ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF THE CASE
This matter comes before the Administrative Law Judge Division (“ALJD”) pursuant to S.C.
Code Ann. §12-60-2540 (2000) and S. C. Code Ann. §§1-23-310 et seq. (Supp. 2003) for a
contested case hearing. The Petitioner, Larry J. Sweeney (“Petitioner”), contests the Aiken County
Assessor (“Assessor”)’s valuation of certain real property, identified as Tax Map No. 00-135-0-01-459, for the 2002 tax year. After notice to the parties, a hearing was conducted on March 10, 2003.
Based on the evidence, I find that the proper valuation of Petitioner’s property for the 2002 tax year
is $372,400.
FINDINGS OF FACT
Based on the evidence presented and taking into account the credibility of the witnesses, I
make the following findings of fact:
1.Notice of the date, time, place, and nature of the hearing was timely given to all
parties.
2.Petitioner owns property located at Lot 513 Forest Bluffs, Woodside Phase 2, Section
20, in Aiken, South Carolina, Tax Map No. 00-135-0-01-459. The actual street address for
Petitioner’s property is 327 Forest Pines Road.
3.Kevin Ward, (“Appraiser”), an appraiser for the Aiken County Assessor (“Assessor”),
assessed Petitioner’s property at a value of $405,400 for the 2002 tax year. Petitioner objected to
the assessed value, and after a review Appraiser reduced the assessed value to $372,400. Petitioner
objected to the reduced value and appealed to the Aiken County Board of Assessment Appeals
(“Board”). The Board found that the property should be assessed at $372,400.
4.Petitioner appealed the Board’s decision to the ALJD. Petitioner does not argue the
fair market value of the property; rather, Petitioner argues that houses in Aiken are not appraised in
a uniform fashion, and that his house has been inequitably assessed much higher than houses in the
surrounding area. Petitioner requests that the assessed value of his property be reduced to $298,313.
5.Petitioner purchased the lot in question in January 1999. Petitioner paid $92,000 for
the lot. Petitioner constructed a house on the lot, which was completed in July 2000. Petitioner took
out a $195,000 construction loan to build the house, and he also paid additional money out-of-pocket
to construct the home. Petitioner cannot recall the total amount he paid to construct the home.
Petitioner does not know what the fair market value of his home is.
6.Woodside is a planned golf community. The value of the lots in Woodside vary not
only on the size of the lot, but also on the location of the lot. Petitioner’s lot is located on the golf
course in Woodside.
7.Petitioner presented six spreadsheets comparing the assessed value of his home to the
assessed value of 50 other homes in Woodside.
8.Petitioner argues that his home is most similar to two houses, the Mink house, located
at 141 Double Eagle Court, and the McDougal house, located at 413 Spalding Lake Circle, which
were built by the same builder and based on the same building plan Petitioner used to build his house.
The Mink house and the McDougal house are located within six-tenths of a mile of Petitioner’s
house. All three houses are on lots located on the golf course. Petitioner’s house is smaller in terms
of square footage than either of these two houses. The Mink house has been assessed at a value of
$289,800, and the McDougal house has been assessed at a value of $294,400.
Petitioner argues that
the assessed value of his house is inconsistent with the assessed values of the Mink and McDougal
houses; he believes that, based upon the average building cost per square foot of the Mink and
McDougal houses, his total property should be valued at $298,313, which includes a value of
$218,313 for the house itself and $80,000 for the lot on which it sits.
9.Petitioner additionally submitted data regarding other homes by the same builder on
golf course lots within six-tenths of a mile of his home. Based on his comparison of the average
building cost per square foot of these six houses, Petitioner believes his property should be assessed
at $295,502.
10.Petitioner also compared eight homes on golf lots within one-quarter mile of his home.
Based upon his comparison of the average building cost per square foot of these eight homes,
Petitioner believes his property should be assessed at $295,262.
11.Petitioner further compared seven houses not on golf lots within six-tenths of a mile
of his home. Based upon his comparison of the average building cost per square foot of these seven
homes, Petitioner believes his property should be assessed at $310,905.
12.Petitioner compared thirty homes on Forest Pines, Forest Ridge, and Forest Bluffs.
Based upon a comparison of the average building cost per square foot of these thirty homes,
Petitioner believes his property should be assessed at $325,621.
13.Petitioner further compared eleven homes on Spalding Lake Circle. Based upon a
comparison of the average building cost per square foot of these eleven homes, Petitioner believes
his property should be assessed at $328,881.
14.Based upon the average building cost per square foot of all homes Petitioner used for
comparison purposes, Petitioner believes his property should be valued at $318,068.
15.Because Petitioner believes the Mink and McDougal houses are most similar to his
own house for comparison purposes, Petitioner proposes that the total value of his property should
be $298,300, which breaks down into $218,313 for the house and $80,000 for the lot.
16.The Assessor viewed the Petitioner’s house, noting various characteristics of the
house, and used a mass appraisal computer system to arrive at his original $405,400 assessment.
When Petitioner objected to the assessed value, the Assessor reviewed Petitioner’s data and
determined that the $405,400 value was too high. The Assessor agreed to reduce the value to
$372,400. Petitioner objected again, and the Assessor reviewed additional data. Upon his additional
review, the Assessor took the cost of all dwellings on Double Eagle Court to come up with an
average value; he also came up with an average value for all dwellings on Spalding Lake Circle and
numerous dwellings on Pine Forest, Forest Bluff, and Forest Ridge. He researched comparisons of
property inside Petitioner’s immediate neighborhood for an average value and outside Petitioner’s
immediate neighborhood for an average value. Additionally, he performed a sales ratio comparison,
comparing actual sales to assessed values, and came up with a sales ratio, which he applied to
Petitioner’s house. He also compared the value Petitioner proposes and actual sales values. All of
these values averaged out to $372,371, which was very close to the $372,400 he had earlier
determined for Petitioner’s property. The Assessor maintains that Petitioner’s property should be
assessed at $372,400.
16.Petitioner bases his valuation upon cost per square footage. According to the
Assessor, however, the less square footage a house has, the higher the cost per square footage for
the house will be. Thus, fact that Petitioner’s cost per square footage is higher than the cost per
square footage of the other houses with which the Petitioner compared his house does not necessarily
indicate that there is an inequitable discrepancy in the assessment of the Petitioner’s house, given the
fact that Petitioner’s house is smaller than most of the other houses Petitioner examined. In
particular, Petitioner’s house is smaller than the two houses Petitioner believes are most similar to
his own house due to their having the same floor plan.
CONCLUSIONS OF LAW
1.S.C. Code Ann. § 12-60-2540 (2000) authorizes the South Carolina Administrative
Law Judge Division to hear contested cases arising from controversies involving the valuation of real
properties by county assessors.
2.S.C. Code Ann. § 12-37-210 (2000) defines property subject to taxation in South
Carolina as “all real and personal property in this State.” All such property must be assessed uniformly
and equitably throughout the State pursuant to regulations promulgated by the S.C. Department of
Revenue. S.C. Code Ann. § 12-43-210(A) (Supp. 2003). “All taxes upon property, real and personal,
shall be laid upon the actual value of the property taxed.” S.C. Const. Art. III § 29.
3.S.C. Code Ann. § 12-43-217 (2000) provides, in part, that “once every fifth year each
county or the State shall appraise and equalize those properties under its jurisdiction. Property
valuation must be complete at the end of December of the fourth year . . . .”
4.“While our constitution requires equality and uniformity in tax assessments, ‘[a]bsolute
accuracy with respect to valuation and complete equality and uniformity are not practically
attainable.’” Reliance Ins. Co. v. Smith, 327 S.C. 528, 537, 489 S.E.2d 674, 679 (Ct. App. 1997)
(quoting Wasson v. Mayes, 252 S.C. 497, 502, 167 S.E.2d 304, 306-07 (1969)).
5.A taxpayer may appeal a property tax assessment made by a county board of
assessment by requesting a contested case hearing before the ALJD. S.C. Code Ann. § 12-60-2540(A) (2000). As the party contesting the assessing authority’s valuation, the taxpayer has the
burden of proving the actual value of the property at issue. See Reliance, 327 S.C. at 534-35, 489
S.E.2d at 677. Thus, in this case, the Taxpayer has the burden of proving the correctness of the
valuation he is seeking, which is $298,313. Because this proceeding is in the nature of a de novo
hearing, the Administrative Law Judge is not sitting in an appellate capacity and therefore is not
restricted to a review of the decision below. Id. at 534, 489 S.E.2d at 677. Findings of fact shall be
based exclusively on the evidence and on matters officially noticed. S.C. Code Ann. § 1-23-320(i)
(Supp. 2000).
6.S.C. Code Ann. § 12-37-90 (2000) provides that all counties shall have an assessor,
whose responsibility is appraising and listing all real property. One of the duties of the assessor is
to “determine assessments and reassessments of real property in a manner that the ratio of assessed
value to fair market value is uniform throughout the county.” S.C. Code Ann. § 12-37-90(d) (2000).7.In S.C. Code Ann. Sec. 12-37-930 (Supp. 2003) the legislature set forth how property
must be valued as follows:
All 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 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.
Therefore, fair market value is the measure of true value for taxation purposes. Lindsay v. S.C. Tax
Comm’n, 302 S.C. 504, 397 S.E.2d 95 (1990).
8.The purchase price of property, while not conclusive, is some evidence of its value.
Belk Dep’t Stores v. Taylor, 259 S.C. 174, 179, 191 S.E.2d 144, 146 (1972).
9.While not conclusive, market sales of comparable properties present persuasive
evidence of fair market value of similar property. 84 C.J.S. Taxation § 512 (2001).
10.In estimating the value of property, all of its elements or incidents which affect market
value or would influence the mind of a purchaser should be considered, such as location, quality,
condition, and use. 1969-70 Op. S.C. Att’y Gen., No. 3045 at 337; see also 84 C.J.S. Taxation § 410
at 784; § 411 at 794 (1954). Appraisal, of course, is not an exact science, and the precise weight to
be given to any one factor is necessarily a matter of judgment.
11.The Petitioner in this case did not present any argument as to what the fair market
value of the property in question is. Rather, Petitioner’s argument is that his property has been
inequitably assessed on the high side in comparison to houses in the surrounding area.
12.With regard to Petitioner’s assertion that Assessor is treating him inequitably,
Petitioner has the burden of proving that Assessor intentionally and systematically undervalued other
properties while his is valued at fair market value. See Sunday Lake Iron Co. v. Wakefield Tp, 247
U.S. 350 (1918). The burden of proving an intentional and systematic undervaluation rests with the
complaining party. Id. To meet the taxpayer’s burden, more than a mere showing that other
properties are undervalued must be shown. Owen Steel Co. v. S.C. Tax Comm’n, 287 S.C. 274,
278-79, 337 S.E.2d 880, 882-3 (1985). The evidence must establish that the undervaluation is not
the result of a mere judgment call, but rather that the undervaluation is the result of an intentional and
systematic undervaluation. Petitioner has failed to produce any evidence that other properties in the
general area of his own property are undervalued due to Assessor’s intentional and systematic
undervaluation of them.
ORDER
Based on the above findings of fact and conclusions of law,
IT IS HEREBY ORDERED that, for the 2002 tax year, the value of Petitioner’s property
at Lot 513 Forest Bluffs, Woodside Phase 2, Section 20, in Aiken, South Carolina, is $372,400.
AND IT IS SO ORDERED.
________________________________________
C. DUKES SCOTT
ADMINISTRATIVE LAW JUDGE
March 22, 2004
Columbia, South Carolina |