CHINA GROVE — At its next meeting, the town board will consider deleting an ordinance after losing a lawsuit over a fee required of developers as a condition of construction.

During the meeting on Sept. 1, the China Grove Town Board will have a public hearing to consider repealing an adequate public facilities ordinance, which has been the subject of a lawsuit that’s lasted more than a year.

The case — China Grove 152 LLC and David R. Investments LLC vs. Town of China Grove — examined whether the town should pay $18,221.58 in interest as part of a refund to a group that planned to develop a subdivision on N.C. 152. The developers named in China Grove’s suit paid more than $54,000 in 2008  to the town to build the subdivision — originally named Miller’s Grant — as required under the ordinance.

The ordinance is intended to help pay for additional fire protection, police coverage or other services that result from additional residents.

A 2012 court case involving Cabarrus County, however, ruled adequate public facilities ordinances unconstitutional.

The subdivision’s developers in 2013 requested the town return the fee. Court documents show China Grove returned the $54,000 fee in Sept. 2013. Developers also asked for an interest payment in conjunction with the Adequate Public Facilities Ordinance fee, but China Grove declined.

Writing the opinion of the court last month, N.C. Appeals Court Judge Lucy Inman cited a 2007 state law that required the payment of interest for any fee ruled illegal. The court ruled unanimously that China Grove should pay interest. It was the second such ruling. Judge Mark E. Klass in a 2014 Rowan County Superior Court decision ordered China Grove to pay the fee.

First, in response to a lawsuit involving the Durham Land Owners Association, the N.C. General Assembly passed a law requiring an interest rate of 6 percent for any fee illegally enacted. Several years later, the N.C. Supreme Court ruled Cabarrus County’s Adequate Public Facilities ordinance illegal.

The N.C. Appeals Court in China Grove’s case tied the two cases together as part of its ruling.

When the appeals court issued its ruling in the case, China Grove paid the $18,221.58 interest payment immediately, said Town Manager Ken Deal. The money was transferred out of the town’s general fund, Deal said.

The interest payment wasn’t originally included in China Grove’s 2015-2016 fiscal year budget, which required more than $250,000 from its fund balance — partially a savings account — to help balance revenues and expenditures. Deal, however, said China Grove’s finances weren’t in danger because of the court’s ruling.

Brooke said he billed the town between $5,000 and $6,000 for the lawsuit.

China Grove could appeal the case to the N.C. Supreme Court, but Brooke said the court doesn’t traditionally take up cases like China Grove’s.

The development by China Grove 152 LLC and David R. Investments was stalled for a lengthy period of time following the 2008 payment. Now renamed Miller’s Grove, the subdivision includes several completed houses and multiple homes currently under construction.

Contact reporter Josh Bergeron at 704-797-4246.