HOUGHTON — The Walmart Supercenter in Houghton has filed a petition with the Michigan Tax Tribunal to lower its taxable value by 40% through the “dark store” theory. 

If granted, Walmart’s state equalized value and taxable value for 2020 would be reduced from $4,562,390 (about $50 per square foot) to $3,050,000 (about $30 per square foot). That would translate to an annual $120,000 hit to the city, county and local schools, City Manager Eric Waara said. For the city, the cost would amount to half an employee, he said. 

“That’s more than half of the base wages of one of those persons who routinely responds to Walmart’s almost daily calls to a problem at their store, or half the base wages of one of those persons who plows the streets all winter so people can drive to their store, or a bus driver who drives people to their store every day,” Waara said. 

The city council voted Wednesday night to allow Waara, the city’s attorney and city assessor to reach a reasonable agreement with Walmart. The city must respond to Walmart’s petition by July 22, Clerk Ann Vollrath said.  

In its petition, Walmart states the assessment exceeds the amount and the percentage of true cash value allowed under the Michigan constitution. 

The assessment subsequently denies Walmart’s rights to “uniformity, equal protection and due process of law,” it states in the petition. 

The “dark store” theory, in which a building is valued at the same level as it would be if vacant, has been the subject of a long legal battle in Escanaba, where Menards sought to have its taxable value lowered because of deed restrictions and other factors. In May, the Tax Tribunal ruled Escanaba had to reduce Menards’ property value and reimburse it for previous years of overpayment.

Walmart had tried to lower its property tax rate through the tax tribunal recently, Waara said. 

In 2018, Walmart had sought to lower its rate from $50 per square foot to $43 per square foot, Waara said. Since the request came shortly after the Father’s Day Flood, the request was put into abeyance, Waara said. 

Walmart had not responded to a request for comment by press time.