Opinion
No. 75-33
Decided March 3, 1976.
Schools — Transfer of local school district territory — R.C. 3311.231 — Real and personal property taxes — Who may levy — R.C. 5705.03 construed — Transferee district not obligated to pay such taxes to transferor, when — R.C. 5719.01 not applicable.
1. Pursuant to R.C. 5705.03, only the taxing authority of the taxing subdivision in which property is located on the date of the tax levy is authorized to levy real and personal property taxes thereon for the year.
2. The single purpose of R.C. 5719.01, pursuant to which a tax lien attaches in favor of the state, and, through the state, in favor of taxing subdivisions thereof, on January 1 of each year, is to guarantee the payment of taxes by those property owners upon whom a levy for taxes is made. The statute has no significance with regard to the actual levy of taxes, or the time when such taxes are levied.
APPEAL from the Court of Appeals for Medina County.
Appellants are the Medina County Board of Education, the Board of Education of the Highland Local School District, and various past and present auditors and treasurers of Medina County and their sureties.
Appellees are the Summit County Board of Education, and the Board of Education of the Revere Local School District.
Prior to July 1, 1970, the Revere Local School District, in Summit County, included approximately 500 acres of real property geographically located in adjoining Medina County. Bordering the Revere district, in Medina County, is the Highland Local School District.
In May 1969, the Summit County Board of Education adopted a resolution, pursuant to R.C. 3311.231, transferring that portion of the Revere Local School District located in Medina County to the Medina County Board of Education.
A referendum was held on the issue in November 1969, and the transfer was approved by the voters.
On December 3, 1969, the Summit County Board of Education adopted a second resolution transferring the property, specifying July 1, 1970, as the effective date of the transfer.
Thereafter, the property was accepted by the Medina County Board of Education, and assigned, pursuant to a prior agreement, to the Highland Local School District.
An oral agreement between the Highland and Revere boards concerning the transfer provided that:
(1) Approximately 500 acres of property in Medina County would be transferred from the Revere district to the Highland district;
(2) Any student living in the transferred area, and born before July 1, 1970, would be permitted to continue attendance in the Revere district until graduation; and
(3) When the Highland district began to receive property tax dollars generated by the transferred territory, it would pay tuition to Revere for pupils living in the transferred area who chose to attend Revere.
Examination of the record discloses that the Revere Local School District received those property tax dollars and tuition payments to which it was entitled pursuant to the foregoing oral agreement. Beginning in January of 1971, the first month of the calendar year in which Highland received property tax revenues from its levy upon the transferred territory, Highland made tuition payments to Revere for those pupils living in the transferred area who chose to attend Revere. The agreement between the Highland board and the Revere board constitutes an independent base upon which the result reached infra could rest.
On July 1, 1970, the transfer of property from the Revere district to the Highland district became effective.
In November 1970, the Highland Board of Education certified to the auditor of Medina County the rates and amounts to be levied upon property, including the now-transferred property, in the Highland Local School District for the year 1970. The taxes were billed by the auditor in December 1970 and June 1971, and the revenue therefrom distributed to the Highland Local School District in March and September of 1971.
On October 26, 1973, the Revere Board of Education and the Summit County Board of Education filed a mandamus action in the Court of Appeals, claiming the revenue generated by Highland's levy upon the transferred property for the period January 1 through June 30, 1970, which was distributed to Highland in March of 1971. The Court of Appeals granted the writ.
The cause is now before this court upon an appeal as of right.
Mr. Stephan M. Gabalac, prosecuting attorney, and Ms. Susan E. Boyer, for appellees.
Mr. Roger R. Ingraham, prosecuting attorney, and Mr. Harry E. Van Horsten, for appellants.
The two issues presented by this appeal are, fiirst, whether the Highland Board of Education, an appellant herein, was the appropriate taxing authority to levy taxes for the year 1970, the revenues from which were distributed in 1971, upon property transferred from the Revere Local School District to the Highland district, effective July 1, 1970; and second, whether the Highland Local School District is obligated by law to pay those tax moneys which it received in March 1971 to the Revere district.
Ohio law requires the taxing authority of each taxing subdivision in the state (the local board of education being the taxing authority for the local school district) to adopt a tax budget for the next succeeding fiscal year on or before July 15 of each year, and to submit that budget to the county auditor on or before July 20. R.C. 5705.28; R.C. 5705.30. Subsequently, the tax budgets are presented to the budget commission for review, and the proper tax levy for each taxing subdivision is certified to the appropriate taxing authority. R.C. 5705.27 et seq. Each taxing authority must then authorize the tax levy, and certify that levy to the county auditor for collection, before the first day of October in each year, or of such later date as is approved by the Board of Tax Appeals.
Property taxes levied in the fall of any particular year are collected and distributed during the following year, and finance operations in this latter year, that is, in the year in which the taxes are collected and distributed. For example, taxes levied in the fall of 1970 (as was done by Highland in this case) are collected and distributed in 1971 to meet operating expenses during 1971.
The statutory scheme contemplates that one taxing authority alone will levy taxes upon real and personal property for each calendar year, namely, the taxing authority of the taxing subdivision in which the property is located on the date of the tax levy. That requirement is explicit in R.C. 5705.03, which states:
"The taxing authority of each subdivision may levy taxes annually * * * 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. * * *" (Emphasis added.)
Herein, in November 1970, the Highland Board of Education certified to the auditor of Medina County the rates and amounts to be levied upon property in the Highland Local School District for the year 1970. On that date, and for four months prior thereto, the transferred property was a part of the taxing subdivision designated the Highland Local School District. Therefore, pursuant to R.C. 5705.03, only the Highland Board of Education was authorized to levy taxes thereon.
Appellees do not dispute this interpretation, but cite R.C. 5719.01, and contend that Revere's right to taxes levied upon the transferred property for the period January 1 to July 1, 1970, which revenues were distributed to Highland in March 1971, vested in the Revere district on January 1, 1970. Such an argument misconstrues the effect of R.C. 5719.01.
That statute provides, in pertinent part:
"The lien of the state for taxes levied for all purposes on the real and public utility tax list and duplicate for the year 1954 and each year thereafter shall attach to all real property subject to such taxes on the first day of January, annually, and continue until such taxes and any penalties, interest, or other charges accruing thereon are paid * * *."
Pursuant to the statute, a tax lien attaches in favor of the state, and, through the state, in favor of taxing subdivisions thereof, on January 1 of each year. The single purpose of the statute is to guarantee the payment of taxes by those property owners upon whom a levy of taxes is made. The statute has no significance with regard to the actual levy of taxes, or the time when such taxes are levied. State, ex rel. Donahey, v. Roose (1914), 90 Ohio St. 345; Cincinnati v. Roettker (1931), 41 Ohio App. 269.
In view of the foregoing, we conclude that only the Highland Board of Education was authorized by law to levy taxes upon the transferred property for the year 1970, and that no statute obligates Highland to pay the moneys distributed to it in March of 1971 to the Revere district. The judgment of the Court of Appeals is reversed.
Judgment reversed.
CORRIGAN, STERN and CELEBREZZE, JJ., concur.
O'NEILL, C.J., HERBERT and W. BROWN, JJ., dissent.
The record shows that the transfer of part of the Revere School District to the Highland School District occurred on July 1, 1970.
As observed by Hunsicker, J., of the Court of Appeals for Medina County, "* * * a tax collection by Medina County authorities [was made] for the first half of 1970, payable in December 1970, and a settlement made to the respective political subdivision in February, 1971, of the tax thus collected. It is this school tax that was not paid. No evidence has been shown to establish the payment."
Thus, no distribution of the taxes which were collected for the period January 1 to July 1, 1970, from the taxpayers owning property in that portion of the territory of the Revere School District which was transferred to the Highland School District on July 1, 1970, was made to the Revere School District when the settlement was made in February 1971 with regard to the taxes for the period January 1 to July 1, 1970, which were collected in December 1970. It follows that the Revere School District was entitled to distribution of those taxes collected for the first half of the year 1970, and conversely that the Highland School District was not.
The judgment of the Court of Appeals should be affirmed.
HERBERT and W. BROWN, JJ., concur in the foregoing dissenting opinion.