Sault Ste. Marie Walmart Drops Tax Appeal, Community Relieved

"It could have had a devastating effect on a lot of people," Sault Area Public Schools superintendent Dr. Tim Hall said.

There is finally a resolution for a community after years of legal back and forth with a Chippewa County Walmart over property taxes.

It stems back to a loophole in property tax law through the Michigan Tax Tribunal called the ‘dark store’ tax theory. 

Walmart in Sault Ste. Marie was using the loophole to reduce their property tax value.

It could have led to big losses for the community.

9 &10’s Blayke Roznowski and photojournalist Noah Jurik have details on the ‘dark store’ tax issue and why the community is celebrating.

It was a win for the City of Sault Ste. Marie and Chippewa County as Walmart decided to drop an appeal fighting for lower property taxes through a loophole.

For places like Sault Area Public Schools who could have been affected, they’re breathing a sigh of relief.

"In the long run it could have affected how much money was available to run our schools across the entire state," Dr. Hall said. 

It was a proposed total loss in revenue of roughly $270,000 for Chippewa County communities in 2015 through what’s called the ‘dark store’ theory.

"It allows open and operational, what’s classically called big box stores, to be valued as though they are abandoned, deed restricted and vacant," Sault Ste. Marie city manager Oliver Turner said.

That means Walmart had appealed to the Michigan Tax Tribunal that they should only pay $15 a square foot instead of $55 a square foot. 

"If you’re running a city or a township or a school district, you don’t have really the opportunity to raise a lot of revenue on your own, so at some point something has to give," Dr. Hall said. "As a community that could be something as bad police and fire support and for schools, it could be teachers or para pros or bigger class sizes." 

Walmart chose to drop the appeal and continue to be assessed at the rate set by the city.

They released a statement to saying they have a right to appeal and feel they had a fair appraisal, but they still chose to drop it.

"It’s really an investment in the community that we try to responsibly manage and certainly we feel that we were glad that we were able to come to a mutual agreement on this," Turner said. 

It is possible for big box stores to still utilize that loophole in the future.

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