As Introduced

136th General Assembly

Regular Session H. B. No. 375

2025-2026

To amend sections 5705.03, 5705.215, and 5705.31 and to enact sections 3314.31, 5705.316, and 5748.11 of the Revised Code to establish a small district magnet community school pilot program.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 5705.03, 5705.215, and 5705.31 be amended and sections 3314.31, 5705.316, and 5748.11 of the Revised Code be enacted to read as follows:

Sec. 3314.31. (A) The department of education and workforce shall establish a small district magnet community school pilot program. A school district may apply to participate in the pilot program in a form and manner prescribed by the department. In the application, a school district shall indicate the length of time it intends to participate in the pilot program, which shall be not fewer than three school years and not more than five school years. The department shall review and approve applications under division (C) of this section.

(B) Notwithstanding anything in the Revised Code to the contrary, under the pilot program, any school of a participating school district shall operate as a community school established under this chapter, and the board of education shall act as the school's governing authority. To the extent the department determines it necessary, the department shall act as the sponsor of a district school. The department shall issue guidelines clarifying and defining how the department will act as a sponsor, the district board will act as a governing authority, and a district school will operate as a community school, as well as whether, or the extent to which, the district board and a district school will comply with requirements under the law for school districts and community schools. The guidelines shall enhance the flexibility of a district school to operate and provide instruction to students, including by doing all of the following:

(1) Permitting the use of multi-grade classrooms, instead of single-grade classrooms;

(2) Permitting the district school to assign the same classroom teachers to the same cohort of students as that cohort is promoted from school year to school year;

(3) Permitting the district school to have flexibility regarding state standards adopted under section 3301.079 of the Revised Code regarding literacy and numeracy in grades pre-kindergarten through three;

(4) Permitting a district school, in grades four and above, to incorporate other subject areas into instruction regarding reading, writing, and mathematics in order to allow more depth in science, social studies, and history;

(5) Permitting district schools to operate for a minimum of nine hundred twenty hours per school year, instead of the minimum hours prescribed under section 3313.48 of the Revised Code.

(C) The department shall review each application submitted by a school district under this section. The department shall approve a school district to participate in the pilot program if the district satisfies all of the following conditions:

(1) The school district has an enrolled ADM of fewer than one thousand students.

(2) The school district has adopted an open enrollment policy under section 3313.98 of the Revised Code that permits the enrollment from students from all other school districts.

(3) The department determines the school district has adopted a competency-based educational pilot program that provides differentiated instruction, academic acceleration in reading, writing, and mathematics, and emphasizes career preparation aligned with the needs of the district's local industries.

(4) The department determines the school district has entered into a shared service agreement with an educational service center that enhances cost-savings efficiencies and includes a memorandum of understanding with the service center under which, if the district is approved to participate in the pilot program, both of the following apply:

(a) The educational service center shall assume specified school district duties and responsibilities while the school district is participating in the pilot program, which may include transportation, special education instruction, truancy intervention, or other similar duties or responsibilities.

(b) The school district may transfer control of buildings, school buses, or other assets of the district, including assets the district is not able to afford to maintain while participating in the pilot program, to the educational service center until the district finishes its participation in the pilot program. Such transfer of assets shall not include any monetary compensation to either school district or the educational service center, but the service center may retain control of the assets it is holding for the district until, after completing its participation in the pilot program, the district is able to financially afford to maintain the assets.

(D) Notwithstanding anything in the Revised Code to the contrary, the department shall provide state funding to each school of a participating school district in the same manner as the department provides funding to community schools under Chapter 3317. of the Revised Code, and the district schools shall be subject to the community school requirements for state funding under Chapter 3314. of the Revised Code.

(E) The department shall develop guidelines and procedures for the operation of the pilot program, including the guidelines described in division (B) of this section.

Sec. 5705.03. (A) The taxing authority of each subdivision may levy taxes annually, subject to the limitations of sections 5705.01 to 5705.47 of the Revised Code, on the real and personal property within the subdivision for the purpose of paying the current operating expenses of the subdivision and acquiring or constructing permanent improvements. The taxing authority of each subdivision and taxing unit shall, subject to the limitations of such sections, levy such taxes annually as are necessary to pay the interest and sinking fund on and retire at maturity the bonds, notes, and certificates of indebtedness of such subdivision and taxing unit, including levies in anticipation of which the subdivision or taxing unit has incurred indebtedness.

(B)(1) When a taxing authority determines that it is necessary to levy a tax outside the ten-mill limitation for any purpose authorized by the Revised Code, the taxing authority shall certify to the county auditor a resolution or ordinance requesting that the county auditor certify to the taxing authority the amounts described in division (B)(2) of this section. The resolution or ordinance shall state all of the following:

(a) The proposed rate of the tax, expressed in mills for each one dollar of taxable value, or the dollar amount of revenue to be generated by the proposed tax;

(b) The purpose of the tax;

(c) Whether the tax is an additional levy, a renewal or a replacement of an existing tax, a renewal or replacement of an existing tax with an increase or a decrease, a reduction or decrease of an existing tax, or an extension of an existing tax to additional territory;

(d) The section of the Revised Code authorizing submission of the question of the tax;

(e) The term of years of the tax or if the tax is for a continuing period of time;

(f) That the tax is to be levied upon the entire territory of the subdivision or, if authorized by the Revised Code, a description of the portion of the territory of the subdivision in which the tax is to be levied;

(g) The date of the election at which the question of the tax shall appear on the ballot;

(h) That the ballot measure shall be submitted to the entire territory of the subdivision or, if authorized by the Revised Code, a description of the portion of the territory of the subdivision to which the ballot measure shall be submitted;

(i) The tax year in which the tax will first be levied and the calendar year in which the tax will first be collected;

(j) Each such county in which the subdivision has territory.

(2) Upon receipt of a resolution or ordinance certified under division (B)(1) of this section, the county auditor shall certify to the taxing authority each of the following, as applicable to that levy:

(a) The total current tax valuation of the subdivision.

(b) The number of mills for each one dollar of taxable value that is required to generate a specified amount of revenue.

(i) If the levy is to renew, renew and increase, renew and decrease, reduce or decrease, or extend to additional territory an existing levy that is subject to reduction under section 319.301 of the Revised Code, the levy's effective rate, expressed in dollars, rounded to the nearest dollar, for each one hundred thousand dollars of the county auditor's appraised value;

(ii) For all other levies, the levy's rate, described in division (B)(2)(b) or (d) of this section, expressed in dollars, rounded to the nearest dollar, for each one hundred thousand dollars of the county auditor's appraised value.

(d) The dollar amount of revenue, rounded to the nearest dollar, that would be generated by a specified number of mills for each one dollar of taxable value.

(e) For any levy or portion of a levy except a levy or portion of a levy to pay debt charges, an estimate of the levy's annual collections, rounded to the nearest dollar, which shall be calculated assuming that the amount of the tax list of the taxing authority remains throughout the life of the levy the same as the amount of the tax list most recently certified by the auditor under division (A) of section 319.28 of the Revised Code.

If a subdivision is located in more than one county, the county auditor shall obtain from the county auditor of each other county in which the subdivision is located the current tax valuation for the portion of the subdivision in that county. The county auditor shall issue the certification to the taxing authority within ten days after receiving the taxing authority's resolution or ordinance requesting it.

(3) Upon receiving the certification from the county auditor under division (B)(2) of this section, the taxing authority may adopt a resolution or ordinance stating the rate of the tax levy, expressed in mills for each one dollar of taxable value and the rate or effective rate, as applicable, in dollars for each one hundred thousand dollars of the county auditor's appraised value, as estimated by the county auditor, and that the taxing authority will proceed with the submission of the question of the tax to electors. The taxing authority shall certify this resolution or ordinance, a copy of the county auditor's certifications, and the resolution or ordinance the taxing authority adopted under division (B)(1) of this section to the proper county board of elections in the manner and within the time prescribed by the section of the Revised Code governing submission of the question. The county board of elections shall not submit the question of the tax to electors unless a copy of the county auditor's certification accompanies the resolutions or ordinances the taxing authority certifies to the board. Before requesting a taxing authority to submit a tax levy, any agency or authority authorized to make that request shall first request the certification from the county auditor provided under this section.

(4) This division is supplemental to, and not in derogation of, any similar requirement governing the certification by the county auditor of the tax valuation of a subdivision or necessary tax rates for the purposes of the submission of the question of a tax in excess of the ten-mill limitation, including sections 133.18 and 5705.195 of the Revised Code.

(C) All taxes levied on property shall be extended on the tax list and duplicate by the county auditor of the county in which the property is located, and shall be collected by the county treasurer of such county in the same manner and under the same laws and rules as are prescribed for the assessment and collection of county taxes. The proceeds of any tax levied by or for any subdivision when received by its fiscal officer shall be deposited in its treasury to the credit of the appropriate fund.

(D) The board of education of a school district participating in the small district magnet community school pilot program under section 3314.31 of the Revised Code shall not adopt a resolution under this section.

Sec. 5705.215. (A) The governing board of an educational service center that is the taxing authority of a county school financing district, upon receipt of identical resolutions adopted within a sixty-day period by a majority of the members of the board of education of each school district that is within the territory of the county school financing district, may submit a tax levy to the electors of the territory in the same manner as a school board may submit a levy under division (C) of section 5705.21 of the Revised Code, except that:

(1) The levy may be for a period not to exceed ten years, or, if the levy is solely for the purpose or purposes described in division (A)(2)(a), (c), or (f) of this section, for a continuing period of time.

(2) The purpose of the levy shall be one or more of the following:

(a) For current expenses for the provision of special education and related services within the territory of the district;

(b) For permanent improvements within the territory of the district for special education and related services;

(d) For permanent improvements within the territory of the district for specified educational programs;

(e) For permanent improvements within the territory of the district;

(f) For current expenses for school safety and security and mental health services, including training and employment of or contracting for the services of safety personnel, mental health personnel, social workers, and counselors;

(g) For increased expenses of the educational service center due to a school district's participation in the small district magnet community school pilot program under section 3314.31 of the Revised Code.

(B) If the levy provides for but is not limited to current expenses, the resolutions shall apportion the annual rate of the levy between current expenses and the other purposes. The apportionment need not be the same for each year of the levy, but the respective portions of the rate actually levied each year for current expenses and the other purposes shall be limited by that apportionment.

(C) Prior to the application of section 319.301 of the Revised Code, the rate of a levy that is limited to, or to the extent that it is apportioned to, purposes other than current expenses shall be reduced in the same proportion in which the district's total valuation increases during the life of the levy because of additions to such valuation that have resulted from improvements added to the tax list and duplicate.

(D) After the approval of a county school financing district levy under this section, the taxing authority may anticipate a fraction of the proceeds of such levy and may from time to time during the life of such levy, but in any given year prior to the time when the tax collection from such levy can be made for that year, issue anticipation notes in an amount not exceeding fifty per cent of the estimated proceeds of the levy to be collected in each year up to a period of five years after the date of the issuance of such notes, less an amount equal to the proceeds of such levy obligated for each year by the issuance of anticipation notes, provided that the total amount maturing in any one year shall not exceed fifty per cent of the anticipated proceeds of the levy for that year. Each issue of notes shall be sold as provided in Chapter 133. of the Revised Code, and shall, except for the limitation that the total amount of such notes maturing in any one year shall not exceed fifty per cent of the anticipated proceeds of such levy for that year, mature serially in substantially equal installments during each year over a period not to exceed five years after their issuance.

(E)(1) In a resolution to be submitted to the taxing authority of a county school financing district under division (A) of this section calling for a ballot issue on the question of the levying of a tax for a continuing period of time by the taxing authority, the board of education of a school district that is part of the territory of the county school financing district also may propose to reduce the rate of one or more of that school district's property taxes levied for a continuing period of time in excess of the ten-mill limitation. The reduction in the rate of a property tax may be any amount, not exceeding the rate at which the tax is authorized to be levied. The reduction in the rate of a tax shall first take effect in the same year that the county school financing district tax takes effect, and shall continue for each year that the county school financing district tax is in effect. A board of education's resolution proposing to reduce the rate of one or more of its school district property taxes shall, in addition to including information required for a resolution under division (B)(1) of section 5705.03 of the Revised Code, specifically identify each such tax and shall state for each tax the maximum rate at which it currently may be levied and the maximum rate at which it could be levied after the proposed reduction, expressed in mills for each one dollar of taxable value.

Before submitting the resolution to the taxing authority of the county school financing district, the board of education of the school district shall certify a copy of it to the tax commissioner and the county auditor. The county auditor shall certify to the board all information required under division (B)(2) of section 5705.03 of the Revised Code, in the manner required under that division, and both of the following:

(a) An estimate of the levy's annual collections beginning for the first year for which the reduction applies, rounded to the nearest dollar, which shall be calculated assuming that the amount of the tax list of the taxing authority remains throughout the life of the reduced levy the same as the amount of the tax list most recently certified by the county auditor under division (A) of section 319.28 of the Revised Code.

If a school district is located in more than one county, the county auditor shall obtain from the county auditor of each other county in which the district is located the current tax valuation for the portion of the district in that county.

(b) The effective rate of the levy for the last year before the proposed reduction and the first year that the reduction applies, both expressed in dollars for each one hundred thousand dollars of the county auditor's appraised value.

The tax commissioner, within ten days of receiving the resolution, shall certify to the board the reduction in the school district's total effective tax rate for each class of property that would have resulted if the proposed reduction in the rate or rates had been in effect the previous year. As used in this paragraph, "effective tax rate" has the same meaning as in section 323.08 of the Revised Code.

After receiving these certifications from the commissioner and the auditor, the board may amend its resolution to change the proposed property tax rate reduction before submitting the resolution to the financing district taxing authority, provided the board certifies a copy of the amended resolution to the county auditor with a request to provide the information required under divisions (E)(1)(a) and (b) of this section and the auditor transmits that information to the taxing authority.

If the board of education of a school district that is part of the territory of a county school financing district adopts a resolution proposing to reduce the rate of one or more of its property taxes in conjunction with the levying of a tax by the financing district, the resolution submitted by the board to the taxing authority of the financing district under division (A) of this section does not have to be identical in this respect to the resolutions submitted by the boards of education of the other school districts that are part of the territory of the county school financing district.

(2) Each school district that is part of the territory of a county school financing district may tailor to its own situation a proposed reduction in one or more property tax rates in conjunction with the proposed levying of a tax by the county school financing district; if one such school district proposes a reduction in one or more tax rates, another school district may propose a reduction of a different size or may propose no reduction. Within each school district that is part of the territory of the county school financing district, the electors shall vote on one ballot issue combining the question of the levying of the tax by the taxing authority of the county school financing district with, if any such reduction is proposed, the question of the reduction in the rate of one or more taxes of the school district. If a majority of the electors of the county school financing district voting on the question of the proposed levying of a tax by the taxing authority of the financing district vote to approve the question, any tax reductions proposed by school districts that are part of the territory of the financing district also are approved.

(3) The form of the ballot for an issue proposing to levy a county school financing district tax in conjunction with the reduction of the rate of one or more school district taxes shall be as follows:

"Shall the _______ (name of the county school financing district) be authorized to levy an additional tax for _______ (purpose stated in the resolutions), that the county auditor estimates will collect $_____ annually, at a rate not exceeding _______ mills for each $1 of taxable value, which amounts to $_______ for each $100,000 of the county auditor's appraised value, for a continuing period of time? If the county school financing district tax is approved, the rate of an existing tax currently levied by the _______ (name of the school district of which the elector is a resident) at the rate of _______ mills shall be reduced to _______ mills for each $1 of taxable value, which amounts to a reduction from $_______ (effective rate) to $_______ (effective rate) for each $100,000 of the county auditor's appraised value, that the county auditor estimates will collect $_____ annually, until any such time as the county school financing district tax is decreased or repealed.

	FOR THE TAX LEVY
	AGAINST THE TAX LEVY	"

If the board of education of the school district proposes to reduce the rate of more than one of its existing taxes, the second sentence of the ballot language shall be modified for residents of that district to express the rates and effective rates at which those taxes currently are levied and the rates and effective rates to which they would be reduced as well as each levy's estimated annual collections, as provided by the county auditor under division (E)(1)(a) of this section. If the board of education of the school district does not propose to reduce the rate of any of its taxes, the second sentence of the ballot language shall not be used for residents of that district. In any case, the first sentence of the ballot language shall be the same for all the electors in the county school financing district, but the second sentence shall be different in each school district depending on whether and in what amount the board of education of the school district proposes to reduce the rate of one or more of its property taxes.

(4) If the rate of a school district property tax is reduced pursuant to this division, the tax commissioner shall compute the percentage required to be computed for that tax under division (D) of section 319.301 of the Revised Code each year the rate is reduced as if the tax had been levied in the preceding year at the rate to which it has been reduced. If the reduced rate of a tax is increased under division (E)(5) of this section, the commissioner shall compute the percentage required to be computed for that tax under division (D) of section 319.301 of the Revised Code each year the rate is increased as if the tax had been levied in the preceding year at the rate to which it has been increased.

(5) After the levying of a county school financing district tax in conjunction with the reduction of the rate of one or more school district taxes is approved by the electors under this division, if the rate of the county school financing district tax is decreased pursuant to an election under section 5705.261 of the Revised Code, the rate of each school district tax that had been reduced shall be increased by the number of mills obtained by multiplying the number of mills of the original reduction by the same percentage that the financing district tax rate is decreased. If the county school financing district tax is repealed pursuant to an election under section 5705.261 of the Revised Code, each school district may resume levying the property taxes that had been reduced at the full rate originally approved by the electors. A reduction in the rate of a school district property tax under this division is a reduction in the rate at which the board of education may levy that tax only for the period during which the county school financing district tax is levied prior to any decrease or repeal under section 5705.261 of the Revised Code. The resumption of the authority of the board of education to levy an increased or the full rate of tax does not constitute the levying of a new tax in excess of the ten-mill limitation.

(F) If a county school financing district has a tax in effect under this section, the territory of a city, local, or exempted village school district that is not a part of the county school financing district shall not become a part of the county school financing district unless approved by the electors of the city, local, or exempted village school district in accordance with division (C) of section 3311.50 of the Revised Code.

Sec. 5705.31. The county auditor shall present to the county budget commission the annual tax budgets submitted under sections 5705.01 to 5705.47 of the Revised Code, together with an estimate prepared by the auditor of the amount of any state levy, the rate of any school tax levy as previously determined, the tax commissioner's estimate of the amount to be received in the county public library fund, the tax rates provided under section 5705.281 of the Revised Code if adoption of the tax budget was waived under that section, and such other information as the commission requests or the tax commissioner prescribes. The budget commission shall examine such budget and ascertain the total amount proposed to be raised in the county for the purposes of each subdivision and other taxing units in the county.

The commission shall ascertain that the following levies have been properly authorized and, if so authorized, shall approve them without modification:

(A) All levies in excess of the ten-mill limitation;

(B) All levies for debt charges not provided for by levies in excess of the ten-mill limitation, including levies necessary to pay notes issued for emergency purposes;

(D) Except as otherwise provided in this division, a minimum levy within the ten-mill limitation for the current expense and debt service of each subdivision or taxing unit, which shall equal two-thirds of the average levy for current expenses and debt service allotted within the fifteen-mill limitation to such subdivision or taxing unit during the last five years the fifteen-mill limitation was in effect unless such subdivision or taxing unit requests an amount requiring a lower rate. Except as provided in section 5705.312 of the Revised Code, if the levies required in divisions (B) and (C) of this section for the subdivision or taxing unit equal or exceed the entire minimum levy of the subdivision as fixed, the minimum levies of the other subdivisions or taxing units shall be reduced by the commission to provide for the levies and an operating levy for the subdivision. Such additional levy shall be deducted from the minimum levies of each of the other subdivisions or taxing units, but the operating levy for a school district shall not be reduced below a figure equivalent to forty-five per cent of the millage available within the ten-mill limitation after all the levies in divisions (B) and (C) of this section have been provided for.

If a municipal corporation and a township have entered into an annexation agreement under section 709.192 of the Revised Code in which they agree to reallocate their shares of the minimum levies established under this division and if that annexation agreement is submitted along with the annual tax budget of both the township and the municipal corporation, then, when determining the minimum levy under this division, the auditor shall allocate, to the extent possible, the minimum levy for that municipal corporation and township in accordance with their annexation agreement.

(E) The levies prescribed by section 3709.29 of the Revised Code.

Divisions (A) to (E) of this section are mandatory, and commissions shall be without discretion to reduce such minimum levies except as provided in such divisions or section 5705.316 of the Revised Code.

If any debt charge is omitted from the budget, the commission shall include it therein.

Sec. 5705.316. (A)(1) The board of education of a school district that levies a current expense school district income tax shall notify the tax commissioner of the date that the district begins to participate in the small district magnet community school pilot program under section 3314.31 of the Revised Code.

(2) The board of education of a school district shall notify the tax commissioner of the date that the district ceases to participate in the small district magnet community school pilot program.

(B) A county budget commission shall reduce the rate of, or the annual amount of money to be raised by, each current expense school district income tax levied by a school district participating in the small district magnet community school pilot program for each tax year ending on or after the date described in division (A)(1) of this section and before the date described in division (A)(2) of this section. The rate of any such tax shall be reduced to zero mills, or the amount to be collected by such tax shall be reduced to zero dollars for each of those tax years.

Sec. 5748.11. (A)(1) The board of education of a school district that levies a current expense school district income tax shall notify the tax commissioner of the date that the district begins to participate in the small district magnet community school pilot program under section 3314.31 of the Revised Code.

(2) The board of education of a school district shall notify the tax commissioner of the date that the school ceases to participate in the small district magnet community school pilot program.

(B) The board of education of a school district participating in the small district magnet community school pilot program shall not levy a current expense school district income tax under this chapter for any taxable year ending on or after the date described in division (A)(1) of this section and before the date described in division (A)(2) of this section. The board shall not adopt a resolution levying a school district income tax under this chapter.

Section 2. That existing sections 5705.03, 5705.215, and 5705.31 of the Revised Code are hereby repealed.