A JUDGE IN RIVERSIDE, CALIF., RULED that the city of Corona's method of charging for building permits and other construction services is illegal. As in many cities, Corona's permit fees are based on the total cost of running its building department. But in late April, Riverside County Superior Court Judge E. Michael Kaiser found that state law requires permit fees to be based on the actual cost of providing a service. The mayor of Corona and the city are deciding whether to appeal.

The judge ordered Corona to “cease and desist using the current methodology” to determine building department fees and gave the city until the end of July to come up with a new method for setting them. He also said those fees should be reduced over the next two years to make up for the $332,129 in excess revenue the city had collected over a certain period of time.

Builder Barratt American of Carlsbad, Calif., and Richard McCarthy, a retired developer from Palm Springs, filed the suit. This case was the third brought against the city of Corona since 1997. The city won the previous two cases but Barratt and McCarthy sued under a different section of state law and won the third time. They have brought several lawsuits against California cities and counties charging that municipal building departments impose excessive permit fees.

The California Supreme Court agreed last October to review a different case filed by Barratt American involving Rancho Cucamonga's fees. That decision could finally determine how local governments across California set building fees.