Over coffee several days ago, a friend of mine said, "Ten years ago no
one would listen about property tax reform, now everyone is talking about
it." A day or two later, Rep. John Graham Altman called to ask my opinion
on property tax reform and reminded me of a conversation I had with him
several years ago about the huge increases that would occur in the
Crescent subdivision. These two conversations made me think back to the
beginning of my concern over the present method of property taxation.
It began after the reassessment of 1983. At the time, I owned several
properties in the city of Charleston and Sullivan's Island. I remember
sharing my thoughts with then-Sen. Dewey Wise. There were not many
outcries, however, and the issue faded away. There was an interesting
debate in California, however, and I believe Proposition 13 passed that
year or shortly thereafter.
In 1988, I decided to run for the S.C. House of Representatives and
included in my brochure was a concern about my property taxes increasing
by 275 percent, and I vowed to try and do something about it.
From the day I was elected until the day I left the General Assembly, I
searched for ways to do something about what I perceived to be a bad
law.
I introduced bills but never got anywhere with them. There were several
problems, not the least of which was a very complicated issue. In
addition, other areas of the state were not yet experiencing the huge
increases that we were in Charleston and therefore could not relate to our
problem.
I remember telling Jack Simmons, chairman of The Committee to Save The
City that until Greenville and a few other counties received the jolt we
were beset with, nothing would happen. In addition, the municipal and
county associations were opposed to any changes in the current law. They
would, then as now, do anything to protect their sacred cow.
In the mid-'90s I appeared before our Charleston County Legislative
Delegation and warned what was to happen in the next reassessment.
At that meeting, then-Sen. Ernie Passailague asked his fellow members
to allow me to be on the delegation subcommittee dealing with property tax
reform.
After a number of attempts by Sens. Passailague and Glenn McConnell in
the Senate and Reps. Altman, Bobby Harrell, and Chip Limehouse in the
House, it occurred to me that any proposed legislation should be local
option.
While this would solve the political problem of other counties, it also
became clear to me that one law for the entire state was an idea left over
from the days our state was so different from what it is today.
The current law was created by a largely rural Legislature whose
members represented farm areas. In addition, the urban areas experienced
little or no economic growth.
It was at this point that I met with Bernie Maybank in the Department
of Revenue and together came up with the 15 percent cap idea.
I need not dwell on what happened with that legislation.
Today, I see some real hope for something being done to make a change
in an antiquated law because Charleston County is not the only county
experiencing huge property value increases and higher taxes. Some
residents of North Charleston are now dealing with increases they never
thought would occur.
I believe local elected officials will do everything they possibly can.
The reality, however, is that well-paid lobbyists, the municipal and
county associations and other legislators will be fighting any proposal
that changes the status quo. It will take a two-thirds vote of both bodies
to get anything done.
Think about discussing a controversial subject among 10 or 15 people at
the corner grocery store, a favorite pub or anywhere people gather and try
to get two-thirds of them to agree on a controversial matter. Everyone is
for what is right, but sometimes a consensus, much less a two-thirds vote,
will not happen.
I trust our delegation to do their best. We need to encourage but not
hamper them with proposals that will not get enough votes. It would be
nice if all property taxes were eliminated, but that just is not going to
happen.
If I were king for a day, I would do the following:
--Increase in the sales tax to provide for state support of operating
expenses for public education, K-12, eliminating the tax on homeowners. To
eliminate taxes on all real property is risky and probably not
feasible.
--Provide for a 15 percent cap on all property with base value changing
when property is sold. If a local government selects the caps; a roll back
tax similar to the agriculture roll back should be allowed. This roll back
tax should be used only for bond payments. A percentage would go to the
school district based on a formula.
--If the local option sales tax is not repealed, that money should also
be required to pay bond debt. I regret the day that we did not require
this when we passed local option.
Some of the above would require a constitutional amendment. I believe
an amendment would pass, provided the public is given some options.
James Bailey is a former state House member from
Charleston.