SC Administrative Law Court Decisions

This matter is a contested case brought by Danny W. Parker ("Petitioner" or "Taxpayer") against the Chester County Auditor ("Auditor") concerning the payment of property taxes on a 1995 S-10 Chevrolet pickup truck for the tax year 1997 and the appeals process before the Chester County Auditor. The parties have exhausted their prehearing remedies and jurisdiction is granted to the Administrative Law Judge Division ("ALJD") by S. C. Code Ann. 12-60-2540 (Supp. 1996).

A contested case hearing was held at the offices of the Administrative Law Judge Division at the Edgar A. Brown Building, 1205 Pendleton Street, Columbia, South Carolina on September 9, 1997, after notice to the parties.

I find that the assessment of personal property taxes against the taxpayer's 1995 Chevrolet S-10 pickup truck is proper and lawful and that the Auditor's office handled this case in a proper manner.

FINDINGS OF FACT

Having carefully considered the credibility of the testimony and accuracy of the evidence presented at the hearing and taking into consideration the burden of persuasion by the parties, I make the following Findings of Fact by a preponderance of the evidence:

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. Taxpayer is a resident of Chester County.

4. Taxpayer owns a 1995 Chevrolet S-10 pickup truck. He purchased the truck from Burns Nissan, Inc. of Rock Hill, South Carolina on February 21, 1997. The sales price paid for the truck was $8,999.00.

5. The vehicle was assessed by Chester County at 790 or a property value of $7,523.00. See letter of Edward M. Thomas, Chester County Auditor, dated April 21, 1997.

6. Taxpayer owns another vehicle, an F-350 Ford truck, on which he pays property taxes to Chester County. He utilizes this truck on his twelve acre farm. He has paid the property taxes due on this truck.

7. The 1997 "Vehicle Assessment Guide" for Chevrolet trucks, as provided by the Department of Revenue to the county for assessment purposes, lists an assessment value of 790 for Model S 14, Fleetside S-10 pickups for the year 1995. This guide was utilized by Chester County in assessing Taxpayer's Chevrolet pickup truck.

8. The property tax assessed by Chester County onTaxpayer's pickup truck is $227.89 for 1997.

9. Taxpayer requested a conference with the Auditor and met with him. Unsatisfied with the result of that conference, Taxpayer requested from the Auditor the proper procedure to appeal the Auditor's denial of relief.

10. The Auditor provided Taxpayer the form to file a protest. The protest was filed with the Auditor and was denied.

11. Taxpayer was notified of his right to appeal the decision of the Auditor to the Administrative Law Judge Division and have a contested case hearing on the matter.

12. By letter dated June 26, 1997 and received by the Division on June 27, 1997, Taxpayer requested a contested case hearing.

CONCLUSIONS OF LAW AND DISCUSSION

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

General Law

1. S. C. Code Ann. § 1-23-600 (Supp. 1996) grants jurisdiction to the Administrative Law Judge Division to hear contested cases under the Administrative Procudures Act.

2. Pursuant to S. C. Code Ann. § 12-39-340 (1976), the county auditor is responsible for ascertaining that all personal property subject to ad valorem taxation by the Constitution or general law is listed and assessed according to manuals, guidelines and rules and regulations promulgated by the Commission (now the Department of Revenue).

3. S. C. Code Ann. § 12-39-350 (Supp. 1996) provides that the county auditor shall adopt valuations of the county assessor and the Commission.

4. S. C. Code Regs. 17-119 and 17-19.1 (1976) provides "Assessment Guides for Personal Property" which the county auditor is required to follow and use in assessing personal property.

5. Effective August 1, 1995, the South Carolina Revenue Procedures Act established the procedure for personal property tax assessment protests, appeals and refunds where the county auditor has assigned the value. S. C. Code Ann. §§ 12-60-2910 through 12-60-2940 (Supp. 1996).

6. S. C. Code Ann. § 12-37-210 (1976) defines property which is taxable in South

Carolina as follows:

All real and personal property in this State, personal property of residents of this State which may be kept or used temporarily out of the State, with the intention of bringing it into the State, or which has been sent out of the State for sale and not yet sold, and all moneys, credits and investments in bonds, stocks, joint-stock companies or otherwise of persons resident in this State shall be subject to taxation.

7. Pursuant to S. C. Code Ann. §§ 5-37-710, -890 and -900 (1976), residents of this State are required annually to list for taxation all tangible personal property which they own, or which is in their control or possession on December 31st preceding the relevant tax year. Such personal property shall be taxed at the place where the owner resides at the time of listing.

8. Taxpayer asserts that there is not a proper appeals process in Chester County which allows for a fair and impartial hearing. S. C. Code Ann. § 12-60-2920 (Supp. 1996) provides that a taxpayer may request a contested case hearing with the Administrative Law Judge Division if he is aggrieved by the decision of the county auditor. Although Taxpayer is not provided by statute a hearing before a local board, he is provided an impartial and fair hearing before an administrative law judge where he can present any relevant testimony and evidence. Taxpayer has not offered any evidence that the valuation placed by the Auditor on his Chevrolet truck is excessive nor is he making such an argument. His only argument is that it is unlawful for the Auditor to assess and tax the truck. He has been provided a proper forum to argue his legal position.

9. Taxpayer also asserts that it is discriminatory to have to pay personal property taxes on this Chevrolet pickup truck since he has already paid personal property taxes on the Ford truck he owns. Simply put, Taxpayer argues that it is a violation of the Equal Protection Clause of the State and Federal Constitutions for him to pay a personal property tax when other county residents, not required to pay the tax, benefit from the services provided by the tax receipts.

Our Supreme Court has consistently held that the Equal Protection Clause does not require equal distribution of tax revenue. The South Carolina Constitution grants state and lcoal governments the power to assess and collect property tax. S. C. Const. Art. X, §§ 1 and 6. The plain language of those sections imposes uniformity on property tax levies, but does not impose uniformity on the distribution of taxes. Westvaco Corp. vs. Dep't of Revenue, ___ S.C. ___, 467 S.E.2d 739, 741 (1995). "There are many cases, both State and Federal, which hold that taxes, otherwise lawful, are not invalidated by reason of the fact that the resulting benefits are unequally shared." Atkinson Dredging Co. v. Thomas, 266 S.C. 361, 367-368, 223 S.E.2d 592, 595 (1976).

Taxpayer contends that the use of his tax monies to benefit those who do not have such tax burdens is unfair. The power to tax derives from the state constitution, and the General Assembly promulgates legislation and rules to tax the property of residents equally. It does not provide for equal distribution.

In Davis v. County of Greenville, 313 S.C. 459, 443 S.E.2d 383 (1994), the court faced an analogous situation to this case. Taxpayers challenged the county's taxing of all residents uniformly while providing certain services only to the unincorporated areas of the county. The taxpayers argued that distributing those services, such as road and bridge maintenance and law enforcement, to only the unincorporated areas violated the Equal Protection Clause because the distribution of those services did not benefit the county residents in municipalities. The court stated that:

Taxes are levied on all property...for the maintenance of government in the county. Although some services are not rendered in [some] areas, these services are still provided for the maintenance of county government and, therefore, benefit all the residents of the county. The equal protection clause does not require that mathematical symmetry be attained between benefits received and payment for those benefits.

Id. at 465, 443 S.E.2d at 386.

Applying the principle of Davis to this case, the distribution of tax monies collected from Taxpayer and redistributed to benefit others who have paid no such tax does not violate the Equal Protection Clause. No equalization between monies paid and benefits received is necessary. Indeed, one of the central purposes of government is to provide for the welfare of all its constituents, regardless of economic contribution. The government provides a balancing effect in society with the redistribution of wealth through taxes and fees and services and benefits.

9. Following South Carolina case law, regulations and the plain language of the South Carolina Constitution, Taxpayer has not shown to this court the existence of any violation of the Equal Protection Clause nor that he was denied procedural due process in voicing his legal positions. Accordingly, it is the conclusion of this court that Taxpayer's contentions are without merit and that the Auditor properly and lawfully assessed the taxes in question.

ORDER

Based upon the foregoing Findings of Fact, Conclusions of Law and Discussion, it is hereby:

ORDERED that the case filed by Taxpayer is dismissed.

AND IT IS SO ORDERED.

Chief Judge

December 2, 1997

Columbia, South Carolina.