Fiscal Note & Local Impact Statement


124 th General Assembly of Ohio

Ohio Legislative Service Commission

77 South High Street, 9th Floor, Columbus, OH 43266-0342 ˛ Phone: (614) 466-3615

˛ Internet Web Site:


H.B. 198


May 6, 2001


As Introduced


Rep. Peterson






Requires delinquent property tax collections to be distributed among taxing districts in proportion to current tax rates, rather than the rates in effect while the taxes were outstanding


State Fiscal Highlights


·        No direct fiscal effect on the state.

Local Fiscal Highlights



FY 2000

FY 2001


Counties, School Districts, Municipalities, Townships, Special Districts


Potential Gain or Loss of up to many thousands of dollars

Potential Gain or Loss of up to many thousands of dollars

Potential Gain or Loss of up to many thousands of dollars


Minimal negligible decrease

Minimal negligible decrease

Minimal negligible decrease

Note: For most local governments, the fiscal year is the calendar year. The school district fiscal year is July 1 through June 30.


·        County Auditors will have a minimal negligible expenditure decrease.

·        Statewide, the effect will be close to revenue neutral due to the relatively constant statewide effective millage rate. But, at the individual tax district level, a significant revenue gain or loss could occur if current tax rates are substantially different than the tax rate during the delinquency period. Due to the very complex nature of Ohio’s tax districts and the unavailability of data, LBO did not forecast the possible district-by-district revenue losses.




Detailed Fiscal Analysis


Under current law, each taxing district is entitled to its proportionate share of that year’s delinquent property tax collection, minus a 5 percent county administration county cost. The proportionate share is determined in the year the taxes were due and is the percentage of the total tax collections that the district is entitled to relative to all other taxing districts that tax the same property. H.B. 195 proposes to distribute delinquent tax collections based on the current year’s proportionate share of tax collection instead of the proportion in the year of delinquency.


The fiscal impact of the bill will result in some tax districts receiving more or less revenue in comparison to the current distribution system. The State of Ohio has approximately 4,100 tax districts. These tax districts are not unique and therefore overlap, creating a much higher permutation of tax rates on individual parcels of property. Through calendar year 1999, approximately $888 million of property taxes are outstanding (see table below).


Calendar Year Ending 1999 County Delinquent Property Tax Amounts


Delinquent Tax Amount

Carroll, Defiance, Fulton, Gallia, Hardin, Highland, Holmes, Mercer, Monroe, Morgan, Noble, Paulding, Putnum, Van Wert, Vinton, Williams, Wyandot.

Less than $1 million

Adams, Ashland, Athens, Auglaize, Belmont, Brown, Champaign, Clinton, Coshocton, Crawford, Darke, Fairfield, Fayette, Guernsey, Hancock, Harrison, Henry, Hocking, Huron, Jackson, Knox, Lawrence, Logan, Madison, Marion, Meigs, Miami, Morrow, Ottawa, Perry, Pickaway, Pike, Preble, Ross, Sandusky, Scioto, Seneca, Shelby, Tuscarawas, Union, Washington, Wayne, Wood.

$1 million to $5 million

Allen, Ashtabula, Clark, Clermont, Columbiana, Delaware, Erie, Geauga, Greene, Licking,  Medina, Muskingum, Portage, Warren.

$5 million to $10 million


$10.7 million


$11.2 million


$11.6 million


$14.4 million


$20.1 million


$26.7 million


$34.8 million


$37.6 million


$49.1 million


$69.1 million


$69.4 million


$72.8 million


$73.2 million


$176.1 million




Given the cumulative history of the reported delinquent property tax data and the thousands of possible tax rates, LBO did not estimate the potential future fiscal impacts of redistributing delinquent property tax collections. The table below illustrates an example of how various taxing districts could be affected by this change.   In this example, a fire district had a 3-mill levy that was in effect when the taxes were charged, but not in effect in the year the taxes were collected. 



Tax District

Delinquency Amount Accumulated Over 4 Years

Original Tax Rate

Original Proportion

Original Revenue

Current Proportion

Current Revenue

Revenue Difference

Fire District


3 Mills






School District


43 Mills






Other Local Governments


14 Mills









The overall statewide impact will be close to revenue neutral due to the fact that the overall effective state millage rate has been fairly constant over the last several years. But, at the individual tax district level, revenue gains or losses could be more significant if the effective tax rates are significantly different from the period covered by the delinquency. Contingent on the amount of delinquent tax revenue, historical tax rates, and when a collection occurs, an individual tax district could experience an insignificant or significant delinquent property tax revenue gain or loss. A district with a relatively higher tax rate currently than during the delinquency period would receive more revenue and other districts would receive less. If a district had a relatively lower tax rate than now than during the delinquency period, then the district would receive less revenue than the current system and other districts would receive more revenues.


Delinquent property often has several years’ worth of delinquencies that are settled at one time. The proposed change would result in a slight decrease in administrative costs for county officials because of the need for less calculation than under the current method.




LSC fiscal staff:  Nickie Ringer, Economist