A recent Ohio Supreme Court decision has narrowed the ability of school districts to challenge properties they believe are undervalued. Treasurer TJ Cusick told the Board of Education the change could ultimately raise the tax bill for Worthington homeowners. In his report to the board, Cusick walked through how property valuations work, what changed in the courts over the past two weeks, and why a nearby undervalued commercial property can mean a higher bill for residents.
Why one property's value affects everyone's taxes
In Ohio, property owners share a common interest in making sure every property is valued accurately, Cusick explained. "If your neighbor's property is undervalued, everyone else is paying more in tax to make up for that," he said.
The same issue affects the district's own tax rate. When Worthington Schools next calculates how much millage it needs, which Cusick said would happen around 2028, the rate is based on the total value of all properties in the district. "If a subset of properties is undervalued, the millage we're gonna ask residents to pay is gonna be slightly higher," he said. Historically, districts learned about undervalued properties by watching the news: a commercial building would sell for far more than its listed value, and the district would contest the figure before the county Board of Revisions.
What House Bill 126 changed
A few years ago, the state legislature passed House Bill 126, which limited districts' ability to challenge valuations in several ways. Cusick focused on two provisions: a property generally has to have sold before a district can challenge its value, and only the owners of a property — not school districts — could appeal a Board of Revisions decision to the state Board of Tax Appeals.
Worthington and districts like it have challenged the constitutionality of House Bill 126, a case that is still working its way through the courts.
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The ruling last week, and the case still pending
The appeals piece is what made the news. House Bill 126 eliminated districts' ability to appeal the valuation of property they don't own or lease to the state Board of Tax Appeals. Districts including Olentangy instead tried to take such cases to the court of common pleas. On May 29, the Ohio Supreme Court ruled 6-1 in the Olentangy case that districts cannot use that route either. "So that's the bad news, that effectively we don't have appeal rights," Cusick said.
Separately, the broader constitutional challenge is still alive and, so far, has cut in the district's favor. In late April, the Tenth District Court of Appeals ruled for the districts, declaring House Bill 126 unconstitutional. That decision conflicts with a ruling from the Fifth District Court of Appeals that went the other way, a split that Cusick said the Ohio Supreme Court will likely have to resolve.
The "disguised sale" loophole
Because the law requires a sale before a district can challenge a value, Cusick described a loophole that lets high-value properties avoid reassessment. Rather than sell a property outright — which requires filing paperwork with the county auditor — the property is held by a limited liability company (LLC), and the owners simply transfer their stakes in the LLC. No deed is filed, no sale is recorded, and the district has no opening to challenge the value.
He pointed to a local example: Copley Park Apartments, off Worthington Galena Road, that was on the books at approximately $15.7 million. The district had documentation that the property transferred for about $34 million, more than double its listed value. After the Board of Revisions kept the auditor's figure of roughly $15 million, the district appealed to the Board of Tax Appeals and won, with the value raised to $34 million based on the disguised sale. Cusick noted the owner will likely appeal.
The bigger picture
Cusick framed the ruling as one layer of a larger system that he said pushes more of the tax burden onto homeowners. He cited the lack of state income tax on sole proprietors earning up to $250,000, properties such as "The Heights" that he said were reclassified from a single commercial unit into hundreds of condominium units to reduce their tax burden on paper, and data centers receiving tax abatements while creating few jobs.
"All of these things are why residential property taxes are so high in Ohio," he said. The district will continue to monitor the conflicting appeals rulings as they head toward the Ohio Supreme Court. In the meantime, Cusick said, the goal is to help residents understand the full picture: "It's not just the school spending too much. It's all of these things coming together and squeezing the residential taxpayer."