South Carolina              
Administrative Law Court
Edgar A. Brown building 1205 Pendleton St., Suite 224 Columbia, SC 29201 Voice: (803) 734-0550

SC Administrative Law Court Decisions

CAPTION:
SCDOR vs. Union Day School and Harold Freeman

AGENCY:
South Carolina Department of Revenue

PARTIES:
Petitioners:
South Carolina Department of Revenue

Respondents:
Union Day School and Harold Freeman
 
DOCKET NUMBER:
00-ALJ-17-0171-CC

APPEARANCES:
For the Petitioner: Geoffrey R. Bonham, Esquire

For the Respondents: Pro Se
 

ORDERS:

FINAL ORDER AND DECISION

STATEMENT OF THE CASE

This case comes before the Administrative Law Judge Division pursuant to S.C. Code Ann. § 1-23-600 (Supp. 1999) and S.C. Code Ann. § 12-4-30 (Supp. 1999). The South Carolina Department of Revenue ("DOR") brought this matter against Respondents, Union Day School and Harold Freeman, for two violations of S.C. Code Ann. § 12-21-4270 (Supp. 1999) in failing to pay the required tax on their purchase of bingo cards. DOR seeks a $5,000 penalty for each violation and revocation of the Respondents' license. Respondents admit that the tax was not timely paid, but they contend that the penalty is excessive given the circumstances in this case. After notice to all parties, a hearing was conducted on August 3, 2000 at the Administrative Law Judge Division ("ALJD") in Columbia, South Carolina. At the hearing, the parties stipulated to consolidating the cases and making a single record of the proceedings.



FINDINGS OF FACT

Having carefully considered the testimony and the arguments of both sides, and taking into account the credibility of the evidence and witnesses, I find by a preponderance of the evidence:

1. Notice of the time, date, place and subject matter of the hearing was given to all parties in a timely manner.

2. Respondents applied for and received a Bingo Card Purchase Voucher on October 30, 1997 authorizing the purchase of $29,040.00 of bingo cards.

3. The Voucher stated that $4,791.60 in bingo tax was due on or before November 14, 1997 (fifteen days from the date of purchase).

4. Respondents did not pay the tax on or before November 14, 1997, but they did pay the tax five (5) days after November 14, 1997.

5. Respondents applied for and received a Bingo Card Purchase Voucher on April 20, 1999, authorizing the purchase of $20,000.00 of bingo cards.

6. The Voucher stated that $3,300.00 in bingo tax was due on or before May 5, 1999 (fifteen days from the date of purchase).

7. The manager of the bingo operation, Yahia Zahran, attempted to pay the taxes on May 5, 1999, but arrived after the tax office had closed. Mr. Zahran paid the taxes the next morning on May 6, 1999.

8. After the November 14, 1997 violation, Respondents did not receive a Final Determination from DOR until February 28, 2000. Respondents testified that after talking with DOR employee, Mr. John Rampey, they thought this violation had been "taken care of," and that they would not have to pay a fine.

9. Union Day School no longer sponsors bingo. The bingo operation was closed on December 31, 1999.



CONCLUSIONS OF LAW

Based upon the above Findings of Fact, I conclude the following as a matter of law:

1. S.C. Code Ann. § 12-21-4270 (Supp. 1999) requires the payment of a 16.5% tax on the purchase of bingo cards, and this tax must be paid within fifteen (15) days of the DOR's receipt of the purchase application. Here, no dispute exists that the taxes were not timely paid. Given the late payments, the issue is what penalty results from a failure to timely pay the taxes.

2. The failure to timely pay the tax subjects the violator "to a penalty of up to five thousand dollars and revocation of the license at the discretion of the department." Each day in violation and each violation constitutes a separate offense. S.C. Code Ann. § 12-21-4140 (Supp. 1999).



3. Under S.C. Code Ann. § 12-21-3960 (Supp. 1999), the promoter and the nonprofit organization are jointly and severally liable for the penalty. Therefore, Union Day School and the promoter, Harold Freeman, are jointly and severally liable for the penalty DOR seeks to impose.

4. The amount of the penalty imposed is within the sound discretion of the Administrative Law Judge. Walker v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991). Considering DOR's lengthy delay in processing the 1997 violation and the fact that Respondents have turned in their bingo license and are no longer running the bingo operation, I believe that a $5,000 penalty for each violation and a revocation of their licenses is excessive. Therefore, I find that a monetary penalty in the amount of $200.00 and revocation of Respondents' licenses is appropriate in this case.



ORDER

Based upon the above Findings of Fact and Conclusions of Law,

IT IS THEREFORE ORDERED that the South Carolina Department of Revenue shall impose a penalty in the amount of Two Hundred ($200.00) Dollars against the Respondents.

IT IS FURTHER ORDERED that the Respondents' licenses to conduct bingo be revoked. AND IT IS SO ORDERED.





________________________________

C. DUKES SCOTT

ADMINISTRATIVE LAW JUDGE





August 18, 2000

Columbia, South Carolina


Brown Bldg.

 

 

 

 

 

Copyright © 2022 South Carolina Administrative Law Court