Wal-Mart is gaining a reputation for being a tax deadbeat — but there are still many communities that are learning this the hard way. Wal-Mart Supercenter Store #2129 is located at 100 Supercenter Drive in Clearfield, Pennsylvania. When the superstore was being proposed, Wal-Mart told officials in Clearfield that the new store would be good news for property tax revenues. That was before the store opened. Now, the issue of property taxes has become a sore point in Clearfield. It turns out that Wal-Mart thinks its paying the county far too much in property taxes, and wants its bill cut dramatically. The giant retailer took the community to court over its superstore property tax assessment. According to the Gant Daily newspaper, the appeal is now underway at the Clearfield County Courthouse. The county assessed the supercenter on Supercenter Drive at $6.8 million, but Wal-Mart wants to slash that by almost a third to $4.6 million in assessed value. In the appeal, Wal-Mart has presented the method its assessors used to cut the value of their store, and the county has defended its methodology. The case will be decided by Clearfield County President Judge Frederic J. Ammerman. If the retailer gets a break on its taxes, the loss will be felt by taxpayers in Clearfield County, Lawrence Township, and the Clearfield Area School District. Clearfield County is located in the center of Pennsylvania. The county has 6 exits off Interstate 80, with plenty of development properties available near the exits. Recent additions to the Clearfield County business community include a Wal-Mart Distribution Center located in Bradford Township. The Wal-Mart corporation made out pretty well tax-wise when that distribution center was built. According to Good Jobs First, the state provided $5.5 million in subsidies for Wal-Mart, including $2 million for land acquisition and $3.5 million for infrastructure improvements. The city and town provided a ten-year property tax abatement worth approximately $2.5 million. Given this $8 million in public welfare that was provided for their distribution center in Clearfield County, you might think that Wal-Mart would not pressure the county on its superstore property tax bill. Clearfield County would have every reason to think that the corporation was a tad bit ungrateful for the $8 million subsidy it got already from Pennsylvania. Local officials probably had no way of knowing that Wal-Mart routinely files such appeals as a way of bullying its way to a lower tax bill. If communities knew this going into a deal, they would insist on an agreed-upon assessment level before permitting any project. Instead, Wal-Mart waits until its approvals are granted, its building is open and running — before hitting the local community with a property tax abatement. It’s just one more way for Wal-Mart to Save Money and Live Better.
On October 10, 2007, Sprawl-Busters reported on the release of a study by Good Jobs First which concluded that Wal-Mart methodically attempts to lower its property taxes by challenging the assessments of its stores and distribution centers. Good Jobs First is a non-profit, nonpartisan research center in Washington, D.C. The group has documented in an earlier report how the giant retailer uses public subsidies to build its stores and site infrastructure. The study “Rolling Back Property Tax Payments” charges that Wal-Mart “drains vitally needed funds from communities by regularly challenging the valuation put on its properties by public officials.” According to Philip Mattera, research director of Good Jobs First and principal author of the report, “When the company succeeds in one of these challenges, it diminishes the funds available to pay for education, police and fire protection, and other essential services provided by local governments.” Good Jobs First reviewed a national sample of Wal-Mart stores and all of its distribution centers open as of the beginning of 2005. Wal-Mart had filed assessment challenges at more than one-third of its facilities around the country. At many facilities there have been appeals in multiple years. Overall, Good Jobs First estimates that Wal-Mart filed more than 2,100 property tax challenges nationwide. “These systematic property tax challenges are part of a larger pattern of state and local tax avoidance by Wal-Mart,” Mattera noted. “They are consistent with the company’s reported use of a real estate investment trust gimmick to dodge income taxes in many states. And they are consistent with the widespread property tax abatements, income tax credits and sales tax diversions that make up a large part of the more than $1.2 billion in economic development subsidies that Good Jobs First has documented in previous research on Wal-Mart.” Property tax valuation disputes are challenges to the local assessors, and are pursued in direct opposition to the wishes of local governments. Cities and towns can oppose Wal-Mart claims, but it can be a financial burden to try to fight Wal-Mart legally. A property tax abatement request can be turned down by local asessors, but Wal-Mart just takes their case to a state appellate board, tying up local staff and resources. Readers are urged to make two phone calls on behalf of taxpayers and schoolchildren in Clearfield County, Pennsylvania. The first call is to the Wal-Mart superstore in Clearfield at (814) 765-8089. Ask for the store manager, and tell him: “I would like to see Wal-Mart pay its property taxes like other corporate citizens in Clearfield County. Your company should thank the taxpayers of Pennsylvania for their generous subsidy of your distribution center in the county, and drop your property tax appeal, which is costing taxpayers more time and money.” Then call the Clearfield County Judge’s Chambers at (814) 765-2541 and leave the following message for President Judge Frederic J. Ammerman: “Before you render a decision in the Wal-Mart property tax abatement case, please review a 2007 study by Good Jobs First, which found a pattern of property tax abatement requests by this giant retailer. According to this national study, Wal-Mart routinely files such abatement requests to push small towns into granting them relief. Wal-Mart has filed assessment challenges at more than one-third of its facilities around the country. At many facilities there have been appeals in multiple years. Overall, Good Jobs First estimates that Wal-Mart filed more than 2,100 property tax challenges nationwide. The county should have gotten Wal-Mart to agree on the store’s value before they permitted it, but now the retailer should not be rewarded for what has become a systematic corporate policy to lower its costs — just as it pressures its suppliers to lower their costs. Make Wal-Mart pay its fair share of property taxes in Clearfield.”
