The Town Council adopted the ordinance in December 2005 to support park upgrades. The fees typically are paid by residential developers but are passed on to homeowners.
The Builders Association of Greater Indianapolis, a trade organization representing 400 home builders, challenged the $1,862-per-lot fee in an October 2006 lawsuit, complaining that the cost is higher than the $1,054 fee an advisory committee had recommended to council members.
Lawyers for the town asked Boone Superior Court Judge Rebecca McClure to dismiss the case, but she denied the request and ruled last month that the fee ignored specific guidelines in state law on how to calculate the charge.
The case would advance to the Indiana Court of Appeals if council members choose to challenge the judge's ruling.
BAGI filed the suit against the town of Zionsville and its Plan Commission and Town Council.