PROSSER - A deal finally was struck Monday that ends eight years of negotiations between Benton County and the Department of Energy over money the county sought to replace property taxes for the federal agency's Hanford lands.

For those closest to the project, the signing ceremony in the third floor of the county courthouse was an overdue, sweet occasion. The room fell silent as Hanford Manager John Wagoner signed the settlement papers approved last week by county commissioners.

When he finished, Wagoner simply said: "It's done."

And it is, almost.

The first installment of the $11.2 million in back payments -$5.98 million - will be electronically transferred into the county's bank account Wednesday, leaving the county and eight of its taxing districts to figure out what to do with the money.

"It's a nice problem to have," said Treasurer Claude Oliver, who will have a say in the dispersal when he takes a seat on the county commission next month. "I would much rather have this scenario going into 1997 than another year of negotiations."

Exactly what will happen with the county's portion of the initial payment, $2.2 million, or with the money going to various taxing districts, isn't decided yet, but Oliver hopes the county will spend $1 million to improve Columbia Park.

"I'd like to see the park bloom," Oliver said.

Commission Chairman Max Benitz Jr. said Monday that Benton County's portion likely will be divided between road improvements, capital projects and a rainy day savings fund. The commissioners will listen to suggestions from department heads and the public before making decisions, said Benitz, the only current commissioner returning next year.

Dave Hedengren, president of the Richland School Board, said the district might use its portion -$922,755 to start with and two more payments of $434,102 - to build up its reserves or to help with the repair or replacement of Carmichael Middle School.

"Certainly, there will be a lot of demand for it," Hedengren said.

County Commissioner Ray Isaacson said there should have been more for Richland schools.

Isaacson, although pleased to see the $11.2 million, believes Richland schools should have gotten an additional $3.5 million from DOE. But the agency argued it already had paid the school district that amount in "impact funds" and refused to pay again.

After eight years of battling to reach an agreement, Isaacson said, it wasn't worth holding out any longer.

"The DOE said it was their last and final offer," he said. "And since it is discretionary, how far do you beat a dead horse?"

The fight for the settlement money - called PILT, or payment in lieu of taxes - started in 1988, when the county first asked DOE for money to make up for the taxes the county wasn't collecting on Hanford lands.

Numerous snags held up the deal during the years, but Wagoner credited Secretary of Energy Hazel O'Leary for making Monday's ceremony possible by changing the DOE's stance on the payments in 1994.

In January, Franklin and Grant counties came to agreements with DOE that brought $1.5 million to Franklin County and $4.7 million to Grant.

Under terms of the deal, the counties and their taxing districts will not only receive the back payments, but also will begin receiving annual payments in lieu of taxes.

Benton County will receive about $1.5 million for 1996 based on the current tax rate.