PLATTEVILLE, Wis. — The City of Platteville faces the latest in what has become a series of legal challenges to the tax liability of local big box stores.
Walmart recently sued the city in Grant County Circuit Court, alleging that its Platteville store’s assessed value is “excessive” and should be reduced from $12.3 million to $6 million. The company also requested a partial refund for 2021 taxes at the property, which is located at 1800 Progressive Parkway.
The lawsuit comes after Walmart sued the city in 2020 and settled out of court to reduce its assessed value from $12.7 million to the current figure, and City officials fear that repeated challenges disproportionally will fall on the backs of homeowners and small businesses.
“You had hoped that both sides had come to an agreement on what was acceptable,” said City Manager Adam Ruechel. “Every year, this is an ongoing concern.”
Representatives from Walmart did not respond to a request for comment for this story.
The dispute with the company is one of many that has occurred statewide in what has been referred to as the “dark store loophole.”
Big-box retailers successfully have challenged their property assessments, arguing that stores’ assessed values should be based on the sales of vacant and abandoned properties of similar size.
Wisconsin caps the amount that local governments can levy, so the tax burden is redistributed each time a property owner’s assessed value is reduced.
Municipal leaders generally are disincentivized from resolving challenges in court, fearing a worse outcome if they lose.
And one settlement often begets another. A stipulation of Platteville’s 2020 settlement was that Walmart’s new valuation was not admissible in court in the event of future challenges.
The company previously challenged its Platteville property’s assessment in 2016, which at the time was $16.1 million. The city also settled the case.
The League of Wisconsin Municipalities pitched legislation during the previous two sessions to state officials that would curb the practice.
Local lawmakers expressed support for the measure, but it encountered fierce resistance from the state’s business lobby, and GOP leaders declined to bring the bill to the floor for consideration.
State Rep. Travis Tranel, R-Cuba City, said he heard little about the issue last year during the pandemic, but he believes that without continued pressure from the League of Wisconsin Municipalities, lawmakers are unlikely to take up the issue again.
State Sen. Howard Marklein, R-Spring Green, could not be reached for comment Wednesday.
This year, Democratic Gov. Tony Evers included a dark store provision in his budget bill, but the state budget committee stripped all nonfiscal policy items from the proposal.
The League of Wisconsin Municipalities recently shifted tactics, encouraging municipalities to defend their assessments in court. A number of recent court decisions have ruled in favor of cities and villages.
“The courts are interpreting the law the way we think it should be interpreted,” said Curt Witynski, the league’s deputy executive director.
Platteville’s attorney and insurance company are reviewing the lawsuit before it is presented to the Common Council for deliberation, Ruechel said.