SC Administrative Law Court Decisions

This is a contested case matter brought by Ruth Mitchell as the Petitioner (hereinafter referred to as "taxpayer") against the Richland County Assessor (hereinafter referred to as "assessor") concerning property valuations for property tax year 1992. The property owner exhausted the prehearing remedies with the assessor and the Richland County Board of Assessment Appeals and is now seeking a contested case hearing before the Administrative Law Judge Division (hereinafter referred to as "ALJD"). Jurisdiction is granted the ALJD by S. C. Code Ann. §12-60-2540(A) (Supp. 1994). After considering all of the evidence presented at a hearing on September 6, 1995, I conclude the property must be valued at $54,700.

Any issues raised in the proceedings or hearing of this case but not addressed in this Order are deemed denied. ALJD Rule 29(B). Further, the filing of a motion for reconsideration is not a prerequisite to any party filing a notice of appeal of this Order. ALJD Rule 29(C).

1. Is the taxpayer's property correctly valued for assessment purposes for 1992?

2. Is the taxpayer's property equitably valued in relation to similar properties?

1. Positions of Parties:

The taxpayer challenges the accuracy of the market sales method used to value her property. She asserts the sales of similar properties, hereinafter referred to as "comparables," do not adequately reflect the value of the property. The assessor, however, asserts his comparables considered the limitations on the taxpayer's property and fairly represent the value of the property.

2. Findings of Fact:

I find, by a preponderance of the evidence, the following facts:

a. General

1. The taxpayer is the owner of a parcel of real estate consisting of a lot with improvements.

2. The property is located in Richland County, South Carolina, is identified on the Richland County Tax Map as Tax Map #19104-04-04, and carries an address of 7534 Burdell Drive, Columbia, South Carolina.

3. The Richland County Assessor appraised the property for the 1992 tax year for $54,700.

4. After an appeal by the taxpayer to the assessor, the assessor performed a physical inspection of the property and still maintained the value of the property was $54,700.

5. The taxpayer appealed to the Richland County Board of Assessment Appeals, which also concluded the property is to be valued at $54,700.

b. Description of Property

6. The subject property consists of a lot with a size of 82 x 219 feet.

7. The structure is a three bedroom, one and a half bath, one-story brick veneer house with approximately 1176 square feet of living space.

8. The property is used as a rental property and is well maintained.

c. Method of Valuation

9. The assessor used four comparables in his application of the market sales approach.

10. Comparable number 1 is located on the same street as the taxpayer's property and consists of an 82 x 219 foot lot.

11. Assessor's comparable number 1 has an improvement consisting of a three bedroom and one and a half bath house with 1,128 square feet which sold in June of 1991 for a sales price of $53,700.

12. Comparable number 2 is approximately a quarter of a mile from the taxpayer's property and consists of an 100 x 200 foot lot.

13. Assessor's comparable number 2 has an improvement consisting of a three bedroom and one and a half bath house with 1,350 square feet which sold in August of 1991 for a sales price of $61,000.

14. Comparable number 3 is located several streets away and consists of an 84 x 150 foot lot.

15. Assessor's comparable number 3 has an improvement consisting of a three bedroom and one bath house with 1,080 square feet which sold in July of 1989 for a sales price of $49,900.

16. Comparable number 4 is located on the same street as the taxpayer's property and consists of an 82 x 219 foot lot.

17. Assessor's comparable number 4 has an improvement consisting of a three bedroom and one and a half bath house with 1,153 square feet which sold in June of 1992 for a sales price of $60,000.

18. The properties identified above as comparables 1 through 4 are sufficiently similar to the taxpayer's property to be used as reliable evidence of the value of the taxpayer's property.

19. The sales of comparable properties provide a range of values per square foot as follows:

20. The average value per square foot based upon the sales prices and the square footage of the living space of the assessor's four comparables is $47.76.

21. The average sales price of the assessor's four comparable properties is $ 56,150.

22. The assessor valued the taxpayer's property at $54,700 or $46.51 per square foot of living space.

23. The taxpayer presented no sales of comparable properties. 24. The taxpayer's property is fairly valued at $54,700.

3. Discussion

The issue in dispute is the value of the taxpayer's property. The value is established by determining the price a willing buyer would pay to a willing seller for the taxpayer's property. S. C. Code Ann. §12-37-930 (Supp. 1994). The evidence here supports the $54,700 value based upon a market sale approach.

The four sales utilized by the assessor are reliable indicators of value. The comparable sales present an average value per square foot of living space of approximately $47.76 per square foot and an average sales price of $56,150. The assessor's value of the taxpayer's property of $46.51 per square foot and $54,700 is well within the fair market value of other similar property.

4. Conclusions of Law

Based on the foregoing Findings of Fact and Discussion, I conclude the following as a matter of law:

1. All property shall be valued for taxation purposes at its true value in money which in all cases shall be held to be the price which the property would bring following reasonable exposure to the market, where both the seller and the buyer are willing, are not acting under compulsion, and are reasonably well informed as to the uses and purposes for which it is adapted and for which it is capable of being used. S. C. Code Ann. §12-37-930 (Supp. 1994).

2. Fair market value is the measure of true value for taxation purposes. Lindsey v. South Carolina Tax Commission, 302 S.C. 504, 397 S.E. 2d 95 (1990).

3. While not conclusive, market sales of comparable properties present probative evidence of the fair market value of similar property. 84 C.J.S. Taxation § 411 (1954); see Cloyd v. Mabry, 295 S.C. 86, 367 S.E. 2d 171 (Ct. App. 1988).

4. The value of the taxpayer's land and improvements for assessment purposes is $54,700 for the assessment year 1992.

1. Positions of Parties:

The taxpayer's position is that the property in dispute is not equitably valued in relation to other properties. She seeks to have her property reduced in value to reflect the values of similar property in the area. The assessor asserts the same method of valuation was used on all of the properties in the taxpayer's area and that all properties were valued fairly.

2. Findings of Fact:

I find, by a preponderance of the evidence, the following facts:

1. The following properties are located on Burdell Drive and are comparable to the taxpayer's property:

2. The assessor's average adjusted assessment for the five comparables is 45.76 per square foot.

3. The assessor's average adjusted assessment for the five comparables is $54,560.

4. The taxpayer's property is assessed at $ 54,700 or $46.51 per square foot of living space.

5. Discrepancies in assessments of properties owned by other property owners in the taxpayer's neighborhood have occurred.

6. Property located at 7540 Burdell Drive is adjacent to the taxpayer's property.

7. The 7540 Burdell Drive property is similarly built and has approximately the same size lot as the taxpayer. Such property is assessed at $56,700 even though the structures on 7540 Burdell Drive contain significantly more square footage than the taxpayer's property.

8. The discrepancy in value from the taxpayer's to that of 7540 Burdell Drive is not intentional but rather results from errors of judgment.

3. Discussion

The taxpayer is seeking a reduction in value based on principles of equity. The allegation is that some neighbors own similar property which is valued less than the taxpayer's property. From this position, the taxpayer asserts the properties should be equalized by reducing the taxpayer's value.

The taxpayer's argument is based upon the Equal Protection Clauses of the Federal and State Constitutions, as well as the uniformity provision found in the South Carolina Constitution at Article X, Section 1. These provisions do not afford the taxpayer the relief she seeks.

None of the above constitutional provisions require absolute accuracy in property tax matters. Allied Stores of Ohio v. Bowers, 358 U.S. 522 (1959); Owen Steel Co., Inc. v. South Carolina Tax Commission, 287 S.C. 274, 337 S.E. 2d 880 (1985). Complete equity and uniformity are not practically attainable when valuing property. Wasson v. Mayes, 252 S.C. 497, 167 S.E. 2d 304 (1967). Rather, what is proscribed is the intentional and systematic undervaluation of certain properties while other properties in the same class are valued at fair market value. Sunday Lake Sun Co. v. Wakefield Taxpayer, 247 U.S. 350 (1918).

The burden of proving an intentional and systematic undervaluation rests with the complaining party. Sunday Lake Sun Co., supra. This burden is not met by a mere showing that some properties are undervalued. Owen Steel Co., Inc., supra. Rather, where a county assessor deliberately established a county-wide procedure whereby all property values were based upon their most recent purchase price, an intentional and systematic undervaluation of property was found. Allegheny Pittsburgh Coal Co. v. County Commission, 488 U.S. 336 (1989).

Unlike Allegheny Pittsburgh Coal Co, supra., there has been no showing in the instant case that the county assessor has intentionally and systematically undervalued property in the county. Further, there is no showing the taxpayer's property has in fact been valued higher than other similar properties.

The comparables in the record indicate the assessor attempted to value all properties at fair market value. For example, the comparable assessments show that the assessor's average assessment for the five comparables is $45.76 per square foot and that the average assessment for the five comparables is $54,560. Here the taxpayer's property carries an assessment of $46.51 per square foot of living space and is assessed for $54,700. Such a value is reasonably in line with the values determined by the comparables.

4. Conclusions of Law

Based on the foregoing Findings of Fact and Discussion, I conclude the following as a matter of law:

1. The taxpayer's property is valued equitably in relation to similar property.

2. There is no systematic or intentional undervaluation of property in the county.

3. There is no violation of the equal protection clauses of the Federal or South Carolina Constitutions.

4. There is no violation of the uniformity provision of the South Carolina Constitution as set out at Article X, Section 1.

5. The taxpayer is not entitled to have the disputed property value lowered due to inequities in assessment.

Based upon the foregoing Discussion, Findings of Fact, and Conclusions of Law, the following ORDER is issued:

The assessor is ordered to value the taxpayer's property identified as Richland County Tax Map #19104-04-04 at a value of $54,700 for assessment year 1992.

IT IS SO ORDERED.

____________________________

RAY N. STEVENS

Administrative Law Judge

This 8th day of September, 1995.