Business Lobby Delays “Dark Stores” Bill?
Bill overturns ruling that assesses big-box stores as though they are empty.
Another national retail chain is using a legal loophole to challenge a small Wisconsin town over its tax assessment. Meanwhile, legislative proposals to address the issue remain in limbo three months after being introduced by GOP lawmakers.
Earlier this month, Macy’s Inc. sued Grand Chute, claiming the town’s $11.4 million property assessment on its store there was too high. The luxury store chain said its store was worth only $7 million, which would reduce its tax bill from $211,200 to about $130,100. Sears has also sued Grand Chute over the tax assessment of its store there.
Other large chain stores, including Walgreens, Menards, Target, and Lowe’s, have successfully challenged and slashed their local property tax assessments numerous times throughout the state in recent years. They have argued the value of their operating stores should be based on the substantially lower tax assessments of empty big-box stores. This so-called dark store loophole is based on a 2008 Wisconsin Supreme Court case that municipalities say artificially lowers the value of operating stores and unfairly shifts large property tax burdens to homeowners and smaller business. Municipalities also say the assessment challenges are creating large legal costs.
But there’s been no other progress on the bills in about two months, in part because of the summer-long legislative stalemate on a new 2017-19 state budget. The budget plan remains unfinished because of differences between majority Republicans in the Assembly and Senate on tax, education and transportation funding issues. And in recent weeks, legislators have turned their attention to a proposed $3 billion corporate welfare package for Foxconn, a Taiwanese electronics manufacturer, to build a factory in southeastern Wisconsin.
The other drag on the bills might be opposition from a host of special interests led by Wisconsin Manufacturers & Commerce (WMC), the state’s largest business organization and a traditional election-time ally of most Republican legislative and statewide candidates. More than a dozen groups and businesses have used the time to line up against the proposals because they could cost major retailers hundreds of thousands of dollars more in taxes that are now paid by small businesses and residents.
In addition to WMC, the other groups and businesses that are opposing one or both of the bills are:
- Americans for Prosperity
- Aggregate Producers of Wisconsin
- Alliance of Wisconsin Retailers
- CVS Health
- Marathon Petroleum
- Metropolitan Milwaukee Association of Commerce
- Outdoor Advertising Association of Wisconsin
- T. Wall Enterprises
- Union Pacific Railroad
- Wisconsin Hotel and Lodging Association
- Wisconsin Independent Businesses
- Wisconsin Property Taxpayers
- Wisconsin Grocers Association