Wisconsin & Milwaukee Hotel, LLC v. City of Milwaukee (Property Tax Assessment)

In Wisconsin & Milwaukee Hotel, LLC v. City of Milwaukee (2018AP1744), the Court of Appeals District I upheld property tax assessments of a downtown Milwaukee hotel.

Wisconsin & Milwaukee Hotel (WMH) owns and operates the Milwaukee Marriott Downtown. The city assessor valued the property at $24 million in 2014 and $37 million in 2015. WMH challenged both assessments, arguing the method of valuation violated both the Wisconsin Property Assessment Manual and the state constitution’s Uniformity Clause.

The court found that the assessor did not violate the law when she used an income-based method for valuing the hotel. Wisconsin statutes and the assessment manual lay out three tiers of methods for property assessment: 1) recent sales of the property, 2) comparison to sales of similar property, and 3) analysis of income generated by the property. The court agreed with the assessor that there were no recent sales and no similar sales to compare with the Marriott because other hotels sold differed in age, space, location, amenities, and other features. The assessor’s use of the income approach to value a hotel was consistent with the assessment manual.

The court further found that the assessments did not violate the Uniformity Clause (Wis. Const. Art. VIII § 1), which provides “the rule of taxation shall be uniform.” WMH contended that the Marriott’s tax burden as assessed was significantly higher than other similarly located hotels of the same class. The court held WMH failed to establish a uniformity violation because it did not provide evidence of what it believed would be a fair market value.

Because WMH did not overcome the presumption of correctness in favor of the assessor, the court upheld the property tax assessments.

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