Property tax abatements need re-examination in light of impact on property tax valuations

tax protesters
Wednesday, January 23, 2019; Cuyahoga County Administration Building, 2019 E. 9thStreet: Southside (Tremont) residents Melody Perry and Robert Mihalik protest increases in property valuations and huge increases in property taxes that are creating extreme hardship for many residents of Cuyahoga County.

by Chuck Hoven

(Plain Press, February 2019)          Residents of neighborhoods with a large number of new and substantially rehabbed houses, like Tremont (Southside) and Ohio City say they have been particularly hard hit by recent property valuations that have substantially increased their property tax bills. For many low-or-moderate income homeowners, the increases will cause a hardship and may threaten their ability to remain in their property. On January 23rd, Southside (Tremont) residents Melody Perry and Robert Mihalik stood in the rain in front of the Cuyahoga County headquarters for hours protesting the huge hike in property taxes.

One Tremont resident that wishes to remain anonymous said, “I believe it all comes down to the Tax Abatements given to new/predatory builders. We, the heritage property owners, are making up the taxes these developers are not paying because of the abatements.”


School systems and other entities base the amount of increase in property tax that they request on what they expect to collect. If there are a large number of abated properties, taxing bodies need to ask for higher levy amounts. Also, school systems have to take into account the percentage of property owners who will be delinquent. A percentage that increases when more homeowners can’t pay their continuously increasing property taxes. It becomes a vicious circle resulting eventually in higher taxes on the remaining property taxpayers.

Residents also report that their property values are being compared to new or substantially rehabbed houses in the neighborhood rather than older homes that have not undergone a substantial rehabilitation.

The same Tremont resident mentioned above suggested that Cuyahoga County develop a system to protect long time property owners from huge tax increases. She said, “We need to have “Tax Control” properties. That is LOOP, Longtime Owner-Occupied Program (or Properties). It is a program to give property owners a discount for staying in their homes for a period of years. It’s worked in other cities. However, the wheels in CLE move slowly.”

It is evident that the property tax subsidies in Cleveland are somewhat backwards. The subsidies go to the relatively wealthier people that can afford new or substantially rehabbed homes.  This leads to existing property owners having their property values raised because of the value of these tax abated properties or the increase in the attractiveness of the neighborhood for investment. The rise in property values can then result in a hardship for a low-or-moderate income homeowner that have been long-term residents of the neighborhood. It seems that if subsidies are to be given, these long-term homeowners are the ones that need reduced property taxes, not the relatively wealthier newcomers.

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