Lowe’s, 2015 Geneva St., Delavan, has filed two lawsuits against the city of Delavan appealing its property tax assessment.


Voters in Walworth County will be asked on the Nov. 6 ballot whether the state Legislature should address the practice of commercial taxpayers appealing their property tax assessments and, in many cases, owing less as a result.

The advisory referendum addressing the so-called “dark store” theory passed the Walworth County Board unanimously Tuesday night. The Lake Geneva City Council approved a similar advisory referendum to take place in November.

Critics say the dark store theory allows commercial retailers to appeal their property tax assessments on the grounds that their buildings should be assessed the same as a vacant building of the same size. In some cases, the difference can be worth millions of dollars.

Proponents of the advisory referendum say local governments aren’t always able to enter lengthy court battles to fight assessment appeals. Municipalities often settle appeals out of court to the advantage of businesses.

Critics also say lowering a retailer’s assessment unfairly shifts the tax burden onto residential property owners.

“I know there are small businesses and certainly property owners that are paying more taxes unfairly, in my opinion,” Walworth County Board chairwoman Nancy Russell said. “I feel that that is just unfair. I think we need to put a stop to it.”

In Lake Geneva, City Administrator Blaine Oborn said Best Buy threatened to appeal its property value assessment in 2016. In order to avoid a lawsuit, Oborn said the city lowered Best Buy’s assessment by $2.2 million.

Oborn said the city lowered commercial property taxes by 1.7 percent between 2014 and 2015. During that time, Oborn said residential property taxes spiked between 3 and 5 percent.

By placing the advisory referendum on the November ballot, officials from Lake Geneva and Walworth County hope to influence legislative action on the dark store theory, something Russell said legislators have ignored in the past.

“We have already sent privately, individually, letters to our legislators, but they haven’t done anything about it. I think a referendum will get more attention,” Russell said. “I understand they have to use their judgment. But I think a referendum will show how strongly people feel about it in the county.”

For voters in Walworth County, the question will ask: “Should the State Legislature enact legislation to close the Dark Store loopholes, which currently allow commercial retail properties to significantly reduce the assessed valuation and property tax of such properties, resulting in a substantial shift in taxes levied against other property taxpayers, such as residential home owners, and/or cuts in essential services provided by an affected local government?”

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