Your voice matters: How HB 335 could hurt Ohio’s students

In this episode of the Leading the Way podcast, host Scott Gerfen discusses the profound implications of House Bill 335 on Ohio's students. The bill could strip up to $2 billion in funding from public schools, affecting teacher employment, class sizes, extracurricular programs and more. Legislative experts Jennifer Hogue and Nicole Piscitani break down the bill's provisions, its current status in the legislative process and what it could mean for students and communities across Ohio. The discussion also covers the state budget and the importance of advocacy in shaping education policy.

Sponsored by Pappas & Associates.

For more resources, training and advocacy updates from the Ohio School Boards Association, visit ohioschoolboards.org.

Transcript

SPEAKER_00 0:00

The following program is a presentation of the Ohio School Boards Association. Welcome to OSVA's Leading the Way podcast, where we bring the voices that shape public education across Ohio. A big thank you to our friends at Pathison Associates who helped make this podcast possible. Today we're talking about a bill that would profoundly change what school looks like for students across Ohio. It's House Bill 335. Hey everyone, it's Scott Gurfin. This proposal, one of many property tax reform bills under consideration, would strip up to $2 billion in funding from public schools. That's not just a number. It could mean the loss of 20% of Ohio's teachers, and for students, it means larger class sizes, fewer course offerings, cuts to art, music, and extracurriculars, and more. Educators and school leaders are calling the impact of this bill cataclysmic. And that's why we're sitting down today with Jennifer Hogue and Nicole Piscitani with OSBA's legislative team. They've been following House Bill 335 and will help us understand what's in the bill, where it stands in the legislative process, and what it could mean for our students and communities. We're also going to talk about the state budget as lawmakers wrap up their work. Jennifer, can you give our viewers a quick overview of House Bill 335? How does it fit into the larger state budget conversation? And why has tax reform become such a prominent issue in this year's budget process?

SPEAKER_02 1:37

Yeah, so property tax reform has been a conversation for a while. In the last General Assembly, we had the property tax review and reform study committee. We also have seen about 33 different bills that have been introduced this General Assembly just on the topic of property tax reform. So it's been a conversation for a while. House Bill 335 was just introduced last week, had its first hearing and committee, its second hearings tomorrow. And so a lot of activity around that, which takes, you know, several bills that have been pending and then some new ideas as well, putting them all in one big bill. Part of the reason that they're looking to do this now right away is they have a recess coming up. And so for lawmakers, if they don't act now, they won't have something in play for the next tax year. And so I think that's why it's important to them. Coupled with the fact that we also have seen a ballot initiative on the horizon with folks getting circulating for signatures now to abolish property taxes altogether in the state. And so I think those things coupled together have created more of a sense of urgency for them to move forward with something.

SPEAKER_00 2:39

Nicole, what are the main provisions of House Bill 335 as it relates to school funding and property tax? How does it propose to change the current law?

SPEAKER_01 2:47

Thank you, Scott. So as Jennifer mentioned, it takes several bills and puts them all into one and then adds some additional layers to that. So right off the top, it would not allow school districts to receive the inside millage that they currently receive today. And so that would impact all school districts across the state of Ohio. And depending on how much they receive through inside millage, it will greatly impact rural districts who, you know, operate very close to that 20-mil floor, but it's also going to disproportionately hurt suburban districts that rely more heavily on their local taxes. They don't receive a lot from the state. So if a district is only receiving 10%, they are expected to bring in 90%. And then the legislature is further not allowing them to collect what they've told them they have to collect. House Bill 335 also brings in the 20 mil floor language that we've seen both in the House and the Senate. It changes the floor calculation to include both emergency levies and substitute levies. So that will hurt districts who are mostly rural, as a lot of them are those 20-mil floor districts that they will now see a lot of shifting. And I think that's the concern about this bill is there's so many different provisions and they're all going to hit school districts at the same time. And we don't exactly know where everybody's going to land because you're going to have districts who are seeing increases in their millage because of no longer being allowed to not have the emergency substitute levies on there. But then at the same time, they're not receiving inside millage. And so all of that impacts school districts and is going to impact them differently just based on what their composition is. The bill also does not allow inflationary growth for those districts who are at the 20-mil floor. So it does limit to inflation what a district could receive if they do ultimately end up on the floor. And then fourth, it allows the county budget commissions to make decisions about if a school district can collect on a levy. So that's even outside of the inside mill. So this could be other operating levies based on what the cash balance of that district is at that time. And then additionally, we still have the cash balance provision that is looming over all of these as well. And so the really important part to note is that is going to hit districts first. The way that it's written in 335, as well as the budget, districts will first lose cash balance and then they will haul have all of these property tax implications hit them later.

SPEAKER_00 5:29

Jennifer, uh could House Bill 335 be included in the state budget? I mean, this sounds like such a dramatic change that this is something that should go through the the process of testimony and hearings.

SPEAKER_02 5:42

Yeah. Um the short answer is yes. If you had asked me the question about will property tax stuff be in the budget, you know, six months ago when we started the budget, I would have said I wasn't sure. Um, you know, this depending on which legislator you asked, they said yes, some said no. I think it's inevitable at this point that there will be tax property tax reform changes in this budget. The Senate added some in their version. Um 335 came out very shortly after the Senate version came out with their property tax proposal. And so I think we will see something. I think the worst case scenario is that we see 335 as it is, and so I think it's very, very important um that you know we be at the state house having conversations, but not just us. Um we need our members to make those conversations known as well about what the impact will be on kids of doing so many things all at once without time to phase them in and really protect for those big changes.

SPEAKER_00 6:32

So, Jennifer, you talk about the budget, it's now in the conference committee. Uh, for our viewers who may not be familiar, can you explain what happens in this phase? Uh how much influence does advocacy still have at this point in the game?

SPEAKER_02 6:46

Right. So advocacy has a huge impact at this point in the game. Um the conference committee, for those that don't know, is a committee of six legislators, three from the House and three from the Senate. Um you'll have two Republicans in each chamber and one Democrat in each chamber, um, and they'll serve on the committee. So today they are supposed to hear updated revenue projections for the state, and then we won't hear from them again until they come together to adopt the conference committee report. A lot of the work that takes place takes place sort of behind the scenes. Um, the Speaker of the House and the President of the Senate will be negotiating along with the minority leaders in both chambers to try to come up with a package that both sides, um both chambers can support. Um so a lot of the work is done there, and so advocacy is extremely important, making sure that your legislators understand the impact to your districts and that they can have those conversations because those leaders will be going back and sort of taking the temperature of the other members in their caucus to see if they have enough support moving forward. So making those calls, making sure that they have the understanding of the impact is extremely important at this stage of the game.

SPEAKER_00 7:50

So I wanted to go back quickly to uh Nicole talked about the carryover, the cash balance. Uh that was included in the Senate. Can you update our our viewers on what exactly because when it went out of the house, it was at 30 percent. Correct. And I believe the Senate it it settled on 50 percent. Can you just talk about what is that carryover balance? What does that mean, and why is it important to school districts?

SPEAKER_02 8:12

Yeah, and you're correct, it was 30 in the House, 50 in the Senate. The Senate also put in a little bit of flexibility, um, allowing districts to kind of earmark or set aside money within their general revenue fund for improvements, permanent improvements, um, as long as they spend it down within three years. So that will allow them to sort of be over that 50% if they've set that money aside. Um, those cash balances are extremely important to districts. I think there's a misunderstanding in the legislature and then also probably in the public as well about what a cash balance is. It is not a rainy day fund or money that's just stuffed aside by a district that they're just sitting on. It's really their operating account. So think of it like your checking account. Money comes in, money comes out. Um, so it's important for them to have that cash on hand to be able to continue to provide the services to students. And so they take that into account as they plan the needs of students, as they look at their levy cycle and making sure that they're minimizing what they need to ask for from voters and those kinds of things. So all of that comes into play with that cash balance, and it's extremely important for districts to have a cash balance on hand.

SPEAKER_00 9:12

So yeah, you've got that, and coupled with this tax as Nick tax reform, as Nicole said, I mean, it's it's incredible what's uh happening in the education landscape right now.

SPEAKER_02 9:23

And a lot of moving parts, and so a lot of unknowns, and so making sure you're having conversations about all of those because any combination or all of them could be in the final products coming out of the budget.

SPEAKER_00 9:34

And Nicole, uh, OSBA and its partner associations have been keeping members informed, right? I mean, I I think we're sending out a lot of e-alerts here recently just to make sure our members know exactly what's at stake, right?

SPEAKER_01 9:47

Yeah, so obviously we're in the final stretches of the budget, so there was portions of that that we were making sure districts across the state were aware of what their state funding would be as well as the property tax um provisions of the state budget. But then when they announced House Bill 335 the day after the Senate, you know, dropped their changes, um it was very clear that the House wanted to have this conversation during the conference committee. Um, and so it was imperative that we reached out and let districts know what the impact is going to be. Um, because again, we do we don't know if these are included in the final budget. Um, it would be cataclysmic as we have said, just with everything coupled together, um districts would be severely impacted.

SPEAKER_00 10:35

So, Jennifer, you know, as we've discussed here, this is not just a funding issue, this is a learning issue. This is truly going to impact students if it passes, right?

SPEAKER_02 10:45

Absolutely. Um, you know, I think a lot of times we get lost in the budget as being, you know, dollars and where we're gonna allocate those dollars, but we need to remember that behind those dollars are students at desks preparing for their future, and and it's vital that they have those learning opportunities and are have a strong foundation in their public schools that are preparing them for success. Um, you know, as future Ohioans that'll help shape the state.

SPEAKER_00 11:07

Anything else you guys want to add before I let you go?

SPEAKER_01 11:11

Say uh become friends with your state representatives and senators. Um it is truly impactful when the schools reach out and develop those relationships. Um person can really make a difference and change things, and so um developing those relationships, communicating the impact, that's what students need. Um, they need schools to step up, communicate, to help protect what they are doing every day.

SPEAKER_00 11:40

Jennifer and Nicole, thank you for uh coming on the Leading the Way podcast, and I also want to thank our sponsor, Pappas and Associates. They're shaping policy with integrity. We'll see you on the next episode of Leading the Way.