ORDERS:
ORDER AND DECISION
STATEMENT OF THE CASE
This matter is a contested case brought by Darlene K. Giles (taxpayer or Petitioner) against
the Richland County Assessor (Assessor) concerning a property valuation for the tax year 1992. The
taxpayer exhausted her prehearing remedies with the Assessor and the Richland County Board of
Assessment Appeals (Board) and has requested a contested case hearing before the Administrative
Law Judge Division (Division).
A hearing was held by me at the Division's offices, 1205 Pendleton Street, Columbia, South
Carolina on December 12, 1995. After considering all the evidence and testimony, and having
personally viewed the lot with the consent of the parties, I conclude that the property must be valued
at $24,900.
ISSUES
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?
FINDINGS OF FACT
After consideration and review of all the evidence and testimony, by a preponderance of the
evidence, I make the following findings.
1. This Division has personal and subject matter jurisdiction.
2. Notice of the date, time, place and nature of the hearing was timely given to all parties.
3. On February 13, 1987, taxpayer purchased lot 12, Block D, in Spring Valley
subdivision, section #11, for the sum of $22,500 from Spring Valley section #11, a South Carolina
Partnership. The lot is designated in the Assessor's office as TM # R20005-01-47, located in Tax
District 2S, Richland County and is known as 130 Southlake Court.
4. There are no improvements on the lot.
5. The Richland County Assessor appraised the property for the 1992 tax year at
$34,300.
6. After an appeal by the taxpayer to the Assessor, the Assessor performed a physical
inspection of the property, reviewed all information, and as a result reduced the assessed value to
$30,000.
7. The taxpayer appealed to the Board which held a hearing on June 14, 1994, and
affirmed the value placed on the property by the Assessor.
8. The taxpayer appealed the decision of the Board to the South Carolina Tax
Commission (Commission), arguing that the Board did not have a quorum present at its hearing. The
Commission, in an order dated October 13, 1994(1), remanded the matter to the Board for a re-examination of the evidence at a hearing to be held either with a quorum present, or by consent of
the parties for a waiver of such.
9. The Commission, in its decision, opined that "there is substantial evidence and
testimony contained in the record to support taxpayer's position of $25,000 on the subject property."
10. The subject lot consists of 0.33 acres.
11. The lots on the cul-de-sac where this subject lot is located are deed-restricted to 2500
square foot homes.
12. This lot has been marketed and listed for sale by taxpayer for approximately eight
years. For a short period of time prior to the second Board hearing, it was listed for sale at $25,000,
with no offers made.
13. The Assessor used the market sales method to value the property for taxation
purposes, using six comparables for sales comparison and equity comparison. The table below
delineates the various lots with their acreage and appraised value, as compared to taxpayer's lot.
Land Equity Comparison
and
Sales Comparison
| Comparable No. |
Date of
Sale |
Sales Price |
Land Size |
Zoning |
Appraisal
Value |
| 1. 120 Spring Valley Ct. |
11/90 |
30,000 |
0.195 Ac. |
RG-1 |
30,000 |
| 2. 30 Olde Springs Rd. |
5/91 |
32,500 |
0.64 Ac. |
RS-1 |
34,250 |
| 3. 8 Barclay Ct. |
9/87 |
37,500 |
0.65 Ac. |
RS-2 |
27,400 |
| 4. 128 Southlake Ct. |
|
|
0.37 Ac. |
RS-2 |
34,250 |
| 5. 124 Southlake Ct. |
|
|
0.32 Ac. |
RS-2 |
34,250 |
| 6. 120 Southlake Ct. |
|
|
0.25 Ac. |
RS-2 |
34,250 |
14. Comparable #1 is generally rectangular in shape, is a patio home site, located within a
small patio home subdivision. This subdivision is located to the left of the major roadway (Spring Valley
Road) leading into Spring Valley subdivision, after passing through the main entrance. A home was
constructed on this lot within 3 to 4 months after its purchase.
15. Comparable #2 is also generally rectangular in shape. It is located several blocks to the
north of taxpayer's lot. A home was constructed on it in 1991.
16. Comparable #3 is located at the end of a cul-de-sac, backing up on Harrington Road. It
is the farthest of the comparables from taxpayer's lot.
17. Comparables #1, #2 and #3 are generally flat lots with minimal elevation from the street
in front.
18. Comparables #4, #5 and #6 are located on the same side of Southlake Court as the subject
lot and adjoin it.
19. Taxpayer presented no comparable sales to establish a valuation different from those
of the Assessor. However, he argued for adjustments to the Assessor's comparables based upon the
irregular shape of the subject lot, its elevation from the street, and the right of way or utility easement
on its eastern boundary which limits the placement of a house on it.
20. A listing of the square footage and assessed value based upon the Assessor's values
applicable to both taxpayer's lot and the six comparables are as follows:
| Lot |
Acreage |
Square Footage |
Assessed Value per Square Foot |
| Taxpayer |
0.33 |
14,505.48 |
1.909 |
| Taxpayer's comparable #1 |
0.195 |
8,494.20 |
3.53 |
| Taxpayer's comparable #2 |
0.64 |
27,879.40 |
1.229 |
| Taxpayer's comparble #3 |
0.65 |
28,314.00 |
0.968 |
| Taxpayer's comparable #4 |
0.37 |
16,177.20 |
2.125 |
| Taxpayer's comparable #5 |
0.32 |
13,939.20 |
2.457 |
| Taxpayer's comparable #6 |
0.25 |
10,890.00 |
3.145 |
The only sales comparable utilized by the Assessor are #'s 1-3. Thus, they are the most reliable.
Arguing this square footage, and assessed value per square foot provides an average value per square
foot of $1.909. Further, applying a discount of 10% due to the lots irregularity and the utility
encumbrance is appropriate. Using the $1.909 square foot price and the 10% discount, the value of
the subject lot is $24,921, rounded off to $24,900.
21. The valuation date used by the Assessor is December 31, 1991.
22. In the tax year 1992, this lot was reassessed as part of a county-wide reassessment
program which resulted in taxpayer's initial Assessment of $34,500. Information pertaining to other
property owners who were reassessed in 1993 is contained in finding of fact number 13.
DISCUSSION
Taxpayer challenges the accuracy of the market sales method used by the Assessor to value her
lot. She asserts that the sales of the six comparable properties do not adequately reflect the value of
her lot. Her lot is irregular in shape as compared to each of the comparables. Further, it is on a much
steeper grade as compared to comparables 1-3, each of which is generally flat. Although it has similar
elevation as comparables 4, 5, and 6, which adjoin it on Southlake Court, it does not have the depth
they have. Further, it is encumbered by a utility easement for power lines on its eastern boundary with
lots 40 and 63 which inhibit the "placement" of a house it.
Although comparables are used to help establish value, they are more reliable if they are
affected by or subject to the same factors, such as shape, size, easements, road frontage, sales prices,
zoning requirements, restrictions, etc...to which the property being valued is subject. If not, they lose
their reliability. In this instance, the comparable sales must be adjusted for these differences to provide
a meaningful and reliable comparison.
Taxpayer has attempted for a number of years to sell the property. Although a taxpayer is not
required to sell a property to establish its value, the inability to sell a property after advertising it for
sell for a period of eight years is a factor to consider in determining that value a willing buyer would
pay a willing seller for it.
Further, taxpayer argues that the Assessor did not equitably value her lot in using the $34,500
value assigned to the land value of comparables 4, 5 and 6 which adjoin it on Southlake Court. In
explanation, she argues their land value of $34,500 each is artificially inflated or greater than their true
value. However, to correct this, she argues the Assessor adjusts the valuation of the houses on each
lot downward to ensure the resulting figure equates to the correct value for assessment purposes.
Sufficient proof to support this argument was not placed in the record by the taxpayer.
Taxpayer has not proved any intentional and systematic undervaluation by the Assessor.
Although some of the properties may be overvalued or undervalued, there was no proof the Assessor
deliberately established such a county-wide procedure.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, applicable law, and Summary of the Evidence, I
conclude, as a matter of law, the following:
1. S.C. Code Ann. § 12-60-2540 (Supp. 1995) authorizes the South Carolina
Administrative Law Judge Division to hear this contested case pursuant to Chapter 23 of Title I of the
1976 Code, as amended.
2. S.C. Code Ann. § 12-37-90 (Supp. 1995) grants authority to the South Carolina Tax
Commission to alter values set by the assessor on real property.
3. S.C. Code Ann. § 12-4-30(D) (Supp. 1995) provides that an administrative law judge,
after February 1, 1995, shall hear all contested cases as defined by S.C. Code Ann. § 1-23-310 (Supp.
1995) previously heard by the South Carolina Tax Commission.
4. S.C. Code Ann. § 12-37-90 (Supp. 1995) states that all counties shall have a full-time
assessor, whose responsibility is appraising and listing property. Further, the assessor shall:
a) Maintain a continuous record of recorded deed sales transactions, building
permits, tax maps and other records necessary for a continuing reassessment
program;
b) Diligently search for and discover all real property not previously returned by
the owners or agents thereof or not listed for taxation by the county auditor and
list such property for taxation, in the name of the owner or person to whom it
is taxable;
c) When values change, reappraise and reassess any or all real property so as to
reflect its proper valuation in light of changed conditions, except for exempt
property and real property required by law to be appraised and assessed by the
commission, and furnish a list of these assessments to the county auditor;
d) Determine assessments and reassessments of real property in such a manner that
the ratio of assessed value to fair market value shall be uniform throughout the
county.. . .
5. S.C. Code Ann. §§ 12-43-300 and 12-60-2510 through 12-60-2530 (Supp. 1995)
provide the procedure whereby a taxpayer, upon receipt of a notice from the Assessor of the valuation
and assessment placed on his property, may file written notice of objection to the valuation and
assessment within certain time frames. Failure to serve the written notice of objection within the
statutory time limitations is a waiver of the owner's right to appeal. If the objection is timely filed, the
owner may have a conference with the assessor and, if still aggrieved, may appeal that decision to the
Board of Assessment Appeals.
6. An assessor's valuation is presumed correct with the burden being on the property
owner to disprove the assessor's determination. 84 C.J.S. Taxation § 410 (1954).
7. The Legislature, in S.C. Code Ann. § 12-37-930 (Supp. 1995), has decided how real
property must be valued:
"All real property shall be valued for taxation 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 buyer
are willing, are not acting under compulsion, and are reasonably well informed
as to the uses and purposes of which it is adapted and for which it is capable of
being used..."
8. Fair market value is the measure of true value for taxation purposes. Lindsey v. S.C.
Tax Comm'n, 302 S.C. 274, 395 S.E.2d 184 (1990).
9. The taxable status of real property for a given year is to be determined as of December
31st of the preceding tax year. S.C. Code Ann. § 12-37-900 (1976). Atkinson Dredging Co. v.
Thomas, 266 S.C. 361, 232 S.E.2d 592 (1976).
10. 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).
11. Neither the equal protection clauses of the Federal and State Constitutions nor the
uniformity provision found in the South Carolina Constitution in Article X, Section 1 afford relief to
a taxpayers argument for reduction in value based upon principles of equity, i.e...that his neighbors'
similar property is valued less than his and that they should be equalized. None of these constitutional
provisions require absolute accuracy in tax matters. Allied Stores of Ohio v. Bowers, 358 U.S. 522
(1959); Owen Steel Co., Inc. v. S.C. Tax Comm'n, 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).
12. Taxpayer has the burden of proving an intentional and systematic undervaluation of
certain properties, with other properties in their same class but which are valued at fair market value.
Sunday Lake Sun Co. v. Wakefield Taxpayer, 247 U.S. 350 (1918). 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 Comm'n, 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 Richland County.
13. The Assessor, as affirmed by the Board, placed a value of $2.068 per square foot on
taxpayer's lot. An average of the Assessor's value of the three comparables (#'s 1-3), each of which
actual sales data was placed into evidence, produced an average assessed value per square foot of
$1.909. Each of these lots were flat in topography, were fairly rectangular in shape and were not
burdened with a utility easement. The South Carolina Tax Commission, in a similar case(2), recognized
the difficulty in valuing such property. In that matter it averaged comparable sales data and applied
a 13% discount due to a power line encumbrance. I conclude a 10% discount is appropriate in this
case.
14. After review of all the evidence, I conclude that using the $1.909 square foot price and
the 10% discount is appropriate. Accordingly, the assessed value of TM # R20005-01-47 is valued
at $24,922 and rounded off to $24,900.
ORDER
Based upon the above Findings of Fact, Discussion, Conclusions of Law and a viewing of the
property, it is hereby
ORDERED that the Assessor value taxpayer's property identified as TM# R20005-01-47 at
$24,900.
AND IT IS SO ORDERED.
________________________________________
Marvin F. Kittrell
Chief Judge
Columbia, South Carolina
January 31, 1996
1. Commission Decision 94-93
2. Commission Decision 93-98 |
