Los Angeles could pay up to $92.5 million to taxpayers and attorneys to resolve a lawsuit over a city telephone tax that has endured nearly nine years, under a class-action settlement that was granted preliminary approval by a Superior Court judge Thursday.
The $92.5-million figure is a cap: The ultimate amount that L.A. would pay depends on how many people seek and obtain refunds for telephone taxes paid during a roughly 2 1/2-year period that ended in 2008. Any money not claimed would revert back to the city.
City Administrative Officer Miguel Santana, the top budget official in the city, said the settlement marks an important step toward Los Angeles resolving “looming liabilities” that could threaten its financial stability if left unaddressed.