NANAIMO - Another Vancouver island mill is having issues paying it's property taxes.

The Harmac pulp mill in Nanaimo has yet to pay its almost $3 million dollar tax bill - money owed to the city that has been overdue since July 2nd.

Catalyst Paper - which operates three island mills is also in a tax fight of its own. But the owners of Harmac insist theirs is a different kind of battle.

In a gloomy industry downturn, the Harmac pulp mill in Nanaimo, is considered a bright spot.

But despite that success, the City of Nanaimo is still waiting for their tax bill to be paid.  $2.8 million dollars for property taxes - was due on July 2nd.

Harmac is employee and local investor owned. They took over the mill a year ago when the former owners went bankrupt.

So far, this unique mill ownership model seems to be working well.  Production is up and a new line the opened in the fall means there are now 270 employee/owners.

But those new owners have taken issue with the property taxes they are expected to pay - based on the assessed value of the 250 acre property the mill stands on.

The owners say the mill property was assessed at $17 million, even though Nanaimo Forest Products paid $13.2 million for the land, buildings and machinery.

Harmac is not the only island mill, fighting it's tax burden. Catalyst paper went to court earlier this year over what they say are unfair taxes.

On Monday, Catalyst paper filed an appeal after the decision by the BC Supreme Court that ruled their property taxes are valid.

Catalyst had sued four municipalities - arguing their tax bylaws were unreasonable and therefore illegal. At issue was about $23 million dollars owed to North Cowichan, Campbell River, Port Alberni and Powell River municipalities.

But the owners of Harmac insist this is a different kind of tax fight.

Nanaimo forest products has already paid it's 2009 taxes on the 67 other properties it owns - amounting to $100,000 dollars.