The Brunswick Walmart, located at 15 Tibbett’s Drive. The location is assessed at $17 million, but the company contests it is really only worth about $11 million. (Hannah LaClaire / The Times Record)
BRUNSWICK — After a full day of mediation Friday, Brunswick town officials and representatives from Walmart are no closer to agreeing on how much the Brunswick superstore is worth, or how much the retail giant should have to pay in property taxes.
Walmart, the world’s biggest retailer and the seventh-highest payer of property taxes in Brunswick, claims it’s being over-taxed in Brunswick, a claim repeated in communities across the state and nation. Walmart asked Brunswick to slash its taxable value for 2017 and 2018 on the grounds that the building’s $16.9 million assessed value “exceeds the property’s fair market value;” a move that, if granted, would cost Brunswick more than $236,000 in tax revenue for the two-year period. Cloutier said he anticipates Walmart will likely request an abatement for 2019/2020 as well.
In 2017, then-Brunswick Assessor Cathy Jamison denied the company’s request for an abatement. At the time, Walmart claimed the property was only worth about $10 million, citing a Walmart appraisal that Brunswick Town Attorney Stephen Langsdorf said this summer was “very, very flawed.” If granted, Walmart would pay about $184,000 in property taxes, rather than the $311,000 it paid in 2017.
Walmart also filed a separate 2018/2019 abatement this spring, contesting again that the $16.9 million assessment “exceeds the property’s fair market value,” but valued the property at $11.2 million, $1.2 million more than the 2017 request. If granted, Walmart would pay about $212,000 in annual property taxes, rather than the $320,000 it paid in 2018. Brunswick Assessor Nick Cloutier denied the request.
Walmart then appealed the 2017 decision to the local board of assessors, which also denied the request, before then appealing to the state board of assessment for review. Friday’s mediation was only for the 2017 Assessment Appeal, Cloutier said in an email, though the 2018 appeal was also discussed. “The 2018 appeal has not yet been heard by the Town’s Board of Assessment Review, which will likely be scheduled for some time in November,” he said.
In June, Brunswick hired Stephen Traub, an independent appraiser to evaluate the 15 Tibbett’s Dr. property. He valued the property at $21 million, or about $11 million more than what Walmart thought it should be worth. Cloutier also attended the appraisal and raised his estimate by nearly $1 million, to $17.8 million.
Part of the State Board of Appeals process requires that the parties attempt to reach a mediated solution. After they failed to reach an agreement Friday, Cloutier said, they are waiting to schedule a date with the state board of assessment, but that “the process can take some time” and that it will likely “not be anytime soon.”
“We tried to see eye to eye, but we were unable to,” he said.
This appeal is a common move for Walmart, which has reportedly been appealing property tax valuations around the country for years. “This is part of a very broad effort, where they go around the country challenging property tax valuations,” Langsdorf said. Walmart has hired Stavitsky and Associates, a property tax appeal law firm based out of New Jersey to handle the filings.
The trend is mirrored across the state in communities such as Ellsworth, Oxford, Thomaston, Bangor and Augusta.
Some of these appeals are based on what is known as a “dark store loophole,” which allows big box stores like Walmart, Target and Lowe’s to reduce their property tax value by contending that their fully operational businesses should be assessed the same as vacant buildings.
This is not a viable argument, Langsdorf said, as an established, bustling store — like the one in Brunswick — is going to have a higher value than a shuttered building.
Eldridge told the town council last week that, although the term “dark store” has not been used in the negotiations, he feels that term is the basis for Walmart’s argument.
Cloutier agreed, calling the dark store vs. highest value argument a “difference of opinion.”
Walmart is ranked No. 1 in of Fortune 500 companies and had more than $500 billion in revenue in 2018 and made more than $6.6 billion in profit, according to the magazine. It operates more than 5,000 stores across the U.S.
The company contends that its conflict with towns such as Brunswick is necessary to fight what they see as unfair taxation.
“Fair property taxation is critical to our efficient operation and ability to save our customers money, and we strive to work directly and collaboratively with local jurisdictions to reach a fair market value,” said Delia Garcia, senior director of communications for Walmart. “The challenge is that fair market value changes and based on current market conditions we believe the value of the property is lower than the assessed amount,” she said of the Brunswick location. “Similar to other Maine businesses and residents, we are simply seeking a fair market value for the taxation of our stores.”
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