(COLDWATER) - A class action lawsuit challenging the Coldwater Board of Public Utilities payment-in-lieu-of-taxes fee has been put on hold until a June court hearing.
Branch County Probate Judge Kirk Kasian, sitting as circuit judge, issued a stay that temporarily pauses discovery while the court considers the City of Coldwater's request to dismiss the case.
The lawsuit was filed on behalf of nearly 7,000 utility customers and claims the city has been overcharging residents by about $3 million a year.
Plaintiffs argue the city has been calculating the 6.5 percent PILOT fee using gross revenue rather than gross income.
A motion-to-dismiss hearing is now set for June 11.
The case has also seen a judicial change after newly appointed Circuit Judge Zach Stempien announced plans to recuse himself because of potential conflicts involving city officials.
City attorney Amanda O'Boyle argues the current fee collection method is required under Coldwater's 1960 voter-approved city charter and says moving forward with broad discovery right now would place an undue burden on city staff.