Could a forfeited-land commission sell property for taxes due without adding outstanding local fees?

Plain-English summary

In 2011, the South Carolina Attorney General concluded that Lancaster County's Forfeited Land Commission likely could sell property deeded to it for the amount of taxes due without adding the full amount of outstanding assessments and local fees to the sale price. The question involved public works assessments, fire fees, road improvement charges and a road-bond fee. The AG tied its answer to the statutory requirement that the sale serve the best interests of the county and state.

The statute gave the commission broad discretion over terms of a sale and the purpose of returning land to the tax rolls. The opinion cautioned that omitting assessments and fees from the price did not necessarily eliminate questions about the proceeds. A county treasurer might need to allocate a proportion of sale proceeds to the purposes for which those charges were imposed. The AG also noted that other governmental entities with an interest in the property could matter; its analysis understood the county likely to be the ultimate recipient of the fees described.

Currency note

This opinion was issued in 2011. 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

Did the commission have to add every outstanding fee to the sale price? A: The AG said probably not for the listed charges, if a lower price served the county and state's best interests under the sale statute.

Could the commission sell for the amount of taxes due?
A: The opinion said it likely could do so for property deeded to the commission, subject to the statutory best-interest judgment.

Did the opinion say the unpaid assessments vanished?
A: No. It addressed the sale price and warned that the treasurer might need to allocate some proceeds to the purposes of the assessments or fees.

What if another taxing entity had an interest in the land?
A: The AG noted that a commission could owe duties to other governmental entities with property interests. Its conclusion rested in part on the expectation that the county would receive the fees in question.

Background and statutory framework

Lancaster County's auditor and treasurer asked about a forfeited-land sale without adding several categories of local charges to the price. The AG read section 12-59-40 as giving the commission discretion to set sale terms for the county and state's best interests. It distinguished that discretion from the later distribution of sale proceeds among entities and purposes.

Citations and references

The opinion quotes section 12-59-40 on sale terms and refers to § 12-59-100 on dividing proceeds when land sells for less than taxes and penalties due.

Official title

Concerning whether the Forfeited Land Commission of Lancaster County (“the Commission”) may effect a sale of real property pursuant to section 12-59-40 of the South Carolina Code for the Amount of the taxes due, without including in the sale price the amounts due to certain assessments and fees.

Requester

The Honorable Cheryl H. Morgan, Lancaster County Auditor and The Honorable Carrie W. Helms, Lancaster County Treasurer

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/september-23-2011-1/
• Original PDF: https://www.scag.gov/wp-content/uploads/2011/09/morgan-c-h-helms-c-w-os-9314-9-23-11-forfeited-land-commission-sale-of-real-property.pdf

Original opinion text

ALAN WILSON

A TIORNEY GENERAL

September 23, 2011

The Honorable Cheryl H. Morgan
Lancaster County Auditor
P.O. Box 2016
Lancaster, South Carolina 29721
The Honorable Carrie W. Helms
Lancaster County Treasurer
P.O. Box 729
Lancaster, South Carolina 29721
Dear Ms. Morgan and Ms. Helms:
You have requested an opinion of this Office concerning whether the Forfeited Land Commission of Lancaster County ("the Commission") may effect a sale of real property pursuant to section 12-59-40 of the South Carolina Code for the amount of the taxes due, without including in the sale price the amounts due for certain assessments and fees. Specifically, you refer to assessments imposed pursuant to the County Public Works Improvement Act, section 4-35-10 et seq. of the South Carolina Code, "fire fees," "road improvement fees," and "fee[s] for a bond issued for road improvement within a district." The Commission likely has the discretion to make a sale of this kind. South Carolina Code section 12-5940 (2000) requires county forfeited land commissions to "effect the sale of lands forfeited and bid in for'' those commissions. The section further provides: All lands deeded to the forfeited land commission of any county shall be held by it as assets of the county and State and sold to the best interest of the county and State. [The commission] shall sell and dispose of such lands in such a manner and upon such terms and conditions as to it may appear to be for the best interest of its county ....

Id (emphasis added). This Office has explained the role of a county forfeited land commission as follows: One of the main purposes of the commission is to return lands to the tax rolls, rather than have the lands continue as a drain on the tax base. The commission is charged with the duty of selling and disposing [of] lands in a manner and upon such terms and conditions [as] appear to be for the best interests of the county and the State. The

REMBERT

c. DENNIS BUILDING • POST OFFICE Box l 1549 • COLUMBIA, SC 29211-1549 • TELEPHONE 803-734-3970 • FACSIMILE 803-253-6283

The Honorable Cheryl H. Morgan
The Honorable Carrie W. Helms
Page 2
September 23, 2011

General Assembly did not rule out that in certain situations, the interests of the county and State would be best served by the commission selling the land for a price lower than the amount of taxes and penalties due on the land. In order to adequately perform [its] duties, the General Assembly seems to have granted the commission broad discretionary authority to structure the sale of lands in such a way as it may deem appropriate, so long as the sale is in the best interest of the county and State. Letter to the Honorable Linda Sharpe, Aiken County Treasurer, Op. S.C. Att'y Gen. (March 15, 1999) (emphasis added) (attached). Accordingly, it is the opinion of this Office that the Commission likely is authorized pursuant to section 12-59-40 to sell property transferred to it by deed for the amount of the taxes due, without including in the sale price an amount equal to the outstanding assessments and fees, provided that doing so will serve the best interests of the county and the State. 1 We note, however, that it might be necessary for the county treasurer to apply some pro rata portion of the proceeds of such sale to the specific purposes for which the outstanding assessments and fees were imposed. Cf S.C. Code Ann.
§ 12-59-100 (2000) ("If any tract of land is sold for less than the taxes and penalties due thereon the proceeds of such sale shall be divided between the State and county in the proportion of the amount of taxes and penalties due each of them."); Letter to Mr. Michael L. Horton, Assistant Comptroller General, Op. S.C. Att'y Gen. (July 5, 1994) (see note I, supra); Letter to the Honorable Paul E. Short, Jr., Op. S.C. This Office has cautioned that county forfeited land commissions might owe duties to governmental entities other than their county and the State, if such entities have an interest in the property sold. See Letter to Mr. Michael L. Horton, Assistant Comptroller General, Op. S.C. Att'y Gen. (July 5, 1994) (opining that "property deeded to [forfeited land commissions] should be held ... as assets of the counties and districts which have a tax interest in the property" and that "[s]uch property should be sold on terms and conditions which best satisfy [the interests of] both") (attached). However, it is likely that the county is the governmental entity that ultimately would receive the assessments and fees referred to in your opinion request. See, e.g., S.C. Code Ann.§ 4-35-40 (Supp. 2010) (authorizing the governing body of a county to finance improvements "in whole or in part, by the imposition of assessments in accordance with this chapter and through the issuance of [various kinds of] bonds ... or by a combination of the funding sources"); id. § 4-35-30(2) (defining the improvements that may be financed under section 4-3540 to include "the relocation, construction, widening, and paving of roads and streets"); S.C. Code Ann. § 4-19-20 (1986 & Supp. 2010) (authorizing the governing body of a county to "establish [a] fire protection district and, in order to provide for the operation and maintenance of it, authorize the levy of an annual ad valorem tax ... or the imposition of rates and charges for fire protection services within the fire protection district ... "); id. § 4-19-20(4) (explaining that fire protection districts "may be operated as an administrative division of the county, or the governing body [of the county] may appoint a commission ..
. and provide for [the commissioners'] duties and terms of office"); S.C. Code Ann. § 4-9-30(5) (1986 & Supp. 2010) (authorizing counties to create special taxing districts that "may be operated as an administrative division of the county, or county council may appoint a commission ... "and authorizing counties to impose uniform service charges within such districts). If the county is the ultimate recipient of the assessments and fees about which you have inguired, there does not appear to be a danger that a sale of the kind discussed herein would place the interests of the county at odds with the interests of any other entity to which the Commission might owe a duty.

The Honorable Cheryl H. Morgan
The Honorable Carrie W. Helms
Page 3
September 23, 2011

Att'y Gen. (Apr. 29, 1987) (explaining the constitutional import of distributing the proceeds of a sale for nonpayment of taxes to the various entities that levied the taxes on the property sold) (attached). Very truly yours,

Dana E. Hofferber
Assistant Attorney General
REVIEWED AND APPROVED BY:

~le;µ__
R'ObertD:COOk
Deputy Attorney General