May 10, 1982

Mr. Sam Tidball 
Executive Director 
Associated School Boards of South Dakota 
Box 1211 
Pierre, South Dakota 57501

Official Opinion No. 82-28

Appraisal of Surplus Property Sold at Public Auction

Dear Mr. Tidball:

You have requested an official opinion from this office in regard to the following factual situation:

FACTS: 

The 1982 Legislature passed SB 107 which amended SDCL 13-21-5. The amendment removed the requirement that surplus property sold at public auction cannot be sold for less than 90 percent of its appraised valuation and provided that it may be sold to the highest bidder.

Based on the above facts, you have asked the following question:

QUESTION: 

Is it necessary to have surplus property appraised when it is sold at public auction?

Senate Bill 107 effective July 1, 1982, amended SDCL 13-21-5 as follows: 

In lieu of sealed bids, the school board may advertise an auction sale of the property by posting notices and by advertising in the newspaper as indicated in §  13-21-3.  At the auction sale the property may be sold to the highest bidder. 

[Additions indicated by underscores--deletions indicated by]

SDCL 13-21-1 empowers school boards to declare any property held by the board to be surplus.  SDCL 13-21-2 requires the board to appoint a board of  appraisers and requires the board of appraisers to appraise surplus property unless the surplus property is to be traded in or destroyed.   SDCL 13-21-3 states that if the property consists of personal property with an appraised value of less than $500 the board may sell it in any manner and for any amount it wishes.  Where the property is not personal property or is personal property valued at more than $500, the fact that the property is surplus and its appraised value shall be published together with the time when bids will be opened by the board.  SDCL 13-21-4 provides that when property is sold by sealed bids, it must be sold to the highest bidder and bids must be at least 90 percent of the appraised value.  Prior to the action of the 1982 Legislature, SDCL 13-21-5 allowed for a public auction in lieu of sealed bids and also required the property to be sold for 90 percent of its appraised valuation. Senate Bill 107 removed all references to appraisal in the statute dealing with public auction.  When the entire legislative scheme contained in SDCL ch. 13-21 is examined it becomes apparent that after the effective date of Senate Bill 107 (July 1, 1982), there will no longer be any reason to appraise property that is to be sold at public auction.  It is a canon of statutory construction that the legislature does not intend useless acts and since property to be sold at public auction is to be sold to the highest bidder without regard for any appraised value it is my opinion that there is no purpose nor statutory requirement that surplus property to be sold at public auction be appraised  prior to the auction.

The answer to your question is no.

While you did not inquire, I feel compelled to advise school districts contemplating this action that they may have items to be sold at public auctions appraised if they so desire and they may establish a minimum price below which the property will not be sold for the protection of the public. See SDCL 57A-2-328 for the requirements of public auction sales with reserve.

Respectfully submitted,

Mark V. Meierhenry
Attorney General