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Michigan Municipal League

Press Release


Matt Bach
Director of Communications
Michigan Municipal League
(734) 669-6317; C: (810) 874-1073;


Michigan Supreme Court denies Menard’s effort to overturn Dark Stores ruling, major victory for local government and taxpayers

Lansing, MichiganBig Box stores can no longer use the “Dark Stores” property valuation method that has allowed them to escape paying millions of dollars in local property taxes – pushing those tax burdens on other property owners or forcing cuts in government services – after the Michigan Supreme Court today let stand a Michigan Court of Appeals ruling.

The Michigan Supreme Court denied an appeal from Menard Inc., thus the favorable Court of Appeals decision will stand.

The Michigan Municipal League and Michigan Townships Association (MTA), which have been fighting the case on behalf of communities across Michigan, said the decision restores fairness to the assessing process and will help local government provide valued services to constituents and hold down tax rates.

In Menard, Inc. v. City of Escanaba, the Court of Appeals said the Michigan Tax Tribunal made an error of law in accepting a Dark Stores-style appeal by Menards and cutting the retailer’s value by more than half from the original assessment.

“This is a major victory for local governments and their residents,” said Stephanie Simon Morita, the attorney who wrote the Amicus Brief (for the Michigan Municipal League, the MTA and other local government groups) that was substantially utilized by the Court of Appeals in rendering its decision. Morita specializes in property tax law at the municipal law firm, Johnson, Rosati, Schultz & Joppich, and additionally serves as the Rochester Hills City Council vice president.

“No longer can big box stores obtain unfair and substantial tax reductions based upon unrealistically low artificial values, while our other taxpayers contribute based upon the value of their properties,” Morita said. “This order levels the playing field and helps to ensure that all taxpayers, large and small, are treated similarly.”

MTA Executive Director Larry Merrill echoed those sentiments.

"This precedent-setting decision validates local governments’ long-standing concerns and sets a blueprint for how to successfully establish valuations on 'big box' stores," said MTA Executive Director Larry Merrill.

Overall, this is a huge win for local government and its ability to fairly tax all property owners. In its order, the Supreme Court denied Menard’s application for leave to appeal.  Through the denial, the Court essentially rejected Menard’s claims that the Court of Appeals exceeded its permissible scope of review, that the cost approach amounts to a value-in-use standard and should not be used to value real property for tax purposes, and that it is permissible to utilize deed restricted properties to value non-deed restricted properties.  The Court’s decision upholds the May 26, 2016, published opinion of the Court of Appeals which found the Michigan Tax Tribunal (MTT) committed an error of law when the MTT rejected the cost approach and then utilized a sales comparison approach without accounting “for the effect on the market of deed restrictions” on the sales comparables, Morita said.

The ruling restores long standing practices that call for property to be assessed based on market values based on similar properties. When major, often out-of-town retailers lower their property tax bills inappropriately, the result is often cuts in police, fire and other vital services in communities or higher taxes for other taxpayers, including residential taxpayers.

The League, MTA, the Michigan Association of Counties and other groups filed amicus briefs in support of the City of Escanaba’s position in the case. The matter now returns to the Tax Tribunal for reconsideration and the presentation of additional evidence.

The League also called on the Legislature to move House Bill 4397, sponsored by Republican Rep. David Maturen of Vicksburg, to codify the issues the Supreme Court has said should be considered in property assessments.

“Now is the time to clear up any confusion in the minds of businesses and city officials on this issue,” said the League’s Chris Hackbarth, director of state and federal affairs. “Rep. Maturen’s bill does just that, and will add stability to the property tax assessment process.”

For additional information, contact the League’s Matt Bach, director of communications, at (810) 874-1073 (cell); (734) 669-6317 (office) and

Michigan Municipal League is dedicated to making Michigan’s communities better by thoughtfully innovating programs, energetically connecting ideas and people, actively serving members with resources and services, and passionately inspiring positive change for Michigan’s greatest centers of potential: its communities. The League advocates on behalf of its member communities in Lansing, Washington, D.C., and the courts; provides educational opportunities for elected and appointed municipal officials; and assists municipal leaders in administering services to their communities through League programs and services. Learn more at




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