Lawmakers circulating bills targeting big box stores


Big box stores operating in Wisconsin, along with the state chamber of commerce, are fighting a pair of bills circulated Wednesday that are designed to result in the retailers paying more in property tax.

The bipartisan push to change how the value of stores like Menards, Lowe's and ShopKo is assessed for levying property taxes also has the backing of cities and towns throughout the state that are embroiled in costly court battles.

Mayors joined Republican and Democratic lawmakers at a news conference to unveil the proposals, saying they're needed to reverse recent court rulings that have forced municipalities to cut large checks in tax refunds to retailers like Walgreens.

"We've had issues all over the state cropping up where businesses are challenging their assessment saying they should be compared to a dark, vacant store that hasn't been perhaps opened for years," said State Sen. Roger Roth, (R-Appleton).

The stores have been successfully arguing that their value should be based on the underlying real estate, so nearby empty big box stores can be taken into account. But municipalities call that a dark-store loophole that artificially lowers the value of the operating retail stores, shifting the property tax burden to smaller retailers and homeowners.

Recently Appleton lost in court when CVS Pharmacy challenged a property assessment. The city said the property was worth around $4.5 million, CVS said that was excessive, and the court agreed, valuing the property around $2 million.

"This is really about fairness, this isn't about taxes or revenue, this about fairness," said Appleton mayor Tim Hanna. 

The bills come in reaction to court rulings in Wisconsin and nearby Midwestern states -- starting in Michigan -- that have helped the retail giants lower the value placed on their stores for levying property taxes.

Even as the mayors and lawmakers spoke, Wisconsin Manufacturers and Commerce sent a memo to legislators urging them to oppose the bills as being bad for business. The state chamber and other opponents blame assessors with being overly aggressive and targeting retail stores and restaurants for large tax increases.

"Thankfully, the courts have been on the side of property taxpayers and have overturned many of these unwarranted increases," the WMC memo to lawmakers said. "This legislation would fly in the face of current law, overruling what the courts have said."

The bills set up the unusual dynamic of the state chamber, which typically supports Republicans, lobbying against them.

"Clearly we're going to be fighting people who are normally our allies in the state," said Republican Rep. Rob Brooks, the lead sponsor of the Assembly bills. The Senate sponsors are Sens. Duey Stroebel and Roger Roth. All three are Republicans, but Democratic Rep. Gordon Hintz joined them at the news conference to support the measure on what he called an issue of statewide concern.

Mayors and other local leaders from Appleton, Wauwatosa, West Bend, Pleasant Prairie and Madison were also on hand. The bills are a priority for the League of Wisconsin Municipalities.

Roth said he was hoping the Legislature would take up the bills in the fall. Brooks said he had spoken with Gov. Scott Walker about it, but would not say what his position is.

"The governor has been a huge proponent on holding the line on property taxes," Brooks said.