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Spokane County must refund taxes to broadband provider

Spokane County has been ordered to repay a government-based broadband provider for property taxes that should never have been collected.

County commissioners on Tuesday voted to borrow $50,000 from the county treasurer’s investment pool to finance the refund.

The Northwest Open Access Network, a nonprofit, publicly owned corporation, sued the state of Washington and 39 counties last year for collecting property taxes even though it is exempt as a public entity.

The case was filed in Benton County Superior Court, where a judge in March ordered the repayment by Spokane and 24 of the defendant counties. The refund amount for Spokane County is $75,205.

Among other Eastern Washington counties, Lincoln County was ordered to repay $3,641 and Whitman County $670.

NoaNet is owned by 10 public utility districts and one joint operating agency in Washington. It was formed in 2000 to provide wholesale communication service to rural and other underserved regions of the state.

The organization has brought high-speed broadband links to those locations over a fiber-optic network.

NoaNet paid under protest last year after requesting a property tax exemption from the state Department of Revenue. The request was denied, prompting the lawsuit.

NoaNet, which has placed its network operations center in Spokane, had been paying property taxes since 2010. In Spokane, that amount totaled $351,000. It had sought a refund of the amount of taxes dating to 2010, but a stipulated agreement reached to settle the lawsuit only called for repayment of taxes from 2013.

In the resolution approved Tuesday, county commissioners borrowed from the treasurer’s investment pool so the funds could be deposited in a separate account used to reimburse property owners for successful property tax appeals. The loan will then be repaid with interest from regular tax collections next year.