The Jerusalem District Court has ordered the Jerusalem Municipality to pay the city's Gay and Lesbian Center NIS 350,000 for "cultural and social activities" held by the organization over the last three years, a court spokeswoman announced Monday. The ruling was the second legal defeat for the municipality over the contentious issue in as many years. The decision was handed down in the wake of a petition submitted by the organization against the city, which, since 2003, had stopped allocating funds for the group out of its small cultural activities budget. "Even if municipal officials have a hard time accepting the gay community, and believe this [community] is an unwanted phenomenon, the municipality cannot swerve from fundamental principles and ignore this community," Judge Yehudit Tzur wrote in her ruling, accepting the petitioners' argument that the city was discriminating against them. "It must treat this community with equality, out of recognition of the supreme value of equality, and out of respect for the values of tolerance and pluralism, which exist at the heart of democratic society." The court also ordered the city to pay the petitioners NIS 25,000 to cover court fees. Last year, the Jerusalem court ordered the municipality and Mayor Uri Lupolianski to pay NIS 30,000 each for the annual local Jerusalem gay parade after the city tried to stop it. The latest ruling, which was handed down late Sunday night, comes against the backdrop of a looming showdown in the city over the center's plans to host a controversial international gay festival in Jerusalem this summer. The planned weeklong event, which was originally scheduled to take place last year but was postponed until August due to last summer's concomitant Gaza pullout, has been widely criticized by a coterie of Jewish, Christian and Muslim religious leaders in Jerusalem and around the world as a deliberate affront and provocation to millions of believers around the world. In a largely conservative city, with a strong religious and traditional makeup, the idea of holding such an international parade in Jerusalem is seen by many - even outside of religious circles - as out of touch with both the spiritual character of the city as well as the sensitivities of its observant residents. A public opinion poll released last year found that three-quarters of Jerusalem residents were opposed to holding the international gay event in the city. Organizers of the gay festival said Monday that they were buoyed by the Jerusalem court ruling. "We are very satisfied with the ruling, which is everything we wanted, and which strengthens our stand ahead of the international gay pride events this year in Jerusalem," said Noa Sattath, chairperson of Jerusalem's Gay and Lesbian Center. The last international gay parade, which took place in Rome in 2000 despite the wrath of the Vatican, attracted about half a million participants, while local organizers expect tens of thousands of revelers for the Jerusalem event this summer. The six-day event is slated to include street parties, workshops and a gay film festival.