Photo by Nathan Gray

Sandra Burdette, an Anderson County Assessor’s Office employee, takes the square footage measurements on Friday of an Anderson County house.

Photo by Nathan Gray

Sandra Burdette, an Anderson County Assessor’s Office employee, takes measurements Friday at a house in Anderson County. Tax reassessment in Anderson County will affect property tax bills that will be mailed to residents this year.

ANDERSON COUNTY — Anderson County homeowners may be in for a surprise when tax bills arrive in mailboxes later this year.

Although the property tax millage rate is lower than in the past, the reassessment of home values should increase the amount residents owe. And, for the first time, the owners of some of Anderson’s more expensive houses will benefit from a 15 percent property tax cap.

The property tax cap is part of the implementation of Act 388, a tax bill adopted by the South Carolina General Assembly in 2006.

State law requires counties to reassess property values every five years, providing the option to delay for a year if needed. Anderson County’s last reassessment was in 2001, and after Act 388 passed, county officials decided to delay the 2006 reassessment.

The delay is one reason a home’s value on a tax notice this year may be higher than the home’s worth today. The tax bill homeowners get this year is based on home values in 2006, in accordance with the requirements of Act 388. At the end of 2007, the median sales price for property on the Hartwell Lake waterfront was up 22.2 percent from 2006, but the median price in northern Anderson County was down 10.9 percent, according to information from the Elizabeth Gray-Carr real estate team. As of April, median prices in the county were up 2 percent from April 2007.

Anderson County Assessor Mike Freeman said the residents most likely to benefit from the tax cap are the ones whose property is worth the most.

Holley Ulbrich, a researcher at Clemson University’s Strom Thurmond Institute of Government and Public Affairs, called the cap a tax break for the wealthy. People with high-value homes — typically those on Hartwell Lake or in the rapidly growing Powdersville area — won’t see the tax increase they usually do, but they are not the norm.

“A lot of property (values) will grow less, particularly in today’s housing market,” Ulbrich said.

To further complicate the matter, homes purchased since the last reassessment are not eligible for the cap. Instead, those houses are taxed at the sale price, which means two neighbors with identical homes could see a disparity in their tax bills just because one is a new homeowner.

“When people realize what’s going on, it may well kill some sales,” Freeman said.

Behind the push for a reassessment cap is the idea that rapidly appreciating home values are creating a revenue bonanza for local governments at homeowners’ expense.

Judy Stevonavich was one of several residents to tell the Anderson County Council in June that she disagreed with increasing the county budget at a time when the economy is slowing.

“No business in the private sector could operate the way Anderson County government is operating,” Stevonavich said. “Please take control of this budget.”

But in a study of assessment, millage and spending caps, Ulbrich found that revenue from property taxes has grown at an average rate of 6.5 percent per year statewide, and spending by all local governments has grown at a rate of 6.9 percent per year.

Counties are required to rollback the millage in a reassessment year, and Anderson County’s millage rate dropped this fiscal year to its fiscal year 2006-07 levy of 75.4 mills. The rate for 2007-2008 was 84.5 mills, according to a county handout from that budget presentation.

Anderson County Finance Director Gina Humphreys expects the value of a mill to increase to $565,000 this year, for total revenues of $149 million, but she said the new law makes predicting future county revenue even more difficult. County revenues are even more closely tied to the housing market under Act 388. The difference between the assessed value and sales value of homes means county revenue could increase when homes are selling then drop off in a down market.

“It’s always difficult because you’re trying to see into the future, but this makes it fantastically harder,” Humphreys said.

The change in regulations is the major reason tax bill preparation is running behind schedule. There are 120,000 parcels in Anderson County, and appraisers only recently started assessing new construction, Freeman said. Normally, he would be closing his books at the end of July, he said.

Humphreys said she hopes that as more counties implement Act 388, lawmakers will see its flaws and make changes. But Ulbrich isn’t holding her breath.

“I think it’s fairly widely known this was not the brightest idea, but once they’ve given a tax break, they’re not going take it back,” she said.