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DARK STORES LEGISLATION: CONTACT YOUR SENATORS NOW!
The Wisconsin Counties Association (WCA) is requesting county officials contact their State Senators and ask them to support dark store legislation aimed at closing the assessment loophole utilized by big box retailers. The Senate bills (
SB 291 and
SB 292) have received a committee hearing and are awaiting a committee vote followed by full consideration in the Wisconsin State Senate. The State Senate is likely to consider the dark store legislation earlier than the State Assembly. As the possibility of a Senate floor vote moves closer, opponents of the legislation are increasing their activity in the State Capitol.
Please contact your State Senator immediately and stress the need for them to support these bills aimed at protecting homeowners and main street Wisconsin businesses.
SB 292 - Dark Stores - Talking Points
- The goal of SB 292 is to avoid a large tax shift from commercial properties to other classes of property, primarily residential.
- Homeowners already currently pay 68 percent of the statewide property tax levy.
- Courts in other states like Michigan have upheld the "Dark Store" strategy, which argues that sales of closed, vacant stores can serve as comparables for determining the value of open, new stores, cutting property tax assessments for big box retail stores in some cases by as much as 50 percent.
- No appellate court in Wisconsin has endorsed the dark store strategy yet. However, if this strategy becomes successful in Wisconsin it could result in a shift of millions of dollars in tax burden from commercial property owners to homeowners and other taxpayers.
- The legislation is modeled after similar legislation the state of Indiana passed in 2016.
- The legislation codifies language in Wisconsin case law and DOR's Wisconsin Property Assessment Manual.
- The legislation clarifies that when assessors use sales of comparable properties for determining the value of a property they must use properties that are within the same market segment and similar to the property being assessed with regard to age, condition, use, type of construction, location, design, and economic characteristics.
- The legislation explicitly provides that assessors may not use a dark and vacant store as a comparable for property that is not dark or vacant.
- If the legislation is enacted, counties will not receive even one additional dollar in tax revenue due to levy limits. The legislation will, however, prevent more of the tax burden from being shifted to homeowners.
SB 291 - Reversing the 2008 Walgreens v. City of Madison decision - Talking Points
- SB 291 makes it clear that when valuing property assessors are to consider any applicable lease provisions and actual rent pertaining to a property and affecting its value.
- In 2008, the Wisconsin Supreme Court held in Walgreens v. City of Madison that an assessment by the income approach of retail property leased at "above market" rents must be based on market rents rather than the terms of Walgreen's actual leases and that the value added by an "above-market" rent constitutes a contract right, rather than a real property right.
- The 2008 decision continues to control how assessors must value Walgreens, CVS, and other single-tenant retail stores, despite changes made to the Wisconsin Property Assessment Manual to counteract the effects of that decision.
- Walgreens, CVS and other single tenant retail properties are successfully using the decision to convince the courts that their assessed values should be less than half of the actual sale prices of the properties on the open market.
- Even though chain drugstores have become the most popular single-tenant properties in the national real estate investment market, regularly selling for $6 million or more in Wisconsin, attorneys for Walgreen, CVS and other single-tenant stores argue that their actual sale prices don't represent market value and the underlying leases are the wrong tool for determining the property's value for property tax purposes.
- However, for all other purposes, such as federal income tax reporting, the value of the real estate is listed as the recent sale price. Only for property tax purposes is the actual sale price not acknowledged as the value of the real estate.
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FALL FLOOR SESSION
Now that the 2017-19 state biennial budget has been put to bed, members of the Wisconsin State Legislature have been told to focus on committee work.
Wisconsin State Senators have been told to keep Tuesday, October 31 and Tuesday, November 7 available for floor sessions.
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MINORITY LEADER HINTZ APPOINTS REP. TAYLOR TO JOINT FINANCE COMMITEE
Assembly Minority Leader Gordon Hintz is appointing Rep. Chris Taylor to his spot on the Joint Finance Committee.
Taylor, D-Madison, was a member of the committee until former Dem leader Peter Barca named Rep. Katrina Shankland, D-Stevens Point, to one of the two Dem Assembly seats on the committee. Shankland will continue to be on Joint Finance.
Hintz, D-Oshkosh, said Taylor "will be a fierce and articulate advocate for Democratic values."
"Serving with Rep. Taylor on the Joint Finance Committee during the 2015-17 budget was one of the most rewarding experiences of my time in the Legislature," he said. "Rep. Taylor understands the importance of our state's investment in future economic opportunity by supporting our public schools, small businesses, universities, and public infrastructure." -SOURCE: WisPolitics.com
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COMMITTEE HEARINGS FOR THE WEEK OF OCTOBER 2, 2017
Note: The Committee hearings and bills listed below reflect action on legislation impacting county government.
See a complete listing of weekly hearings here.
Tuesday, October 3, 2017
Senate Committee on Economic Development, Commerce and Local Government, 10:30 a.m.
Senate Bill 236 - competitive bidding thresholds and requiring school districts to utilize competitive bidding.
WCA supports this bill.
Wednesday, October 4, 2017
Senate Committee on Transportation and Veterans Affairs, 10:00 a.m.
Senate Bill 386 - lighting requirements for animal-drawn vehicles operated on highways.
WCA supports this bill.
Assembly Committee on Children and Families, 11:30 a.m.
Assembly Bill 481 - creating family treatment court and juvenile treatment court grant programs in the Department of Children and Families.
WCA supports this bill.
Senate Committee on Workforce Development, Military Affairs and Senior Issues, 10:00 a.m.
Senate Bill 385 - therapeutic diets in certain long-term care facilities.
WCA is monitoring this bill.
Thursday, October 5, 2017
Assembly Committee on Criminal Justice and Public Safety, 10:00 a.m.
Assembly Bill 351 - body cameras on law enforcement officers.
WCA is monitoring this bill.
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UPCOMING WCA MEETINGS/EVENTS
- October 5 - County Organization and Personnel Steering Committee
- October 13 - Taxation and Finance Steering Committee
- October 20 - Judicial and Public Safety Steering Committee
- October 25 - WCA County Ambassador Program (CAP Team)
- November 17 - Health and Human Services Steering Committee
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HOW CAN YOU FOLLOW THE SESSION WITH US?
As a member-benefit, the Wisconsin Counties Association offers access to
The Wheeler Report,
WisPolitics, and
WisconsinEye.
If you would like to subscribe to any one of these news services, please contact Amy Dias, Office Manager at [email protected] or at 866.404.2700.
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QUESTIONS?
If you have any questions about anything happening at the state level, please feel free to contact any member of the WCA Government Affairs Team:
Kyle Christianson,
Director of Government Affairs
608.663.7188
[email protected]
Sarah Diedrick-Kasdorf,
Deputy Director of Government Affairs
608.663.7188
[email protected]
Dan Bahr,
Government Affairs Associate
608.663.7188
[email protected]
Marcie Rainbolt,
Government Affairs Associate
608.663.7188
[email protected]
Chelsea Fibert,
Government Affairs Assistant
608.663.7188
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