It ends a period of doubt among counties, including Beaufort, of whether they could impose a 15 percent cap on assessed value of property. By a unanimous 5-0 vote, justices said the law must follow the Constitution. Justices said in their two-page decision that the state Constitution "mandates statewide uniformity in property tax exemptions enacted by the General Assembly."
Ending local-option assessment caps is but half the victory, however. The court didn't address whether a statewide limit on how much property values increase during assessment would be legal.
This issue has been a source of contention between the General Assembly and Gov. Mark Sanford. The legislature last year approved legislation capping assessed values at 20 percent. Sanford vetoed the legislation in part because he said it violated the constitutional requirement that tax values be based on fair market value.
Monday's decision is a result of years of challenge by North Charleston. North Charleston led the attack on tax caps because its elected officials thought correctly that such a law would penalize the city's property owners while rewarding many Charleston-area property owners whose property values were escalating rapidly. In other words, it would give a break to one group and shift the tax burden to another in a community where property values were more stable.
The hope is that the court's decision will send a warning to lawmakers who think they can offer property tax relief. When the legislative session began in January, Beaufort County legislators dusted off and massaged the bill vetoed by Sanford. The revamped bill would cap property tax increases at 15 percent. Another bill would lock property values on a home at the current assessment until the house is sold unless additions or improvements were added.
Both measures run counter to constitutional provisions. They shift the burden to finance local government to others. More than a month ago, Rep. Thayer Rivers, D-Ridgeland, said the legislature's plan doesn't answer the problem of increasing tax bills for some property owners to make up for lost revenue in capping taxes on property that has greatly appreciated in value. The S.C. Association of Counties shared the same concern. The Constitution requires that the property be taxed at a fixed percentage of its fair market value, the group said.
The court's ruling Monday would indicate that lawmakers may have to change the Constitution to offer relief.
The goal of helping longtime property owners and those on fixed income or in the lower-income bracket to keep their homes is noble. But changes must conform to the state's Constitution, which bases assessment and taxes on fair market value.