LANSING — State Representative John Kivela (D-Marquette) said that he is pleased to cosponsor state Rep. Dave Maturen’s (R-Vicksburg) House Bill closing a tax loophole created by court decisions dealing with dark stores. The bill would require the Michigan Tax Tribunal to make its own independent determination when issuing a decision in a commercial property dispute case.           

“This bill would create a level playing field for local governments when arguing cases at the Michigan Tax Tribunal,” said Kivela. “The dark store property tax loophole has taken millions of dollars out of my communities and communities across the state. When we lose that tax money, residents lose as well because it hurts services that residents and businesses rely on and that are provided by our local governments.”

Big-box stores have successfully argued to the Michigan Tax Tribunal that their taxes should be drastically reduced by using what’s known as the “dark store” argument. The stores argue that the value of their store should be compared to the value of older closed and vacant stores worth far less than what it cost to build a newer store and they should pay less in taxes on the newer store. This argument allows them to win huge tax refunds that decrease the property tax base in Michigan and is devastating to state and local government budgets.

 Kivela was cosponsor to the same bill last year that passed the House by a vote of 97-11. The bill was, however, never taken up in the Senate.

 “I have been fighting this dark store issue ever since I came to the Legislature, and I will continue fighting to fix it and help my local governments,” said Kivela. “Big box stores shouldn’t be able to come into a community, run out local businesses, and then get a tax break that shorts local governments and impacts the services they provide to residents and those big box stores. It’s not a fair tax break and I will continue fighting to end it.”