CLINTON — Archer Daniels Midland will receive more than $2.5 million in tax credits as part of a settlement in the property tax dispute between the company and the city of Clinton Board of Review.
As part of a settlement that was entered into on Thursday, ADM will receive $2.1 million in tax credits against future property tax liabilities on the co-generation facility to account for ADM’s overpayments resulting from erroneous assessments on the facility.
The documents were made available Monday.
“The good news is that this will be in tax credits instead of having to write a check,” Clinton County Auditor Eric Van Lancker said.
The property in question was labeled a utility plant in 2008 and was thus exempt from property taxes in 2009.
However, City Assessor John Moreland and other city officials protested the tax-exempt designation.
In 2010, legislation was passed saying that a co-generation plant would be locally assessed. Moreland conducted that assesment, determining the facility’s value at $78 million.
In 2011, ADM lobbied for new legislation that would relieve them of their property tax obligation. They were successful, and that ruling applied retroactively to the previous year.
On Sept. 30, 2011, a partial property tax settlement was reached, lowering the stipulated value of the co-generation facility from $77 million to about $32 million.
ADM has been making property tax payments throughout the ongoing legal battle, which resulted in them overpaying, according to the settlement that was reached in Clinton County District Court on Thursday.
The final agreed assessed value for the co-generation facility was $7.6 million for the 2010 assessment year. This means that the $1.36 million ADM paid in property taxes exceeded the property taxes that would have been due based on the final agreed-upon assessed value by more than $1 million.
The 2011 assessment year value was $11 million. For that assessment year, ADM paid $1.5 million in taxes, another $1 million over the property taxes that would have been due on the final assessed value. The $2.1 million ADM is owed in already paid property taxes on the co-generation facility will come from the 2012 and 2013 taxes that will be collected later this year and into 2015.
The settlement resolves the taxes for the assessment years 2010 through 2013 and resolves all disputes relating to the co-generation plant as well as ADM’s corn plant and bio-processing plant.
ADM will receive $159,573 in property tax credits for the bio-processing plant and $407,773 for the corn plant.
The settlement will result in a loss of projected property tax dollars for Clinton County, the city of Clinton and the Clinton Community School District, but officials did not know what the loss for each of the entities will be.