Bunge-Ergon has asked Warren County to lower a fee-in-lieu of property taxes paid on its ethanol plant at the Port of Vicksburg because of lower production than planned.

Internal calculations by the company’s accounting arm have concluded the value of the state’s lone ethanol-producing facility has dropped from the joint venture’s $126 million investment when it opened in 2008, Tax Assessor Richard Holland said Monday.

The calculation was presented to Holland just before members of the board of supervisors toured the plant earlier this spring, Holland said. The resulting picture was of a plant producing less than 54 million gallons of corn-based ethanol annually.

A fee-in-lieu worth one-third of the plant’s assessed value produced $789,721.82 for the city, county and school district last year. Company officials have pitched a rate based on an assessed value of $40,024,800 — a figure less than a third of the current assessment, Holland said, adding tax revenue to the county would fall by 69 percent.

Holland and Deputy Tax Assessor Jim Agent have recommended basing a compromise on investment values between $99 million and $108 million, or a per-gallon investment value between $1.85 and $2. Local government and the school district would lose $127,627 if a deal is struck on the higher end of that range, less than the $179,940.43 lost to the county alone under the company’s current proposal.

In April, supervisors OK’d a 10-year fee-in-lieu for Ergon’s refining entity totaling $80,712,825. Taxes paid over the life of the deal equal $1,484,429.92 paid to city, county and the school district. The company secured an inventory tax exemption on $3.6 million in goods shipped outside Mississippi from the ethanol plant.

A decision whether to adjust the tax break could hinge on an Attorney General’s opinion on how to interpret state law allowing counties to implement substitute taxes. Currently, the law only addresses the starting investment value and doesn’t allow for fluctuations based on the economy and the like.

A complication has been finding similar plants to compare values, Agent said. Consultations with the Mississippi State Tax Commission have centered on about 17 plants in the Midwest sold between April 2009 and February 2010, Agent said, adding most were sold at foreclosure sales.