Dear Community Member,

In February, we provided you with an update to the Beachwood City School District's litigation with the Cleveland Clinic Foundation regarding real estate taxes for its Cedar Road facility in Beachwood.

The litigation began in 2005 when The Clinic appealed the Ohio Tax Commissioner's decision rejecting The Clinic's application seeking to exempt the Cedar Road facility from real estate taxation. In doing so, the Beachwood City School District became a party to the litigation and essentially was required to defend the decision of the Ohio Tax Commissioner. Had the District failed to participate actively in the litigation, the taxable status of the Cedar Road facility would likely be lost for the indefinite future*.

When we last updated you in February, we informed you that The Ohio Tax Commissioner, through its representation by the Ohio Attorney General, suddenly and inexplicably reversed its position after the trial was completed and urged that the Cedar Road facility be designated as exempt from real property taxation.   

Earlier this week, the Board of Tax Appeals issued its written decision and ruled in favor of The Clinic, granting it tax-exempt status for real estate tax purposes. While this decision was expected given the position only recently taken by the Attorney General, it is nonetheless frustrating and disappointing given the valuable time and resources expended defending this matter, and - of course - the unrealized revenue for the district.

At this time the Beachwood Board of Education is exploring what steps, if any, it will take next. We are reaching out to other school districts that may be affected by this ruling, as well as state and national school board associations, to determine all options so that we may decide the best course of action to take. The climate in Columbus and throughout the country has varied and shifted on the relevant issues over the nine years since this litigation began. Your Board of Education is committed to taking the steps necessary to protect our students, schools and community. However we must weigh all factors - financial and non-financial - before making any decisions.

We will keep you apprised of future developments in this matter.

Sincerely,

Mitchel E. Luxenburg, President

Beachwood Board of Education

Dr. Brian Weiss, Vice President

Beachwood Board of Education

*There is legislation in Ohio, namely Ohio Revised Code Chapter 140, which enables medical facilities to obtain real property exemption under certain circumstances. Therefore, the only years affected for the Beachwood City School District are 2002-2011.