WISCASSET (AP) – The defunct Maine Yankee nuclear power plant was handed a $3.5 million tax bill by the town after a new assessment determined the decommissioned plant is worth $218 million.

Maine Yankee currently pays $1 million in property taxes to the town of Wiscasset. Plant officials agree the amount should be higher, but not the amount the town wants for the 800-acre site.

Maine Yankee is disputing the assessment and the disagreement will likely be settled in court.

Town Manager Larry Cilley said the company’s land is valuable because of its fuel storage capabilities.

“Maine Yankee has a license to store spent fuel there. That gives it value, similar to how a zoning change can benefit someone. If they did not have that land, they’d have to find someone else to take their waste,” Town Manager Larry Cilley said.

But Maine Yankee spokesman Eric Howes said the storage facility is a liabilty, not an asset.

“The claim of the town’s consultant that someone would pay Maine Yankee $13.5 million per acre for land on which Maine Yankee’s dry storage facility is located defies logic and commonsense,” he said.

Maine Yankee, the town’s largest taxpayer, announced in 1997 it would stop producing electricity.

In the years that followed, Maine Yankee began demolishing buildings and initiated a site clean up. The company continued to pay taxes, but the amount decreased each year to $1 million in 2002.

Earlier this year, faced with a complete loss of revenues from Maine Yankee, the town hired a team of consultants to conduct a new assessment of the Maine Yankee site.

About the same time, the town offered $1.3 million for a 441-acre parcel owned by Maine Yankee. Town officials say the undeveloped tract located north of Ferry Road could be used for a technology park.

Maine Yankee officials say they are considering the offer and will respond by Oct. 10. Both sides say that deal has nothing to do with the tax dispute.

AP-ES-10-01-03 1122EDT