Ohio House Speaker Matt Huffman said Wednesday that several property tax-related bills have been making their way through a House tax-writing committee as Republicans put finishing touches on their version of the state budget bill.
He said the House Ways & Means Committee’s chair, Republican state Rep. Bill Roemer of Richfield, and its vice chair, Republican state Rep. David Thomas of Ashtabula County, have been airing out the bills while also doing the complex work of reviewing the state’s property tax system from top to bottom.
The state’s complex property tax formula, last updated in the late 1970s, is meant to prevent large unvoted tax increases. But it’s been strained by the recent surge in property tax prices. The result has been significantly larger tax bills for many voters across the state and a surge of grassroots voter anger.
“They’re working to unpeel the onion and do the easy things at the beginning,” Huffman, a Lima Republican, said Wednesday following Gov. Mike DeWine’s State of the State Address. “We need to be careful that we don’t have a giant upset of the system that we have and do things [where there are unintended consequences].”
He said the review won’t take just the current budget process, which is set to wrap up at the end of June, but the entire legislative session, which closes at the end of 2026.
“This is essentially a 30- or 40-year problem that’s been created,” Huffman said.
DeWine’s two-year, $69.1 billion budget bill is a vehicle for myriad policy proposals. But it currently doesn’t contain any property tax changes.
Democrats on Wednesday renewed their criticism that the governor’s budget bill shows that Republicans continue to neglect the issue, which lawmakers commonly describe as the thing they hear most from the public about.
“It is a complicated issue,” said state Sen. Hearcel Craig, a Columbus Democrat who’s co-sponsored several pieces of property tax legislation. “But the truth of the matter is, that does not negate us as a legislature for finding sensible, reasonable and effective solutions to that issue.”
Beyond budget hearings
The legislative process for DeWine’s budget bill is approaching a crossroads. Friday is the deadline for any changes to DeWine’s budget plan following weeks of budget hearings. Republicans then are expected to unveil their revised budget plan on April 1.
Once the House proposes and approves its plan, it would go to the state Senate for review before heading to DeWine’s desk for his signature. State law requires a budget be approved by June 30.
Meanwhile, the House Ways & Means Committee has been holding its own meetings. While lawmakers have introduced around a dozen property-tax related bills, three have received multiple public hearings recently.
What’s in proposed property-tax related bills being discussed at the Statehouse?
The first bill is House Bill 22, which would create a new “homestead” property tax break for the spouses of military members who were killed in the line of duty. This proposed exemption in essence would make the military widow’s home completely tax-free until they remarry or move in with someone who isn’t a direct relative.
The proposal is similar to existing homestead exemptions for widows of disabled military members or first responders who died in the line of duty. The measure would reimburse local schools for any lost tax revenues, which would cost the state $3 million, according to an estimate by the legislature’s research office, the Legislative Service Commission.
The second tax bill being discussed is House Bill 40, which is another military-related homestead exemption proposal. This would make up to $100,000 of a totally disabled military veteran’s home exempt from property taxes, compared to the current $56,000. A veteran only could qualify if they make less than $125,000.
The LSC estimates the bill would cost the state nearly $8 million a year in reimbursements to local governments.
One proposal would block local governments from asking for replacement levies
The most controversial and wide-ranging proposal is House Bill 28, which would forbid local governments from asking voters to approve what’s called a “replacement” levy. The measure has drawn support from business and anti-tax groups. It’s also drawing opposition from local governments, which say the bill will make it harder for them to get the funding they need.
A renewal levy often appears on local ballots to support such things as police and fire services or school operations. When supported by voters, they do not result in changes to local property owners’ tax bills. That’s one reason such levies almost always pass.
The complexities of Ohio’s property tax system also allow local governments to seek what is called a replacement levy. Though the two options sound similar, they are not.
A replacement levy almost certainly would make property owners’ taxes go up – while bringing in more funding for the local government requesting it. State research shows renewals are statistically more likely to pass than a request for an explicitly new tax, even though both result in a tax increase.
Arguments for and against House Bill 28 affecting replacement levies
HB28’s sponsors, Republican state Reps. Adam Mathews of Lebanon and Thomas Hall of Butler County, say the change would bring more transparency to the tax levy process. Voters often don’t realize the difference between renewal and replacement levies and how each would affect their actual tax bill, the pair said in written sponsor testimony.
“This simple fix to the property tax system will increase local control of property taxes and put more control with the voters where it belongs,” they said.
Those testifying against the proposal include groups representing cities, townships, fire departments, park districts, libraries, schools and other local governments that receive property taxes. They all argued the change could destabilize the finances for local governments, which already are struggling to get voters to approve tax levies they say they need to meet rising personnel and equipment costs.
“Eliminating replacement levies would remove a vital option for communities like mine and leave departments with few alternatives — either pursuing higher millage rates, which are increasingly difficult to pass, or facing dangerous funding shortfalls,” said Joseph Kitchen, chief of the Bath Township Fire Department in Allen County and president of the Ohio Fire Chiefs’ Association.
But Kitchen and others also concede that the term “replacement” may not clearly convey to voters that approving one likely would make their taxes go up.
“A replacement is sometimes more easily digested, maybe it feels a little better,” Kitchen said during a Wednesday committee hearing. “We might be lost in the semantics of it.”
A Legislative Service Commission analysis suggests that eliminating replacement levies may make it harder for local governments to pass levies.
Across the state in 2024, 91% of renewal levies passed. In contrast, 75% of replacement levies passed. A smaller amount yet, 49%, of new levies passed.
What the tax committee’s chair says
In an interview, Roemer said the bills getting multiple hearings are priority bills for his committee. He said he hopes some sort of homestead exemption bill will end up in the state budget.
Roemer said the bill eliminating replacement levies is a priority for him too, despite the opposition from local governments.
He said a replacement levy’s chances of passing aren’t that much different than a renewal levy’s chances.
“It’s a slightly harder sell. But it’s massively more transparent,” Roemer said.