The announcement this week that the City of Rhinelander settled with Walmart on a revised tax assessment has again put a focus on what's termed the 'Dark Store loophole'.
The tax loophole allows existing stores to be assessed the same as a store that is out of business, hence the name 'Dark Store'. This has resulted in some significant tax refunds to large retailers and a blow to city budgets and services across Wisconsin.
But the Executive Director of the League of Wisconsin Municipalities, Jerry Deschane, says they applaud the legislature for taking steps recently to pass three bills recommended by a special committee. The bills make clearer the rules for these types of assessments..
"As you know from your recent experience up in Rhinelander, these are big property taxpayers. When these things are challenged in court, it drags out, there's a lot of uncertainty for budgeting purposes. These three bills are not the be-all and end-all, but they do make the process more effective and efficient..."
Deschane says the local municipalities can win these lawsuits, but it is costly...
"Local municipalities have generally been winning these battles when they get to court. The problem is going to court is a risky proposition and it's expensive. These three laws passing would eliminate some of that uncertainty. They would get these cases settled faster, which would benefit both the property owner and the city..."
Advocates for maintaining the loophole say property tax assessments have been tilted too far on large retailers.