Walmart is seeking to reduce its city of Beaver Dam tax bill, despite the fact the city provided $6.18 million to the business for locating its distribution center here.
Walmart filed a suit against the city Friday to lower the property value of its two properties in Beaver Dam, the WalMart store at 120 Frances Lane and the Walmart Distribution Center at 115 Distribution Way.
The city assessed the value of the store at about $9 million, but Walmart claims to value to be about $7 million. The 1-million-square-foot distribution center is valued at $40.72 million, but Walmart wants that lowered to $26 million. With lower property values, Walmart would pay less in property taxes.
Walmart already negotiated with the city last year to be reassessed and lower its taxes here. Mayor Becky Glewen has said that the first value change shifted tens of thousands of dollars onto other residents of Beaver Dam, and such another huge change could go into the hundreds of thousands.
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In 2003, the city struck a deal with Walmart to offer $6.18 million in incentives to Walmart to build the distribution center, including a lump sum of $1.38 million and 20 annual payments of $200,000.
According to the contract, those payments would continue through 2024, but city officials could not provide information Wednesday about whether they are still being made.
The Walmart store in Beaver Dam was built in a tax incremental finance district. In such a district, property taxes collected are used to repay the cost of investment in the district—usually expenses such as roads, water and sewer service.
Another big box retailer—Menards—is across the road from Walmart in Beaver Dam and the company has been challenging its property tax assessments in lawsuits around Wisconsin.
A few months ago, West Bend emerged on the winning side of a similar case in which Menards was challenging its property tax assessment there.
Municipalities across the state are concerned about the so-called “dark store loophole,” where big box stores have their properties valued as though they were vacant in an attempt to reduce their property tax levy. Big-box companies argue that not doing so is unfair and goes against state law. Last year, the Beaver Dam Common Council supported a resolution asking the legislature to take action on the issue, which has not yet happened.