Dark Store Loophole: Walmart and Menards Take Action Against City to Lower Assessed Value

Finance Committee Approves Donation to Combat Dark Store Loophole

City Communicates OnFocus – The Finance, Budget and Personnel Committee approved making a $2,500 donation to the League of Wisconsin Municipalities to help in their fight against the Dark Store Loophole currently used in Wisconsin.

“Wal-Mart and Menards have been actively and aggressively in Wisconsin and beyond our borders seeking to get reductions to their assessed value, in some cases using what’s called the dark store theory,” said Steve Barg, City Administrator. “It’s got to do with comparison with other buildings that maybe have seen reductions in value because they’re not occupied, but they may be similar type of structures.

“It’s not a negative campaign on our part or the league’s part against companies like Walmart and Menards or anybody else. It’s just an assessing type of issue. We believe that their argument of trying to compare an active store to a vacant building that they used to own that’s been sitting there for a while is not a fair comparison from an assessing standpoint, and that the reductions that they’re asking for are simply not warranted.”

“The League of Wisconsin Municipalities and a lot of assessors and others have been battling this argument, attorneys are involved now, and quite frankly the city of Marshfield is involved because both Wal-Mart and Menards have taken action against us here,” said Barg. “We are fighting legally with some help from our lawyers to try and preserve the fact that we think that their argument is an error. Others across the state are doing the same.”

“The league wants to do an all-out campaign blitz with legislators, PR campaign, advertising, that type of thing, to really rally the troops that this is an invalid argument by these companies to try and get their assessed values reduced,” he continued. “It’s going to cost money. It’s going to take time and effort and energy. The league has already put $75,000 of its own dollars in from its reserve funds they’re looking for cities and villages across Wisconsin to contribute monies as well. Their suggested donation is $1,200. They’re appreciative of anything that we would give.”

Lawsuits are decided on a case by case basis. “All I can say for right now is it would
be obviously a lot of tax revenue to make up from the remaining taxpayers if [the stores] were to be successful,” said Barg.

Alderman Gordon Earll moved to make a donation in the amount of $2,500.

Alderman Jason Zaleski voiced concern over the timeline. “You mentioned, Steve, that the state legislation had died, that was through the Senate. You mentioned correctly that we’re in an election season now. Likely any future legislation wouldn’t happen at the state level until they take up session in January,” said Zaleski. “I tend to think that that they will take this up, so I I’m not excited about the eagerness of this right now. I don’t see it as a pending issue.”

The motion passed 3-2 with Alders Rebecca Spiros and Zaleski voting no. The issue still has to be approved by the full council in the consent agenda on August 14t​h​.