School Districts: Protect Your Tax Base

The steady uptick in the economy means property values are on the rise. While this translates to more money in a school district’s coffers, it also means residents and commercial property owners are preparing their offensives to ensure their property values remain low despite a better economy. As the new year gets underway, school districts should be aware of and prepare for an increase in the number of challenges to property values.

When the real estate bubble popped spurning the “Great Recession,” school districts were hit with ad valorem tax complaints filed by property owners asserting that a steep economic downturn necessarily means their assessed property values were too high. Some county boards of revision were more sympathetic than others, but few could argue that a reduction was not warranted to some extent. With limited resources to put toward a defense, many school districts had to grin and bear the loss.

Fortunately, the pendulum is now swinging the other way and property values are on the rise. As each county conducts a reappraisal every six years, property values will be increased, or at least “corrected.” Property owners are not pleased when they open notices reflecting new and higher values. Indeed, 2018 is a reappraisal year for Cuyahoga County, and the fiscal officer is already anticipating an onslaught of complaints.

Districts, especially board treasurers, are encouraged to keep an eye out for notices from their county auditors and fiscal officers regarding property tax complaints. If the district hasn’t done so previously, it may want to be more involved in board of revision proceedings this time around and hire legal counsel to ensure the tax base is protected. The district should also remind the board of revision hearing officers that it is closely monitoring the proceedings.

Complaints must be filed by March 31st and counter-complaints in response must be filed shortly thereafter. If a deadline is overlooked, a school district may lose its chance to participate in the proceedings or challenge the property owner.

Peter Zawadski is an attorney at Walter | Haverfield who focuses his practice on education law as well as labor and employment matters. He can be reached at pzawadski@walterhav.com and at 216-928-2920.