There is a potential win/win in this one, no matter which way it goes, if handled correctly, I think.
If the case gets the fee reduced, all well and good. If not, making widely known to the NYC POLICE that the permit fee helps fund their pension plan might not be a bad thing....
In these times of grasping at every possible dollar, might not the desire for funding...encourage them to allow more permits, and maybe even treat permit holders a little nicer?
Of course, that might not happen, but its a nice dream...
All else being equal (and it almost never is) bigger bullets tend to work better.