On October 7, Sen. Kirk Schuring (R-Canton) introduced Senate Bill 212 (SB212) with authorizes townships and municipal corporations to designate areas within which new homes and improvements to existing homes are wholly or partially exempted from property taxation.

The primary objective of the bill is to provide financial incentive for the development of new, single-family housing. Unlike other bills that have previously been considered that would provide a blanket, statewide exemption on increased property value from agricultural land that is subdivided for new residential development but has not commenced construction, SB212 will give a local government (municipality or township) the authority to create a “Neighborhood Development Area” which is land set-aside for new development, or for the remodeling of existing housing contained within the development area.

Under the bill, the local government legislative authority can create the zones, and provide tax exemptions of 70-100 percent for a period of up-to 10 years for new construction, or 5 years for remodeling (provided that the cost of the remodel is at least $10,000). The 100 percent exemption applies to neighborhood development areas that have been approved by local school districts (or if the school district fails to respond to a request on the creation of the neighborhood development area within the 14 day period provided by the bill).

A school district that objects to the creation of the neighborhood development area does not mean that the development areas creation fails - it simply means that the full 100 percent exemption will not be applied to the area. Instead, only 70 percent of the property taxes will be exempted for the 10 year period for new construction or 5 years on remodeling, instead of the requested 100 percent exemption. This will ensure that local school districts will continue to receive funding from property taxes.

The creation of neighborhood development areas are contingent on findings that demonstrate that the designation of the area will encourage the construction of new single-family dwellings, or the improvement of existing single-family dwellings, that in either case would be unlikely to occur in the absence of such a designation.

SB212 has not been assigned to a committee to date, but should be shortly. Be sure to follow GOPC’s legislative tracker for updates on this and other bills GOPC is monitoring in the Ohio Legislature.

(Note: This post, along with the inclusion of a bill on the GOPC tracking list, does not indicate endorsement of, or support for any bill.)