Success Stories

Ohio REALTORS® Back Legislation to Overturn Unfair Property Valuation System

November 2022

With help from an Issues Mobilization Grant from the REALTOR® Party, Ohio REALTORS® and a coalition of like-minded partners convinced lawmakers to reform the state’s property valuation system – one which, unique in the country, allowed third parties to challenge the value of another’s residential or commercial property for tax purposes.

In an odd legislative anomaly, a law in Ohio allowed a third party within the same county to file challenges against another person’s property values without prior notice.  As a result, a sizeable cottage industry developed among attorneys retained by school districts, whose budgets depend on property taxes.  To protect the state’s residential and commercial property owners, and to revive its business climate – which had been downgraded by the Council on State Taxation because of this rampant practice – Ohio REALTORS® helped form a coalition that pushed long-sought tax reforms across the finish line.

As Ohio REALTORS®’ Government Affairs Director, Beth Wanless, explains, “This has been a priority for us for some time, and last year we recognized that the climate was finally right for a major strategic effort.”  With backing from an Issues Mobilization Grant from the REALTOR® Party, the REALTORS® banded together with like-minded partners to hire an expert tax law firm, one of whose managing members is a former Ohio Tax Commissioner.  “One of the important tasks they took on was researching how vastly our existing statute diverged from those of other states,” notes Wanless.  These findings made their way into speaking points that coalition members used in their lobbying efforts.

In February, Ohio REALTORS® held a webinar for members to learn the facts about the state’s tax valuation system, the only one in the country allowing for such wide-spread abuse.  It was well-attended, reports Wanless, and proved to be a real eye-opener, even for seasoned REALTORS®.  “Understandably, there had been confusion, because, of course, we want to fund schools in our communities, and in fact, Ohio REALTORS® has spent nearly $60K supporting school levies in recent years.  But when the tax vulnerability of our state’s commercial and residential property owners was made clear to them, she continues, “The response was: ‘Oh wow– this is bananas!’”  As the coalition and its consultants worked with state officials to pass the reform legislation, their efforts were buoyed by these enlightened members reaching out to the governor’s office and to state legislators, in support of the new bill.

In April, the governor signed Substitute House Bill 126 into law, protecting new and existing property owners in Ohio from rampant arbitrary challenges to their property values.  Among other provisions, it requires challenges to be made at a public meeting, and only if the property in question meets several specific requirements; it also establishes a system of appealing such challenges, with the assurance of a prompt decision.

“It’s a huge victory,” states Wanless.  “Our members are really happy about this.  These reforms make Ohio’s tax valuation system reasonable and fair, and consistent with those of other states.  In the few months since the old law was overturned, she reports, property investors have been returning to the Ohio market.  “Between this predatory tax practice and the threat of rent control that we helped to pre-empt earlier this year, investors had been leery; but now that the state is not going to be able to tell them how much rent they can charge, and they’re not at risk of getting random property valuation increases, they’re feeling more secure with the certainty of property valuation!”

To learn more about how OHIO REALTORS® is making the state more hospitable to homeowners and property investors, contact Beth Wanless, Director of Government Affairs, at wanless@ohiorealtors.org or 614.327.8308.

 

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