The Brunswick Walmart, located at 15 Tibbetts Drive. Times Record photo by Hannah LaClaire

BRUNSWICK — Brunswick and Walmart officials have reached a settlement over a years-long tax battle that started in 2017 when the retail giant tried to get the town to slash its taxable value by more than 40%. 

Walmart has requested similar tax abatements in subsequent years, initially claiming that the store is only worth about $10 million — while the town valued it at $16.9 million — and later increasing the figure to about $11.2 million. 

After nearly three years, on June 17, officials reached a settlement that values the 15 Tibbetts Dr. property at $16.25 million for five years beginning in 2017, according to Town Manager John Eldridge. 

The value Walmart was seeking was essentially a ‘dark store’ value,” Eldridge wrote in an email on Tuesday. 

The “dark store” theory is a common loophole used by big box stores like Walmart, in which retailers contend their stores should be valued as if they were empty, not a fully operational retail hub. 

Walmart has reportedly been appealing property tax valuations around the country for years. The trend is mirrored across Maine in towns like Ellsworth, Oxford, Thomaston, Bangor and Augusta. 

In 2017, Walmart, the seventh-highest payer of property taxes in Brunswick, asked Brunswick to lower its taxable value by nearly $7 million on the grounds that the building’s $16.9 million assessed value “exceeds the property’s fair market value;” a move that would have cost Brunswick roughly $128,000 in tax revenue.

At the time, then-Brunswick Assessor Cathy Jamison denied the company’s request for an abatement. 

Walmart also filed a separate 2018/19 abatement the following spring, contesting again that the $16.9 million assessment again “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. Then-Brunswick Assessor Nick Cloutier denied the request.

If granted, the abatements would have cost the town more than $236,000 in tax revenue for the two-year period. 

Walmart then appealed to the local board of assessors, which also denied the request, before then appealing to the state board of assessment for review.

In June 2019, Brunswick hired Stephen Traub, an independent appraiser to appraise the property. He valued the property at $21 million. 

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. Officials were not able to come to an agreement during mediation in the fall. Walmart hired Stavitsky and Associates, a property tax appeal law firm based out of New Jersey to handle the filings.

The company though, holds 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,” Delia Garcia, senior director of communications for Walmart said last summer. “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.”

Others remain unconvinced. 

Legislative Aide and Town Councilor Dan Ankeles said in January that the loophole is a “dishonest argument” that is “effectively stealing from Brunswick families and small businesses.”

The dark store theory is “something cooked up to grind towns down into settling for less,” he said at the time. “Most of the time they don’t want to go through the legal process. There comes a time when you have to stand up for people and say we’re going to find you down to the bitter end. That’s what Brunswick’s going to do… We’re trying to be a leader.”

A proposed bill, LD 2045 would require that, for property tax purposes, retail sales facilities more than 20,000 square feet must be valued based on current use compared to similar properties in their retail market segment, or, if vacant, according to their highest and best use. The bill is sponsored by Rep. Ryan Tipping and co-sponsored by Rep. Mattie Daughtry, Senate President Troy Jackson and Sen. Nate Libby. 

A representative from the Maine State Legislative Information Office said the bill was “carried over to any special session,” and that while a meeting has not been scheduled yet, “that’ll be looking into that in the near future.” 

Efforts to reach Walmart officials Tuesday were unsuccessful.

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