Could the Lugoff Fire District issue bonds and set debt-service millage without Kershaw County approval?

Plain-English summary

In 2012, the Lugoff Fire District asked whether it could approve new debt and debt-service millage without Kershaw County. The Attorney General read the district’s bond statute to give commissioners authority to set the bond amount after voters approved issuance. It treated the required county signature on the bonds as a ministerial act if the bonds were regular and valid. Debt service still had to appear in the district’s annual budget, which the county had to approve and adopt. The opinion said district and county public hearings appeared required before each adopted the budget. It predicted the statutory bonds would be special-source bonds supported by project revenues and district assessments; it did not decide whether another route allowed general-obligation bonds within the constitutional debt limit.

Currency note

This opinion was issued in 2012. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Q: Could district commissioners decide the bond amount?
A: Yes under the statute analyzed, but the opinion said qualified district voters decided whether the bonds would issue.

Q: Did the county approve the district’s debt-service millage? A: The AG said the annual district budget, including debt-service needs, required county approval and adoption; millage was derived from that budget.

Q: Did the county official have discretion to refuse a regular bond signature? A: The opinion characterized the signing duty as ministerial for bonds that were regular in form and otherwise lawful.

Q: Were budget hearings required?
A: The AG read the statutes as implying that both the district and county should hold hearings before adopting the district budget.

Q: Did the opinion approve all possible forms of fire-district debt? A: No. It left open whether other procedures permitted general-obligation debt under the constitutional limit.

Background and statutory framework

The district had been organized under article 1, chapter 11, title 6. The AG analyzed bond elections, county bond signatures, annual budgets, and the later state constitutional categories for public borrowing.

Citations and references

The opinion examined sections 6-11-180 through 6-11-270, sections 4-9-130 and 6-1-80, and article X, section 14 of the South Carolina Constitution.

Official title

Concerning the procedure for approving new debt not exceeding the eight percent limitation of article X, section 14(7) of the South Carolina Constitution.

Requester

Dennis K. Ray, Fire Chief, Lugoff Fire District

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/september-19-2012/
• Original PDF: https://www.scag.gov/wp-content/uploads/2012/09/ray-d-k-os-9414-9-19-12-lugoff-board-of-commissioners-fire-district-levy-taxes.pdf

Original opinion text

A LAN WILSON
ATTORNEY G ENERAL

September 19, 2012

Dennis K. Ray, Fire Chief
Lugoff Fire District
892 Hwy # 1 South
Lugoff, South Carolina 29078
Dear Fire Chief Ray:
On behalf of the Board of Commissioners of the Lugoff Fire District, you have requested an opinion of this Office concerning the procedure for approving new debt not exceeding the eight percent limitation of article X, section 14(7) of the South Carolina Constitution. First, you ask whether the elected governing body of the district may incur new debt without seeking approval of that debt from an appropriate official or body of Kershaw County. Second, you ask whether the district governing body must seek the county 's approval for "new debt service millage." Finally, you ask whether a public hearing is required prior to approval of new debt service millage. Analysis We have determined previously that the Lugoff Fire District was established pursuant to article 1, chapter 11 , title 6 of the South Carolina Code (2004 & Supp. 2011). See Letter to Dennis K. Ray, Op. S.C. Att' y Gen. (Mar. 2, 2012). By their plain language, sections 6-11-180 to -230 and 6-11-260 to -2 70 set forth the procedure by which such districts may issue bonds " (t]o meet the costs of construction or acquisition of the ... fire protection system[s] ." We will first analyze the plain language of these statutes, then we will explore their legal context. Finally, we will discuss whether alternative procedures are available to districts of this kind.

I. Procedure for issuing township bonds pursuant to article 1, chapter 11, title 6 Section 6-1 l -180 provides: To meet the costs of construction or acquisition of the lighting system, waterworks system, fire protection system and sewerage system, the commissioners of any district may issue and sell serial coupon bonds for and in behalf of the township within which the district is located. Pursuant to section 6-11-190, " [t]he amount of the bonds to be issued shall be determined by the commissioners of the district[]." By the plain language of these provisions, the authority to set the amount of bonds to be issued for the benefit of the district has been vested in the board of commissioners of that district. Section 6-11-190

REMBERT

c. DENNIS BUILDING • POST O FFICE Box 11549 • COLUMBIA, SC 292 11-1549 • TELEPHONE 803-734-3970 • FACSIMILE 803-253-6283

Dennis K. Ray, Fire Chief
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September 19, 2012

makes no mention of a role for county officials in approving the commissioners' decisions in this regard, even though certain other decisions of the board expressly require county approval. E.g., S.C. Code Ann.
§ 6-11-260, infra; see generally Hodges v. Rainey, 341 S.C. 79, 86, 533 S.E.2d 578, 582 (2000) ("The canon of construction 'expressio unius est exclusio alterius' ... holds that ' to express . . . one thing implies the exclusion of another, or of the alternative."'). It is important to note, however, that the board of commissioners has not been given the authority to determine whether these bonds should issue. Instead, that threshold determination has been vested in the qualified voters of the district. Pursuant to sections 6-11-200 and -210, upon a petition of the electors or freeholders of the district, the commissioners must order an election on the bond issue. If the result of the election is favorable, the commissioners must issue and sell the bonds. S.C. Code Ann. § 6-11-200 ("Upon the receipt of such petition, the board of commissioners of the ... district ... shall order an election to be held ... on the question as to whether such bonds shall be issued or not."); id. § 6-11-210 ("If a majority of the votes cast at such election shall be for the issuing of bonds, such bonds shall be issued and sold by the board of commissioners .. . ."). 1 Section 6-11 -220 provides: All bonds issued under and in pursuance of the provisions of this aiticle shall be signed by the chairman of the board of commissioners of the .. . district and by the county supervisor of the county in which such district is situated. The names on the coupons attached to the bonds may be lithographed, which shall constitute a proper and sufficient signing thereof. (Emphasis added). We construe this duty to sign the bonds as ministerial in nature, for the reasons that follow. First, two official signatures are required: that of the chairman of the board of commissioners and In Sojourner v. Town of St. George, our Supreme Court struck as unconstitutional a provision that required a petition of "at least twenty-five per cent of the resident freeholders of the city or town" before an election could be held, finding that this provision restricted the right to vote upon "grounds other than residence, age, and citizenship" and it was not justified by a compelling state interest. 3 83 S.C. 171, 17677, 679 S.E.2d 182, 185-86 (2009). Unlike in Sojourner, however, section 6-11-200 provides for an election upon petition of "at least one third of the resident electors or a like proportion of the freeholders of the age of twenty-one years or over." (Emphasis added). Accordingly, the freeholders cannot restrict the right of the electors to call an election. In addition, if a court found these petition and/or election provisions unconstitutional, it likely would find them severable in light of the following clause included in the authorizing act: The sections and provisions of this Act are separable and are not matters of mutual essential inducement, and it is the intention to confer the whole or any part of the powers herein provided for, and if any of the sections or provisions or pa11s thereof are for any reason illegal, it is the intention that the remaining sections and provisions or parts thereof shall remain in full force and effect. Act No. 734 § 10, 1934 S.C. Acts 1292, 1298.

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that of the appropriate county official.2 The commissioners' lack of discretion as to whether bonds should issue is clear on the face of sections 6-11-200 to -210, discussed above. It would be absurd to read section 6-11-220 to allow the chairman of the board of commissioners to do what the board as a body could not do. Therefore, assuming the bonds are regular in form and otherwise meet the requirements of law, it would be absurd to read section 6-11-220 to allow the chairman to refuse to sign the bonds. 3 Second, nothing in the plain language of section 6-11-220 would justify different treatment for the county official than for the chairman of the board. Finally, our court previously has treated similar language as a matter of fonn . See State ex rel. Cathcart v. City of Columbia, 12 S.C. 370, 383 (1879) (construing a requirement that certain city bonds "be signed by the Mayor ... and countersigned by the City Clerk and Treasurer" as a matter of "the form of the bonds ... and the mode of authentication" (construing Act No. 171 § 2, 1872 S.C. Acts 220, 221 )); see generally Letter to The Honorable Harry Agnew, Op. S.C. Att'y Gen. (Oct. 22, 1963) (opining that in the absence of a statute requiring a county treasurer to execute a note on behalf of the county "as a ministerial function, such as by way of attestation," such signature would be a discretionary act); McQuillin, The Law of Municipal Corporations§ 43:58 ("In a proper case, the duty to sign bonds may be enforced by mandamus"). For these reasons, we conclude that the duty to sign the bonds is ministerial. In sum, in our opinion, the board of commissioners has discretion as to the amount of the bonds to be issued pursuant to article 1, chapter 11, title 6 but not as to whether such bonds should issue, and both the chairman of the board and the appropriate county official have a ministerial duty to sign the bonds.

2. Procedure for setting debt service millage pursuant to article 1, chapter 11, title 6
   Sections 6-11-260 and -270 of the South Carolina Code provide for the assessment and collection of a tax to pay the bonds issued by the board of commissioners. As discussed in our letter to you dated March 2, 2012, these sections require county approval of the district's annual budget. Section 6-11-260 provides: To meet the expenses of operation and maintenance and the sinking fund and interest charges on [any] bond issue when the income derived from the works is not sufficient to meet such charges, the board of commissioners ... shall each year before the levying of taxes make up an estimate or budget for such district, which shall give the estimated maintenance and expenses for the succeeding year and shall submit it to the county 2

We refer here to a county official, rather than to the county supervisor, because in many counties the position of county supervisor no longer exists. In those counties, the duties of the county supervisor have devolved upon the county governing body or an appropriate county official. See, e.g., Hardy v. Francis, 273 S.C. 677, 679, 259 S.E.2d 115, 116 (1979) ("The duties and responsibilities previously delegated to the office of County Supervisor by Section 14-254 of the 1962 Code devolved upon local government with the passage of Home Rule."); Letter to Joseph H. Earle, Jr., Op. S.C. Att' y Gen. (Nov. 13, 1984) (opining that certain duties previously assigned by law to the county supervisor had become the joint responsibility of the county administrator and county council). 3

We do not here consider whether the chairman may refuse to sign the bonds if they are patently irregular or invalid. We state only that in the absence of irregularity or invalidity, it would be absurd to permit the chairman to so refuse.

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supervisor for approval and adoption. Any surplus or deficit that may occur in any one year shall be carried forward and applied to the next year's account and properly considered in the budget for the expenses of the district for the ensuing year. (Emphasis added). Section 6-11-270 states: "[a]fter the approval thereof by the county supervisor, taxes shall be levied to meet such expenses upon all assessable property in the district ...." As shown by the language underlined above, the budget created by the board of commissioners and approved by the county must account for both operational and debt service needs. Pursuant to section 6- 11-270, the millage for the district will be derived mathematically from the budget in order to ensure sufficient tax revenue to cover the projected expenses. Cf County of Lee v. Stevens, 277 S.C. 421, 423, 289 S.E.2d 155, 156 (1982) ("Tax rate is generally reflected in 'mills' or ' millage rate.' ... In general terms, the appropriate tax rate is reached by dividing the assessed value of the property to be taxed into that part of the budget to be generated by property taxes."). 4 You have asse11ed that section 6-11-260 only "concern[ s] the operational expenses ... as presented ... in an annual operational budget." However, the plain language of section 6-11-260 is not so limited. Rather, that section makes it clear the budget should provide for sufficient revenue-whether from taxes or from other sources-to meet both operational expenses and "the sinking fund and interest charges on
[any] bond issue." Accordingly, it is our opinion that the annual budget submitted to the county for approval should reflect both operational expenses and debt service obligations.

4

The authorizing act for districts of this kind originally included the following language concerning debt service on the bonds authorized therein:
[I]t shall be the duty of county officers charged with the assessment and collection of taxes, upon recommendation of the Board of Commissioners, to levy and collect annually from all the property, real and personal, within the limits of such district, a sum sufficient to pay the interest on such bonds and also a sum sufficient to provide a Sinking Fund for the payment of such bonds when due. Act No. 734 § 5, 1934 S.C. Acts 1292, 1295-96. Language of this kind typically is construed in a manner consistent with our interpretation above. See Stackhouse v. Floyd, 248 S.C. 183, 198, 149 S.E.2d 437, 445 (1966) (similar language gave "no ... discretionary power to the Auditor" and "[t]he amount of the levy . . . [was] established by the maturity schedule of the bonds and the interest rate"); Letter to The Honorable Betty J. Catoe, Op. S.C. Att'y Gen. No. 85-24 (Mar. 20, 1985) (similar language was "selfexecuting," such that the auditor would "mathematically determine[] the number of mills necessary" based on the terms of the bonds). This language has been omitted from article I, chapter 11, title 6 since 1952. However, it can be used to provide additional insight into the legislative intent. See generally Town of Forest Acres v. Seigler, 224 S.C. 166, 179-80, 77 S.E.2d 900, 906 (1953) (" [C]hanges made by a revision of the statutes will not be construed as altering the law, unless it is clear that such was the intention, and, if the revised statute is ambiguous ... reference may be had to prior statutes for the purpose of asce1taining the intent of the Legislature." (quoting Dennis v. Independent School Dist. of Walker, 148 N.W. 1007, I 009 (1914))).

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Next, you have asked whether a public hearing is required prior to approval of new debt service millage. Section 4-9-130 of the South Carolina Code (1986), which concerns county government, provides in relevant part: Public hearings, after reasonable public notice, must be held before final council action is taken to: ( 1) adopt annual operational and capital budgets .... South Carolina Code section 6-1-80 (2004) provides notice requirements " in lieu of the requirements of Section 4-9-130," including in relevant part the following: A county, municipality, special purpose or public service district, and a school district shall provide notice to the public by advertising the public hearing before the adoption of its budget for the next fiscal year in at least one South Carolina newspaper of general circulation in the area. Section 6-1-80 implies that a public hearing is required before a special purpose district adopts its budget. As to counties, if read narrowly, section 6-1-80 would supplant only the notice provisions of section 4-9130, not supersede section 4-9-130 in its entirety. While the plain language of section 6-1-80 is limited to an entity's adoption of "its" budget, section 4-9-130 contains no such limitation. Rather, section 4-9-130 appears to be triggered by any action by county council to adopt a budget. As section 6-11-260 provides that the county must "adopt[]" the district's budget, a court giving effect to both 6-1-80 and 4-9-130 likely would find that each body must hold a public hearing prior to its adoption of the district budget.

3. Context of article 1, chapter 11, title 6
   The predecessor provisions to article 1, chapter 11, title 6 were first enacted in 1934, and these provisions have undergone little change since that time. However, the legal context of these provisions has changed, particularly in the adoption of " new" a1ticle X of the South Carolina Constitution. New article X authorizes political subdivisions of the State to incur indebtedness in ce1tain categories " and in no others." S.C. Const. art. X, § 14(2) (emphasis added). The permitted categories of indebtedness are "(a) [g]eneral obligation debt; and (b) [i]ndebtedness payable only from a revenue-producing project or special source." Id. To ensure the continued efficacy of the procedures in article 1, chapter I I , title 6, we tum now to the endeavor of discovering to which of these two categories such bonds might belong. It appears to be generally accepted that the districts authorized by article 1, chapter 11 , title 6 are special purpose districts and therefore political subdivisions of the State. 5 Nonetheless, district commissioners

E.g., Hagley Homeowners Association, Inc. v. Hagley Water, Sewer, and Fire Authority, 326 S.C . 67, 485 S.E.2d 92, 95 (I 997) ("South Carolina Code Ann. §§ 6-11-10 to -1260 ... provide the method by which special purpose districts may be established by petition of the affected landowners." ); Capital View Fire District v. County of Richland, 297 S.C. 359, 362, 377 S.E.2d 122, 124 (Ct. App. 1989) (holding a "special service district established pursuant to" this aiticle was "a political subdivision of the state");

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act as agents of the township within which the district is located for the purpose of issuing bonds. See generally Askew v. Smith, 126 S.C. 159, 119 S.E. 378 (1923) (explaining that the General Assembly could "provide such system of township government as it shall think proper," "change such system when and as often as it may deem proper," and designate agents of the township for particular purposes). In particular, section 6-11-180 specifies that the bonds authorized by article 1, chapter 11, title 6 are "bonds for and in behalf of the township within which the district is located." If these bonds were viewed as general obligation bonds of the township, new article X of the South Carolina Constitution would demand that the bonds be "secured in whole or in pa11 by a pledge of [the] full faith, credit and taxing power" of the township. See S.C. Const. art. X , § 14(3). No such pledge is found in article 1, chapter 11, title 6. On the other hand, bonds payable only from a special assessment do not require a pledge of the full faith, credit, and taxing power of the issuing jurisdiction. In fact, new article X would demand that such bonds state on their face "that the full faith, credit, and taxing powers are not pledged therefor." S.C. Const. art. X, § 14(10); see also S.C. Code Ann. § 11-27-40(7) (Supp. 2011) (preserving existing law authorizing "indebtedness ... payable solely from a revenue-producing project or from a special source" and requiring that " [e]vidences of such indebtedness ... contain a statement on the face thereof specifying the sources from which payment is to be made and ... [a statement] that the full faith, credit, and taxing powers of the issuer are not pledged therefor"). "It is very true that in popular parlance, and even in legislative enactments, assessments are frequently called taxes, but courts will look behind mere words to find the real meaning." Jackson v. Breeland, I 03 S.C. 184, 88 S.E. 128, 130 (1916). For example, in the oft-cited case of Evans v. Beattie,6 a highway district consisting of six counties was created as a political subdivision of the State to be governed by a board of six appointed commissioners. The commissioners were empowered to issue bonds of the district payable "primarily" from "[t]he levy of an annual ad valorem tax upon all taxable prope11y in the district sufficient to pay the principal and interest upon [the] bonds ... as such principal and interest bee[ a]me due," though this levy could be reduced by the amount available for payment from other specified sources, particularly the automobile license tax, a po11ion of the gasoline tax, and federal aid. Id. at 50406, 135 S.E. at 541-42. The Evans Court characterized the advalorem tax as follows: The taxation authorized by the act is not referable, as general taxes, to the power of the state by an equal and uniform method, to tax all property for a public purpose. It is, on the contrary, the exercise by the Legislature of the assumed right to carve out of the territory of the state a special district, and to order in the fonn of a tax upon all prope11y in that district a special assessment for local improvements.

Id at 507, 135 S.E. at 542 (emphasis added). As explained in Hagley Homeowners Association:

Letter to The Honorable James E. Kinard, Jr., Op. S.C. Att'y Gen. (July 21 , 1980) (referring to a district created pursuant to this article as a "special purpose district"); Letter to R.A. Messick, Op. S.C. Att'y Gen. (July 20, 1970) (opining that districts created pursuant to this article are "political subdivision[ s] of the State"). 6

137 S.C. 496, 135 S.E. 538 (1926), overruled on other grounds by Weaver v. Recreation District, 328 S.C. 83 , 87 n.2, 492 S.E.2d 79, 81 n.2 (I 997).

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Generally, taxes are imposed on all property for the maintenance of government while assessments are placed only on the property to be benefited ... . Unlike taxes, charges and assessments are similar in that a person receives something specific in exchange for payment of a charge and/or assessment. "The imposition of an assessment for the expenses of the local improvement upon adjoining lands benefited by it, although an exercise of the taxing power is not taxation within the provisions of the State Constitution regulating or prescribing the manner of taxation." 326 S.C. at 75, 485 S.E.2d at 96 (internal citations omitted). A key consideration in distinguishing a tax from an assessment is the generality of the benefits received. For example, in Painter v. West, 261 S.C. 277, 199 S.E.2d 538 (1973), the South Carolina Supreme Court refused to treat a statute authorizing a tax for the payment of ce1tain sewer bonds as authorization for a special assessment for local improvements. The Court explained that, unlike Evans and other similar cases, the benefits of the sewer systems at issue in Painter were statewide benefits aimed at reducing pollution throughout "the watercourses of the State." Thus, the Court held the improvements authorized by the act were not local in nature. The General Assembly appears to have intended the bonds authorized by a1ticle 1, chapter 11, title 6 to be special assessment bonds. Of particular note, the General Assembly specified that the bonds would be bonds of the township, but only the electors of a district within the township would vote on the issue of the bonds, only the owners of real property served by the improvement would pay the charges established by the board, and the "tax" for the payment of the bonds would be assessed only upon property within the district. See S.C. Code Ann. § 6-11-140 ("The board of commissioners of any such ... district shall establish and maintain just and equitable rates, rentals or charges .. . to be paid by the owner of each and every lot, parcel of real estate or building that is connected with and uses such works ... or that in any way is served by such works ... ."); id. § 6-11-200 ("[O]nly qualified voters residing in s uch district shall be allowed to vote."); id. § 6-11-270 (providing for a levy "upon all assessable property in the district''). These facts indicate the General Assembly viewed the improvements financed by the bonds as local in nature and as benefitting only the portion of the township within the district. In fact, the express purpose of these districts is to "protect public health" by supplying services to "a portion of any county . . . which is not included in any incorporated city or town" and which elects to establish such services in the area. See id. § 6-1 1-10 (emphasis added). Moreover, at the time the authorizing act was adopted, townships might have been unable to issue general obligation bonds for at least some of the purposes listed in section 6-11-180. As construed in Doran v. Robertson, 203 S.C. 434, 27 S.E.2d 714, 718-20 (1943), aiticle X, section 6 of the South Carolina Constitution of 1895 likely would have prohibited the issue of township general obligation bonds for the purpose of constructing a sewerage system. 7 However, a comt acting at that time likely would have 7

Article X, section 6, as quoted in Doran, provided:
The General Assembly shall not have power to authorize any county or township to levy a tax or issue bonds for any purpose except for educational purposes, to build and repair

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found that bonds payable only from assessments were not subject to the restriction of a1ticle X, section 6. The Doran Court explained: Not overlooked in the consideration of the powers of a county under the Constitution is the important decision of Park v. Greenwood County, 174 S.C. 35, 176 S.E. 870 [1934], in which it was held that a county might construct and operate a hydroelectric power plant, but no question was there made, uppermost here, that there was a violation of section 6, a1ticle X of the Constitution of 1895 by the intended issuance of bonds or levy of taxes for the purpose. In that interesting case it was expressly found that no bond or obligation of the county, in the constitutional sense, was involved, for the cost. principal and interest, was payable solely from revenues to be derived from the operation. The decision, therefore, merely involved the power of the county to pursue the purpose and did not relate to bonds or taxes, referred to in the prohibition against counties [and townships] in the section of the Constitution here invoked. 203 S.C. at 447, 27 S.E.2d at 719 (emphasis added). Likewise, courts had stated that bonds payable solely from assessments did not form patt of an entity's bonded debt in the constitutional sense of that term. See Berry v. Milliken, 234 S.C. 518, 526-27, 109 S.E.2d 354, 357-58 (1959) (discussing cases). In an opinion adopted by the Supreme Court, the circuit judge in Jackson v. Breeland explained: Construing [section 5 of article IO] as a whole, it is perfectly apparent that the bonded indebtedness therein referred to means indebtedness contracted for corporate purposes pursuant to law and to be paid out of taxes to be levied upon all the prope1ty within the corporate boundaries. It is further apparent that the bonded indebtedness therein referred to has no connection whatever with the assessment of property for local improvement, and the authority of a drainage district to levy and collect assessments for the drainage of swamp and low lands, and the issuance of so-called bonds therein is not derived from this section of the Constitution or affected thereby. 103 S.C. at 191 , 88 S.E. at 130 (emphasis added). Following the reasoning of Doran and Jackson, a court likely would have found the bonds authorized by article 1, chapter 11 , title 6 were payable solely from revenue of the projects financed and from assessments, such that they were not subject to the restriction in article X, section 6 of the South Carolina Constitution of 1895. For these reasons, we conclude a comt likely would find that in the context of new article X of our state constitution the bonds authorized by article 1, chapter 11, title 6 are special source bonds within the meaning of section 14( 10).8 Our conclusion in this regard does not impact our conclusions above as to public roads, buildings and bridges, to maintain and support prisoners, pay jurors, County officers, and for litigation, quarantine and cou1t expenses and for ordinary County purposes, to supp01t paupers, and pay past indebtedness. The Doran Court found the construction of a sewerage system was not an "ordinary County purpose[] ." While section 14(10) clarifies that bonds issued by its authority may not pledge "revenues from any tax or license," it makes no mention of revenue from special assessments. The General Assembly has

8

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the procedure for issuing these bonds or for setting the debt service "mi llage." Though we conclude that the so-called tax for debt service might in fact be an assessment, its nature as an assessment would not demand any change in the procedure for calculating the same. Rather, the Evans Couit quoted approvingly several authorities that support the view that assessments may be calculated on an ad valorem basis, levied by the county auditor, and collected by the county treasurer. 137 S.C. at 513-16, 135 S.E. at 544-45.

4. Procedure for issuing bonds oftlte district
   Assuming article 1, chapter 11, title 6 does not provide the procedure by which the board of commissioners may incur general obligation debt on behalf of the district, it is unclear whether the board might rely upon other statutory procedures to accomplish this purpose. For example, South Carolina Code section 11-27-40 affirms the authority of the governing body of each political subdivision of the State to incur general obligation debt, as follows: The governing body of each of the political subdivisions of the State shall be empowered to incur general obligation debt for their respective political subdivisions as petmitted by Section 14, New Article X and in accordance with its provisions and limitations. All laws shall continue in force and effect after the ratification date, but each of such laws is amended as follows .... However, this section does not provide a comprehensive set of procedures by which general obligation bonds may be issued. Rather, it lists modifications to existing statutes. Moreover, while sections 6-11810 et seq. of the South Carolina Code (2004) provide a procedure by which special purpose districts may issue general obligation bonds, the term "special purpose district" is defined for the purposes of that article as certain districts "created by act of the General Assembly prior to March 7 1973." Accordingly, sections 6-11-810 et seq. are inapplicable to districts of the kind at issue in this opinion, which were created by voter initiative not by special act. Cf Letter to C. Wesley Smith, Op. S.C. Att' y Gen. (Apr. 7, 1980) (finding sections 6-11-410 et seq. inapplicable to a district created pursuant to sections 6-11-10 et seq. because such district "exists not by vi1tue of an act of the General Assembly but, instead, by an affirmative vote in an election called for by petition"). For these reasons, it is not clear whether an alternative to the procedures in article 1, chapter 11, title 6 might be available to the board. Conclusion New article X of the South Carolina Constitution restricts the types of bonds that may be issued by a political subdivision of the State. We predict that a court would find the bonds authorized by a1ticle 1, chapter 11, title 6 are special source bonds payable solely from revenue of the projects financed and from assessments upon the property within the district. It is unclear whether other procedures might be available by which the board of commissioners could issue general obligation bonds of the district not

authorized revenue bonds payable from special assessments in a different context. See S.C. Code Ann. § 4-35-80 (Supp. 2011) ("The governing body [of a county] may use the provisions of Chapter 21 , Title 6 to issue revenue bonds, and any assessments authorized by [the County Public Works Improvement Act] are revenues of the system for that purpose.").

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exceeding the eight percent limit in a1ticle X, section 14(7) of the South Carolina Constitution. Following the plain language of article 1, chapter 11, title 6, we answer your questions as follows . The board of commissioners of the district is charged with setting the amount of, issuing, and selling the bonds authorized therein. The chai1man of the board and an appropriate county official have what appears to be a ministerial duty to sign the bonds. The debt service for such bonds must be accounted for in the budget required by section 6-11-260, and that budget must be approved and adopted by the county, as discussed in our letter to you dated March 2, 2012. Sections 4-9-130 and 6-1-80 of the South Carolina Code imply that both the district and the county should hold a public hearing before adopting the district's budget. Very truly yours,

7)Ct«?- ['. J-/f i,C?
Dana E. Hofferber
Assistant Attorney General
REVIEWED AND APPROVED BY:

Jf&z62,~
Robe1t D. Cook
Deputy Attorney General