CEDAR RAPIDS, Iowa (AP) – Thousands of people whose state income tax refunds were withheld to pay Cedar Rapids traffic camera tickets would get refunds under a proposed $3 million lawsuit settlement.

The City Council learned Tuesday that the city also would stop trying to collect fines and late fees on about 177,000 unpaid tickets issued before Aug. 31 last year.

“To avoid additional time and expense to all parties involved, the city recommends settling this before going to trial,” city finance director Casey Drew told the council. The council voted unanimously for the settlement of the 2018 lawsuit.

The case stems from a December 2017 initiative in which the city sought payments for 221,000 unpaid tickets dating back to 2010.

People who received notices had 45 days to pay the original amounts. After that, a 25% late fee was added and the debts were submitted to an Iowa Department of Administrative Services’ program that withheld tax returns to settle the debts.

The Iowa Supreme Court said in another case, however, that the process violated Iowa Code, which requires court proceedings to assign liability.

The settlement has no bearing on the current use of traffic cameras.