Journal of the Senate
of the First Session of the 111th General Assembly
of the State of South Carolina
being the Regular Session Beginning Tuesday, January 10, 1995

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| Printed Page 3360, May 30 | Printed Page 3380, May 30 |
Printed Page 3370 . . . . . Tuesday, May 30, 1995
SECTION 5. Section 11-11-140(D) of the 1976 Code is amended to read:

"(D) Appropriations from surplus may not be made before the first meeting of the General Assembly following the Comptroller General's closing of the books on the fiscal year in which the surplus occurred and may be appropriated only for nonrecurring purposes. The provisions of this subsection do not apply to appropriations to cover midyear shortfalls in the Property Tax Relief Fund as established pursuant to Article 11, Chapter 36 of Title 12."

SECTION 6. In each county of the state in which the local option sales and use tax is not imposed, the referendum provided in Section 4-10-30 of the 1976 Code must be held on November 7, 1995. If the question is approved, the tax is imposed in the county in the manner provided by law. In each county in which is imposed the local option sales tax, the referendum provided in Section 4-10-35 of the 1976 Code must be held on November 7, 1995. If the question is approved, the tax is rescinded in the county in the manner provided by law.

PART III

Tax Relief

SECTION 1. A. Article 3, Chapter 37, Title 12 of the 1976 Code is amended by adding:

"Section 12-37-257. In addition to any other homestead exemption allowed by law, one hundred percent of the fair market value of every homestead qualifying for the assessment ratio provided pursuant to Section 12-43-220(c) is exempt from all ad valorem taxes except ad valorem taxes levied as follows:

(1) for debt service and for payments pursuant to lease-purchase agreements;

(2) by special purpose or public service districts;

(3) county special tax districts;

(4) ad valorem taxes levied pursuant to a referendum in which a majority of the qualified electors of the jurisdiction voting in the referendum voted in favor of levying the taxes."

B. Subject to Part I of this act, Section 12-37-257 of the 1976 Code, as added by this section, is effective for property tax years beginning after 1995.

SECTION 2. Chapter 29, Title 4 of the 1976 Code is amended by adding:

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"Section 4-29-72. For agreements executed after June 30, 1996, the provisions of Section 4-29-67 apply regardless of the amount of the project investment."

SECTION 3. Section 4-29-10(3) of the 1976 Code is amended to read:

"(3) `Project' means any land and any buildings and other improvements on the land including, without limiting the generality of the foregoing, water, sewage treatment and disposal facilities, air pollution control facilities, and all other machinery, apparatus, equipment, office facilities, and furnishing which are considered necessary, suitable, or useful by the following or any combination thereof: (a) any enterprise for the manufacturing, processing, or assembling of any agricultural or manufactured products and facilities for an enterprise engaged in the sale or distribution to the public of electricity, gas, or telephone services; (b) any commercial enterprise engaged in storing, warehousing, distributing, transporting, or selling products of agriculture, mining, or industry, or engaged in providing laundry services to hospitals, to convalescent homes, or to medical treatment facilities of any type, public or private, within or outside of the issuing county or incorporated municipality and within or outside of the State; (c) any enterprise for research in connection with any of the foregoing or for the purpose of developing new products or new processes or improving existing products or processes; (d) any enterprise engaged in commercial business including, but not limited to, wholesale, retail, or other mercantile establishments; office buildings; computer centers; tourism, sports, and recreational facilities; convention and trade show facilities; and public lodging and restaurant facilities if the primary purpose is to provide service in connection with another facility qualifying under this subitem; and (e) any enlargement, improvement, or expansion of any existing facility in subitems (a), (b), (c), and (d) of this item. The term `project' does not include facilities for an enterprise primarily engaged in the sale or distribution to the public of electricity, gas, or telephone services. A project may be located in one or more counties or incorporated municipalities. The term `project' also includes any structure, building, machinery, system, land, interest in land, water right, or other property necessary or desirable to provide facilities to be owned and operated by any person, firm, or corporation for the purpose of providing drinking water, water, or wastewater treatment services or facilities to any public body, agency, political subdivision, or special purpose district."

PART IV

Administration

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SECTION 1. A. Section 12-4-310 of the 1976 Code, as last amended by Act 361 of 1992, is further amended by adding at the end:

"(11) collect taxes on properties assessed by the department as provided in Section 12-4-540 except for business personal property. The State Treasurer shall distribute property taxes collected pursuant to this item daily by electronic transfer to county treasurers for the credit of the taxing entities in the county."

B. The amendment to Section 12-4-310 of the 1976 Code as contained in this section is effective for taxes due for tax years beginning after 1995.

SECTION 2. Section 12-4-540(A) of the 1976 Code is amended to read:

"(A) The commission department has the sole responsibility for the appraisal, assessment, and equalization of the taxable values of corporate headquarters, corporate office facilities, and distribution facilities and of the real and personal property owned, used, or leased by the following businesses in the conduct of their business:

(1) manufacturing;

(2) railway;

(3) private carline;

(4) airline;

(5) water, heat, light and power;

(6) telephone;

(7) cable television;

(8) sewer;

(9) pipeline;

(10) mining.

In addition, the commission department has the sole responsibility for the appraisal, assessment, and equalization of the taxable values of the business personal property of merchants."

SECTION 3. A. Section 12-37-970 of the 1976 Code, as last amended by Act 181 of 1993, is further amended to read:

"Section 12-37-970. The assessment for property taxation of merchants' inventories, equipment, furniture, and fixtures, and manufacturers' real and tangible personal property, and the machinery, equipment, furniture, and fixtures of all other taxpayers required to file returns with the South Carolina Department of Revenue and Taxation for purposes of assessment for property taxation, must be determined by the department from property tax returns submitted by the taxpayers to the department on or before the due date for the taxpayer's state income return, including any extension last day of the fourth month after the close of the accounting period regularly employed by the taxpayer for income

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tax purposes in accordance with Chapter 7 of this title. The department by regulation shall prescribe the form of return required by this section, the information to be contained in it, and the manner in which the returns must be submitted and shall provide a method of filing this return as a part of the taxpayer's state income tax return. Every taxpayer required to make return to the department of property for assessment for property taxation must make the return to the department not less than once each calendar year. Whenever by a change of accounting period, or otherwise, more than one accounting period ends within any one calendar year, the taxpayer must make one such return within the prescribed time for filing following the end of each of the accounting periods and the department shall determine the assessment from the return setting forth the greatest value.

When property required to be returned as herein provided is sold after the end of the seller's accounting year and before January first next ensuing and when the purchaser's accounting year ends after the seller's and before January first next ensuing, the property must be returned by the seller as of the end of his accounting period. The purchaser is not required to list and return the property as of the close of his accounting period during the calendar year of sale. The seller and the purchaser are jointly and singularly liable for the tax that is due and payable by reason of this provision. The provision of this section does not apply to motor vehicles licensed for use on public highways.

When property required to be returned as provided in this section is sold before the end of the seller's accounting year and before January first next ensuing and when the purchaser's accounting year ends before the date of purchase and before January first next ensuing, the property must be listed and returned by the taxpayer holding title as of December thirty-first and is liable for the tax for the ensuing year.

The Department of Revenue and Taxation shall forward the assessments prepared as a result of the returns submitted pursuant to this section for business personal property to the appropriate local taxing authorities no later than August fifteenth of the applicable tax year."

B. Section 12-37-905 of the 1976 Code is repealed.

C. This section is effective for property tax years beginning after 1995.

SECTION 4. A. Section 12-43-250 of the 1976 Code is amended to read:

"Section 12-43-250. The Commission shall make sales ratio studies in all counties of the State and when, in the judgment of the Commission, a county needs to reassess or remap property, the Commission shall make

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application to the circuit court in which the county is located for a determination of whether or not the county shall be required to commence reassessment or remapping. If the circuit court determines that the county needs reassessment or remapping, such county shall be required to commence the reassessment or remapping within thirty days of such determination. All taxable real property in a county must be appraised and equalized once every fourth year beginning with the 1996 property tax year. Upon completion of a reassessment and equalization program, property taxpayers must be notified of any resulting change in value or classification. The values determined by the program first apply for the property tax year beginning after the completion of the program and notification of taxpayers. If a county fails to comply with this section, the Comptroller General shall withhold twenty percent of the reimbursement due the county pursuant to Section 12-36-1120."

B. The Department of Revenue and Taxation shall establish a schedule of initial reassessments for all counties in conformity with the provisions of Section 12-43-250 of the 1976 Code as amended by this section.

SECTION 5. A. Section 12-43-300 of the 1976 Code, as last amended by Act 181 of 1993, is further amended to read:

"Section 12-43-300. (A) Whenever the market value estimate of any property is fixed by the assessor assessing authority at a sum greater by one thousand dollars or more than the amount returned by the owner or his agent, or whenever any property is valued and assessed for taxation which has not been returned or assessed previously, the assessor assessing authority shall, on or before July first, or as soon thereafter as may be practicable, in the year in which the valuation and assessment is made give written notice thereof to the owner of the property or his agent. In reassessment years, the written reassessment notice to owners or agents must be given by July first. If there is no timely written notice, the prior current year's assessed value must be the basis for assessment for the current succeeding taxable year. The notice must include the prior market value, the total market value estimate, the value estimate if applicable, the assessment ratio, the total new assessment, the percentage changes over the prior market value, if there is no change in use or physical characteristics of the property, number of acres or lots, location of property, tax map, appeal procedure, and other pertinent ownership and legal description data required by the South Carolina Department of Revenue and Taxation. The notice may be served upon the owner or his agent personally or by mailing it to the owner or his agent at his last known place of residence which may be determined from the most recent listing in the applicable telephone directory, Department of Revenue and

Printed Page 3375 . . . . . Tuesday, May 30, 1995
Taxation Motor Vehicle Registration List, county treasurer's records, or official notice from the property owner or his agent. The owner or his agent, if he objects to the valuation and assessment, shall serve written notice of his objection upon the assessor assessing authority within thirty days of the date of the mailing of the notice. In years when there is no notice of appraisal because of a less than one thousand dollar change or no change in the appraised or assessed value, the owner or agent has until March first to serve written notice of objection upon the assessor assessing authority of the appraised or assessed value. In those years, failure to serve written notice of objection by March first constitutes a waiver of the owner's right of appeal for that tax year and the assessor assessing authority is not required to review any request filed after March first. The assessor assessing authority shall then schedule a conference with the owner or agent within twenty days of receipt of the notice. If the assessor assessing authority requests it, the owner, within thirty days after the conference, shall complete and return to the assessor assessing authority the form as may be approved by the Department of Revenue and Taxation relating to the owner's property and the reasons for his objection. Within thirty days after the conference, or as soon thereafter as practicable, the assessor assessing authority shall mail written notice of his action upon the objection to the owner. The owner or agent, if still aggrieved by the valuation and assessment, may appeal from the action to the Board of Assessment Appeals a department hearing officer by giving written notice of the appeal and the grounds thereof to the assessor assessing authority within thirty days from the date of the mailing of the notice. The assessor assessing authority shall notify promptly the Board of Assessment Appeals hearing officer of the appeal, who shall schedule a hearing on the appeal within thirty days after notice from the assessing authority and notify the taxpayer of the hearing date and furnish the taxpayer a summary of the applicable procedures for the hearing.

(B) The governing body of the county may by ordinance extend the time for filing an objection to the valuation and assessment of real property resulting from reassessment within a county.

(C) The Department of Revenue and Taxation shall prescribe a standard reassessment form designed to contain the information required in subsection (A) in a manner that may be understood easily.

(D) At the hearing provided in subsection (A), the hearing officer shall consider the issues raised by the taxpayer and the assessing authority and subsequently shall make a determination which is binding on both parties. The department shall prescribe the procedure applicable to these hearings which shall require information from both parties sufficient for the hearing

Printed Page 3376 . . . . . Tuesday, May 30, 1995
officer to make an appropriate determination. These hearings must be conducted informally. Any party aggrieved by the determination of the hearing officer may appeal the decision to the Administrative Law Judge Division in the manner prescribed by law which shall hear the matter de novo as a contested case pursuant to Chapter 23 of Title 1. Notwithstanding the provisions of this section, a taxpayer aggrieved by the determination of the assessing authority whose property is assessed pursuant to Section 12-43-220(a) or who objects to the classification imposed by that section may waive the hearing before the hearing officer and appeal directly to the Administrative Law Judge Division for a de novo hearing of the appeal.

(E) The department shall provide sufficient hearing officers to hear all appeals expeditiously."

B. The amendment to Section 12-37-300 of the 1976 Code contained in this section applies to appeals for taxes filed for tax years after 1995.

SECTION 6. A. Article 5, Chapter 4, Title 12 of the 1976 Code is amended by adding:

"Section 12-4-580. The governing body of a county may by ordinance transfer to the department the responsibility for the appraisal, assessment, and equalization of the taxable real property under the jurisdiction of the county assessor. When this transfer occurs, the department shall perform the functions of the county assessor in that county. Before this transfer occurs, the county governing body and the department shall agree to the employees, duties, functions, and other related items to be transferred to the department. Upon agreement, and with the approval of the State Budget and Control Board, the transfer allowed under this section occurs on the first day of July following approval by the board if sufficient funds are appropriated to the department to meet the additional expenses. The State Budget and Control Board shall conduct a study to determine the expenses of the department in the transfer of functions and personnel authorized by this section and shall make recommendations to the General Assembly of the appropriations necessary to meet these expenses."

B. This section takes effect July 1, 1996.

SECTION 7. A. The first paragraph of Section 12-37-90 of the 1976 Code is amended to read:

"Except as provided in Section 12-4-580, all counties shall have a full-time assessor, whose responsibility is appraising and listing all real property, whether exempted or not, except real property required by law to be assessed by the commission department and property owned by the federal government, state government, county government or any of its political subdivisions which is exempt from property taxation. If the

Printed Page 3377 . . . . . Tuesday, May 30, 1995
assessor discovers that any real property required by law to be assessed by the commission department has been omitted, he shall notify the commission department that such property has been omitted and the commission department shall be is required to appraise and assess the omitted property."

B. This section takes effect July 1, 1996.

SECTION 8. Section 12-4-320 of the 1976 Code, as last amended by Act 516 of 1994, is further amended to read:

"Section 12-4-320. The commission department may:

(1) make rules and promulgate regulations, not inconsistent with law, to aid in the performance of its duties. The commission department may prescribe the extent, if any, to which these rules and regulations must be applied without retroactive effect;

(2) upon written application, determine the tax effects of transactions and the tax liability of taxpayers, upon facts furnished to it, and it may revoke or modify the rulings if the facts should develop differently later. The commission department, in its discretion, may publish these rulings. This publication may be in brief hypothetical form so as to give all pertinent facts and decisions without violating the provisions of Section 12-54-240;

(3) compromise any tax, interest, or penalty imposed by this title or other law assigned to it and may return to the owner, in whole or in part, any goods seized or confiscated;

(4) enter into a written agreement with a person with regard to a tax liability. If the agreement is approved by a majority of the commissioners the department, it is final and conclusive and the case may not be reopened by administrative or judicial action or otherwise, except in cases of fraud, malfeasance, or misrepresentation;

(5) publish its findings and decisions in all controversies resolved by it. This publication may be in brief hypothetical form so as to give all pertinent facts, decisions, and reasons without violating the provisions of Section 12-54-240.;

(6) if damage by natural forces occurs as defined in Section 12-9-310, prescribe temporary rules including, but not limited to, the filing of returns, payment of taxes, and extensions of due dates.;

(7) waive the retroactive assessment of a state tax when it determines the taxpayer acted in good faith, and that there were reasonable grounds for the taxpayer's interpretation of the applicable law."

SECTION 9. A. Section 12-54-160 of the 1976 Code is amended to read:

Printed Page 3378 . . . . . Tuesday, May 30, 1995
"Section 12-54-160. The Commission department, unless prohibited within a specific section, may waive, dismiss, or reduce penalties provided for in this chapter;. Interest may not be waived, dismissed, or reduced except:

(1) when the taxpayer can establish that he followed professional advice which has proved inaccurate; or

(2) if the taxpayer can by clear and convincing evidence establish he did not know he was liable for the tax; or

(3) the imposition of the tax is a result of regulation or other interpretation of existing tax laws."

B. This section takes effect upon approval by the Governor and applies with respect to interest on underpayments of state taxes assessed on and after that date. The provisions of subsection A. of this section also apply to interest paid or accrued in the three years preceding the effective date of this section, but no refund of interest already paid may be made except upon application therefor to the Department of Revenue and Taxation within ninety days of the effective date of this section.

SECTION 10. A. The 1976 Code is amended by adding:

"Section 6-1-60. (A) A county, municipality, and a school district must provide notice to the public by advertising the public hearing before the adoption of its budget for the next fiscal year in the nonclassified section of the largest general circulation newspaper in the area. The public hearing must give the residents of this governing body the opportunity to express their concerns and to provide ideas or input for discussion by the local governing entity. This notice must be given fourteen days in advance of the public hearing, and must be a minimum of two columns by ten inches (four and one-half by ten inches) with at least a twenty-four point headline.

(B) The notice shall include the following:

(1) the governing entity's name;

(2) the time, date, and location of the public hearing on the budget;

(3) the total, actual, and projected expenditures of the current operating fiscal year in the budget of the governing entity;

(4) the proposed total projected operating expenditures for the next fiscal year as proposed in next year's budget for the governing entity;

(5) the proposed or estimated percentage change in operating budgets between the current fiscal year and the proposed budget;

(6) the total, actual, and projected revenue of all property taxes in dollars for the current fiscal year budget;

(7) the proposed total projected revenue of all property taxes in dollars for the proposed budget;

Printed Page 3379 . . . . . Tuesday, May 30, 1995
(8) the millage in current year dollars for the current fiscal year;

(9) the proposed millage in dollars as proposed in the budget for the next fiscal year; and

(10) any new fees or taxes that would affect more than five percent of the total proposed budget.

(C) The requirements of this section apply in the preparation of annual budget and supplemental appropriations. When a county, municipality, or school district determines that it requires a greater tax rate after the adoption of the budget or during the current fiscal year, or fails to provide notice within the above-specified period, it must also comply with the notice provisions of this section."

B. This section is effective for fiscal years beginning after June 30, 1995.

PART V

Effective Date

SECTION 1. The following provisions of this act take effect upon approval by the Governor or as otherwise provided:

Part I,

Part II, Section 6

Part IV.

The remaining provisions of this act take effect July 1, 1996, or as otherwise provided but only upon the certification of the State Election Commission to the Code Commissioner and the Department of Revenue and Taxation of a majority "yes" vote in the referendum provided by this section./

Amend title to conform.

Senator PASSAILAIGUE argued in favor of the adoption of the amendment and Senator LEATHERMAN argued contra.

Senator PASSAILAIGUE moved that the amendment be adopted.

Point of Quorum

Senator LEATHERMAN made the point that a quorum was not present. It was ascertained that a quorum was present. The Senate resumed.

Senator LEATHERMAN moved to lay the amendment on the table.

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