Child Evangelism Fellowship, sponsor of the Good News Clubs, which are religious, after-school clubs for elementary school children, filed a federal lawsuit against Chico Unified School District seeking access to the school facilities after the District insisted on charging the club a discriminatory access fee. CEF is represented by Mathew Staver, President and General Counsel for Liberty Counsel.

In November 2004, Child Evangelism Fellowship of Butte-Tehama-Glenn requested to use District facilities to hold a Good News Club after school hours. According to Board Policy 1330 and Administrative Policy 1330.1, "officially recognized Non-District student organizations who [sic] do not collect a fee," including Boy and Girl Scouts, the YMCA and 4-H Clubs, are entitled to use District facilities without charge. However, when CEF applied for use of school facilities, District officials insisted that CEF pay "direct costs" because it is a "religious organization." Even after CEF Director Joe Stevens provided District officials with U.S. Supreme Court cases which stated that Good News Clubs must be provided access to school facilities on the same terms and conditions as groups such as Boy and Girl Scouts, District officials refused to grant a fee waiver to the Good News Club. The District claimed that it was required to charge the Good News Club a fee under California law because the Good News Club is a religious organization.

In 2003, a federal court in Child Evangelism Fellowship of San Fernando Valley v. Los Angeles Unified School District ruled that a public school may not charge discriminatory fees to religious clubs. Liberty Counsel represented CEF in that case. There the court rejected the same arguments now raised by the Chico Unified School District.

According to Staver, "Imposing a financial barrier based on the religious viewpoint of groups seeking to access public property violates the right to free speech. Whether the school bans a group from accessing its facilities because of its religious viewpoint or places a financial barrier on the group based on its religious viewpoint, the outcome is the same - the Constitution has been violated. Equal access means equal treatment."

Staver stated: "The District Policy is astounding in light of the fact that the United States Supreme Court has already ruled that it is unconstitutional to prohibit Christian groups from using public school facilities when secular groups are permitted to do so." Staver remarked, "One thing is clear - a policy excluding persons or groups from using school facilities, or one that imposes discriminatory fees for similar groups solely because of their religious viewpoint, is unconstitutional."