News from the SCS Treasurer (Volume I, Issue I)
April, 2019 Edition
Hello, this is George Anagnostou, Treasurer of Strongsville City Schools. One of our District objectives within our strategic plan is to actively partner and communicate with our parents and residents to strengthen school-community bonds. In an effort to improve communication about financial topics of our school district, I will be publishing a monthly newsletter, Treasurer Talk, to address these various topics which impact our budget. This month’s edition will focus on property taxes, property valuation, and property tax rates.
Property Taxes, Property Valuation, & Property Tax Rates
For Strongsville City Schools, property tax revenue makes up the largest revenue source for the District, accounting for about 82% of our general fund revenue. From the chart below, property taxes are comprised of local tax collections, TIF Revenue (Tax Increment Financing), and State of Ohio Reimbursements for Homestead and Rollback credits. The remaining revenues of 18% are made up from Ohio State Foundation Funding (14.3%) and other sources (3.7%). Other sources include, but are not limited to interest income, kindergarten and preschool tuition, tuition from other districts, pay to participate fees, federal medicaid reimbursements, cell tower and vending commissions, state catastrophic aid reimbursements, and refunds of prior year expenditures.
How Do Changes in Property Values Impact Tax Revenue?
Prior to asking the voters for a new levy, the revenue that a proposed levy will generate for the school district is set by the county. Once approved by the voters, a school district will never collect more or less than the approved amount. This is due to an Ohio law (HB 920) that was passed in the 1970s. As inflation rates go up or down, this law adjusts the tax rates (i.e., millage amounts). If property values go up, the effective millage rate would go down. Also, if property values go down, the effective millage rate would go up. This change from a voted millage rate to an effective millage rate occurs so the revenue remains stable. However, by law, effective millage rates cannot exceed the voted millage rate. So, if property values go down to the point that would cause the effective millage rate to go higher than the voted millage rate, there would be a loss of revenue for the district.
For tax year 2018, Cuyahoga County completed a county reappraisal to determine the property values within the city of Strongsville. This is required to be completed every six years. For the reappraisal, the city property values increased approximately 10%. In order to keep the revenue Strongsville City Schools would collect the same as it was approved by the voters, the effective millage rates decreased.
To see your property information, click here
With New Construction in the City, Does the District Receive Additional Tax Dollars?
The school district does receive an incremental increase based on the increased value of the land with the new construction. However, new construction is one of several variables that impact and can can cause tax collections to fluctuate annually. The other variables are collection rate, collection split, prior delinquency payments, County Board of Revision refunds issued, State of Taxation approved exemptions, reappraisals, and changes in law. Since FY 2009, tax collections fluctuate within a range of $46.2 million to $51.9 million. An eleven year annual average of $48.8 million.
GFOA Certificate of Achievement for Excellence in Financial Reporting
The Treasurer's Office has earned this certificate of achievement from the Government Finance Officers Association (GFOA) for 2 straight years for the District's Comprehensive Annual Financial Report (CAFR). GFOA is reviewing this year's CAFR to determine recognition for this year.
For additional financial information for Strongsville City Schools, please visit the Treasurer’s website by clicking here. You can also follow me on Twitter at @SCSTreasurer