School districts rally together over Duke's plan to cut their tax revenue

CINCINNATI - Electric sparks were flying as superintendents gathered together to fight back against Duke Energy's decision to withhold some of its tax payments to school districts.

Duke believes it's $230 million Ohio property tax bill is too high.

The energy company believes it's overpaying by about $40 million.

The company says it's been working with the State of Ohio since December to try to reach a new deal.

However, Duke says since the state still hasn't made a decision, it's taking matters into its own hands.

Duke Energy's decision to withhold about $20 million in tax payments will cost Cincinnati Public Schools nearly $3.5 million this year.

It could add up to $8 million if Duke Energy's appeal is approved by the State of Ohio.

Lakota Schools could lose about $500,000 along with other districts from Deer Park to Mariemont losing hundreds of thousands in tax revenue.

"This unfortunately is not unusual in these times because the economy is so, so, so difficult. Every institution is looking for ways to cut back or to save money. Unfortunately, everyone is doing it to our students or trying to do it to our students. So, it's time for us to standup and say no. We're not going to let this happen," said Cincinnati School Board member Eileen Cooper Reed.

Duke's Vice-President of Community Relations and Economic Development, Johnna Reeder, says the company has conducted its own assessment on its substations and power lines and believes it should be reduced by $40 million annually.

"Personal property is what we make income off of and I don't have to tell you that the economy has not been good. It's affected income and so therefore it has effected rates of personal property. We want to pay our fair share, just no more, no less," Reeder said.

Some school districts say they already have plans to go to voters in November to ask for more money.

Mt. Healthy Schools superintendent says the district will likely have to ask for even more money than previously planned for on the November ballot since Duke is withholding some of its tax payment this year.

"As we look at our needs and try to set the millage for our upcoming levy. It's probably going to mean that we're going to have to ask for an extra mill," said Mt. Healthy Schools Superintendent David Horine.

School districts say they don't understand why Duke would make this decision to withhold $20 million in personal property tax payments with just days left for them to come up with a final budget for the 2010-2011 school year.

"The deadline has already passed for teacher layoffs and non-certified layoff notification. We're going to be scrambling to find some place to make-up the shortfall on our budget. In West Clermont, we spend $1,300 per pupil less than state average. That doesn't leave a whole lot of places left to cut," said West Clermont Schools Treasurer Alana Cropper.

Duke Energy says it isn't breaking any laws.

The company can legally do this until the State of Ohio makes a decision on its appeal, which is scheduled for late summer or possibly early fall.