Flagstar drops IM tax appeal

IRON MOUNTAIN -- Flagstar Bank has withdrawn its appeal to the Michigan Tax Tribunal on the assessment of its Iron Mountain bank branch at 1805 S. Stephenson Ave.

The action comes just after the city hired an attorney to help settle Flagstar's attempt to set a 2025 taxable value of $350,000 -- a reduction of more than $380,000. The tribunal in June had also permitted Flagstar to include a 2026 reduction in the case.

City Manager Jordan Stanchina informed the city council Monday that the withdrawal means the city's established taxable value will stand.

A compromise taxable value reduction to $500,000 would have resulted in a loss of about $5,500 in annual city tax revenues, according to Stanchina. The taxable value had already been reduced several years earlier after an appeal.

Aaron M. Fales, a Birmingham, Mich., attorney representing Flagstar, filed a motion with the tribunal July 15 to withdraw his client's appeal. An order of dismissal was issued the same day.

At Stanchina's request, the city council July 6 had agreed to hire attorney Thomas Dillon of Grand Rapids to pursue a settlement. The city's cost for that representation should be minimal, Stanchina said.

Flagstar acquired 52 Wells Fargo branches in the Midwest in late 2018, including 14 in the Upper Peninsula.

In an assessment appeal filed in 2020, Flagstar sought a taxable value of $350,000 for its Iron Mountain bank branch after the city had set a value of $840,200.

Taxable values in Michigan are set at half the true cash value, which can be based on a number of factors, including comparable sales. The purchase price for the Flagstar bank property in November 2018 was $1,609,083, according to the city.

Stanchina had noted that Flagstar's new appeal was filed even as property values are rising.

In other action, the council:

-- Agreed to seek bids to repair damaged cement driveway squares in front of the apparatus bays at the Iron Mountain Fire Department building on Fleshiem Street. Funds for the project were included in this year's budget and bids will be due Aug. 17.

-- In connection with ongoing sewer and water infrastructure work by Bacco Construction, delayed ordering additional paving on Hughitt Street and Prospect Avenue on blocks that are in poor condition but where no underground work is taking place. Mobilization costs would be too high due to extra equipment needed, so more investigation will be done, Stanchina said.

-- Learned that the construction area on East C Street off of Stephenson Avenue near B's Country Cafe and Catering has been graveled, allowing some access to surrounding businesses. Sewer and water work continues, meanwhile, on the first three blocks of East C east of Stephenson.

———

Jim Anderson can be reached at 906-774-2772, ext. 85226, or janderson@ironmountaindailynews.com.