Montgomery Co. property values hurt housing prices, city services

Loss in revenue will mean cuts for schools, cities and emergency services.

Map: Residential property value loss in Montgomery County

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By Ken McCall and Joanne Huist Smith
Staff Writers Updated 11:43 AM Thursday, June 30, 2011

Fallout from Montgomery County’s nearly $2 billion decline in property values obviously will impact housing prices, but Auditor Karl Keith also estimates resulting tax revenue loss will cut funding for municipal services, schools, parks and libraries.

County taxing authorities, such as cities and school districts, will lose about $28 million in revenue annually beginning in 2012, because of the drop in value.

The revenue losses are based on estimates for 2011 and 2010 that assume the county can collect 95 percent of the taxes owed.

“These numbers can change a bit, but they should stay in this same ballpark,” said Sam Braun, spokesman for the auditor’s office.

Here are some public agencies and organizations that will be hit hardest by the declining property values:

• The Montgomery County Human Services Levy — providing services to the elderly, abused or neglected children, public health, and residents with mental health or addiction issues — will take a $8.7 million hit annually.

The last levy passed in November 2010 with 70 percent of the vote.

• Revenue to Sinclair Community College is expected to fall by just more than $2 million.

• The Dayton Metro Library and Five Rivers Metro Parks, will lose more than $1 million each. In 2009, county voters approved both levies with more than 70 percent of the vote.

• The hardest hit city, Dayton, will see revenue fall by more than $1.5 million and school districts in the county will be dealing with a combined property tax loss of $8.1 million.

“This is going to result in some loss of services. It’s painful, but it was expected,” said Keith, adding the county hasn’t experienced value loss of this magnitude since The Great Depression.

Critics of government spending say there are too many taxing districts in Ohio and they need to look at consolidation and cost-saving ideas instead of raising levies and asking for more from taxpayers. “In 2002, Ohio had 41.3 local governments per county, compared to the national average of 27.9,” said Lavea Brachman, executive director of the Greater Ohio Policy Center, in an email. “Consolidation of government bureaucracies can improve efficiencies and free funds for investment in areas that matter.”

Parks, library systems hit with cuts, too

The regional Five Rivers MetroParks, funded through a countywide parks levy, is slated to lose $1.2 million a year, more than 5 percent of its general fund budget from the property value declines — and that doesn’t include cuts coming in state funding.

Spokesperson Valerie Beerbower said the park district has started some cost-cutting measures by consolidating its outdoor recreation and education departments. They’re also looking for alternative funding sources and volunteer options.

With fewer dollars, the park district will have to offer fewer programs and spread the staff out more, but Beerbower said the public “shouldn’t really anticipate any decreases in quality. Necessity is the mother of invention, so it’s time to get creative,” Beerbower said.

Germantown resident Lisa King and her husband, Scott, watched as their children splashed in the fountains at Five Rivers Metroparks’ RiverScape Wednesday afternoon. “It’s scary to think you’re going to lose some of the things like this that children enjoy,” she said.

Voters overwhelmingly approved a 1.75 mill replacement property tax levy for Dayton Metro Library in 2009 to lessen the impact of less state funding. That cushion is being eroded from the library’s $29 million general fund budget by new state cuts and property value loss, said Mark Willis, community relations manager for the library system.

“Part of our challenge is that it isn’t just one hit. It’s hit, after hit, after hit,” Willis said. “We’re just so grateful we got community support for the levy.”

Willis said one of the first expenses to be cut in a budget reduction is often the “new book-buying fund.” To compensate for revenue loss, the library no longer mails out overdue or reverse book notices. The library also has reduced operating hours.

The more than $485 million in property value loss in Dayton will directly impact funding for schools and city services.

Dayton’s projected $1.54 million loss in property tax revenue would be equivalent to 1 percent of the city’s $150 million general fund. But by city ordinance, only half of Dayton’s roughly $17 million in annual property tax revenue goes to the general fund. The other half goes to the bond retirement fund, to retire debt.

Deputy City Manager Stanley Earley said the biggest impact will be on that debt fund and the city’s ability to borrow. “We’ve structured our debt so we’re completely covered now. But this reduces what we can do in the future,” Earley said. “(The lost revenue) means about $8 million less that we can borrow for roads and streets.”

Dayton Public Schools Treasurer Stan Lucas plans to meet with the auditor next week to learn the full details of the value loss in the school district.

“Loss of tax revenue always has a financial impact on the district and $2 million is a significant number,” Lucas said. “I want to get the details before we create more alarm than need be or not enough alarm.”

The city of Kettering is estimated to lose about $600,000 a year in property tax revenue. City Manager Mark Schwieterman said city officials knew a decrease was coming to their second-largest income source.

“Obviously a reduction of resources is going to mean that we have to analyze what we do and what we fund in future years,” Schwieterman said.

Staff writers Jeremy Kelley and Christopher Rizer contributed to this report.

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