Governor Vetoes Tax Break For Wealthy Taxpayers Added Late To Budget
One of Gov. Mike DeWine’s 25 vetoes on the state budget struck a provision that was added at the last minute – a property tax reduction for certain homeowners in one wealthy school district, but not others.
Hunting Valley is a village of 700 people just east of the outerbelt around Cleveland. It’s one of the wealthiest communities in the country. And it’s one of four communities in the Orange City Schools district, but only 25 kids from Hunting Valley go to Orange.
“They didn't particularly want to have to pay for public school education of students because they don't have a lot of kids that go to public school. Most of their students in their area go to private schools,” said Rep. Juanita Brent (D-Cleveland).
Brent’s House district doesn’t include Hunting Valley but does include some of the other communities in the Orange school district. Brent announced on the House floor that she was voting against the budget because of that amendment, which was added in the conference committee.
Senate Finance Committee chair Matt Dolan (R-Chagrin Falls), who co-chaired the conference committee, admits he helped to author the amendment. Hunting Valley is in his district, and he says those residents are in a unique position.
“They pay $212,000 per student. Orange, which is a great school system, expends $20,000 per student,” Dolan said.
Dolan said the amendment would have capped property tax bills in districts that spend at least $20,000 for each student. The average district in Ohio spends about $11,000 per student.
The amendment language specifiesthe property must be in both a village and a school district of at least 1,300 students, and that property taxes would be capped at four times what the school district expended for each student.
An analysis by legislative researchers said it would cost affected school districts up to millions in tax revenue, but the data limited them in estimating how much.
Brent uses $5.8 million as the amount the district would lose – that’s the estimate of the Orange schools treasurer. But Dolan disagrees, saying the village treasurer estimates it would add up to $3 million, and a new development would make up for that.
Brent said that’s still too much.
“That's a lot of money that's offset. Our schools are not set up to be able to offset that much money. That's too much is at stake. And if he wanted to put in his amendment he should talk to the community about this and get some community input. You don't just make decisions. I represent my people. I don't represent myself,” Brent said.
Dolan said this situation has been discussed locally for years, and that the amendment was crafted so that it would affect only Hunting Valley and Orange City Schools, and no other communities and districts. But he admitted the last minute add-in of amendments not previously passed by either the House or Senate isn’t usually done.
“Fair point. There are a number of provisions in both budgets that dealt with local property taxes as it relates to school systems. So while this obviously is unique to Hunting Valley and Orange, it is consistent with the many tax local tax property issues that were discussed in the budget,” Dolan said.
Brent is frustrated with what she feels is the overall idea behind the amendment.
“It was a jab to really only benefit a certain particular group of people who have, who don’t care about public education….but that’s not how the system works. I went to private school for the majority of my life, and my family always paid their property tax. They always supported a school levy regardless of [whether] I was in a public school or not,” Brent said.
But Dolan said this was simply a tax fairness plan.
“I had no intentions of hurting Orange schools,” Dolan said. “In fact, the other veto that the governor did have on one of my amendments would have would have helped Orange schools tremendously and other schools in northeast Ohio, and that got vetoed. So that was to me that was more disappointing than this other one on schools could greatly benefit from my amendment.”
That’s an amendment that would have guaranteed about three dozen public school districts would get at least the same per-pupil state aid as private schools. DeWine vetoed it, saying it would benefit the wealthiest districts.
Dolan said he’s not sure the Hunting Valley proposal will come up again in the legislature. But it certainly seems possible. Several residents are big political donors, and one hosted a fundraiser for President Trump the weekend before the budget deal was done.