MOORHEAD, Minn. - The American Crystal Sugar Co. cooperative has begun a broad push to contest the assessed value of all of its property, leading to disputes in a total of four counties in Minnesota and North Dakota.

If successful, cities and counties in both states could lose thousands, or even hundreds of thousands, of dollars in tax revenue at a time when many rural governments have particularly tight budgets.

The heaviest blow could fall on Moorhead, where the cooperative is based, and surrounding Clay County. The two governments intend to jointly fight the tax appeal by hiring a St. Paul lawyer to mount a defense that could cost up to $200,000.

A spokesman for the sugar beet cooperative, Jeff Schweitzer, said asking for a fair appraisal of the company's property is just good business. He declined to discuss the details of the appeal because it would not be "in our best interests."

In North Dakota, the company paid its 2003 Traill County and Pembina County property taxes under protest and filed for an abatement for its upcoming tax bill for 2004, county officials said.

American Crystal has also filed for refunds on taxes it paid for 2001 and 2002, Traill County Assessor Jodi Buzick said.

In addition to delays involving the 2003 taxes, the abatement process for the 2004 assessment is on hold while the company is in court trying to get its business records sealed, county officials said.

American Crystal's Traill County property is the processing plant at Hillsboro. The county assessed the company on the basis of a $28.7 million market value, with a 2003 tax bill of about $407,000, Buzick said.

Its Pembina County property, including a plant at Drayton, piling stations and land, was assessed at $256,808 in taxes for 2003, on the basis of a $16.1 million market value, county Auditor Dorothy Robinson said.

In Clay County, the protests cover 17 land parcels, valued for 2004 tax purposes at $12.7 million, according to county assessment data.

The lion's share of that property is in Moorhead, including the $1.6 million corporate headquarters, a $1.9 million technical services center and a $8.2 million sugar processing facility.

American Crystal wants a two-thirds reduction in the values set for its properties in 2002 and 2003, applicable for taxes payable in 2003 and 2004, Moorhead City Assessor Peter Doll said.

"We think our values are reasonable, and we'll defend them. We've kept them pretty flat," Doll said.

Reducing the value of the cooperative's facilities would trouble city and county officials because a reduction in valuation means a roughly similar reduction in property tax, Doll said.

If the tax court in St. Paul sides with American Crystal, the difference between taxes on the lower valuation and the higher valuation for 2003 and 2004 would be refunded, Assistant Clay County Attorney Michelle Winkis said.

Because tax levies for those years already have been set, that money would be lost for good, she said, which could mean higher property taxes for "John Public Taxpayer."

"Essentially, what happens in the long run, if the tax appeal is successful, is it's just taking from Peter to give to Paul," she said. "The difference is spread out amongst the rest of the taxpayers."

Doll said in 2003, American Crystal's gross taxes on its Moorhead properties, including taxes paid by the company and state tax incentives, provided $558,000 to the city, county and Moorhead School District.

So if the tax court complies with American Crystal's request to reduce the value of its property by two-thirds, the city, county and school district would be required to refund about $373,000, part of it to American Crystal and part of it to the state.

While out-of-state corporations have filed broad challenges to assessments of their facilities in the past, Moorhead City Manager Bruce Messelt said it is unusual for a locally owned business do so.

"It's not something you'd expect to see from a company whose board of directors is made up of local farmers and residents," he said.

School officials decided against joining the legal fight because the state school funding formula makes the issue less pressing to them.

In Polk County, American Crystal is contesting the $20.1 million value assessors there put on its property, including factories in Crookston and East Grand Forks.