YOUNGSTOWN — The Youngstown City School District is owed more than $12 million in property taxes, but it may never see much of that money.

At the district’s regular Board of Education meeting Tuesday, Mahoning County Auditor Ralph Meacham and Director of Taxation Cheri Donofrio said the tax delinquency in the district through tax year 2022 totals $12,302,991.54.

Donofrio said 23,593 properties — or 37.5% of the 62,883 residential, commercial, industrial and other properties within the district — are delinquent on taxes.

Tax delinquency among the 22 school districts for which Meacham’s office tracks data, including some in Trumbull and Columbiana counties, totals more than $20.2 million. That means YCSD’s portion makes up 61% of unpaid taxes owed to school districts.

“The school district has no control over this,” Meacham said. “I imagine a lot of poorer cities have a similar problem, that inner-city school districts in Akron and Cleveland probably are looking at similar deficits.”

District Treasurer Bryan Schiraldi said he has not yet had time to review how Youngstown compares with other districts or if the delinquency rate is especially abnormal, but he said it is not entirely surprising.

“A lot of districts, after COVID, saw delinquent tax rates going up,” he said. “So I need to look into whether or not this level of delinquency is common for Youngstown or if it is newer just since COVID. But certainly it does have an impact on our district’s finances and our forecasting.”

The district is expected to operate with an annual deficit for the next five years. A January report from State Auditor Keith Faber’s office said Youngstown schools are headed toward a projected $16.9 million shortfall by fiscal year 2028, despite voter approval in November of a four-year, 9.51-mill renewal levy that will bring in $5.2 million for annual general operating expenses.

On Tuesday, the district announced it will begin slashing personnel from administrative and support staff, in an effort to save the district between $3.5 million and $4 million a year. The district also will be ending or not renewing some contracts with vendors to help with cost cutting.

Meacham also addressed the effects of the recent property revaluation.

Ohio requires that Mahoning County fully reevaluate every property in the county every six years. The 2023 revaluation led to a general increase in property values countywide. Meacham said that led to about one-third of residents paying more in property taxes, one-third paying less, and the remainder staying about the same.

In Youngstown, he said, property values increased an average of 57%, compared with the countywide average of 36 to 37%. That means slight changes to some of the district’s funding mechanisms, which could work in the district’s favor.

The emergency levy renewed in November operated at 9.6 mills last year, generating $5.29 million.Donofrio said this year the millage rate is adjusted to 7.08 mills to generate the same amount of money.

“Because of the values increasing, the millage rate comes down,” Meacham said. “School districts do not get a windfall because of an increase from revaluation. The net asset value went up, so the taxation rate comes down.”

However, revaluation does produce an increase for inside millage — the 10 mills that a government can assess on any piece of property to generate tax revenue.

For tax year 2022, Donofrio said, the inside millage was 4.2 mills and it generated roughly $2.3 million for YCSD. Now, the rate is still 4.2 mills but it will generate about $3.1 million.

That means an extra $800,000 for the district.

While it is small compared to the district’s projected deficits, Schiraldi said every bit helps.

“It absolutely benefits the district for sure — every dollar counts,” he said. “We knew there would be some money from higher valuations coming in, and my original projections were actually under what it ended up being. It’s a pretty historical increase. It’s not a big percentage but it helps, especially when we have such a high tax delinquency rate.”

But Schiraldi said the benefit could come with a potential hidden cost.

“With how state funding works, it can make the district look wealthier than it really is, so the state might decrease its share,” he said. “Each district has a calculation, and it differs from district to district. So each district has to be mindful of how they’re impacted based on these changes.”

Youngstown draws more money from the state than many others, bringing in about $13,450 per pupil, about 39% of its total revenue.

Another financial hit comes in the form of tax abatements — reduced tax rates that property developers seek from communities and school districts as incentives to bring business and real estate investment into neighborhoods.

Property tax abatements mean that any existing value on the property is still taxed at the regular rate, and the tax abatement applies only to improvements made on the property. That amount is determined by the auditor’s office, not by the developer.

“Just because someone says they’ve invested $1 million, that does not mean the improvement is valued at $1 million,” Donofrio said. “We look at the improvement and we may assess it at only $750,000 or even $500,000.”

Meacham said many have asked YCSD for abatements on new construction such as housing at Youngstown State University and the DoubleTree hotel downtown. Donofrio said the list of residential, commercial and other properties the district owns runs to four pages.

Records from the auditor’s office show that the district owns 38 abated properties, assessed at 35% of market value, for a total assessed value of $24.8 million. Donofrio said that while it is difficult to determine the total real value the abatements cost the district — there are two different tax rates for residential / agricultural and commercial / other properties — the inside millage alone generates about $104,000 a year less on the abated properties.

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