Sanford should veto
tax-shifting property tax cap
IF YOU NEEDED evidence of how the General Assembly doesn’t let
practicality or constitutionality or even costs to local government
(and thus the people they serve) get in the way of trying to rack up
bragging rights at the polls, look no further than the property tax
cap that legislators rushed into law just before heading out of town
for the year.
The cap was a bad idea to start with: Legislators had already
given counties the right to cap the increase in property values if
they wanted to. But since only one county wanted to, the Legislature
decided it was time to step in and order the rest of them to do so.
That change will reduce property taxes for homeowners in popular and
fast-growing neighborhoods, but it will increase taxes for all other
homeowners, cars and businesses.
As little thought as was given to the effect of this tax shift,
even less was given to the real-world effects of the cap as
lawmakers chose to structure it.
The most urgent problem with the cap is that it is set to take
effect immediately. That means the nine counties that are in the
middle of the reassessment process that the Legislature wisely
requires every five years would have to throw out all the work
they’ve done so far and start over, sending out new forms notifying
people of new assessed values, and taking a new batch of protests.
That takes time, and it costs money.
It’s complicated by the fact that the Legislature didn’t send the
bill to Gov. Mark Sanford until the last day of the session, which
gives him until January to decide whether to sign or veto it. It is
therefore urgent that Mr. Sanford act quickly, either signing or
vetoing the bill, or else announcing that he plans to delay action
until next year. Every day that Mr. Sanford delays reduces the
chance that counties would be physically able to comply with the law
if he does sign it.
Fortunately, most of the nine counties left in legal limbo are
able to use another state law that allows them to delay reassessment
by one year. Richland and Berkeley counties have wisely done so. Of
course, this delay is going to cost taxpayers money, as well; if the
governor vetoes this ill-considered law, those counties will have to
retrace some of the steps they’ve already taken.
The problems that legislators simply ignored in their rush to
pass this bragging-rights law don’t stop with bad policy and
impracticalities. There also are questions of constitutionality.
North Charleston is in court arguing that the optional cap
violates a constitutional provision that requires all property to be
assessed at its fair market value. If the court sides with North
Charleston, it’s difficult to see how the new cap could survive.
Lawmakers say the constitution allows them to create new
“homestead exemptions,” which is what they consider both caps. But
that provision also requires that such exemptions be approved by a
two-thirds vote. And neither the House nor the Senate can prove it
had that with the latest cap, since it was passed on a voice
vote.
Thus, the new cap has two potential constitutional weaknesses. If
Mr. Sanford signs it into law, someone will go to court to get a
ruling, and that will result in the waste of even more tax
money.
Any one of these problems by itself would be reason enough for
Mr. Sanford to veto this bill, and to do so quickly. The combination
of problems — an assault on local autonomy, an ill-considered tax
shift, unnecessarily high implementation costs and serious
constitutional questions — should make a veto a sure thing. |