Potential tax hikes challenge local leaders

Government officials are usually loath to raise taxes. That's typically the case even when tax increases are necessary to maintain government services or to tackle needed capital improvements. Partly that's because politicians recognize that tax increases are unpopular with the public, even if the services they pay for are popular. And taxes seem even more unpopular than usual right now in Ohio, particularly when it comes to property taxes. It's an understandable reaction to rising property taxes, which are driven by rising property values. For example, on average Lorain County residential property values increased by 31 percent when county Auditor Craig Snodgrass conducted a mandatory sexennial reappraisal last year. Even if an individual homeowner's property taxes didn't go up quite that much, most folks still felt the pinch when their tax bills arrived. Those higher bills have created headaches for local officials, who must decide whether they should ask voters to raise taxes. It's a decision that plenty of county and municipal officials have been wrestling with in recent weeks as the August deadline to get issues on the November ballot draws near. North Ridgeville, which could hit deficit spending as early as 2027, is considering asking voters to approve raising the city's income tax rate from 1 percent to 1.75 percent. That would generate about $6.3 million annually. "The city is at the point now," Mayor Kevin Corcoran told City Council on Monday, "just like with most other entities, that we're seeing costs have gone up and we're trying to figure out how to keep the city afloat in the future." Likewise, the county commissioners, facing a potential budget deficit of between $5 million and $7 million next year, are considering asking voters to approve a 0.25 percent sales-tax increase. Although the $14 million that it would generate would be devoted to the county Sheriff's Office, it would free up county money for other uses. We suspect both North Ridgeville and the commissioners will roll the dice and hope that voters agree that the extra revenue is necessary. On the other end of the spectrum was Sheffield Lake, where City Council on Tuesday rejected a plan to ask voters to replace two permanent levies that support the city's Fire and Police departments respectively. The 1.74-mill levies have been in place since 1997, with each one generating almost $192,000 annually based on property values from nearly 30 years ago. Replacing the levies would have allowed the city to use current property values and collect almost $466,000 annually, better setting up the departments to pay for equipment and staffing. Sheffield Lake appears to be in decent financial shape, so the plan to replace the levies seems to have been proactive rather than reactive. Councilman Romolo DeBottis, who voted against the putting the replacement levies on the ballot, said a majority of voters he talked to were opposed to them. "We have proud residents that have made tremendous sacrifices over the years to live in this great city," he said. "Some of them are generational, and have been here many, many years. I feel the citizens of my ward have spoken to me." It was an understandable position to take, but by declining to put the replacements before voters now, the city might have endangered its chance to do so in the future. Among the provisions Ohio Gov. Mike DeWine correctly vetoed in the state's recently passed biennial budget was one that would prevent local governments from replacing levies in the future. The Ohio House, controlled by DeWine's fellow Republicans, voted this week to override the governor's veto. The Senate, also dominated by the GOP, has yet to act. Additionally, as most consumers know, the longer you wait to buy something, the more expensive it tends to become. The same logic applies to purchases that governments make. Say in a few years that Sheffield Lake does find itself facing a looming budget deficit like North Ridgeville or the county. Officials might need to ask for more money. Absent the authority to seek replacement levies, they might have to ask voters to approve new levies, which tend to be a harder sell. Or, if they wait until after the county's triennial review of property values, scheduled to take place in 2027, they might find property values have increased, which might make it even harder to sell new levies. Snodgrass told us that unlike with last year's sexennial review, the Ohio Department of Taxation will send him a letter in 2027 that says how much it expects the county's property values to change. (In 2021, he said, the state ordered the county's property values to increase by 16 percent.) Based on the past 14 months of residential property sales, he said, it appeared the state might demand that values rise again. Looming over all of this are various efforts to change how Ohio handles property taxes. DeWine has convened a working group on the topic, but who knows what will come out of that? We also worry that the state legislature's relentless drive to slash the state income tax at the expense of public schools and other local governments will eventually lead to more local political entities asking voters to approve more taxes to make up for lost revenue. Even worse is an ill-conceived proposal to amend the state Constitution to ban all property taxes. "I don't think you've ever had more uncertainty than we do now," Snodgrass said of the future of property taxes and tax revenue. That uncertainty might be the only certainty when it comes to property taxes these days.