LOVELAND, OHIO Below are the estimated savings of Governor Ted Strickland's proposed expanded homestead relief program for senior citizens. The figures are based on Estimated Median Home Value (EMHV) by School District compiled by the Ohio Department of Taxation.
Loveland School District: $175,000 (EMHV), 64.59 (Tax Rate) $3,343 (Current Tax), $2,865 (Tax after Proposed Exemption), $478 (Tax Savings), 114.3% (Tax Reduction).
Milford School District: $147,000 (EMHV), 58.939 (Tax Rate) $2,653 (Current Tax), $2,202 (Tax after Proposed Exemption), $451 (Tax Savings), 17.0% (Tax Reduction).
Little Miami School District: $148,000 (EMHV), 46.43 (Tax Rate) $2,104 (Current Tax), $1,749 (Tax after Proposed Exemption), $355 (Tax Savings), 116.9% (Tax Reduction).
The Governor's proposal would replace the current homestead exemption program with an exemption of $25,000 from the market value of a home for all owner-occupied homesteads, where the homeowner meets one of the following criteria:
- s age 65 or over
- is the spouse of a deceased homeowner who was 65 at the time of death
- is totally and permanently disabled
The income limits under the current homestead program would be eliminated under the Governor's proposal.
The new program is estimated to expand the number of homeowners being served by the homestead exemption program from 220,000 under the current program to about 775,000. On average, the proposed homestead exemption program will provide tax relief of more than $400 for each eligible homeowner according to the report.
Loveland Superintendent, Dr. Kevin Boys said, "Any property tax relief is a great thing for our senior or disabled citizens. I'm certain it can often be a challenge for our seniors on fixed incomes to vote for school levies even when they understand the need and importance of quality schools in their community.”
The figures show the estimated amount of the tax relief for a typical eligible homeowner in each school district, using the estimated median home value in each district. The estimates are for a homeowner who qualifies under the Governor's proposal but is not eligible for the current homestead exemption program. The tax rate that is used is the 2006 school tax rate plus the weighted average tax rate in each school district for non-schools (the tax rate for non-schools is generally not uniform within a school district because districts tend to be in multiple counties, townships, or municipalities).
The data shows the current property tax, the property tax after the $25,000 exemption, the net savings, and the percentage savings for a typical taxpayer in each school district. In general, the higher the tax rate, the greater the dollar savings to the homeowner. Conversely, in general, the lower the median home value, the higher the percentage reduction from the current tax.
As an example, the Department compared two school districts in Montgomery County, Dayton, and Oakwood. The tax rate in Oakwood is about seven mills higher than in Dayton, so the average property tax savings in Oakwood is $519 as compared to $462 in Dayton. However, since the median home value in Dayton is considerably lower than in Oakwood, the percentage of the current tax that is reduced is substantially higher in Dayton, 36 percent versus 13 percent.
(Source: Ohio Department of Taxation)
“As I travel Ohio I hear how this tax cut will truly benefit the lives of Ohioans, and I can tell it will make a meaningful difference for Ohio's senior citizens,” Strickland said. “This is truly an example of investing in what matters. By making sound fiscal decisions to fund current and future school building projects for Ohio's students we are also able to offer a tax cut for our seniors.”
Strickland's office said the proposal to expand the Homestead Tax Exemption will provide property tax relief for an estimated 775,000 homeowners - one of every four homeowners statewide, compared to only 220,000 who receive the benefit from the exemption today. “Expanding the Homestead Exemption will save senior citizen homeowners an average of $400 a year without impacting school districts.”
Strickland's proposal also eliminates income limits that currently apply. Otherwise, the program continues to benefit: (1) homeowners age 65 or over; (2) the spouse of a deceased homeowner who was 65 or over at the time of death; or (3) a homeowner who is totally and permanently disabled.
“The annual savings are significant for all senior homeowners but even more so for those living in the state's seven largest school districts,” Ohio Tax Commissioner Richard Levin said. “Based on the median value of a home in these districts, senior homeowners will see property tax cuts ranging from 26 percent to 61 percent.”
The Governor's office said the proposed expansion would have no impact on school district or local government revenues because the state will reimburse for the additional property tax relief, as it does now for the existing Homestead Exemption program.
Boys agreed that this particular proposal ensures that schools will be reimbursed for the exempt taxes, but added, “While that sounds reassuring, the reality in the Governor's budget proposal is that Loveland Schools is projected for a zero percent increase in state funding in spite of continued growth of our student population. So our actual funding for each pupil goes down.”
Boys also said, “While we applaud and support the Governor's tax relief for senior and disabled citizens, there is still much work to be done in this budget and in the way schools are funded in Ohio."
Boys noted that the proposed constitutional amendment for which signatures are now being collected by Getting It Right! For Ohio’s Future, includes the exemption of the first $40,000 market value for seniors as opposed to the Governor's plan, and overall, less reliance on property taxes for funding Ohio's schools. He said that now is “a good time for senior citizens to get involved in the debate about school funding.”
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