Saturday, February 16, 2013

Hilliard Schools, Columbus Taxes

Each year, Treasurer Brian Wilson and his team publish the "Comprehensive Annual Financial Report" (or CAFR), which is much like the annual report produced by corporations. It's about as exciting to read as well. Nonetheless, it's a wealth of information for anyone trying to get an understanding of the financial dimension of our school district.

Near the end of the report is a set of tables showing the tax rates which apply to the sixteen tax districts which make up our school district.

That's right - sixteen.  Most folks know that our school district covers an area which is all or part of many municipalities: Hilliard, Columbus, Dublin and several townships. Depending on when a parcel of township land was annexed into a city, that parcel may have fully transferred from the township to the city, or it might have been annexed under more recent laws which allows a parcel to be in both a city and a township. Each of those combinations end up as a separate taxing district to reflect the different combinations and rates of taxes the property owners will pay.

For decades, real estate agents have been fond of the phrase "Hilliard Schools, Columbus taxes" when trying to sell a house that's in the part of our school district which has been annexed by the City of Columbus. While that can be a selling point for such a house, it also troubles folks who live in other parts of the school district, many of whom think they getting stuck paying higher school taxes.

Here's a table of the effective millage rates for the tax districts in our school district, compiled from the CAFR:

Tax DistrictEffective Rate
Franklin Twp99.27
Prairie Twp/City of Columbus97.62
Prairie Twp96.02
City of Columbus/Washington Twp91.75
City of Dublin/Washington Twp91.00
City of Hilliard/Washington Twp90.65
Norwich Twp90.35
Norwich Twp/City of Columbus89.43
City of Hilliard89.33
Washington Twp89.05
City of Hilliard/Brown Twp88.90
Brown Twp/City of Columbus88.90
Brown Twp87.30
City of Columbus82.03
Union County/Washington Twp80.17

So yes indeed, the folks in our school district who live in the City of Columbus, and are not also part of a township, have lower property taxes than those of us who don't. The difference can usually be attributed to which municipality provides the fire/safety services. The fire/safety services in the townships are funded via property taxes, while the City of Columbus funds their fire/safety services via other revenue streams, primarily their income taxes.

It also matters when the various tax levies were enacted, as the voted millage goes down over time as property values go up. So a 10 mill township levy passed 20 years ago might be collecting today at an effective rate of 5 mills, if the value of the properties doubled over those 20 years (keeping the dollars collected constant).

The key thing to understand, relative to school funding at least, is that all of us pay exactly the same effective millage to our school district, which currently is 89.35 voted mills (or 42.03 effective mills). No one gets a discount.


  1. Interesting coincidence that the Dispatch ran a story today about community authorities, which is a euphemism for yet another entity that can levy property taxes.

    In these cases, the developer - as the sole landowner - agrees to the formation of the community taxing authority. Then when the parcel is subdivided into lots, the taxing authority remains in place, attached to the lots the new homeowners buy.

    I expect that the existence of this taxing authority is disclosed to the buyer prior to the closing, but it's probably glossed over and forgotten. Then the tax bill shows up.

    I don't have a problem with these community authorities. They cause the incremental cost of building infrastructure to be borne by the people who are creating the demand for that infrastructure.

    Sometimes these community taxing authorities are set up so that the schools get a share of the new taxes. I don't know the specifics, but recall that the Big Darby Accord plan included the creation of a such a taxing authority, with a small amount going to the schools. I have to ask about that...

    1. I was wrong about the Big Darby Accord. The documents do call for the creation of a community taxing authority, a recommends that it be set up to collect 10 mills. However it would designate that half of the money goes to fund to "local public infrastructure improvements and community facilities" and half to "regional improvements," whatever that means.

  2. Paul, either I misunderstand something, or your table is wrong (or labelled incorrectly).

    If we all pay the same effective rate to the schools, why are 7 of the taxing districts in the table (of effective rates) less than that amount?

    1. Thanks for pointing that out. The 89.35 mills is the voted millage. The current effective rate for all of us as of FY12 is 42.03 mills.

    2. That makes much more sense. However, that effective rate does not include the bond millage, right? Could you post that as well please?

    3. Correct, the 42.03 is operating millage only. The last data I have on the effective bond millage, which came from that brief time the County Auditor published it on his website, puts the effective bond millage at 6.3 mills.

      But remember, the bond millage is variable - it's the amount we have to pay in debt service which is fixed, so when new properties are built in the district, total cost for debt service gets divided over more parcels, slightly lessening the amount that needs to be collected from each of us.

      The debt service also changes when we refinance bonds, which happened just last week. The final report will come out soon, but the preliminary results are that the present value of the new payment stream will be 7% less than the present value of the payment stream it replaces. That will show up as some reduction in bond millage as well.

    4. According to the auditor's website, I am paying a total of 56.64 mills to the school district, so either the 42.03 mills is wrong, of the 6.3 mills is wrong... (Or the total in your table is wrong...)

    5. You're killing me here...

      Since you and I live in the same taxing district, our proportions should be identical, and indeed when I reverse engineered the numbers on the county auditor's site, which is what I expect your did, the school portion of my total property tax ends up being 81.18 mills vs the 125.12 full millage, or 57.45 mills vs the 88.546986 effective millage - which is essentially the number you came up with.

      So I need to ask some questions. Meanwhile, the primary thesis of this posting remains true - there is no difference in the school tax collected on folks who live in the City of Columbus vs any other part of the school district.

    6. For what it's worth, I picked out a house in my old neighborhood (Golfview Woods), which is in the City of Columbus and no township, and the effective school tax came out to 57.45 mills once again.

    7. Yes, sorry, don't want anyone to miss the point to your post that we are all paying the same rate to schools regardless of where we live. :) Or should that be :( ?