A Warren County judge has ordered Hamilton Twp. officials to return $2.5 million in impact fees collected since 2007.

The Ohio Supreme Court ruled in May the impact fees the township has been charging new home builders are impermissible taxes. Judge James Flannery on Friday ruled the township must return $2.1 million to the home builders who sued them and $403,177 to individuals who did not sue but paid the taxes.

The builders who sued must receive their refund, with interest, by Dec. 15. The individual impact fee payers will also receive interest that has accrued on their payments. The outstanding sums will be sorted out at a future hearing on attorneys fees.

Charles Miller, an attorney for the home builders, said they will ask Flannery for a 40 percent attorney fee on the $403,177 owed to the non-party impact fee payers — an amount equal to their client agreement. He said he expects the judge to rule that the township is liable for the attorney’s fees since they lost the case. He also thinks the township’s insurance company will cover that cost.

His partner Joe Trauth said it’s only fair.

“Since they also benefit from this settlement the judge will have a hearing on how to disburse the money to them and what, if any, attorneys fees can be paid out of their portion,” he said. “You don’t necessarily get a free ride just because you didn’t hire an attorney. We did the work.”

Warren Ritchie, the township’s law director, said he can’t discuss whether their insurance company or taxpayers might pay the fees — if Flannery orders the township to pony up. But they are glad the case is coming to a close.

“The township welcomed Judge Flannery’s ruling, as it provides guidance as to what the township should do with the funds that it has collected,” he said.

The fastest growing township in Warren County instituted impact fees in May 2007 to deal with the large growth it was receiving in new homes. The Home Builders Association of Greater Cincinnati and a bevy of builders sued within three months.

Flannery and the 12th District Court of Appeals found the fees were permissible. Since no other township in the state had tested the right to impose the fees, the high court accepted the case.

The township argued because the fees are segregated into four accounts — for police, fire, parks and roads — and can only be used for capital projects or purchases, they are not taxes.

Justice Paul Pfeifer, who penned the opinion, said segregating the funds is not enough to make the fees truly fees.