‘Dark Store’ Valuation “less than dirt”


Costco Oshtemo Township

As new big box stores open all over the state, concerns are spreading. “The Menards store in Oshtemo Township [Kalamazoo County], for example, was valued at just under $8.3M in 2011. They appealed to the MTT and their property’s true-cash value was reduced to $6.4M. This decision cost our township $75,000 in revenue over five years that would have been spent on police, fire, and roads… In 2014, Costco purchased property for $5.5M and the construction valued at over $12M, resulting in a total building and land value of $17.5M. Attempting to strike a balance between the conventional methods of assessment and those of the MTT, the assessor in Oshtemo valued the property at $8.6M, a conservative valuation. Despite this effort Costco is asking the MTT for a true-cash value of $4M. They are requesting a value that is less than what they paid for the dirt on which it was built.”

Michigan townships, through the MTA, have been spreading the word downstate. Kalamazoo County, Comstock Charter Township Attorney, James Porter, calls this the “less than dirt” valuation method. Coalitions have formed. Attendance at the Marquette County Community Forum in early November was around 300 people.

The vice-chairman of MI Tax Policy Committee has been asked to form a committee to find a solution to the practice of tax assessments based on ‘dark store’ property comparisons. He says: “A very real and proximate example of this flawed (in my opinion) dark store methodology can be found with a brand new, national retail facility at U.S. 131 and Stadium Drive in Oshtemo Township [Kalamazoo Cnty.]. It has appealed its first year assessment and has asked the tribunal for a reduction of 80 percent of its total construction cost (land and building), which results in a value less than what it paid for the land alone in 2014.
I think most taxpayers in our state would not call that the product of the type of tax system we want in Michigan. No other class of property gets this specialized approach to value.”

It is not too late to join this move to inform and educate our own legislators on the devastating effects of these MI Tax Tribunal rulings. An informational committee hearing is planned for December 9th in the House. You can call or e-mail  concerns and accounts of specific effects of the cuts in your local services to:

David Maturen davidmaturen@house.mi.gov, or call 517-373-1787
House tax Policy Committee Clerk’s Office Ph: 517.373.0135 Clerk@house.mi.gov

More at –In the dark. Unfair assessing theory costs locals millions – township focus, November 2015

6 thoughts on “‘Dark Store’ Valuation “less than dirt”

  1. SaveMQT SaveMI Post author

    Representative Maturen speaks more on this on a recent radio interview: http://wbckfm.com/big-box-tax-refunds-hurting-local-governments-video/?trackback=fbshare

    “63rd State Rep. Dave Maturen has been charged with looking into the issue to see what changes the state might propose to the sytem. It’s a complicated issue. Businesses pay property tax based on the cost paid to buy land and build a facility. But many are convincing the Tax Tribunal in Lansing to reduce it, based on the value of an empty, abandoned store. Rep. Maturen joined WBCK’s Tim Collins on the Richard Piet Show on Monday morning. [WBCK]

    Read More: Big Box Tax Refunds Hurting Local Governments (VIDEO) | http://wbckfm.com/big-box-tax-refunds-hurting-local-governments-video/?trackback=fbshare&trackback=tsmclip

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