Ohio Senator Proposes Land Value Tax as Alternative to Property Tax Repeal

State Sen. Bill Blessing, R-Colerain Township, introduced Senate Joint Resolution 7, which would permit local boards to adopt a land value tax by majority vote. The measure would require supermajority approval in the legislature before going to voters.

Ohio lawmaker proposes land value tax amendment as alternative to property tax elimination

by Nick Evans, Ohio Capital Journal
February 26, 2026

While activists gather signatures to try to eliminate property taxes statewide in Ohio, a lawmaker is suggesting Ohio should tax the underlying land instead of the total property including improvements like homes and buildings.

Changing incentives

The proposal for new land taxing authority from Ohio state Sen. Bill Blessing, R-Colerain Twp., would only apply to local elected boards, and it’s permissive, so they don’t have to impose a land tax if they don’t want one.

His proposal, Ohio Senate Joint Resolution 7, would need supermajority support in both chambers of the General Assembly before it could go before voters.

The idea amounts to a reordering of incentives, and Blessing believes several positive developments could flow from that simple change.

“Why are land value taxes superior to property taxes? Quite simply, they don’t tax development,” Blessing told an Ohio Senate committee earlier this month. “And as many of you know, if we’re going to tax improvements, we get less of them.”

Because property taxes rise as you build, there’s an inherent disincentive to development, he explained. That’s why local governments add in sweeteners like tax abatements after the fact.

But if a landowner’s taxes are the same regardless of what they build, it makes sense to build more and spread the cost among multiple households.

“A very likely outcome,” Blessing said, “is that land value taxes would bring in more money in the aggregate, while lowering tax bills for the individual and reducing housing costs due to the added supply.”

Lower housing costs would mean ordinary Ohioans have greater buying power; a boon for them and for local businesses, he said. Also, tax collection under the land value model would be comparatively simple and straightforward. Gimmicks meant to hide or diminish a home’s value become irrelevant.

“You can’t move land, nor can you hide it,” Blessing said.

Because of those features, he added, many economists favor land taxes to property taxes.

Ohio economist Rob Moore helped Blessing with his proposal, and he explained there have been calls for a land tax for more than a century. By encouraging development and expanding the tax base, he explained, you get more bang for your buck.

“They’re more efficient (and) they’re more equitable than property taxes,” Moore said. “I think if we were starting from square one, this would be a much better way to do it.”

Another feature of Blessing’s proposal could prompt the taxing authorities themselves to change their behavior.

The Ohio Constitution allows local governments to levy ten mills (or 1%) in property taxes, but any additional property tax levy must go before the voters.

Blessing wants land taxes to work differently. Rather than going to the ballot, Blessing thinks taxing authorities should be able to impose them by a simple majority vote.

Because only elected boards have that power, their voters have the ballot box to hold them accountable, Blessing said.

And instead of budgeting for that “rainy day” when voters reject a levy, Blessing thinks officials will have greater certainty that they can raise money if it’s really needed.

Playing out the string

Blessing’s proposal is a big one, and it’s not the only one he’s offered.

Are you frustrated with an unresponsive state legislature? Blessing thinks adding 72 new seats would make lawmakers better represent much smaller districts.

How about the number of major policy questions that arrive as constitutional amendments? Blessing has a resolution to make Ohio’s initiated statute process more attractive by comparison.

In all three cases, he’s aiming to use state laws to carve a new path guiding behavior. He wants to nudge people toward outcomes that prioritize efficacy rather than simple partisanship.

Regarding the land taxing authority, Blessing downplayed the likelihood of out-of-control local officials.

“I do have faith in local governments to largely do the right thing,” he said. “I think that they would use these things judiciously, because, again, you’re taxing your residents.”

Blessing doesn’t imagine there would be some dramatic shift from property to land taxes if his proposal passed. Instead, he thinks local authorities would transition to land taxes over time as their existing property tax levies expire.

“I think it would be the end of outside millage, for sure,” he said, of those levies beyond the 10 mills granted in the state constitution. “Because why go to the ballot for any of this, again, when you can just do this by majority vote?”

As for the amendment to ban property taxes altogether, Blessing remains skeptical it will make the ballot at all. And if it did, he thinks his land tax proposal would have a good shot against it.

So how does his purportedly better tax system beat no taxes at all?

In short, he thinks opposition would be so vast and forceful that the abolition campaign will founder.

Part of that is the well-publicized $24 billion hole it would blow in the state budget.

Agencies that rely on that funding don’t want to see it threatened, and elected leaders won’t want to be blamed when other taxes shoot up to bridge the gap.

Ohio’s Office of Management and Budget projects a sales tax of 15% to 18%, or an income tax of 11% to 15% would be needed to replace lost property tax revenue.

Blessing also contends the people supporting a property tax repeal won’t like the Ohio they’re left with if it passes.

“Holy cow,” he said, “If I were an out-of-state investor, I would get my ass into Cincinnati as quickly as possible, buy up as much land as I can, sit on it forever, tax free. Ditto for homes, apartments, you name it.”

First time homebuyers would have a particularly difficult time getting started, he said. If sales taxes spike, older Ohioans struggling to cover property taxes on a fixed income would just trade one challenge for another.

How does that work in practice?

Right now, roughly three-fifths of Ohio’s property taxes go to schools. Any change to that system could have a big impact on school balance sheets.

Howard Fleeter is an economist who specializes in public finance, and he’s one of the state’s foremost experts on school funding.

When it comes to Blessing’s idea, Fleeter is an enthusiastic maybe.

“He’s trying to think outside the box,” Fleeter said. “Which, as it relates to this issue, that’s not a bad idea, because the box we’re in has a lot of constraints around it.”

One of Fleeter’s biggest concerns is ensuring some minimum level of local school funding.

For instance, Ohio’s current property tax system sets a floor of 20 mills for local schools.

Fleeter would like to see something similar for land taxes, but at this stage he said it’s a minor detail, and he was reassured to hear Blessing bring it up on his own in committee.

Property tax is complicated, and Ohio’s system, in particular, Fletter said, is more complicated than most.

Once you understand millage, the reappraisal cycle and taxable vs. appraised value, there’s the state rollback and reduction factors.

Each idea serves a purpose. But taken together, it’s layer upon layer of complexity.

Most people would rather not think about property taxes at all, and frustration with the current system has led to “a full out property tax revolt,” Fleeter said.

He’s not ready to fully embrace Blessing’s idea, but he’s not pushing it away either.

It’s good to put every idea on the table, Fleeter explained, if Ohio voters might be considering whether to abolish property taxes in just a couple of months.

“I think the points he’s making are valid points,” he said. “And the concerns, the things that we don’t know yet about how this would work over time, and how it would be implemented, those are also valid concerns.”

Fleeter brought up his own neighborhood as an example. His lot is about a tenth of an acre, but a handful of his neighbors live on one-acre lots.

“And so, the people with the one-acre lots would be paying 10 times as much in a land tax as I am,” he said. “They’re still single-family homes, right? Are their homes worth 10 times as much as mine? My guess is they’re not.”

On the other hand, Fleeter can see the value of encouraging development in places that are growing fast.

“My bottom line on it, is the things that he’s saying and the problems he’s trying to solve, these are the right issues,” he said. “So any policy discussion of those issues, I think, is a step in the right direction.”

Warren County Auditor Matt Nolan recently served on Gov. Mike DeWine’s property tax working group.

Like Fleeter, he sees a lot to like in Blessing’s idea but thinks it’s “a very long shot in the grand scheme of things.”

The first hurdle he sees is the agricultural lobby.

Blessing’s approach could put pressure on large landowners, and some of Ohio’s biggest are farmers.

“Any time you challenge the Farm Bureau — I’ve been told repeatedly, and I’ve experienced repeatedly — you lose,” Nolan said.

Under Ohio’s current property tax structure, farms pay a much lower rate through the Current Agricultural Use Value program.

A hundred acres of homes or businesses generates a lot more money than a hundred acres of corn or soybeans. But if you taxed farmland at that market value, you’d lose a lot of farms.

Even though Blessing’s land value tax is permissive, Nolan thinks it would be in trouble if ag interests get spooked.

For its part, the Ohio Farm Bureau has yet to a take a position on the measure.

Director of Communications and Media Relations Ryan Matthews explained they’re still reviewing the idea, “and how it would affect farmland or land in agricultural use.”

Nolan raised another potential bit of friction that could crop up between neighbors.

Imagine a neighborhood of modest homes with equally sized parcels. What happens if a new owner knocks down the existing home and builds a much larger one in its place?

“That person with the small house on that land, same land, would pay the same amount (in) taxes as the guy with the mansion on the land,” Nolan said. “And I would think there would be some equity issues that would really cause some heartburn.”

But moving Ohio away from its reliance on voted levies? Nolan thinks that’s a great idea.

Expanding the tax base by nullifying the tax abatements and exemptions that push more of the tax burden onto fewer property owners? That’s great, too.

Still, Nolan has a nagging feeling you could go a long way toward expanding the base without having to amend the Ohio Constitution.

“There just hasn’t been the courage to do that,” he said.

“You know, I like the idea, all the pieces of it,” he added. “It seems like a big lift, but I think that this is a time more than ever we need to be exploring all these different ideas and try to find the system that works best.”

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Ohio Capital Journal is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Ohio Capital Journal maintains editorial independence. Contact Editor David Dewitt for questions: info@ohiocapitaljournal.com.

Blessing argues taxing land rather than buildings would encourage development, lower housing costs and simplify tax collection. The proposal comes amid debate over a separate effort to abolish property taxes, which state budget officials estimate would create a $24 billion revenue shortfall.