Grand Chute leaders get in heated exchange with lawmaker over dark store loophole

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GRAND CHUTE, Wis. (WBAY) - UPDATE: On Wednesday, the general counsel for Wisconsin Manufacturers & Commerce, Corydon Fish, demanded an apology from Grand Chute Town Board Chairman David Schowalter, saying the chairman made "inaccurate and inflammatory comments" while talking about the business association's opposition to the dark store loophole. Click here to read that letter.

State Rep. Mike Rohrkaste (R-Neenah), left, answers questions from Grand Chute town board on July 16, 2019 (WBAY photo)

A heated exchange erupted Tuesday night between the Grand Chute town board and a local state lawmaker over continued inaction in addressing the so-called "dark store loophole."

The loophole is designed to give big-box retailers a break by allowing an operational store to be assessed based on the value of a closed property.

Gov. Tony Evers included a proposal in his state budget plan to prevent that, but it was taken out by Republican lawmakers who control the Joint Finance Committee.

In February, we detailed how much money it was costing local municipalities, including Grand Chute, in legal fees, lawsuit settlements and tax refunds.

As we reported, it has cost the town $678,457.51 in tax refunds between 2013 and 2017, split among three big-box stores. Plus, the town has pending property tax lawsuits from Walmart and Sam's Club.

Members of the Grand Chute town board have been asking the state for years to address the dark store loophole, and so far nothing has happened.

State Rep. Mike Rohrkaste (R-Neenah), who serves on that budget committee, came to Tuesday's meeting for a question-and-answer presentation. Just minutes after Rohrkaste stepped up to the podium, Grand Chute Town Chairman Dave Schowalter had plenty to say, addressing the dark store loophole.

"I truly feel that no one likes to hear that word 'corruption' in Madison, but I know that Wisconsin Manufacturers and Commerce is the largest donor, and they seem to be controlling the whole situation down there," Schowalter said.

That immediately upset State Representative Rohrkaste.

"I resent your term of 'corruption.' I find it appalling, childish, and not factual," he responded.

Rohrkaste went on to say, "I can understand you may disagree, and that's fine, I respect that, but to use the term corruption is out of line."

"I represent the citizens of Grand Chute," Schowalter said.

"You're attacking my personal integrity," Rohrkaste said.

Schowalter wrote a column in a recent town newsletter warning the community about the potential for rising taxes because of the loophole.

He specifically called out State Senator Roger Roth (R-Appleton), who sponsored legislation to close the loophole, and it never received a vote. Efforts in the state Assembly met the same fate.

"That's one of the biggest frustrations that I see, you can't get legislation past two people in the state. They can hold up legislation that people want to move forward," town board member Bruce Sherman told Rohrkaste.

However, Rohrkaste told the board, closing the loophole would shift a larger tax burden over to the business community.

"I have really tried to listen to both sides. I think there needs to be a compromise in the middle," he said.

Since state lawmakers are in recess now for most of the summer, Rohrkaste tells us action on the dark store loophole is unlikely until maybe next year.