxable value where the Legislative Service Commission put the long-run effect nearer 2%. The statewide margin above would be narrower in an ordinary year, and narrow enough to change hands. What does not depend on the year is the sign of the base error: total taxable value always overstates the charge-off, so any comparison run against it flatters the mechanism that replaced it. verified

Properties Contents

NameCharge-off local share
Calculation
local share=charge-off millage×district recognized valuationstate aid=computed cost−local share\begin{aligned} \text{local share} &= \text{charge-off millage} \times \text{district recognized valuation} \\ \text{state aid} &= \text{computed cost} - \text{local share} \end{aligned}
Statutory basisR.C. 3317.022, with the rate set by biennial session law. The 1991-1997 progression is recited with its Ohio Laws citations at DeRolph I, paragraph 97. Ohio Laws' online version archive for the section begins at 1 July 2014, after the mechanism was retired, so the operative text for the charge-off era is not retrievable from codes.ohio.gov.
Calculatorregime-diff (computes the local share and differences it against FSFP local capacity); millage supplies effective millage inputs.

What this node used to say Contents

The corpus is not rewritten to have always been right. Each entry is a claim this node carried, what replaced it, and the thing that settled it.

Correction 1 of 2

It said

The charge-off was described, here and in its function, as a statutory millage against the district’s total assessed valuation.

It says

Its base is recognized valuation, which defers a district’s inflationary increase in carryover real property over three years and is therefore smaller. The rate never moved; the thing it multiplied did. verified

Settled by

The Legislative Service Commission’s description of the charge-off as it operated in FY2008, set against DeRolph I’s description of it in 1997. Reconstructed per district in crates/regime-diff/src/recognized_valuation.rs.

What else it touched

Every figure in findings: was computed against the wrong base, and every one of them moved.

Correction 2 of 2

It said

“413 of 606 districts do better under local capacity and 193 would have done better under the charge-off”, with 81 districts zeroed, every valuation quintile better off under the plan, and Ottawa Hills charged 69% more against Jefferson Township’s 26% less.

It says

316 would have done better under the charge-off against 290 under the plan, the median district is $45 per pupil worse off under it, 65 districts are zeroed, and Ottawa Hills is charged 101% more against Jefferson Township’s 22% less. Only the wealthiest quintile still gains.

Settled by

Re-running the counterfactual on recognized valuation: crates/regime-diff/tests/the_charge_off_against_local_capacity.rs, which pins both the corrected figures and the superseded ones.

What else it touched

The sign of the headline comparison reversed. The corrected run landed in crates/regime-diff and in Local Share Charge-Off Millage but not here, so this node published the superseded run under [verified] in the interval.