GOUVERNEUR — An assessment dispute has created tension among town officials and left Edward John Noble Hospital wondering how to pay taxes it doesn't believe it should owe.

As of March 1, the taxable status date, Assessor Dale L. Raymo put on the tax rolls for $100,000 a house purchased by E.J. Noble in 2006 as part of its expansion plans. Although the hospital is tax-exempt as a nonprofit organization, it was renting the house on that date to employees of a contractor working at St. Lawrence Zinc.

"I did it to help St. Lawrence Zinc, to help the economy of Gouverneur," Administrator Charles P. Conole said. "Dale is being a strict constitutionalist. It's an unfair tax."

Mr. Conole was asked to rent the house by Michael J. "Mick" Lawler, president of St. Lawrence Zinc and a member of the hospital board, because six to 10 supervisors with Dumas Corp. needed short-term living quarters.

The three-month-long stay Mr. Conole expected stretched to 10 months. The contractor left April 1 and Mr. Conole used some of their $3,000 monthly payment toward the mortgage. He also put a portion toward continuing education for doctors.

The sprawling Victorian house was part of the hospital's purchase for $250,000 in 2006 of the Irene R. Hendra property, which included about 20 acres that stretch along Barney Street from behind E.J. Noble to Pine Grove senior citizen housing.

Although the hospital didn't need all of the land or the house, Mrs. Hendra and her daughter, Barbara Jane Hendra, New York City, wanted to sell the parcel as a whole, Mr. Conole said.

"For once, we're not landlocked," Mr. Conole said. "The home, we'll never use. It was a great old house in its day. On the inside, there's just a total lack of upkeep. It isn't set up for a doctor's office."

Eventually, the house will probably be torn down and become part of a parking lot or used in the future if the hospital decides to establish an assisted living community or some other facility.

Hospital board President Timothy J. Monroe is also a member of the Town Council, which has no direct control over Mr. Raymo.

"You have to go through the normal channels," said Dr. Monroe, a veterinarian.

But Dr. Monroe believes the hospital is being treated unfairly as churches rent out halls for weddings and fire departments fill swimming pools for money.

"I think this is occasional use. Common sense should have prevailed on this," he said. "I think they're singling us out."

Jane B. Powers, St. Lawrence County Director of Real Property, said Mr. Raymo was told of the situation and determined the hospital wasn't meeting all the tests to be tax-exempt.

"As long as it's not being used for exempt purposes, it's taxable," she said. "It's the law."

A lack of renters may not be enough to have the property removed from the rolls.

"Nonuse is not an exempt purpose," she said. "Every year's a new year. If they have plans for the property, they have to have evidence of that."

The hospital will take its case to the Assessment Board of Review, which meets May 27.

Mr. Conole said he hasn't bothered to figure what the hospital's tax liability would be for the village, town, Gouverneur Central School District, and county. Whatever the bill, it won't be high on his list to pay.

"I have continual financial challenges. There's patient care, payroll, suppliers. If I have to choose between the taxes and a doctor's continuing education, I'm going to choose the doctor. The taxes will not be on my radar screen," he said. "I'm not going to pay the taxes out of the operation of the hospital because then I'm going to have a problem with the auditors."

Despite his reluctance, Mr. Conole said the hospital might be forced to become a landlord.

"I'm not in the rental business," he said. "If they take this approach, I might as well be."