Download This Version in Microsoft Word format
Indicates Matter Stricken
Indicates New Matter
COMMITTEE REPORT
April 22, 2004
H. 5027
Introduced by Reps. Harrell, W.D. Smith, Merrill, Clemmons, Cooper, Altman, Barfield, Cato, Ceips, Chellis, Duncan, Edge, Gilham, Hayes, Herbkersman, Keegan, Limehouse, Miller, Witherspoon and Young
S. Printed 4/22/04--H.
Read the first time March 25, 2004.
To whom was referred a Bill (H. 5027) to amend the Code of Laws of South Carolina, 1976, so as to enact the "Uniform and Fair Golf Course Valuation Act of 2004", etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, in Section 12-43-365(A)(1) of the 1976 Code, as contained in SECTION 2, by adding the following new sentence at the end of item (1) to read:
/For purposes of this section, golf course real property has a value of five hundred dollars an acre. /
When amended Section 12-43-365(A)(1) shall read:
"(1) 'Golf course real property' means all parcels owned by a golf course owner constituting in the aggregate the golf operation which includes the golf course, clubhouse, tennis facilities, swimming pools, maintenance facilities, cart storage facilities, driving range, wetlands, drainage areas, pumping stations, parking lots, golf course entry roadways from public highways, and irrigation and effluent disposal areas associated with a golf operation. For purposes of this section, golf course real property has a value of five hundred dollars an acre."/
Amend further, as and if amended, by striking subsection (B) of Section 12-43-365 of the 1976 Code, as contained in SECTION 2 and inserting:
/ (B) The fair market value of golf course real property for ad valorem tax purposes is five hundred dollars per acre plus gross revenue multiplied by the gross revenue multiplier. /
Amend further, as and if amended, by adding a new section appropriately numbered to read:
/SECTION ____. Section 12-54-240(B) of the 1976 Code, as last amended by Act 69 of 2003, is further amended by adding an appropriately numbered item at the end to read:
"( ) disclosure of information on any returns filed with the department to a county assessor pursuant to Section 12-43-365(C)." /
Renumber sections to conform.
Amend title to conform.
ROBERT W. HARRELL, JR. for Committee.
REVENUE IMPACT 1/
This bill is not expected to have any impact on state or local revenues. Although the amount of assessed value of some golf courses would be decreased, local governments are expected to adjust their millages to make up for the shortfalls. This bill would change the incidence of local property taxes by reducing the property taxes collected from golf courses by $7.8 million and shifting this amount among the other classes of property. Those changes from the levels that would occur in the absence of this bill are as follows:
Category ($ Million)
Owner Occupied 1.2
Agricultural .1
Commercial/Rental -5.4
Personal Property (Vehicles) 1.4
Manufacturing 1.3
Utility 1.0
Business Personal .5
Explanation
Under current law, most golf courses are assessed using a comparable sales method, cost or replacement method or income capitalization method. Once a value is established, it is multiplied by a 6.0% assessment ratio and then multiplied by the millage rate. This bill would define the fair market value of golf course real property for ad valorem tax purposes as gross revenue of the golf course multiplied by the gross revenue multiplier. This value would then be multiplied by a 6.0% assessment ratio and then multiplied by the millage rate. Golf course gross multiple revenue is calculated by multiplying the gross revenue generated pursuant to the operation of the golf course by a factor of 1.1. Based on responses from various counties and information in Parks, Recreation and Tourism's Economic Impact of Golf in South Carolina, we estimate this bill will shift $7.8 million of property tax revenue currently received from golf courses to the other classes of property.
Approved By:
William C. Gillespie
Board of Economic Advisors
1/ This statement meets the requirement of Section 2-7-71 for a state revenue impact, Section 2-7-76 for a local revenue impact, and Section 6-1-85(B) for an estimate of the shift in local property tax incidence.
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, SO AS TO ENACT THE "UNIFORM AND FAIR GOLF COURSE VALUATION ACT OF 2004" BY ADDING SECTION 12-43-365 SO AS TO PROVIDE FOR THE MANNER IN WHICH THE FAIR MARKET VALUE OF GOLF COURSE REAL PROPERTY IS DETERMINED FOR AD VALOREM TAX PURPOSES AND THE PROCEDURES WHICH APPLY WITH RESPECT TO THIS DETERMINATION.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. This act is known and may be cited as the "Uniform and Fair Golf Course Valuation Act of 2004".
SECTION 2. Chapter 43, Title 12 of the 1976 Code is amended by adding:
"Section 12-43-365. (A) As used in this section, unless the context clearly indicates otherwise:
(1) 'Golf course real property' means all parcels owned by a golf course owner constituting in the aggregate the golf operation which includes the golf course, clubhouse, tennis facilities, swimming pools, maintenance facilities, cart storage facilities, driving range, wetlands, drainage areas, pumping stations, parking lots, golf course entry roadways from public highways, and irrigation and effluent disposal areas associated with a golf operation.
(2) 'Gross revenue' means revenue from dues, green fees, guest fees, tournament fees, outing fees, cart rentals to members and guests on the golf course real property, rents from lease of facilities, merchandise sales, food and beverage sales, driving range, lessons, club rentals, club repairs, locker rentals, swimming fees, tennis fees, athletic fees, handicap fees, and any other miscellaneous fees received as a result of the operation of the golf course real property. Excluded from gross revenues are refundable membership deposits or initiation fees, interest income, and revenue payable directly to golf course personnel for lessons.
(3) 'Gross revenue multiplier' means a factor equal to one and one-tenth.
(B) The fair market value of golf course real property for ad valorem tax purposes is gross revenue multiplied by the gross revenue multiplier.
(C)(1) The department shall develop a form for the golf course owner to use to certify and attest golf course gross revenue to the assessor of the county in which the golf course is located. The assessor shall provide the form to the golf course owner or the owner's agent. The assessor of the county in which the golf course real property is located may audit the submission of golf course gross revenue for purposes of determining compliance with this section.
(2) The form developed by the department shall provide for the sole proprietor, the corporate president, or chief financial officer, the managing member of a limited liability company or the partner in a partnership, or an officer of a lessee of the golf course real property, if the lease requires the lessee to pay the ad valorem taxes, of a golf course or club operation to attest, under penalties of perjury, the golf course gross revenue.
(D) For purposes of Section 12-43-217 and subsection (B), the assessor shall determine the fair market value of golf course real property for ad valorem tax purposes for the applicable time period by taking the average of the golf course gross revenues for the immediately preceding three calendar years. If there is less than three years of golf course gross revenue records available, then the assessor shall use the golf course gross revenues that are available from the specific golf course to determine the golf course gross revenues that shall be used for purposes of subsection (B). A golf course owner has the right to appeal the valuation of the golf course real property in the same manner and time as other property owners may appeal.
(E) Nothing in this section shall affect the right of a homeowner's association to elect the special valuation of homeowner's association property pursuant to Section 12-43-227."
SECTION 3. Notwithstanding the provisions of Section 12-43-217 of the 1976 Code, the provisions of this act apply beginning with the taxable year in which this act takes effect.
SECTION 4. This act takes effect upon approval by the Governor.
This web page was last updated on Thursday, June 25, 2009 at 10:01 A.M.