L.A., State Reach Accord on Port.

The city of Los Angeles will repay the Port of Los Angeles $62 million that state officials alleged was improperly diverted to pay for municipal services and projects unrelated to the port.

Ending its 1996 lawsuit against the city, the State Lands Commission unanimously approved the settlement after more than 18 months of negotiations between state and port attorneys. The Los Angeles City Council and Mayor Richard Riordan signed off on the terms.

By law, the city may charge for certain services performed in the port but may not use the port to subsidize services beyond that area.

State and city officials contend the agreement should provide other port cities in California guidance about what harbor revenue can be used for.

Under the agreement, the city admitted no wrongdoing, but must repay the port about $62 million over the next 15 years in cash or credits against the bills the city sends the port for future services. The city is allowed to charge the port 100 percent for fireboats and 75 percent of the costs of providing other fire and emergency medical services in the harbor district.

The settlement also states that the city can bill for a variety of other services, including administrative overhead if it relates to the port, and park facilities that are either on or near harbor property. However, city officials can no longer charge the port for costs related to the L.A. Convention Center or Drum Barracks and the Banning Museum in Wilminton.