HILTON HEAD ISLAND, S.C. -A group made up mostly of island property owners has lost its effort to collect taxes and fees they say were unfairly collected in the late 1990s.

The state Supreme Court ruled against the group Monday, saying the U.S. Constitution does not guarantee "no taxation without representation."

"It's probably the end of the line," said Joel Bailey, a Beaufort lawyer representing the group, which filed separate state and federal lawsuits against Hilton Head No. 1 Public Service District in 1998.

Circuit Court Judge Perry Buckner had ruled in favor of the groups after a federal court sent the case back to the state, saying the utility's practices amounted to taxation without representation.

But the state Supreme Court overturned that ruling citing precedents like unsuccessful challenges to the taxing practices of the District of Columbia, which has no elected representation in the U.S. Congress.

"The United States Supreme Court has repeatedly rejected the contention that the federal Constitution guarantees no taxation without representation," the justices ruled.

The lawsuit stemmed from a November 1997 decision by the state Supreme Court that appointed boards of special purpose districts, such as Hilton Head's three utilities, could not levy taxes unless they were elected.

At the time, the court said state lawmakers had until December 1999 to address the issue.

The General Assembly then passed a law freezing existing tax rates for districts authorized under state law to collect property taxes, and required the district's county council to vote on raising or lowering a district's tax rate in the future.

The property owners on Hilton Head Island then sued to recover taxes collected before the state law changed. The group had estimated about 200 owners were affected.

Information from: The Island Packet