Berkeley County School District v. South Carolina Department of Revenue

Justice PLEICONES:

I concur in the result reached by the majority, but write separately as in my view we should answer the question posed based simply on the meaning of “school operations” as the term is used in property tax statutes. The phrase “school operating millage” is found in former S.C.Code Ann. § 12-37-251 (2000), which provided for the operation of the “Trust Fund for Tax Relief.” Section 12-37-251(A)(l) specified that the Trust was to be funded in an amount necessary to fund a $100,000 exemption on certain residential property “calculated on the school operating millage ... excluding taxes levied for bonded indebtedness and payments pursuant to lease purchase agreements for capital construction .... ” (emphasis supplied). In my view, the fact that these types of payments were to be excluded from the “school operating millage” calculations necessarily means that these types of payments are “school operating” expenses. When the legislature reconfigured the property tax statutes in 2006, it eliminated § 12-37-251(A)(l)10 but added § 12-37-220(B)(47).11 This new section provides that the full value of the qualifying residential property is now exempt “from all property taxes imposed for school operating purposes but not including millage imposed for the payment of general obligation debt.” Since it is well established that debt incurred for lease-purchase agreements or installment purchase arrangements are not general obligation debt,12 the effect of this statutory revision was to exempt the full value of qualifying residential property from taxation for lease-purchase debt, but not from that attributable to bonded indebtedness. Moreover, while S.C Code Ann. § 11-27-110 (Supp.2008) subjects school district lease-purchase agreements to the constitutional limits on general obligation debt, it cannot and does not purport to convert those obligations into general obligation debt. Cf. § ll-27-110(D)(State payment under financing agreement is deemed general obligation debt service).

*352Accordingly, I would hold that Homestead Fund13 tier three reimbursement under S.C.Code Ann. § 11 — 11—156(A)(1) (Supp.2008) includes payments made pursuant to lease-purchase agreements and other non-general obligation capital construction arrangements. I therefore concur in the result reached by the majority.

. 2006 Act No. 388, Pt. I, § 4.C.

. 2006 Act No. 388, Pt. I, § 3.

. Colleton Cty. Taxpayers Ass’n v. School Dist. of Colleton Cty., 371 S.C. 224, 638 S.E.2d 685 (2006).

. This Fund, created by 2006 Act No. 388, Pt. I, § 2. is essentially the successor to the Trust Fund.