Two battling business groups in downtown L.A.’s Art District have reached a compromise to create a new business improvement district for the neighborhood, ending a long-running legal dispute.

City Councilman José Huizar, whose district includes the neighborhood, on Tuesday announced that the Arts District Community Council Los Angeles has agreed to drop its application to create a BID and support an application sponsored by a group called Arts District Los Angeles. The ADLA, in turn, agreed to give Community Council representatives at least four seats on an expanded 23-member board. In addition, the area’s homeowners association will get three additional seats on the board.

A Los Angeles County Superior Court judge last May ordered the Arts District Business Improvement District to dissolve because the BID’s renewal process and other aspects of its operation were flawed.

Business improvement districts are financially supported by assessments of property owners in order to pay for services, such as extra trash pickup and safety patrols, that the city doesn’t provide. The old Arts District Business Improvement District was criticized by some property owners for going beyond its mandate and operating more like a local government.

“I want to thank both groups for working with my office to join forces for the betterment of the Arts District community,” Huizar said in a statement. “There is no doubt that both sides care deeply about the success of the Arts District and ultimately their common interest in sustaining a vibrant BID and a clean and safe Arts District far outweighed any differences they might have had.”

The City Council was scheduled to ratify the plan this week.