MOSES LAKE - REC Silicon is embroiled in a tax dispute with Grant County and wants the county to rescind the outstanding tax bill sent to them.

Moses Lake city council members recently made the decision to close the Larson Recreation Center and cancel the Moses Lake Museum & Art Center's holiday show because of $1.3 million in property taxes the city will not be receiving from REC Silicon.

At the last city council meeting, the council heard news from city manager Joseph Gavinski the city would not be receiving the $1.3 million from REC Silicon.

Gavinski told the council that Grant County Treasurer Darryl Pheasant was informed by a state Department of Revenue representative he was premature in sending REC Silicon a property tax notice.

On Sept. 9, Gavinski told the council that REC Silicon appealed the Grant County Board of Equalizations's land value assessment of $671.2 million, stating their property should have a value of $115 million.

The Board of Equalization determined the value was $250 million, a reduction in the past assessment of $421.3 million.

The problem for the city is their 2014 budget is based on the county assessor's $671.3 million assessed evaluation of REC Silicon's property. That means the city stands to lose about $1.3 million, because of REC's appeal.

In the wake of the shortfall came the council's decision to close the Larson Rec Center and cancel the museum's holiday show.

REC Silicon wants county officials to rescind the tax bill they have been given, according to REC Silicon's community relations manager Sharon Palmerton.

"The state Department of Revenue has advised the county to do so because the tax bill is premature under the controlling state statute," said Palmerton.

The statute states no additional taxes can be billed until both parties receive a final determination, which does not have to be reviewed by the State Board of Tax Appeals. Palmerton said the tax bill is premature because it is currently under judicial review.

REC Silicon believes when the matter is ultimately decided upon, the decision will be in their favor.

"Therefore, no additional taxes will ever be due (in 2012 for the 2013 tax year). In fact, the taxing districts will owe substantial additional refunds in that event. This very regrettable situation could have been avoided with better administration by the county's assessment and tax officials," said Palmerton.

Palmerton said the breakdown of additional refunds the county would owe REC Silicon would be up to the county, and that REC Silicon is open to negotiations on the tax dispute.

"We have our opinion, and they have theirs," remarked county Treasurer Darryl Pheasant.