Walgreens Loses Virginia Tax Assessment Appeal
The drugstore chain Walgreens has lost a tax assessment appeal lawsuit against a Virginia municipality that it accused of overtaxing two of its brick-and-mortar locations, reports the Fredericksburg Free Lance-Star.
County faced prior assessment lawsuits
Walgreens had appealed some $300,000 in assessed property taxes by the Spotsylvania County Assessor’s office between 2010 and 2015, on properties it says were overvalued by millions of dollars. While the article notes that local assessment appeals are rare, the county reportedly established an assessment challenge “contingency fund” of $150,000 in 2013, before adding $950,000 to the same fund in 2016. The article reports the county has faced assessment lawsuits before the Walgreens challenge.
Walgreens not a “mattress store”
The article reports that in a Sept. 27 ruling, Circuit Judge Ricardo Rigual found that Walgreens had failed to “establish credible fair-market values” for its stores on State Route 3 and Rollingwood Drive. “[Walgreens] would have this court believe that its properties are no different than a mattress store or a coffee shop,” the judge is said to have written in his opinion. Rigual sided with county authorities that argued properties could be assessed based on the “highest and best use.”
Court rejects store’s “investment value” argument
Each of the two properties was reportedly purchased for more than $7 million, though Walgreens rents the locations and pays the associated taxes. Walgreens had argued unsuccessfully that the purchase price represented an investment value rather than actual worth. In one part of its appeal, Walgreens had argued that its Rollingwood Drive location was worth $3.15 million in 2015, and thus should have had an assessed tax of around $27,000. However, the county valued the property at nearly $7.2 million and assessed a tax bill of $61,675.Posted on: Wednesday, October 11, 2017