ANDERSON, Ind. -- Painfully high property taxes convinced Ricker Oil Co. to shed five stores, four of which are in Muncie, Ind. Taxes for the Muncie stores were two to three times higher than those for similar properties in Fort Wayne or Anderson, two other markets where Ricker Oil operates retail locations.
The paring of the stores, which drops Ricker Oil's store count to 30, was in the normal course of business, according to company president Jay Ricker. Taxes were the primary issue behind our decision to sell the stores, and we'll still supply [image-nocss] them, Ricker told CSP Daily News.
We built four of the five stores from the ground up, he said. It's always tough letting go of stores in a situation like that, but you have to not get emotional and look at the bottom line when making such decisions.
Of the four Muncie stores and one Yorktown location, some of the volumes were good, Ricker said. The nip-and-tuck transaction by no means signals the precursor to a larger sale. There's no reason to read into the tea leaves, he said. We're not selling out, and we're not going out of business.
I think everybody, no matter where they are, is constantly looking to prune the network, he continued. We've always sold one or two stores here or there; it's just that there were more [stores] than the normal amount this time. We've been building a couple of stores per year, and we'll be opening another ground-up very soon.
An examination by Muncie's Star Press showed that Ricker's assessed values and property taxes the revenue generated by applying local government tax rates to assessed values are higher in Delaware County than Anderson's Madison County.
Of Ricker's stores in Anderson, the unit with the greatest assessed value was $427,900. That location has an annual tax bill of $13,665, according to the paper. In Muncie, three of the four stores Ricker sold had assessed values higher than the highest assessed value in Anderson. The highest-assessed store in Muncie was valued at $766,000 and had a property-tax bill of $24,283 this year.
Ricker had expressed his concern over the assessment situation several months ago in a letter to Mayor Dan Canan. Canan told the newspaper he shared that concern and said the reassessment discourages investment, adding that state officials should give local communities the option of drawing funds from property, sales and income taxes. Indiana's current system of assessing property is the market-value system, adopted by state legislators in 2002. Indiana had been one of only two states that didn't base assessment on market value.
I think it was a Muncie problem, Ricker told CSP Daily News. There are some issues [with property taxes] in other parts of the state, but I do think it was a Muncie problem. It was very telling that the same company that did assessments in Muncie did them in Anderson, and you could see big differences in the taxes [between the two].
PSC Associates assessed properties in both cities, according to the Star Press' report. Executives from PSC told the paper that the market value system takes into account not only the size and condition of the property but also the market value of the property and the area around it.
Ricker, who sold the five stores to new Americans, said he hasn't heard of other retailers selling off stores in Muncie specifically for property-tax reasons. He did say, however, that the new owners questioned the tax bills. [The tax bill] was one of the things they called out specifically, he said. They said, Are you sure you gave you us the right numbers?'Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.