Imagine you’re a homeowner who just spent millions of dollars turning your house into a mansion, with over 10 additions and tons of new amenities inside.
Then, when it’s time to figure out what your new property tax bill will be on your estate, you argue to the government that your mansion is actually worth less than it was before and, therefore, your taxes should go down ‒ because there’s really no one else who would ever buy it.
That counterintuitive argument is essentially what the electric automaker Rivian claims as it fights to lower its property tax bill on seven properties in Normal, including the 4.5 million-square-foot plant. If successful, local taxing bodies like Unit 5 schools and the Town of Normal could lose millions of dollars in tax revenue ‒ or try to make up that lost money from the rest of us.
Government assessors think Rivian’s property is worth $527 million. Rivian’s own appraiser argues it’s only worth $115 million. After losing an initial appeal with McLean County’s Board of Review, Rivian is taking its case to the state’s Property Tax Appeals Board.
“Rivian is proud to call Normal home. We remain deeply committed to this community and to being a good corporate neighbor,” Rivian said in a statement. “Like any taxpayer, Rivian has the right to ask that our property be assessed fairly and accurately.”
A property’s assessed value is used to determine how much its owner pays in property taxes: Higher value usually means higher taxes. It’s not uncommon for homeowners and businesses to appeal their assessed values. School districts that rely on property tax revenue closely monitor the bigger appeals where lots of tax money is at stake.
Rivian is hardly the first large business in Bloomington-Normal to argue that its properties were overvalued by government assessors. State Farm and Eastland Mall’s owner have done it. So has Young America, one of the largest owners of rental housing in the community.
Rivian’s size is unique. Its property tax bill is $13.8 million. About $8.4 million goes to Unit 5 schools, with the rest split between McLean County government, the Town of Normal, and other taxing bodies. Unit 5 leaders say $6.8 million is at risk annually with Rivian’s appeal. The impact for Heartland Community College would be $800,000 a year.
Rivian’s argument
Rivian’s case for a lower assessed value is laid out in a 118-page appraisal submitted to the state’s appeals board, obtained by WGLT through a records request. Its central argument is that the plant’s market value ‒ what a buyer would actually pay for it ‒ is much lower than you might expect, because there are so few buyers for massive auto manufacturing plants.
“Plants at this scale are rarely built speculatively and rarely change hands. When one does sell, it is typically a narrow set of buyers at a substantial discount to cost, with poor liquidity and volatile pricing,” the appraisal says. “Highly specialized, single-purpose plants — especially those enlarged beyond the size range with active market demand — hold limited appeal to alternative users and typically transact at meaningful discounts, supporting recognition of functional and economic obsolescence.”
Rivian’s plant at the time of appraisal was 4.5 million square feet — about the size of 25 Walmarts side by side.
“Over the [past] five years ... the largest qualifying industrial sale in Illinois was roughly 1.55 million square feet, about one-third the size of the subject, and only two sales in the entire 12-state Midwest region reached 2 million square feet,” the appraiser wrote.
Rivian’s repeated expansions [over 10] in the past decade also complicates its resale value, wrote the appraiser, Daniel Willaert from DuCharme, McMillen & Associates in Indianapolis.
“The multiple expansions create issues with functional flow of the building and increase the operating costs and future expansion costs,” they wrote.
The health of the Bloomington-Normal has a “neutral influence” on the value, it argues.
“Demand for large-format manufacturing is primarily driven by national and global supply-chain requirements rather than localized industrial trends,” the appraiser wrote.
Rivian’s appraiser also argues the plant is overvalued and overtaxed relative to four other auto manufacturers in Illinois, with its $3.69 in taxes per square foot 2.3 times higher than the next closest property, according to an analysis shared with WGLT.
Rivian also points out the properties were only producing minimal tax revenue and no jobs after Mitsubishi vacated and sold it to a liquidator — that it’s a positive economic development story, even if the assessed values drop. Rivian bought the plant from the liquidator for $16 million and has since invested hundreds of millions into the property. [Rivian avoided paying around $3 million in taxes during its first five years in Normal, thanks to an incentives agreement with local taxing bodies that has since expired.]
One big investment that is not reflected in the valuation dispute is the $1.5 billion that Rivian poured into Normal for the new R2 model. The appeal is focused on what the properties were worth on Jan. 1, 2025, and the new R2 plant was not finished at that time. The R2 plant is certain to drive up the long-term value of the properties even more.
Rivian had around $5.3 billion in cash, cash equivalents, and short-term investments as of July 31, according to their latest earnings report.
What’s next
For now, there remains a gulf between Rivian’s proposed value [$115 million] and the government’s [$527 million], in part due to different methodologies used by their respective appraisers. That’s one of the issues that the state’s Property Tax Appeals Board [PTAB] will sort out.
McLean County Supervisor of Assessments Tim Jorczak said he can’t comment on the pending PTAB case. He said government assessors have kept Rivian updated “at every step” of the process through site visits, in-person meetings and phone calls, especially since 2023 when “construction really began in earnest.”
“Every year we have sent them advance notice of what the value would be and presented them the opportunity to ask questions and discuss any issues they might have had before values were finalized, and never once were we given any indication that there was an issue. This is the approach we will maintain as the project continues to grow and expand,” Jorczak said.
There is no hearing date set for PTAB; that’s not expected until spring 2027 at the earliest. The county’s Board of Review and other stakeholders have until Oct. 14 to submit written evidence or to ask for more time to gather it.
It’s also possible that Rivian and the taxing bodies will reach a compromise, such as a settlement that establishes agreed-upon values for a defined period of time. That’s what Young America did with Unit 5, the Town of Normal and others during a 2017-18 dispute involving 85 properties. State Farm did that as well with a tax dispute that ended in 2010.
Unit 5 says it’s open to having a conversation about that.
“Yes, we are always open to having a conversation. Our legal counsel reached out to Rivian’s counsel early in the process to discuss having a conversation,” Unit 5 said.
The Town of Normal declined comment and referred WGLT to Jorczak.
