The town of North Hempstead has won a lawsuit against Nassau County over $1.3 million in sales tax revenue that was withheld to cover tuition reimbursement fees at the Fashion Institute of Technology dating back more than a decade.

Justice Leonard D. Steinman, in state Supreme Court in Mineola, ruled Thursday that the statute of limitations for the claim had expired and ordered Nassau to return the sales tax revenue.

Under state education law, since 2010 Nassau has billed its municipalities for the difference between out-of-county and in-county tuition rates for residents attending community college, which amounts to millions annually. In June 2015, Nassau informed officials in North Hempstead of its intent to collect $5 million for the 2004-2009 school years. In March, the first payment of $1.3 million for the 2004–2005 school year was deducted from the town’s 2015 fourth-quarter sales revenue.

The town’s legal team argued successfully that the time for Nassau’s FIT reimbursement claim had long run out. State education law does not explicitly set a limitations period, and Steinman ruled that Nassau’s claim was “stale” and that a three-year period was applicable.

The court also issued a declaratory judgment barring Nassau from its “brazen assertion” to collect for the 2004-2009 period.

“We’re gratified that the judge agreed with what we’ve been saying all along, that the county doesn’t have a right to hold this money,” Deputy Town Attorney Amanda Abata said Friday.

Officials with the Nassau County executive’s office did not respond to requests for comment Friday.

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Town Attorney Elizabeth Botwin said she expects the county to return the withheld tax revenue forthwith, adding that unexpectedly losing such a large sum jeopardized the town’s fiscal status and its Aa1 Moody’s rating.

This year, the town was also billed $702,000 for the 2015-2016 school year, amounting to a total of $5.2 million in chargebacks since 2010.

Supervisor Judi Bosworth said the $1.3 million tax revenue comprised nearly half of the town’s fourth-quarter sales tax revenue and would have created a financial hardship for the town.

“It [the court’s decision] is good news for our taxpayers and sets to rest the county’s attempt to balance their budget on the back of North Hempstead,” Bosworth said Friday.

North Hempstead is the only municipality to sue over the 2004-2005 claim, though Nassau has also charged the towns of Hempstead and Oyster Bay, and the cities of Glen Cove and Long Beach.

The lawsuit is the town’s third against Nassau, after it previously argued unsuccessfully that FIT, with its advanced degrees, did not constitute a community college. The town also filed a second lawsuit, which is still active, seeking an accounting of claims for the amounts charged. Town officials said a motion for summary judgment would soon be filed with the state Supreme Court.