LOS ANGELES—Street vendors have reached a settlement agreement with the city of Los Angeles after a lawsuit was filed challenging restrictions that violated state law, plaintiffs announced July 19.

In December 2022, street vendors Merlín Alvarado and Ruth Monroy, along with three community organizations— Community Power Collective, East LA Community Corporation, and Inclusive Action for the City—sued the city, challenging a number of regulations in the ordinance, which they claim violate SB 946, a 2018 state law that legalized sidewalk vending statewide.

During a news conference in Hollywood, the plaintiffs and their attorneys said the settlement would repeal exclusionary vending bans across the city near swap meets, farmers’ markets, schools, and temporary events. The city is also expected to cancel all citations issued for vending in those areas and provide full refunds to vendors for any fines paid.

“The bans are gone and the vendors have been vindicated,” Mr. Alvarado said. “In addition to serving our customers, running our businesses, and providing for our families, we are ready to work with the city to make its sidewalk vending program as successful as possible.”

He added, “Street vending is one of our city’s great traditions and resources, and we look forward to being fully recognized for our role as community caretakers and contributors.”

While the settlement is finalized, it still needs to be formally approved by the City Council and Mayor Karen Bass, which plaintiffs expect to happen when the council returns from recess in August. Once approved, the city will have 90 days to gather all of the citations, identify the individuals eligible for relief under this agreement, and send out the required notices to individual vendors.

Individual vendors who received notices or believe that they paid an eligible citation will need to call the Citation Processing Center to initiate the refund process.

Katie McKeon, attorney with Western Center on Law and Poverty, who represented the plaintiffs, noted the settlement ends what she calls harmful practices and provides justice to vendors.

“We are encouraged that the city is now committed to complying with state law and is adopting policies that respect and support the vital role vendors play in our communities,” Ms. McKeon said.

In addition to Western Center on Law and Poverty, the plaintiffs were represented by Public Counsel and the law firm of Arnold and Porter.

“California’s ‘Safe Sidewalk Vending Act’ is the law of the land and prevents cities from enacting vending regulations based solely on NIMBY complaints or economic animus,” Ritu Mahajan Estes, directing attorney with Public Counsel, said in a statement. “Punitive and baseless vending restrictions not only fly in the face of our collective culture and California history but they are unlawful, discriminatory, and harmful to our communities’s health and well-being.”

In February, the city of Los Angeles changed its street vending laws to eliminate the enforcement of so-called “no street vending zones,” which prohibited street vendors from selling goods at popular tourist sites. Zones were eliminated at the Hollywood Walk of Fame, Hollywood Bowl, Dodger Stadium, LA Live/Crypto.com Arena, Universal Studios/City Walk, El Pueblo De Los Angeles Historical Monument, and Exposition Park.

The city also recently lowered the cost of vending permits to $27.51 from what could have been as high as $541.

The Los Angeles County Board of Supervisors earlier this year also approved a similar pair of ordinances regulating sidewalk food vendors and adopted a subsidy program to offset some costs related to its permitting process.