STATE: AT&T SAID IN 2000 IT LEASED 100% OF LOT FOR EMPLOYEE PARKING

Update: Thursday, November 12th, 2009

Special to the readers of Milwaukeeworld.com


By Michael Horne

According to a statement from the Wisconsin Department of Revenue, AT&T informed the State of Wisconsin in 2000 that it had secured a 10-year lease on 100% of the property at 500 N. Broadway to serve as a parking lot for employees. [See previous post.—Ed.]

In 2000, Ameritech Wisconsin reported a 10 year lease of this property on their 2000 Telco Real Estate Return, Schedule R-2 (Part 1) - LEASED REAL ESTATE. The lease inception date was indicated as 11/1/99. Based on the information that Ameritech leased the entire parking lot for their employees the property was classified as a Telco property for the assessment date of January 1, 2000 per 70.112(4)(b).

As Telco property, the site provided taxes to the state of Wisconsin -- but not the other taxing entities such as the Milwaukee Public Schools, the City of Milwaukee, Milwaukee County, The Metropolitan Milwaukee Sewerage District and the Milwaukee Area Technical College -- in the amount of over $400,000 during the ten years:

The Wisconsin Department of Revenue (WI DOR) assessed the property from 2000-2008. Special taxes were levied against this property each year WI DOR assessed it. The special tax paid by the owners (or lessee) to the State of Wisconsin is based on the fair market value assessment of the property, ratioed to the local level of assessment multiplied by the local property tax rate. This provides owners of telecommunication property uniform property tax treatment (comparable to locally assessed property owners) so the state constitution is not violated. Under this system, the property owner's have paid over $400,000 in "special taxes" during the time WI DOR assessed the property.

But in 2008 DOR learned that AT&T was, for an unspecified period of time, subletting the property:

In October, 2008, WI DOR became aware of a sublease to a parking contractor. AT&T reported that the the parking contractor was to sell parking to the public and charged AT&T employees the same rate. AT&T also stated they did not intend to renew their lease. Based on this new information the parking lot parcel was returned to the City of Milwaukee to be locally assessed for 2009. A letter on file dated 1/5/2009 notified the city of this change. [Milwaukeeworld has asked for this letter.--Ed.]

The property is on the city assessment roll for $2,160,000 for 2009. DOR assessed the property in 2008 at $2,165,000.

Here is a link to a list of all Telco properties in the City of Milwaukee.

http://spreadsheets.google.com/ccc?key=t6ifEo27bMRZ0W7EY1rnEuQ


Note: The state may have done a bit of dissembling with its tax information -- the “special taxes” are not paid proportionately to the taxing entities as they would be if assessed by the city. True, the state eventually sends some "shared revenue" to the city, but it is not pro-rata based on the assessed properties. If only! In fact, shared revenue is a tumultuous battle each and every budget season.

As Milwaukeeworld asked City Assessor Mary Reavey:

Are the “special taxes” sent back to the taxing entities in the same amount they would have originally been remitted? Is there a discount? Does the state take a share?

Her response:

The state gets the entire amount. Nothing is shared to local governments.

--Michael Horne