ORDERS:
ORDER AND DECISION ON MOTION FOR RECONSIDERATION AND/OR REHEARING
STATEMENT OF THE CASE
This matter is before the Administrative Law Judge Division ("Division") pursuant to
Respondent/Charleston County Assessor's ("Assessor") Motion for Reconsideration and/or Rehearing
("Motion") of this court's Order and Decision ("Order") dated June 12, 1995 (incorporated herein
by reference). The motion hearing was held on July 26, 1995 at the Division's offices at 1205
Pendleton Street, Columbia, South Carolina, attended by legal counsel representing the Petitioner,
Assessor and the South Carolina Department of Revenue and Taxation ("Department").
In the Motion, the Assessor seeks a review of this court's Order upon the following grounds:
(1) That the decision dated June 12, 1995 is based upon clear error of law as in a
reassessment year the potential use of the property, not its present use, is the determining
factor in determining the appraised value.
(2) The decision further is flawed in that the taxpayer (Petitioner) is not entitled to a
reduction in the value of his property on the grounds that property of other taxpayers are
undervalued.
Neither the Department nor the Charleston County Board of Assessment Appeals ("Board")
filed a return to Assessor's motion. However, the Petitioner did file a return in which it responded
as follows:
(1) The Order does not conclude (as Respondent alleges) that current use (use to which
the property is adapted) differs from the use to which the property is capable of being used;
however, to the extent any ambiguity might exist in language of the Order, the Petitioner
suggests the possibility of the addition of a final sentence following the third paragraph ( next
to last paragraph) on the bottom of page 7, which sentence would read:
"In the case at hand, I find the current use of the two lots, i.e., that of
a single-family residence, to be the highest and best use for which the
property is capable of being used."
(2) The Order is clearly correct in concluding that it is inequitable as a matter of law to
allow Petitioner's property to be assessed at a value in excess of substantially identical
comparable properties.
The Order dated June 12, 1995 reversed both the Assessor's and the Board's determinations
in valuing as two separate lots Petitioner's real property located at 41 Eugenia Avenue, Kiawah
Island, South Carolina.
The Order dated June 12, 1995, remains in effect in all respects except as amended herein.
DISCUSSION
The Assessor argues that South Carolina law provides that the fair market value of real
property for assessment and taxation purposes is based upon the highest and best use for which the
property can be used or adapted, which may not be its current use. Further, he argues that the law
is the same in valuing real property for assessment purposes as in valuing for eminent domain or
condemnation proceedings. The Assessor opines that Petitioner's real property was reassessed in
1993 as a result of an Order of the South Carolina Tax Commission mandating reassessment as
statutorily required, not as a result of any change in the condition of Petitioner's property.
Petitioner utilized values of adjoining properties fronting on the Atlantic Ocean, as assigned
by the Assessor for 1993, as comparables to formulate his opinion of the value of his property for the
year 1993. The Assessor argues these comparable values cannot be utilized by the Petitioner and are
not helpful or useful since those properties were undervalued by the Assessor.
The Department takes the position that the determination of the highest and best use of the
property is based upon a willing buyer-willing seller situation and the adaptability of the property,
whether it is its current use or not.
Petitioner maintains that the highest and best use of his property for which it is capable of
being used is its current use, which is a single-family residence. Further, he argues that it would be
inequitable to assess his property in excess of assessments assigned by the Assessor to substantially
identical comparable properties in close proximity to his.
The principles to be utilized in ascertaining the value of real property for purposes of taxation
are the same that control in condemnation cases. 72 Am. Jur. 2d State and Local Taxation § 759.
In the absence of evidence to the contrary, the presumption is that the property's present use is the
highest and best use. The present use of property is presumed to be its highest and best use...and the
burden is on the condemnee to show that the property is adaptable for use other than its current use,
and that there is a need for this use in the reasonable foreseeable future and that such use is a legally
permissible use. 29A C.J.S. Eminent Domain §§ 271-272 (1992).
Since there is no evidence in the record to show that Petitioner's property is adaptable for any
use other than its current use or that there is a need for this other use in the reasonably foreseeable
future, I am still persuaded that the determinations of both the Assessor and the Board to assess
Petitioner's property as two separate properties are without merit.
ORDER
Accordingly, IT IS HEREBY:
ORDERED that my previous Order dated June 12, 1995, remains in effect in all respects
except as hereinafter amended:
(1) The reference to "paragraph 3" is Finding of Fact #9 is amended to "paragraph 7."
(2) The last sentence in the last paragraph of page 7, which reads as follows:
"Current usage and not title is the determining factor to apply in
appraising a property for its highest and best use."
is deleted in its entirety and the following is substituted in lieu thereof:
"Current use for which property can be adapted is the determining
factor to apply in appraising a property for its highest and best use."
(3) The last sentence of the first paragraph on page 8 of the Order is deleted in its entirety
and the following is substituted in lieu thereof:
It would be inequitable and an error of law to allow the Assessor to
assign a value to Petitioner's property in excess of those assigned by
the Assessor in the same taxable year to other substantially identical
and comparable properties that either adjoin or are in close proximity
to his property.
(4) The following sentence is added to the second and last paragraph on page 8 of the Order:
In this case, I find the current use of Petitioner's property, i.e., that of
a single-family residence, to be its highest and best use for which it is
currently capable of being used.
AND IT IS SO ORDERED.
____________________________________________
Marvin F. Kittrell
Chief Judge
Columbia, South Carolina
August 9, 1995 |