Am. Sub. H.B. 66 (2005) — FY2006-07 Budget; Tangible Personal Property Tax Phase-Out
The FY2006-07 operating budget, which phased out the tangible personal property tax on general business — machinery, equipment, inventory, furniture and fixtures — over four years beginning in tax year 2006, and separately phased down the assessment rate on electric and natural gas utility property. verified The tangible personal property tax had been a local property tax, levied on the same voted millage as real property, so its elimination removed part of the tax base out from under every district that had industrial or commercial property in it.
legislation/hb-66-2005 · 8 nodes point here
The act created replacement payments to hold districts harmless, funded from the new commercial activity tax. verified Those payments were not permanent: the reimbursement was scheduled to phase down, and subsequent budgets repeatedly revised the phase-down schedule. verified The result is a structural substitution — a locally-levied, locally-controlled revenue source replaced by a state appropriation subject to renegotiation every biennium — concentrated in exactly the districts with the most industrial property. inference
The per-district magnitude of the substitution and the current status of the phase-down are not established here. open
Properties
| Designation | Am. Sub. H.B. 66 |
|---|---|
| General Assembly | 126th General Assembly |
| Signed | 2005-06-30 |
| Effective | 2005-06-30 |
| When each part took effect | Two dates, and effective above carries the appropriation one. Signed 30 June 2005, with the appropriation sections effective then; the codified amendments took effect on 29 September 2005, and some provisions on other dates. verified LSC's enrolled analysis; the legislature's version index |
| What it did | Enacted the FY2006-07 operating budget. Phased out the tangible personal property tax on general business property beginning in tax year 2006, phased down utility tangible personal property assessment rates, created the commercial activity tax, and established replacement payments to school districts for the lost local tax base. |
| Vetoes | Six, and the first is the only attempt in this corpus to legislate around H.B. 920. verified the greenbook A levy that would have tracked the loss of state aid. The General Assembly authorized districts to put to voters a property tax that adjusts to offset year-to-year decreases in state funding caused by increases in the district's local share of base cost funding, capped at 4% growth a year. LSC says plainly what it was for: it "would have provided one way for districts to attempt to counteract the effect of H.B. 920 tax policy that limits revenue growth from existing real property." Vetoed. See H.B. 920, whose whole subject is that limit. Also vetoed: a prescribed method for calculating the limited English proficiency funding transferred to community schools, leaving the method to the department; a purpose statement for the post-secondary enrollment options program; specific reimbursement rates for the Early Learning Initiative, leaving them to Job and Family Services; a delayed effective date that would have kept test-scoring companies from personally identifiable student data until July 2006, so that the veto gave them access immediately; and a reduction of the Ohio Wyami Teacher Cohorts earmark from $1.5 million each year to $1.5 million across the biennium. |
| Effect on accountability | The act that built both of Ohio's rating-triggered consequences for a district, in forms the corpus holds only as their successors. It required the department to establish an academic distress commission for each academic emergency district that had failed adequate yearly progress four consecutive years, with authority over personnel, management and budgetary decisions; and it established the Educational Choice Scholarship Pilot Program for students in buildings in academic emergency three or more consecutive years, with an amount deducted from the resident district's state aid for each scholarship. verified greenbook LSC's final analysis places the commission at R.C. 3302.10 from July 2007 — the former section the current one supersedes — and adds sanctions ending in closure for academic watch and emergency community schools that miss expected gains, a bar on lowering a rating solely because one subgroup missed adequate yearly progress, and a rule letting the superintendent direct the building-blocks spending of watch and emergency districts. inference See Ohio report card. |
Where this appears on the site
The pages outside the corpus that link here, and the section of each the link sits in.
Links
| Instance of | Legislation |
|---|---|
| Constrains | Local Property Tax |
| Creates stream | Tangible Personal Property Tax Replacement Payments |
| Appropriates for | FY2006-2007 Biennium |