Am. Sub. H.B. 920 (1976) — Tax Reduction Factors
The single most consequential enactment in Ohio school finance, and the one least visible in the funding formula itself. H.B. 920 created the tax reduction factors codified at R.C. 319.301: as reappraisal raises the assessed value of existing real property, the effective millage of previously voted levies is reduced so that the levy yields approximately the same number of dollars it yielded when passed. verified
legislation/hb-920-1976 · 13 nodes point here
The consequence is that a district’s revenue from an existing levy does not grow with inflation or with rising property values. Growth comes only from new construction, from new levies, or from reaching the 20-mill floor below which reduction factors cannot push effective operating millage. verified A district whose costs rise with inflation must therefore return to its voters repeatedly simply to stand still, and districts whose voters say no fall behind in real terms without any decision by the General Assembly having been made. inference
This is the mechanism that produced the disparities DeRolph litigated. It is also why the 20-mill floor is a funding parameter and not merely a tax-administration detail: for the large number of districts sitting at the floor, valuation growth passes through to revenue directly, and the entire logic of H.B. 920 is suspended. 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 one legislative attempt to work around it was vetoed Contents
H.B. 66 of 2005 authorized districts to put to voters a property tax that would adjust 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 — a levy indexed to the loss rather than fixed in dollars. LSC’s analysis says what it was for in as many words: 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.”
The Governor vetoed it. verified the greenbook, committed at
crates/project/fixtures/lsc-education-greenbooks.txt
It is the only provision in this corpus that would have loosened the mechanism this node describes, and it never took effect — so it appears in no levy, no valuation and no enacted figure here. The reason to record it is that the absence of any workaround in the data reads as nobody having tried, and somebody did. inference
Properties Contents
| Designation | Am. Sub. H.B. 920 |
|---|---|
| General Assembly | 111th General Assembly |
| Signed | 1976-08-26 |
| Effective | 1976-11-24 |
| What it did | Established the tax reduction factor mechanism at R.C. 319.301, holding the dollar yield of voted millage on existing real property approximately constant across reappraisal, and set a floor below which effective operating millage for school districts may not be reduced. |
| Vetoes | None recorded. |
Where this appears on the site Contents
The pages outside the corpus that link here, and the section of each the link sits in.
Links Contents
| Instance of | Legislation |
|---|---|
| Constrains | Local Property Tax |
| Produces | Effective Operating Millage |
| Sets | Twenty-Mill Floor |
| Bears on | Equity |