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End the "Dark Store" tax loophole

June 14, 2018

More and more, big box retail chains are taking advantage of legal loopholes to avoid paying their fair share of local property taxes. As a result, leaders from communities big and small all over the state have spoken out, urging the Legislature and Governor to act on a fix before residential property taxpayers are left to shoulder even more of the tax burden.

The so called ‘dark store’ loopholes allow big chains to have their property assessed like vacant stores rather than thriving businesses, in some cases cutting their property tax bills in half; that tax burden is then shifted to residential property taxpayers, who can’t take advantage of such loopholes and are already paying about 70% of the total property tax revenue. Authored by Senators Roger Roth (R-Appleton) and Duey Stroebel (R-Saukville) and Rep. Rob Brooks (R-Saukville) and introduced in June 2017, Senate Bills 291 and 292 would close these gaps that currently allow big retailers to avoid paying millions of dollars in property taxes. Both bills have received bipartisan support; they even passed the Senate Revenue Financial Institutions and Rural Issues Committee unanimously. However, in large part due to pressure from Wisconsin Manufactures and Commerce (WMC) and other big business groups, Senate Majority Leader Scott Fitzgerald (R-Juneau) and Assembly Speaker Robin Vos (R-Rochester) have refused to allow them to be voted on in either the Senate or the Assembly. Democrats in both houses made attempts to bring the bills to the floor to be debated and voted on but were shut down by Republican leadership.

With legislative Republican leaders refusing to act, efforts were shifted toward Governor Walker. A letter authored by Robert Wirch (D-Somers) was co-signed by 30 of his colleagues in the Legislature, calling on the Governor to hold a special session on the dark store legislation, but not a single Republican member of the Legislature would sign on to Senator Wirch’s letter.

These bills are about fairness. It’s unfair that big businesses can take advantage of a gap in the law to avoid paying their fair share of property taxes, which pay for our schools and municipal services that we all benefit from. It’s unfair that hardworking, taxpaying families will be forced to pick up the slack. Without action, the League of Wisconsin Municipalities estimates that property taxes in Pleasant Prairie will rise 17% or about $892 on average per home as a result of the dark store loophole, and property taxes in other parts of Kenosha and Racine counties would likely increase by hundreds of dollars per year as well.

Contact Governor Walker and demand he fix the “dark store” loophole
Office of the Governor: P.O. Box 7863, Madison, WI 53707
(608) 266-1212

Sources: League of Wisconsin Municipalities Issue Briefing: Dark Store and Walgreens Tax Decision Shift
league@lwm-info.org; www.lwm-info.org

Senator Robert Wirch 2017-2018 Legislative Session Update
http://wirch.senate.wi.gov. (608) 267-8979



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