ORDERS:
ORDER AND DECISION
STATEMENT OF THE CASE
This matter came before me upon request of Petitioner, the Charleston County Assessor
(assessor), pursuant to S.C. Code Ann. § 12-60-2540 (Supp. 1995) contesting the decision of the
Charleston County Board of Assessment Appeals (Board), valuing certain real property identified as
PID #025-00-00-015 for the tax year 1993. The taxpayer, I. Jenkins Mikell, Jr., exhausted all
prehearing remedies with the assessor and the Board. The assessor is now seeking a contested case
hearing before the Administrative Law Judge Division. After notice to the parties, a hearing was
conducted on October 6, 1995. I conclude that the fair market value of the property is $700,000.
Pursuant to ALJD Rule 52 and SCRCP 21, the Board is hereby dismissed as a party. The
County Board acted only as an adjudicatory body and is not a necessary party required for a complete
decision in this matter. See Owen Steel Co., Inc. v. S.C. Tax Comm'n, 281 S.C. 80, 313 S.E.2d 636
(Ct. App. 1984). Any issue raised in the proceedings or hearing of this case but not addressed in this
Order is deemed denied. ALJD Rule 29(B).
FINDINGS OF FACT
Based upon the evidence presented, I make the following findings of fact, taking into
consideration the burden on the parties to establish their respective cases by a preponderance of the
evidence and taking into account the credibility of the witnesses:
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. The taxpayer is the owner of the parcel of real property that bears PID #025-00-00-015, located at 9084 Peters Point Road, Edisto Island, Charleston County, South Carolina.
4. The subject property, located at the end of Peter's Point Road on Edisto Island,
contains 187 acres with approximately 28 1/2 acres bordering St. Pierre Creek. Most of the 28 1/2
acres is marsh. A small portion of the property is directly on the water. The remaining water access
is through the marsh. The property is classified as agricultural property and is used for row crops and
timber production.
5. The taxpayer argues that access to the property should be a factor in valuing the
property. The road leading to the property is not a public road and there is no easement for access
to the property. At the time of valuation, however, the road leading to the property was a public
road. It was not closed until after December 31, 1992.
6. The Charleston County Assessor originally appraised the property for tax year 1993
at $905,000. After the conference with the taxpayer the value was lowered to $700,000. The
taxpayer appealed to the Charleston County Board of Assessment Appeals. Prior to the Board
hearing, the assessor actually inspected the property and revised its appraisal in 1994. At that time,
the revised assessed value for the 1993 tax year was $898,000.
7. The Charleston County Board of Assessment Appeals concluded the property should
be valued at $700,000, based upon a per acre value of $3,500 per acre.
8. Applying the market sales approach, the assessor used four comparables to arrive at
a fair market value to be placed on the taxpayer's property. These comparables are as follows:
ASSESSOR'S COMPARABLES
PID # Acreage Water Frontage Date Sold Sales Price
023-00-00-007/143 169.0 acres 13.9 acres 2/88 $850,000
028-00-00-004 138.5 acres 7.5 acres 2/93 $575,000
027-00-00-009 110.2 acres 7.35 acres 2/90 $385,000
029-00-00-046 68.36 acres 4.59 acres 11/89 $285,000
9. Comparable #1, located on Oyster Factory Road, is the largest parcel of all the
comparable properties used by the assessor. It encompasses 169 acres of highland and 90 acres of
marsh.
10. The assessor considers this comparable very similar to the subject, but increases its
value by 5% for water frontage, resulting in an indicated value for the subject property of $5,282 per
acre.
11. Comparable #2, located on Hwy. 174, is improved with a house, garage and dock.
The assessor places a value of $40,000 on the improvements because of their poor condition. This
value was deducted from the sales price prior to any adjustments. This property also has a four acre
lake and marsh acreage.
12. The assessor made no adjustments to comparable #2 for location or size, but increased
the value by 10% for water frontage, resulting in an indicated value for the subject property of $4,249
per acre.
13. Comparable #3, located off Hwy. 174 and Manse Road, contains 110.2 acres, 1.5
of which is an island. This property also has 500' of marsh between the water and the highland.
14. A 20% increase in value was made to comparable #3, resulting in an indicated value
for the subject property of $4,193 per acre.
15. Comparable #4, located off Hwy. 174, PID# 029-00-00-046, is the smallest parcel of
all the assessor's comparable properties. This property is located on a tidal creek as opposed to deep
water like the subject property.
16. Adjustments for size, location and water frontage were made to comparable #4 for
an increase in value of 20%, resulting in an indicated value for the subject property of $5,003 per
acre.
17. Using the four comparables listed above, the assessor determined a price per acre
ranging from $4,193 to $5,282, and selected a mid range of $4,800 per acre for the subject property.
18. Although the assessor presents figures purporting to be waterfront acreage, there is
no testimony to determine how this acreage is calculated. Tax maps presented as evidence contain
different figures representing marsh acreage. Without some evidence to substantiate the waterfront
acreage, less weight is given to these figures.
19. The taxpayer argues the property should be valued at $561,000. The taxpayer
presents the following eight comparables in support of his value:
TAXPAYER'S COMPARABLES
PID # Acreage Date Sold Sales Price Price/Acre
030-00-00-010&11 123.0 acres 06/94 $475,000 $3,861
030-00-00-012 147.0 acres 06/94 $319,000 $2,170
028-00-00-004 138.5 acres 02/93 $575,000 $4,151
029-00-00-027 106.49 acres 02/92 $212,000 $1,991
030-00-00-013&14 950.0 acres 10/91 $3,000,000 $3,157
027-00-00-009 110.16 acres 02/90 $385,000 $3,495
080-00-00-023 150.84 acres 10/88 $271,512 $1,800
080-00-00-013 144.40 acres 11/87 $410,000 $2,839
20. The sales of the taxpayer's comparables number one and two transpired 18 months
after December 31, 1992, the effective date of valuation for tax year 1993. These comparables are
given less weight because the date of sale is after the control date for tax year 1993 and no
adjustments to the values were made.
21. Taxpayer comparable #3 is the same property as assessor's comparable #2. The
taxpayer agreed with the assessor about the condition of the improvements. This sale occurred in
February, 1993 but is still an indicator of the market value of the subject property as of December 31,
1992.
22. The taxpayer's comparable #4, located on Shell House Road, tax map #024-00-00-027, contains 106.49 acres and has no water frontage. Comparable #4 sold in February of 1992 for
$212,000, for a price per acre of $1,991 per acre.
23. Comparable #5, located on Bailey's Island, contains 950 acres. Comparable #5 sold
in February of 1993 for $3,000,000, for a price per acre of $3,157 per acre.
24. Comparable #6, located on Store Creek, PID #027-00-00-009, contains 110.16 acres.
Comparable #6 sold in February of 1990 for $385,000, for a price per acre of $3,495 per acre. This
property is the same as assessor's comparable #3.
25. Comparable #7, located at Cassina Plantation, PID #080-00-00-023, contains 150.84
acres and has no water frontage. Comparable #7 sold in October of 1988 for $271,512, for a price
per acre of $1,800 per acre.
26. Comparable #8, located at Cassina Plantation, PID #080-00-00-013, contains 150.84
acres and is improved with a house. Comparable #8 sold in November of 1987 for $410,000, for a
price per acre of $2,839 per acre.
27. No adjustments were made to any of the comparables used by the taxpayer. Using
these comparables listed above, the taxpayer arrived at a value of not more than $3,000 per acre for
the subject property.
28. Both the assessor and the taxpayer used two identical properties as comparable to the
subject property. These are PID #028-00-00-004 and 027-00-00-009. These properties were
selected as comparable because of their similarity to the subject property in water location and
surrounding properties.
29. The assessor made no adjustments based upon the size of the properties. The
indicated range of cost per acre based upon the two comparables selected by both parties is $3500
to $4200. These properties are smaller than the subject property.
30. The assessor argues that accepting the comparables without making adjustments does
not take into account the waterfront capabilities. This argument bases the valuation of the property
on speculation about future use.
31. The fair market value of the subject property is $700,000 approximately $3,740 per
acre based upon its size, location, water access and use when compared to similar property.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, I conclude, as a matter of law:
1. S.C. Code Ann. § 12-60-2540 (Supp. 1995) authorizes the South Carolina
Administrative Law Judge Division to hear contested cases pursuant to Chapter 23 of Title 1 of the
1976 Code, as amended.
2. Real property is subject to tax. S.C. Code Ann. § 12-37-210 (Supp. 1995).
3. S.C. Code Ann. § 12-37-930 (Supp. 1995) provides that real property shall be valued
as follows:
All real property must be valued for taxation at its true value
in money which in all cases is 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 of the uses and purposes of which it is
adapted and for which it is capable of being used.
4. Fair market value is the measure of true value for taxation purposes. Lindsey v. S.C.
Tax Comm'n, 302 S.C. 504, 397 S.E.2d 95 (1990). There is no valid distinction between market
value for sales purposes and market value for taxation purposes under S.C. Code Ann. § 12-37-930.
S.C. Tax Comm'n v. S.C. Tax Bd. of Review, 287 S.C. 415, 339 S.E.2d 131 (Ct. App. 1985).
5. 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).
6. The value of the taxpayer's property is $700,000.
ORDER
Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby
ORDERED, that the Charleston County Assessor shall assess the taxpayer's property
identified as PID #025-00-00-015, located at 9084 Peters Point Road, Edisto Island, Charleston
County, South Carolina at $700,000 for tax year 1993.
AND IT IS SO ORDERED.
_______________________________
ALISON RENEE LEE
Administrative Law Judge
February ____, 1996
Columbia, South Carolina. |