June 1, 2016
The Honorable David Maturen Michigan House of Representatives P.O. Box 30014
Lansing, MI 48909-7514
Dear Representative Maturen,
On behalf of the Northern Michigan Chamber Alliance I wish to voice our support for House Bill 5578 that addresses issues with the assessment of certain commercial retail properties in Michigan – often referred to as the “dark stores” theory.
The Northern Michigan Chamber Alliance is a partnership of chambers of commerce for the Alpena, Benzie County, Cadillac, Charlevoix, Gaylord, Petoskey, and Traverse City areas, and the Lake Superior Community Partnership economic development organization in Marquette County.
Our Chamber Alliance is built on the premise that many issues facing our member businesses are regional in nature. We are the voice of 6,500 plus businesses in Northern Michigan, over 95% of which have less than ten employees.
This issue has served as a difficult one to grapple with for local chambers of commerce in northern Michigan. On the one hand, as advocates for businesses and strong business policy, we wish to support a property owner’s right to challenge their tax assessment. In addition, our local units of government have also been long-time members and partners in business growth and economic development.
In our extensive deliberation on this issue, the Chamber Alliance identified a list of principles that we wished to see in any changes to property tax valuation for commercial properties. The overarching goal of our chambers was to support a policy that treats businesses of all sizes consistently and uniformly in the search for true cash value. Those principles are:
- Taxes should be assessed consistently and uniformly.
- The Michigan Tax Tribunal should ensure that all 3 property valuation methods are each weighed and considered on a case-by-case basis.
- Deed restrictions are and should remain an acceptable part of business and real estate transactions.
- The assessor and Tax Tribunal should consider which party is imposing the deed restriction, and which party is having the deed restriction imposed upon them during a property transaction when considering deeds when valuing commercial properties.
- The Tribunal should give special consideration to whether the party imposing the deed restriction to limit competition should benefit from the decrease in taxable value.
After reviewing the H-1 substitute language that was reported from the House Tax Policy committee on May 18, 2016, it is our belief that the language addresses the principles we desire to see in any legislation dealing with this issue. As a result, we support the concept of House Bill 5578 and believe it will help to guide the determination of true cash value for the properties in dispute.
Thank you very much for your leadership and all of the time and effort you and your office have put into resolving this contentious issue. Please contact me if you have questions about our position or if I can be of further help.
Director of Government Relations Northern Michigan Chamber Alliance
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