Vinson Logo


Rotate Your Device

Ohio Legislature Moves to Allow ESCs to Levy New Property Taxes

Michael Nutter

April 18, 2018

New legislation from the Ohio General Assembly allows educational service centers to levy local property taxes for the purpose of funding school safety measures and mental health services.

On March 21st, the Ohio General Assembly passed Substitute Senate Bill 226 (Sub. S.B. 226) by overwhelming margins (91-3 in the House, 31-0 in the Senate). The bill, which was signed into law by Governor Kasich nine days later, impacts Ohio schoolchildren and their families in two distinct ways.

First, Sub. S.B. 226 creates a specialized sales tax holiday over the first weekend of every August, making permanent an annual exemption the Governor has authorized every year since 2015. During this designated weekend, items of clothing priced below $75, school supplies priced below $20 (backpacks, notebooks, pencils, etc.), and school instructional materials priced below $20 (reference books, maps and globes, textbooks, and workbooks) are exempt from both state and local sales tax. These price ceilings are on a per-item basis, and families can purchase as many tax-free items as they wish.

The average Ohio family spends nearly $700 on back-to-school supplies and clothing each year, and according to the University of Cincinnati Economics Center, families saved over $3.3 million in sales taxes during the 2015 holiday. “While early August can be a costly time for families doing their back-to-school shopping, an annual sales tax holiday will provide some financial relief,” commented State Representative Ryan Smith. “This recurring sales tax exemption will promote savings for families and have a positive impact on Ohio businesses.”

Opening the Door to More Robust School Safety and Mental Health Funding

The other major consequence of Sub. S.B. 226 is more administrative, expanding the taxation powers of educational service centers (ESCs). In 1995, Ohio’s County Boards of Education were consolidated into ESCs, and their purpose was shifted from “imposing standardization on small rural districts to providing large-scale support and special programs to local as well as city and exempted village school districts.”

The Ohio Revised Code dictates that exempted village and local school districts with fewer than 16,000 students must enter into a contract with an ESC of their choosing in order to receive services like special education support, curriculum development, and cooperative purchasing consortia.

Roughly a third of ESC funding comes from the State government — the rest is secured via special-purpose taxation units called county school financing districts that allow ESCs to levy local property taxes for the benefit of their client districts.

Sub. S.B. 226 opens the door for ESCs to levy property taxes for a new purpose: school safety. As the Ohio Legislative Service Commission summarizes, “The bill permits a county school financing district to levy taxes for provision of school safety and security and mental health services, including training and employment of or contracting for the services of safety personnel, mental health personnel, social workers, and counselors.”

Passed as an “emergency measure,” the legislation went into effect immediately, suggesting it was at least partially a response to the tragic events at Marjory Stoneman Douglas High School in Parkland, Florida. State Representative Riordan McClain essentially confirmed this notion, saying, “I think including the amendment to allow ESCs to seek funding for school safety and mental health services creates a beneficial tool to combat potentially tragic incidents in Ohio schools.”

Maximizing Funding for Every District

In the bigger picture, ESC superintendents and treasurers need reliable information from their districts in order to be certain that each client district has as many staff members and resources as they need. Fortunately, when its client districts leverage a powerful EMIS reporting tool like Vinson’s CheckPoint EMIS platform, ESCs can rest easy knowing that the data that informs their work is being compiled efficiently, accurately, and in a manner that’s compliant with Ohio’s data reporting standards.

Sub. S.B. 226 provides ESCs with a great mechanism with which to secure funding for a narrow set of services, but with CheckPoint, ESCs can rest easy knowing that their client districts will receive every last dollar to which they’re legally entitled.

get in touch