by Nicole Piscitani • Feb. 9, 2026
The final property tax bill that the legislature passed and Gov. Mike DeWine signed is House Bill (HB) 186. This bill primarily caps revenue growth for districts on the 20-mill floor. However, there are a few additional provisions.
The Ohio Revised Code (RC) requires that school districts levy at least 20-mills of local property taxes to receive state funding. The Ohio Constitution has a provision commonly referred to as HB 920, which requires that property tax millage be reduced as property valuations increase to maintain the dollar amount approved by voters. However, if a school district only has 20 mills of property taxes, HB 920 is not applied to the millage, thus preventing districts from falling below the 20-mill floor calculation and receiving additional revenue based on the reappraisal percentages. HB 186 does not change the 20-mill floor requirement, but it does restrict how much additional revenue a school district can receive. The bill implements an inflationary growth cap that limits the additional revenue to not exceed the three-year GDP deflator percentage. As an example, if reappraisal values increase by 20% and the GDP deflator is 10%, school districts would still receive additional revenue but not above the GDP deflator. Property tax owners will see the cap not as a refund but as a credit on their property tax statement. The inflationary cap will be applied every three years when the county goes through a reappraisal or a triennial update.
The inflationary cap provisions are prospective, set to begin for tax year (TY) 2025. However, they are also retroactive, being applied to TY ’23 and TY ’24. School districts and joint-vocational districts impacted by the retroactive provision will receive payments from the state to offset the reduction in local property taxes. Those districts are temporarily guaranteed to receive at least the same amount of property tax revenue they received in TY ’24.
HB 186 also changes existing rollback provisions found in state law. A rollback is essentially a property tax credit to homeowners that is paid by the state to the local entity. Currently, Ohio has two property tax rollbacks. The first rollback — known as the nonbusiness property rollback — applies to one-, two- or three-family dwellings and to nontimber, agricultural land. The rollback reduces the property taxes by 10%. The second rollback is known as the owner-occupancy rollback. Property tax owners receive a 2.5% reduction if the property is the primary residence. A further restriction is applied to indicate that the primary residence can only have up to one acre of land. Important to note, not all property tax levies are eligible for the two rollbacks. Due to 2013 RC changes, only levies that were passed by voters prior to November 2013 are eligible to receive the rollbacks; levies passed after that date do not receive the rollbacks. A school district may have a combination of levies that are both eligible and ineligible for the rollbacks.
The bill begins a four-year phase-out of the 10% nonbusiness property rollback for residential property, thus eliminating it entirely. One exception is that nontimber, agricultural land will continue to receive this rollback. Lawmakers wanted to ensure that the intended property tax owners were receiving the rollback credit. To maintain the targeted intention, the owner-occupancy rollback will be increased over a four-year phase-in to 15.38%. The bill maintains that only levies passed before November 2013 would be eligible.
It is important to understand that this bill, along with the other three property tax bills detailed in past Legislative Reports, will become effective on March 20. It is especially important to understand that if your district is on 20-mill floor, HB 129 (refer to article) will cause HB 186 to impact your district differently. Our current understanding is that the HB 129 provisions will first be applied, followed by HB 186 provisions. Due to how these bills impact each community, it is important to educate your residents so they are aware of the changes to their property tax statements.
Note: This information is current as of Feb. 9, 2026.