League of Wisconsin Municipalities
  Capitol Buzz 
September 7, 2016
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Dark Store Resource Page Added to League's Website  
One of the League's priorities for the 2017-2018 legislative session is to pass legislation closing the Dark Store tax loophole. 

What is the Dark Store tax loophole you ask? 

In essence, the Dark Store tax loophole is being used by Big Box retailers and other national chains to lower the amount they pay in property taxes. Retailers such as Lowe's, Target, Meijer, Home Depot, Menards, Walgreens, and CVS are arguing that the market value of their thriving store should be based on the sales of similar size "comparable" properties that are vacant and abandoned.

What? You mean a fully operational store, like a new Target, gets to pay the same property taxes as a closed, empty and "dark" K-Mart down the street? Yes, that's exactly what the retailers are fighting for and it's what is starting to happen more and more frequently.

Some courts in Wisconsin have upheld this "Dark Store theory" and cut property tax assessments in some cases by as much as 50 percent - resulting in a tax shift to homeowners or a cut in local services. These rulings could result in a shift of millions of dollars in tax burden across Wisconsin unless the Legislature acts to close the loophole.

The Indiana Legislature recently enacted legislation closing the dark store tax loophole in that state. The Michigan state house passed a similar bill last May and the Michigan state Senate is expected to take up the bill this fall. 

It's time for Wisconsin to do the same.  It won't be an easy battle. Plenty of organizations, like WMC, will fight to maintain the status quo.

To gear up for the battle, we have created a Dark Store Resource Page on our Web site. On it you will find an informative and well done documentary on how the Dark Store tax strategy is undermining the tax base in Michigan communities. You will also find an issue briefing, a model resolution, and a link to a recent article in Governing magazine that provides an excellent overview of the Dark Store issue.

Please share this page with your legislators and the general public.