FAQ
Learn the basic terms and laws that govern school finance in the State of Ohio
Q: What is a mill?
A: Local tax rates collected on property are always calculated in mills. A mill is actually one-tenth of a penny. That really does not have much meaning to you since you do not have one-tenth of pennies in your pocket. When you multiply it out to get some meaning, a mill is 10 cents tax for every $100 worth of property value. But in reality, we are talking about millage rates taxed against your home, so let's base a mill on the value of $1.00 for every $1,000 worth of property value.
That means if your "assessed valuation" of your home (not the market value) is $20,000, then one mill of property tax would be $20.00. (Assessed valuation and your tax bill are discussed in another segment.)
There are three categories of mills- inside, outside and effective. Inside mills are unvoted mills that every property owner pays to support their local government agencies. This tax revenue is divided up between the schools, county and township.
Outside mills are any additional mills approved by a vote of the people.
Effective mills are what government agencies actually collect because of the House Bill 920 reduction. (House Bill 920 is explained at the bottom of the page.)
A: Market value is the price you would sell your real estate property for on the open market. The county auditor in each county has the responsibility of appraising all taxable real property in the county to determine its value. Every six years the auditor generally hires a firm specializing in this field to do the reappraisals. A representative of this firm will make an on-site inspection of all real property and make an estimate of the sale value of the property.
When taxes are calculated, they are not figured on the market value or the assessed value. The Ohio Supreme Court has declared that the same assessment rate must apply to all real property throughout the state. The Board of Tax Appeals has adopted a rule requiring that the assessed value be 35% of the sale value.
So, if your property has a market value of $100,000 and is assessed for tax purposes at 35% of market value, your property tax will taxed based on an assessed value of $35,000 ($100,000 x 35%=$35,000). You would pay taxes on only $35,000 even though you could sell the property for $100,000.
A: The Sunshine Law is part of the Ohio Revised Code that requires all acts and most deliberations of boards of education and other public bodies, as well as their committees and subcommittees, be conducted in public meetings. It was enacted in 1975. Basically it means that when a public body, such as the Board of Education or the City Council, wants to hold a meeting, they must announce the meeting date, time and place. The public is allowed to attend the meeting. However, the law does not give the public the right to participate in the meeting. At the school board meetings, there is always a public session and anyone attending the meeting is allowed to address the Board of Education. The Board of Education or other public body is allowed to go in to an executive session to discuss a certain list of topics. The reasons for an executive session to be held include anything that must be kept confidential by law, any matters concerning a specific employee or student, the purchase or sale of public property, conference with the Board's attorney or any pending court actions, specialized details of security arrangements, and preparation for, conducting or reviewing negotiations or bargaining
sessions with employees. As you can see, these things need to be discussed in private and could cause problems should the discussion and not the decisions appear in the newspaper before the proper parties were informed. No action can be taken in an executive session.
When a Board of Education or other public entity wants to have a special meeting, they must provide at least twenty-four hours notice to the news media. Any person who has previously requested a notice of time, place and purpose of the special meeting must also be notified. The Board of Education always notifies the local newspapers.
If the Sunshine Law is violated, any action taken in an illegal meeting is invalid. There could also be a financial penalty issued by the court if a suit alleging violation of the law is filed. The Sunshine Law was expanded in February, 1994, to cover committees and sub-committees of the public entity.
A: A school district operates, along with the state, on a fiscal year calendar. This year runs from July 1 through June 30. The fiscal year is referred to as FY 07-08 - meaning July 1 of 2007 through June 30, 2008. It is also called FY 08 using just the ending date of the year.
A: The school district financial records are audited annually by the State of Ohio Auditor's Office. The state auditors are generally on site three or four months and perform a complete financial audit. This includes actually checking bank reconciliations, revenue, purchase orders, grants, food service, athletics and payroll. They actually look at purchase orders, checks, reports, gate receipts, food service tapes, personnel time sheets and many other items. The audit reports are always available for public viewing at the Auditor of State's website. http://www.auditor.state.oh.us/
A performance audit is different and the focus is not on what we do but how we do it. These auditors check the procedures and policies we follow in handling school business.
A: House Bill 920 was passed in 1976 and was designed to save the taxpayers money on their voted tax millage (also referred to as "outside" mills). As your property value increases due to re-appraisals, HB 920 reduces the amount of mills you have to pay so that you are not paying more than the amount of revenue a levy was originally voted to collect. HB 920 does not allow tax levies to generate any more money that originally generated at the time a levy was passed.
For example, if a levy was passed that generated $100 and there were 10 tax payers in the community, each would have to pay $10 in taxes. If the community grew to 20 tax payers living there, each tax payer would only have to pay $5 because that would still total the $100 that the levy was voted to produce.
House Bill 920 is good for taxpayers but is bad for local governments. It restricts growth of tax revenue and does now allow for inflation.