SC’s highest court rejects user fees that are actually taxes

June 30, 2021 GMT

COLUMBIA, S.C. (AP) — South Carolina’s highest court tossed out two fees in Greenville County with the justices saying Wednesday that courts across the state won’t accept fees that are actually taxes in attempts to circumvent the Legislature.

The unanimous Supreme Court ruling found illegal a $10 fee increase for each vehicle registered in Greenville County and a $15 fee to improve communications between public safety agencies. Both were approved in 2017.

Three Republican Upstate General Assembly members sued over the new user fees. State law requires the Legislature to approve a new tax, but not a new fee.

User fees have to apply uniformly for a service or public improvement. Lawyers for Greenville County argued their residents get the benefits of better roads and the improvements to public safety communications would increase property values countywide.

The justices rejected both arguments.


“While Greenville County residents who use the roads every day may derive more benefit from having the roads maintained in good condition, it is still the same benefit every driver gets, no matter where their car is registered,” the justices wrote in their opinion.

They also said the argument about improving property values through better emergency services was irrelevant because all decisions made by governments should do that.

“What governing body would attempt — and what electorate would accept — an act that is calculated to damage property value?” the justices wrote.

In a concurring opinion, Associate Justice John Kittredge said he understands local governments want to call the methods they use to raise revenue fees instead of taxes, but the courts can’t tolerate letting them circumvent state law.

“I believe today’s decision sends a clear message that the courts will not uphold taxes masquerading as ‘service or user fees,’” Kittredge said.

The two fees make up about $18 million of the $319 million budget the Greenville County Council passed Tuesday night, The Post and Courier newspaper reported.

Greenville County officials did not immediately comment on the ruling.

The lawsuit was filed by Reps. Mike Burns of Taylors and Garry Smith of Simpsonville and Sen. Dwight Loftis of Greenville. All three men are Republicans.