Posted on Wed, Nov. 01, 2006

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Today, anti-tax activists explain the property tax amendment

By CINDI ROSS SCOPPE

Associate Editor

I FIRST heard from the dissidents within the anti-tax movement when I wrote a column last November, “Reasons to tax homes far outweigh reasons not to tax them,” in response to the so-called taxpayer advocates who were demanding the elimination of residential property taxes.

Joe Kress, corresponding secretary of the Dorchester County Taxpayers Association, wrote to thank me for being “a real friend of the taxpayer who understands the problem.”

Mr. Kress has a lot of tax ideas I don’t agree with and vice versa. But we’re both certain that the 15 percent reassessment cap on next week’s ballot (Amendment 4) is more than bad policy. It’s a wolf in sheep’s clothing.

He’s not alone. A number of activists who spend most of their time fighting tax increases have been poring over tax projections, studying academic studies and grilling local officials to gather ammunition to counter the misinformation campaign that others in their movement are putting out about Amendment 4.

Bob Henderson, whom you might recall from a previous column as the gentleman who pointed out how grossly misleading the official ballot explanation is, calls himself “a victim of the first 15% Cap in Charleston County in 2001.”

“The Cap is a ‘Reverse Robinhood,’” he says. “It takes from the poor and gives to the rich. It destroys our constitutional right to equal and fair taxation. It seeks to make ‘gross inequity’ in the payment of property taxes a constitutional mandate by building into our Constitution and laws a permanent taxpayer subsidy for a select group of property owners — a direct violation of our Federal constitution that mandates ‘Equal Treatment’ under the law!”

How’s that?

As Vicki Simons explains on her anti-Amendment 4 Web site (www.mrsimons.com/amend4/), the amendment is not a tax cap. It’s a reassessment cap. It means the taxable value of homes can’t go up by more than 15 percent every five years. It “does not limit property tax bills from increasing more than 15% every five years.”

Ms. Simons, a founding member of the Aiken County Taxpayers Association and secretary of the S.C. Association of Taxpayers, quotes a 2004 Circuit Court ruling to explain why that’s important: “When a tax value cap exempts property from taxation, ‘the revenues that would otherwise be “lost” due to the Cap are not forgone, but rather are recaptured by increasing the taxes paid on those properties not helped by the Cap.’”

Hence, the tax shift.

Mr. Henderson cites the projections the state’s chief economist put together for the Legislature: The amendment would shift $372 million in property taxes, generally from those who own the most expensive homes to everybody else.

He cites projections for Dorchester County: 30 percent of taxable property would suddenly become exempt, resulting in “a tax exemption of $18.3 million that will be shifted from owners that can afford to pay their share of taxes to owners that are most in need of and entitled to tax relief.”

Bob Logan, president of We the People of Horry County, cites additional studies: “Information available from the Municipal Association of South Carolina estimates that 70% of property tax payers statewide will pay MORE property tax if the cap is approved November 7th at the voting booths. In Charleston County, a study showed 88.5% of all property owners would see higher tax bills to subsidize the wealthiest 11.5% of property owners.”

You’d never know any of this to hear the louder voices in the anti-tax movement. They claim on their website that the amendment “Limits milleage (sic) increases to Southeastern CPI plus state population growth” and “Eliminates school districts’ ability to tax owner-occupied homes forever.”

It does neither.

The Legislature already did both of those things, this spring. The amendment is entirely separate. The amendment, Mr. Henderson writes on Ms. Simons’ website, means that:

• “Neighbors in the same neighborhood pay vastly difference taxes for the same value homes — Merely because the new neighbor recently purchased his home.

• “Elderly on fixed income will subsidize owners of mansions and big corporations because the property they own does not appreciate or decreases in value below 15%.

• “Owners of Cars, Pickups. boats ... and mobile homes will all pay higher taxes to subsidize tax breaks for wealthy property owners.”

The folks pushing this amendment characterize the opposition as county, school and business officials who are “trying to ‘spread fear’ and turn this into a ‘class warfare’ issue.”

You can understand why.

If they acknowledged where the most effective arguments against the amendment are coming from, that would raise all sorts of uncomfortable questions about what they have to gain from this amendment that their fellow anti-tax advocates — along with most of their fellow South Carolinians — don’t.

Ms. Scoppe can be reached at cscoppe@thestate.com or at (803) 771-8571.