The long simmering dissatisfaction with Ohio’s real property tax system finally boiled over this year, resulting in Gov. Mike DeWine and the Ohio legislature (136th General Assembly) enacting a package of tax reform measures prior to the Christmas holiday break.
Some state legislators have opined that this year’s reforms are the most significant since the enactment of HB 920 (111th General Assembly) in 1976, which prevented most real property tax rates from growing with valuation increases. Some even suggest that this might be the most meaningful package of real property tax protections for taxpayers in nearly a century.
With additional legislative real property tax proposals pending for 2026, and with a citizens group continuing to collect signatures for a ballot issue, Ohioans are likely to hear a lot more about this topic during the remainder of the 136th General Assembly.
Initiated Constitutional Amendment
A private group known as Citizens For Property Tax Reform continues to crisscross the state collecting signatures for a constitutional amendment to ban real property tax outright in Ohio. CFPTR Website Their proposal would repeal all real property taxes, residential (Class I) and commercial (Class II), in Ohio on the first day of the calendar year following voter approval. The proposal does not alter how public utilities in Ohio pay the Tangible Personal Property Tax (TPP). The ballot language contains no provision for replacement revenue or budget reductions, leaving those decisions up to the General Assembly and/or local government officials with authority to levy other types of taxes and alter public expenditures.
Budget Bill Reforms, Vetoes, and Veto Overrides
The Ohio General Assembly had included multiple real property tax reforms in its version of the state’s biennial operating budget. HB 96 Budget Those proposals were line-item vetoed by Gov. DeWine. {Please see our earlier BUZZ Prop Tax Reform Vetoed for more details.}
Some majority caucus legislators in each chamber called for veto override votes. As of December 2025, veto Item 66 which repeals several types of real property tax levy options was overridden. The effect of that vetoed item becoming law over the objections of the Governor is that most replacement levies for political subdivisions and emergency, substitute, and combined property/income tax levies for school districts will no longer be allowed prospectively. The other line-item vetoes concerning real property taxes – Items 55, 63, and 65 – remain under consideration for override. Those items cover County Budget Commission authority, cash carry-over balance limits for school districts seeking property tax levies, and counting property tax levies towards school districts’ 20-mill floor calculations, respectively.
Veto overrides may occur at any point of the General Assembly, so they could be pursued through December 31, 2026. HB 96 Veto Message
However, the General Assembly, continuing its reform efforts after a report from a specially appointed gubernatorial study group (PTWG 2025 Report), did pass several stand-alone bills. The bills also contained provisions which had been recommended by a legislative study group from the prior General Assembly (Joint Committee Report 2024)
The Bills That Passed
- HB 124 (D. Thomas & T. Hall) – Modifies the Process for Property Tax Sales-Assessment Ratio Studies.
- According to the bill’s sponsors, this “flips the script” on the valuation process to put more control at the county auditor level rather than the Ohio Department of Taxation (ODT) level. This is achieved by requiring ODT to consider only a representative sample of arm’s length property sales submitted by county auditors when ODT adjusts/equalizes proposed property values. The stated goal is to prevent inaccurate valuations which could be unduly burdensome to real property owners, thereby increasing their tax bills.
- HB 129 (D. Thomas) – Modifies the calculation of the 20-mill floor that provided school districts with inflationary growth from assessed valuation increases. Authorizes certain types of fixed sum levies.
- According to the bill sponsor, this measure will move hundreds of school districts off the 20-mill floor. This will prevent inflationary growth and higher real property tax bills in those districts on the first 20-mills of school district property taxes.
- The bill also adds certain types of fixed sum levies to the calculation of the floor for school districts, including existing emergency and substitute levies.
- The nonpartisan Legislative Service Commission (LSC) estimates these changes will lower real property tax growth by $162 million with respect to tax year 2026, $223 million with respect to tax year 2027, and $224 million with respect to tax year 2028.
- HB 186 (J. Hoops, D. Thomas) – Caps growth of 20-mill floor school districts’ revenue to inflation. Creates a credit on property tax bills in the second half of 2026. Increases the owner-occupied credit for Class I residential properties.
- Takes funds from the Ohio Sales Tax Holiday Fund to make payments to school districts in areas that went through a reappraisal in tax years 2023 or 2024 in an effort to guarantee them the same revenue they received in 2024. Effectively, the intent is to offset revenue loss to school districts from limiting the growth of 20-mill floor revenue to inflation.
- The bill modifies the 10% and 2.5% property tax rollbacks for residential property with the 10% rollback for Class I property phasing out and the 2.5% owner-occupied credit increasing to 15.38% via a four-year phased schedule.
- The LSC estimates these changes will credit property tax bills $432 million with respect to tax year 2025, $608 million with respect to tax year 2026, and $633 million with respect to tax year 2027.
- HB 309 (D. Thomas) – Makes modifications to county budget commission authority.
- Authorizes county budget commissions (comprised of the county auditor, county treasurer, and county prosecutor) to avoid what they deem unnecessary or excessive collections. According to the bill sponsor, this will give county budget commissions authority to review budgets and decrease tax rates.
- Provides that fixed sum levies continue to raise the same amount approved by voters.
- HB 335 (D. Thomas) – Limits revenue increases from inside millage levies due to reappraisals or updates.
- Requires the county budget commission to adjust the rate of inside millage levies to limit increases in years of reappraisals or updates to the Gross Domestic Product price deflator growth over the three preceding years.
- Allows subdivisions to reduce an inside millage levy.
- LSC estimates this will reduce inside millage revenue by up to $135 million with respect to tax year 2026, up to $250 million with respect to tax year 2027, and up to $378 million with respect to tax year 2028.
Efforts of the Ohio Taxpayer Protection Coalition and Legislators
The Ohio Taxpayer Protection Coalition, a group of business and government organizations, including the Ohio Chamber of Commerce, the Ohio REALTORS®, the County Auditors Association of Ohio, and others, pushed real property tax reforms and supported legislators who led the effort. The goals of simplifying the real property tax system and protecting Ohioans from unvoted tax increases caused by spikes in property valuation are at the heart of these reforms.
Zaino Hall & Farrin testified in numerous hearings to support advancement of the reform package.
House Speaker Matt Huffman, Senate President Rob McColley, House Ways & Means Chair Bill Roemer, and Senate Local Government Chair Sandra O’Brien shepherded the bills of Rep. David Thomas, Rep. Jim Hoops, and Rep. Thomas Hall to enact the most significant real property taxpayer protections in a generation.
Please reach out to Brian Perera, Steve Hall, or any of our ZHF professionals if you would like to further discuss Ohio’s real property tax reforms.