Community Education - Property Taxes

As the Elected County Treasurer, I seldom post on social media.  However, I have been monitoring the content of the conversations related to Property Taxes here locally which are predominantly about Marysville Schools and Union County Property Taxes.  Because many people are following the conversation and because it involves a New Levy, I believe it’s important that the readers and those posting comments have a general understanding of how property taxes are calculated and applied in Ohio and locally, as such I have chosen to provide this information to the public on the Union County Ohio Treasurers website.  

For the purpose of discussion, the terms “Real Estate Tax” and “Property Tax” will be used synonymously.

Some basic definitions which are commonly discussed among parties (only a brief summary):

Property Type - Class I, II, and Public Utility.  As described here class I (residential and Agricultural) & II (Commercial and Industrial) are subject to the calculation of effective rates when applied to fixed rate levies (discussed below).   The rates for each class are calculated separately.  Public Utility Valuation is completed at the state level, and this class pays the full voted rate.
Valuation - Market value assigned to a parcel of land, and the improvements as calculated by the County Assessor or County Auditor; usually considered Fari Market Value (or what a property would sell for on the open market) is the assessed value.
Tax Value -  As established by the Legislature, the tax value is 35% of the assessed value.   Taxes are calculated on the “assessed value times 35%.
Millage - (Mil’s) A mil is $1 of tax on $1000 of tax valuation.
Inside Millage - 1% or 10mils of the taxable value of R/E.
Outside Millage - Voted Millage, exceeding the 10 mils in State of Ohio Constitution.
Effective Millage - The mils actually applied to property Inside millage + section 920 adjusted mils for fixed rate levies.
CAUV - (current agricultural use valuation) This is based on the income producing ability of each soil type in Ohio.  It is calculated by the State of Ohio per acre of land in agricultural use.
Public Utility - The State of Ohio provides the value for utilities in Union County.  The value is derived using different appraisal methodologies than for real property.
Tax Exempt - No R/E tax is applied to fully exempt property such as churches. The exemption must be applied for and in the vast majority of cases decided by the Ohio Tax Commissioner.
TIF - (Tax Increment Financing) Is a way to divert property taxes paid on the improved portion of a parcel to other uses.  Taxes are paid but disbursed per the legal agreement governing the use of those revenues.  Frequently they are sent to the jurisdiction putting the TIF in place (i.e. the City of Marysville).  A TIF can vary in number of years and % applied.
Abatements - The reduction or elimination of R/E taxes on a specific property/parcel.  The reduction can be up to 100% depending on the approved agreement and determination by the State Tax Commissioner.

Some basic facts related to online discussion:

1. 2025 is a revaluation year -  The County Auditor is required by law to reassess every parcel in the county once every 6 years with a physical observation and revaluation.
2. Inside millage (mils) – The inside millage is set by the Ohio Constitution at 1% or 10 mils of the Tax Value.
3. Outside Millage (mils) -  The millage that has been voted and approved by a majority of voters in a political subdivision.  
4. Ohio Revised Code Section 920 – An attempt to negate the impact of inflationary pressures on property values was passed by the legislature in 1976.  It requires the State Tax Commissioner to adjust the “effective” tax rates on existing R/E so a taxing district would NOT receive a windfall as a result of R/E inflation.
5. 20 Mil Floor – A revision by the legislature in 1977 that intended to provide a minimum level of funding for schools equal to 20 mils for operations.  The following levies are excluded from the calculation of the 20 mil floor:  1) Bond levies, 2) Permanent Improvement levies, 3) Substitution levies, 4) Income Taxes, and 5) Emergency levies.
6. TIF’s – (TIF’s and Abatements are not the same thing) Property taxes are still paid on parcels in a TIF district.  However, the distribution of the tax revenue does not go to the entities that normally get the funds.  The funds go to the political subdivision that authorized the TIF.
7. Real Estate Taxes are paid in arrears – This means that in 2025 you are paying taxes related to 2024 that became due on 1/1/2025.  Taxes related to revised values and millage in 2025 will become due on 1/1/2026 (note – the taxes are broken into 2 equal payments due in February and July in Union County).
8. Rental units including Apartments – All real property and improvements unless exempt or abated pay R/E taxes.  The rate depends on the property class.  Rental units with more than 4 units considered commercial or class II and taxed as class II effective rates which are frequently higher than class I or residential units with less than 4 units.

With the above information, let’s get to the conversation that is presently taking place regarding Real Estate/Property taxes.  The questions and comments below are neither FOR or AGAINST an approval of an additional property tax levy which will appear on the ballot for May 6, 2025 special election for the Marysville Exempted School District.  It is intended to educate the public so as to make sound decisions based on accurate information.

Are assessed values for property in the Marysville School District and Union County going up, down, or staying the same? The answer is: It is unknown by the County Assessor/Auditor at this time.   The values will not be known until later in the Summer of 2025.  Consult reliable sources to get an indicator as we cannot provide information that has not been tabulated at this point.

Will your taxes go up down or stay the same?  The answer is dependent on the changes in value and whether we are discussing “Inside” or “voted” Millage.  Since most tax levies are fixed rate levies, a big increase in values won’t automatically have a corresponding increase in related taxes.  Inside millage will trigger a change in taxes based on changes in value, but overall section 920 will keep most of the increases in check or could result in an overall decrease in fixed value levies across the county other than school districts.  As a note, all 3 school districts fully contained within Union County are at the 20 mil floor.

What does being at the 20 mil floor mean?  As noted, the Ohio Constitution allows for 10 mils of inside millage for all entities within a county; all other property tax levies must be voter approved.  The 10 mils and the related taxes increase or decrease with the tax value of property (assessed value x 35%).  However, in 1977 the legislature established a minimum funding level for school districts.  The minimum funding level was set at 20 mils for operating levies.  Once a School District reaches the 20 mil floor, the operating levies act like inside millage.
 
So what does that mean for your overall property taxes for properties in the Marysville School District? It means that if property values rise your school taxes will rise on the 20 mil floor portion.  If values fall your taxes will likely go down.

IF approved, what will the 5.5mill levy do to your property taxes? The 5.5mil will apply to the 2025 R/E values once finalized by the County Auditor.  Individuals referencing the Auditors website for the calculation of the taxes increase tied to the 5.5 mil levy request should understand that the Auditors site is displaying only 2024 values.  Ohio Law requires the Auditor to provide the certified values.  Since 2025 values are not available, the only data permissible are the 2024 values.

How can I calculate my Property Taxes Related to Marysville Schools? There are 2 questions in one here:  1) how much will the 5.5 Mils cost,  2) how will I be impacted because of the 20mil floor.  Below is a simple formula for you to use.  Remember there may be a decrease on levies outside the 20 mil floor that can’t be calculated at this time.

Calculate my Taxes:  The County Auditor’s website includes a calculation tool based on present tax values and impact of 5.5mil. However, the calculator does NOT calculate the impact of the 2025 value changes on current levies or the 20 mil floor)

As the Union County Treasurer, I would encourage individuals who are interested in further information to contact myself or the Union County Auditor.  Remember, we cannot venture to “guess” what your “assessed” and “taxable” values will be in 2025.  You will need to make that determination on your own.  The above information is a guide to calculate the impact of your calculation if you choose to do so.