Across Ohio, property taxes greatly impact the cost of running a business, influence rent rates and ripple through the entire local economy.
Ohio’s effective property tax rate is about 1.31% of a home’s value, making Ohio eighth in property tax burden.
In Montgomery County, the effective property tax rate is roughly 1.7% to 1.8%, among the highest in the state. Greene County ranks among the counties with the largest median property tax bills, often around $4,000 annually depending on property value. Median annual property taxes are roughly $3,000 in Butler County, more than $4,000 in Warren County, about $2,100 in Miami County and around $2,100 in Clark County.
The structure of property taxes means the cost rarely stays with the person who receives the bill. Businesses often feel the impact first.
Many small businesses lease their space rather than own it. In commercial real estate, “triple-net” leases are common. These agreements require tenants to pay their share of property taxes, insurance, and maintenance. When property taxes increase, the added cost often shows up directly in a business’s monthly operating expenses.
For a small restaurant, retail shop, or professional office operating on tight margins this truly matters. Higher property taxes can mean higher lease payments, no increase in employee wages and higher prices for customers.
Communities in growing suburban areas like Butler and Warren counties have spent years working to attract new businesses and investment. Companies comparing locations pay close attention to operating costs. Property taxes affect those decisions.
The Ohio-based think tank the Buckeye Institute has repeatedly highlighted how Ohio’s complicated local government structure contributes to higher tax burdens. The Buckeye Institute has noted “the ever-rising cost of maintaining Ohio’s extraordinarily complicated local government structure” is a major driver of property tax increases.
The institute points out Ohio’s system includes more than 6,500 local taxing authorities, which collectively contribute to one of the highest local tax burdens in the country.
Those costs don’t stay confined to homeowners. Renters are another group frequently overlooked in the property tax debate.
Many people assume renters are insulated from property taxes because they do not receive the bill directly. In reality, property taxes are one of the largest operating expenses landlords pay.
When tax bills increase on apartment buildings or rental homes, those costs often become part of the rent calculation. A landlord paying more in property taxes will factor the expense into rent when leases renew.
Housing markets in counties like Montgomery, Greene, and Clark have already experienced rising demand and limited housing supply in recent years. Higher property taxes can add another layer of pressure.
Developers determining whether to build new apartments and housing or renovate older housing do weigh tax costs, including property tax rates. If the numbers don’t work financially, some development projects never move forward. When fewer housing units are built, housing supply tightens and rents rise.
None of this means property taxes serve no purpose. They remain a primary source of funding for schools, public safety and infrastructure.
The public conversation should recognize property taxes are not confined to property owners.
They appear in the price of a storefront lease, influence the cost of a meal at local restaurants and shape the rent families pay every month.
When voters debate levies or property tax reform, it’s worth remembering the impact of property taxes stretches past homeowners, and does impact businesses and renters too.
Rob Scott, a Republican, is the Kettering Clerk of Court, attorney, and small business owner. Contact him atrob@robscott.us.