Ohio General Assembly Revises Property Valuation Complaint Process

Government Relations

In legislation recently signed by Governor Mike DeWine, Ohio has revised its property valuation tax complaint process to limit the ability of local government entities to challenge property values. House Bill 126, sponsored by Representative Derek Merrin (R-Monclova Township), was passed as a compromise measure by the Ohio General Assembly on April 6, 2022, and signed by the Governor on April 21, 2022. "Local government" under House Bill 126 includes a board of county commissioners, the board of education of any school district, or the legislative authority of a municipal corporation.

House Bill 126 was more limited initially, as it sought only to require local governments filing property valuation challenges to pass individual resolutions authorizing each complaint and to provide property owners notice that a challenge was being filed. 

The sponsor stated that his purpose in proposing the legislation was to make sure local government officials were aware of each property valuation challenge and not providing blanket authorization to their attorneys to file complaints, particularly given the potential financial impact to property owners of increased property taxes, and the evidentiary and administrative or court costs of fighting a complaint. 

But after many property owners testified that some local governments were abusing their right to challenge – several citing examples of properties being challenged every year, a charge that was strongly disputed by local governments – the Senate went beyond the original bill’s provisions and added provisions to eliminate a local government’s right to challenge a tax valuation.

Following a conference committee with members of both the Ohio House and Senate, the new law’s compromise language sets minimum thresholds for challenges, requires individual resolutions for each challenge, and limits appeals rights.

Highlights of the new provisions include:

  • Allows a local government to file property valuation complaints only if (1) the property was sold in the year before the tax year for which the complaint was filed, and the sale price was at least 10% and $500,000 more than the auditor’s value, and (2) it first adopts a resolution authorizing the complaint.
    • These limitations only apply to challenges for property the local government does not own.
    • As under current law, a property owner, including a local government, may file a challenge regarding their own valuation at any time.
  • The $500,000 difference-in-value threshold is indexed to increase with inflation each year, beginning in tax year 2023.
  • Requires a BOR to dismiss a complaint filed by a local government within one year after the complaint was filed if the board does not render a decision by then. (Continuing law requires BORs to render decisions within 180 days but does not require that complaints be dismissed after that time.)
  • Prohibits private pay agreements but specifies that the prohibition applies only to agreements entered into on or after the bill’s effective date.
    • "Private pay agreements" refers to settlement agreements that resulted in local governments receiving increased revenue but without changing the official valuation.

The new law will become effective on July 19, 2022.

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