August 3, 2021
A new law offers potential tax relief to Ohio property owners whose properties declined in value due to the COVID-19 pandemic or state-issued Orders responding to the health crisis. The legislation was passed unanimously by the Ohio General Assembly and was signed into law by Governor Mike DeWine on April 27, 2021.
For Tax Year 2020 – Filing Deadline and October 1, 2020 Valuation Date
Property owners may now file a Special COVID-19-Related Complaint Against the Valuation of Real Property (“Covid Complaint”) between August 3, 2021 and September 2, 2021.
Ordinarily, county Auditors/Fiscal Officers assess the market value of real property in their respective counties as of January 1 of each year. Since the pandemic had not yet taken hold in Ohio on January 1, 2020, all properties were initially valued at pre-pandemic values. Sub. Senate Bill 57 protects Ohioans from paying taxes on overvalued properties which suffered significant reductions in value post-COVID.
The new law provides that COVID affected properties are, instead, to be valued as of October 1, 2020. Our office has been in contact with multiple Auditor’s Offices who have determined that the value reduction will retroactively apply to the entirety of TY 2020. The minority view is that any reduction under this provision would only apply to the 4th Quarter of TY 2020.
Owners must demonstrate that the value reduction resulted from the COVID-19 pandemic or state-issued COVID-19 Orders. Complaints that merely allege a decline in value due to some general economic conditions will be dismissed outright by the county Board of Revision (“BOR”). The COVID Complaint and the owner’s presentation at the BOR hearing should establish a clear link between the value reduction and its cause.
This tax relief is not automatic. Owners have to act by filing a COVID Complaint with the BOR in the county where the affected property is located by September 2, 2021.
Changes to the Triennium Rule and COVID Complaints for Future Tax Years
Under prior law, an owner could only file 1 tax appeal during each 3-year tax cycle pertaining to the County where the property is located. Sub. S.B. 57 changes that rule. The new law allows a COVID Complaint to be filed even when the owner has already filed a tax appeal in the same 3-year tax cycle. For example, if an owner has already filed a regular tax appeal in the current tax cycle, the owner is able to file one or more COVID Complaints in the same tax cycle.
This rule applies to tax year 2020, but also opens up the ability to file a COVID Complaint for tax years 2021 or 2022 as well.
General Rule Change for “NNN” Tenants
This new law also changes the rules as to who can file a complaint. Historically, tenants were not permitted to file a complaint against valuation with regard to the leased property, only the owner could do so. Now, commercial or industrial tenants who (i) are responsible under their NNN leases for 100% of the property taxes assessed on the subject property and (ii) are authorized by the lease to file a complaint (or the property owner later authorizes them to do so) may file a tax appeal. This rule change applies irrespective of whether a normal tax complaint or a COVID Complaint is involved.
Do I Need an Attorney to Challenge My Property’s Valuation?
Commercial property owners are well advised to engage an attorney to represent their interests in these types of cases, even though not legally required. Making a mistake in filling out a Complaint form or during a tax appeal proceeding can be costly to the owner. Cases can be dismissed based upon a technicality, leaving the owner with no recourse. We suggest that it’s better to engage the services of an attorney who is experienced in this field to guide the owner in navigating the complex laws, procedures, and policies of the county Boards of Revision. Additionally, when the local school district files its counter-complaint, it will be represented by an attorney. Owners who are represented by an attorney themselves will be on a more equal footing.
Bluestone Law Group’s clients benefit from our 20+ years of experience during which we have saved our clients millions of dollars in real estate taxes. We are familiar with the tax board rules and procedures. Moreover, Bluestone Law Group has worked with many of the attorneys who represent the local school districts; that familiarity helps to facilitate settlement negotiations. We will bring that experience and legal knowledge to your case.
If your property’s value has declined as a result of COVID, do not delay. Remember, the filing deadline is September 2, 2021. Contact our office as soon as possible to find out if your property is a candidate for tax relief under this new law.
DISCLAIMER – These materials have been prepared for general educational purposes only and are not intended as legal advice for any specific case. The reader is strongly encouraged to seek professional legal representation with respect to the filing of any proceedings by the Board of Revision or the Ohio Board of Tax Appeals.
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