In July This Levy Did Not Cost You Anything. In August It Does.

In July the Cincinnati Public Schools board put a 0.75% earned income tax on the November 2026 ballot. In early August they rescinded it and replaced it with a 7‑mill property tax levy. If you own apartments in the CPS district, that switch moved you from paying nothing to paying every year.

The switch changed who pays

Rental income is not earned income. If you hold the buildings in an entity, or you live outside the district, or your income comes to you as distributions rather than a paycheck, you were not in the base for the income tax version. You could have owned four hundred units inside CPS boundaries and contributed zero.

The property tax version inverts that. The buildings pay, on the auditor's opinion of what they are worth, whether or not the property had a good year.

Here is the math

Ohio taxes property at 35% of market value, so 7 mills works out to $245 per year for every $100,000 of auditor value.

At a 7.5% cap rate, every dollar of permanent annual expense costs about $13.33 of value. Run $245 through that and you get roughly 3.3% of the building — whether you own four units or four hundred.

Now the part I think most owners have not run

Say you have a good year and get 3% rent growth. Assume your other expenses also grow 3%.

The baseline beats 3% because taxes are roughly 46% of the expense load, and HB 920 holds that line fairly flat in a normal year — so only about half your expenses inflate. That gap is what drives NOI growth. The levy shuts it off.

The levy eats about 79% of everything you gained. You can execute a strong year on the revenue side and still hand your lender a flat property.

And there is a second event behind it

Hamilton County is running a triennial update for tax year 2026. New values hit bills issued in January 2027. A levy passed in November lands on that same bill.

A new levy is charged at the full voted rate in year one. No reduction factor, no phase in. Whatever value the auditor sets, multiply by 0.245%.

If you want the broader backdrop on how Ohio value disputes are trending right now, I wrote about the two 2026 court rulings here. And if the cap rate arithmetic above is unfamiliar, this piece walks through where the number comes from.

One caution

You may have seen coverage of Ohio's new property tax relief — the 20‑mill floor changes and the Inflation Cap Credit. The way I understand it, that is essentially a residential story. Four units and up is Class II commercial in Ohio. Do not build that relief into your 2027 budget.

What I would do in the next few weeks

• Pull your auditor value now, before update notices go out.
• Build your income approach file in August, not in March when the Board of Revision window is closing.
• Run your 2027 DSCR at the higher tax number before your lender does.
• Go find the $20 per unit per month. That is all this costs on the example above, and it is recoverable through utility billback, pet, parking, or storage — without winning a rent fight.

I am a real estate broker and an appraiser, not a tax attorney or a CPA, and Ohio property tax law has changed a lot in two years. This is my read, not advice. Confirm anything you plan to act on.

This article is for general educational purposes and is not tax, legal, or investment advice. Please consult your CPA and attorney regarding your specific situation.