Renters’ views unclear on Columbus schools’ tax vote
The Columbus Dispatch – September 30, 2013
When it comes to voting on property-tax increases, Jenine Larrabee doesn’t think renters like her ever consider that the tax hike could drive up their rent.
After all, the landlord pays the tax. But she knows that landlords base their rents in part on their costs, and those costs include taxes.
“Eventually, yes, it gets passed on,” said Larrabee, 46, a content editor for curriculum at Franklin University who lives in an apartment Downtown near the Main Library.
But how renters are going to feel about Issue 50, a 24 percent property-tax increase for Columbus City Schools and yet-to-be-determined charter schools, is an open question, even though about 57 percent of district residents rent.
The campaign for the levy doesn’t have any strategy to focus on renters, said Gene Pierce, who is running the effort.
“We’re looking at the big picture,” Pierce said. Many factors go into why people vote the way they do, such as wanting good schools and safe neighborhoods, he said. “I don’t think there’s any one factor.”
There’s a “weird perception” among property owners that renters tend to pass property-tax increases, said Stephanie Groce, a vice president with the Columbus polling firm Saperstein Associates and a former Columbus Board of Education member.
However, Groce said she couldn’t point to any polls that determined that renting versus owning is a deciding factor. Many renters fall into other categories of voters, such as tending to be younger, she said.
The Columbus Apartment Association can’t speculate on how renters will vote and hasn’t taken a position on Issue 50, said Laura Swanson, the group’s executive director.
“It’s just not something that the Apartment Association tracks, nor do we have knowledge of it,” she said.
Ultimately, the market determines rents, Swanson said. Owners will try to pass as many costs on to renters as possible, including property taxes, but it’s not always possible, she said.
That has certainly been the case in Cleveland since voters approved raising property taxes 50 percent for schools last year, said Ralph McGreevy, the executive vice president of the Northeast Ohio Apartment Association. Most Cleveland landlords had to eat the property-tax increase, he said.
“Let me be brutally honest with you,” McGreevy said. “If you tried to pass on every cost that came your way, no one would live in your buildings.”
But McGreevy rejects the notion that renters vote differently from homeowners on property-tax issues, saying both groups are weighing the cost against concerns about the quality of their communities.
In a paper published in the Journal of Urban Economics, University of Maryland economics professor Wallace Oats said several studies have found that communities with large numbers of renters tend to spend more money on local services, which he called the “renter effect.”
“On each proposal, the percentage of ‘yes’ votes at the precinct level was positively and significantly related to the percentage of renters,” Oats wrote.
The conventional perception that renters support public budgets because they don’t think the added cost will be passed on to them might not be wrong, he wrote. It might be the case, as some have argued, that property taxes are not fully passed on to renters and that they face a relatively lower tax burden, he stated.
However, Oats’ paper goes on to note that renters tend to vote less often than people who own their homes, which could negate the effect.
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