A battle between Corporate America and municipal government rages on in Ellsworth.
On August 19, Wal-Mart Real Estate Business Trust filed a second request to lower its assessed property value from $20.1 million to $10 million, cutting its taxes in Ellsworth by upwards of $180,000 annually.
How is this even possible? Through the employment of the “dark store assessment.”
The dark store assessment is a loophole used by big box stores, such as Walmart, to lower their property taxes. Corporations value their active locations as if they were vacant storefronts, costing local communities tens of thousands of dollars in revenue. They often argue that because their stores are designed specifically for their purposes, their value on the real estate market would be far less than traditional estimates.
This is hardly a new strategy for Walmart. In 2017 alone, Wal-Mart Real Estate Business Trust attempted to use the dark store assessment to appeal its property taxes in eight different Maine towns, including Ellsworth. It did so in municipalities across the country.
And it’s not just Walmart, Maine accountant John O’Donnell told the Ellsworth American: “It’s coming to your town soon, as they say. Walmart, CVS, Home Depot, Kohls, Walgreens. The dark store method is being embraced.”
For municipalities battling the dark store theory, even a win can result in losses due to excessive legal fees needed to counter corporate lawyers.
“Just the threat of going to court may intimidate an assessor to lower the value,” said Ellsworth Assessor Larry Gardner in 2019.
Legislation to close the dark store loophole was introduced in the Legislature this past session. LD 1129 would have required tax assessors to value retail properties based on cost minus depreciation, income generated, and comparable property sales. The bill did not advance.
Our towns cannot be beholden to corporations like Walmart, who use our infrastructure and our labor to benefit themselves. We cannot allow them to deny us the revenue needed to maintain our roads, educate our children, and maintain a decent quality of life for Maine’s working families.