County aids townships on big box taxes
MARQUETTE – The Marquette County Board unanimously approved three measures Tuesday supporting the efforts of Marquette and Breitung townships in their fight to recover thousands of dollars in tax revenue and, in the process, change the way “big box” retailers are assessed on the value of their stores across the state.
“It’s a very serious issue and one that we need to be in with both feet in supporting the townships on this,” county board Chairman Gerald Corkin said. “It has a great effect on not only townships, but counties, schools and (it’s) nonsense.”
The townships are jointly appealing Michigan Tax Tribunal decisions to the Michigan Court of Appeals in a case expected to be heard sometime over the next few months. The outcome will affect communities across Michigan who are also facing potential tax revenue losses from big box tax tribunal challenges.
The tribunal previously ruled against Marquette Township in favor of Lowe’s Home Improvement Warehouse and against Breitung Township in favor of Home Depot. Marquette Township was ordered to pay Lowe’s more than $447,000 in tax revenue and interest for 2010-2012.
The tax tribunal decided in those two cases – and several others involving other big box retailers across the state – that the operating stores must be valued as though they are vacant and for sale or so-called “dark stores,” which have been converted to some other use.
That idea was based on examples from southeast Michigan provided by appraisers indicating that when big box stores are sold they are converted to another use, demolished or investors will spend considerable money reconfiguring the space.
Township attorneys argued the stores should be valued considering existing use, present economic income and the land and structures at the time of tax assessment.
On Tuesday, the county board approved a motion by Commissioner Deborah Pellow to contribute $12,000 to Marquette Township to offset attorney and appraisal fees incurred over the past two years totaling more than $213,000.
Marquette County administrator Scott Erbisch said he and county finance manager Sue Vercoe looked at the budget felt the $12,000 was “an appropriate amount.”
“We feel it’s a good use of the dollars,” Erbisch said.
Erbisch said the county could perhaps contribute more money later as appellate process moves ahead.
“I think it’s a good start, it shows your commitment in the appeals process and what’s being done and the severity of what may happen here,” Erbisch told the board.
Commissioner Paul Arsenault asked Erbisch to keep the board informed with the progress of the case. Erbisch said he would.
The board then approved a motion from Commissioner Bruce Heikkila to send a letter to the Michigan Association of Counties, seeking additional financial contributions.
“This is happening all over the state and it’s affecting everybody,” Heikkila said. “Maybe the association of counties could recommend an amount of $1,000 or something all counties throw into a pot and maybe townships too. But I think you’ve got to fight this on one front and I think this association of counties would be a good place and the townships too.”
Commissioner Gregory Seppanen agreed with Heikkila’s idea to write to the counties association and said Marquette Township should approach the Michigan Townships Association with a similar request.
Pellow asked that a letter be sent to Gov. Rick Snyder outlining the county’s concerns with his appointees to the tribunal and their allowing real estate comparables from economically ravaged southeastern Michigan to be used to assess true cash value of Upper Peninsula big box properties.
“These people on the tax tribunal are making these decisions and they’re appointed by the governor,” Pellow said. “And I think it’s very important that we send a message to the governor saying take a look at what you’re doing and who you’re appointing because they are affecting lives in local units of government up here in the Upper Peninsula and all across the state as a matter of fact.”
Pellow put the idea in the form of a motion, which the board approved. Commissioner Steven Pence was absent from the meeting.
During the public comment portion of the meeting, former county Commissioner Michael Quayle said he wholeheartedly supported the board’s contributing to the townships’ legal defense and offered another idea.
“I think when the gas prices were so high, we used to take and avoid buying gas on a certain day of the month. Obviously, you’re going to buy gas the next day. I’m almost wondering if we shouldn’t be looking at doing something like that with some of these big box stores, just to send a message to their corporate headquarters,” Quayle said. “A certain day, not necessarily all of them the same day, maybe one a day for a week or something like that, we avoid shopping at those places. And I like I say, more than likely people will be there the next day and buy some of the same stuff, but I think that one day and drop in sales to corporate headquarters, just to let them know that the citizens are supporting this also, not just the elected officials.”
The board did not discuss or act on Quayle’s suggestion.
John Pepin can be reached at 906-228-2500, ext. 206. His email address is email@example.com.