PICKENS — A lawsuit that was years in the making has been ruled on by a Circuit Court judge, settling a dispute between the city of Clemson and the School District of Pickens County, along with Pickens County itself.
The suit was filed by SDPC and Pickens County in May 2012 disputing the City of Clemson’s management of a tax increment financing, or TIF, plan implemented in 1998. The suit was based on the city’s management of the plan by extending the original scope of the project and a failure to distribute excess tax money.
“In 1999 there was a change in the law concerning how TIF plans worked and all the government agencies involved would get money from that zone (where TIF is in place), that means the city itself, the county, and school district,” explained John Eby of SDPC. “The entities involved also had to be notified of any changes in the TIF and approve. Clemson expanded the size of the project several times with no notice to the county or school district.”
The county and school district were suing for money going back to expansions of the TIF project in Clemson prior to 2011, but the judge’s ruling cited both institutions should have been aware of the issue before the suit was filed, hence a partial summary judgment.
Based on the court’s ruling, the school district will receive just over $500,000 for fiscal years 2011-2012 and 2012-2013 instead of similar amounts dating further back. The TIF bond payoff will be completed in 2017, totaling a six year period the district will receive approximately the same amount in funds including back payments to fiscal year 2011-2012.
“Once the bond is paid off, going forward the zone where the TIF was in place is taxed normally,” Eby said. “That will be 2017 and will be a big help to the district.”
The error wasn’t discovered by the county’s tax offices until 2011 which, based on the court’s ruling, cost the county and school district several years of tax income based on “surplus funds” from Clemson’s bind payments on a yearly basis. The “surplus funds” are distributed based on a percentage calculated from millage rates.
In this case, Pickens County will receive 19 percent and the school district 55 percent of excess funds after bond requirements have been met.