City reaches phone settlement with Alltel

The city of Springfield will get nearly $6 million from Alltel Communications as part of an out-of-court settlement over business license gross-receipts tax collections, the city announced Tuesday.

Springfield City Council approved the settlement in closed session Sept. 8. In the agreement, Alltel Corp. has paid the city of Springfield $5.92 million, representing the net proceeds from back taxes owed to the city. Alltel had been paying the gross-receipts tax since September 2006.

Council approved a resolution Sept. 10 to put proceeds from any phone company lawsuit into the Police and Fire Pension Fund. Since the agreement was reached before council passed that resolution, council will have to formally decide how to appropriate the funds.

"I believe council's intent is to place 100 percent of these net proceeds into the pension fund to demonstrate our commitment to resolving this issue," Mayor Jim O'Neal said in a news release.

Alltel, which was acquired by Verizon earlier this year, also will pay attorney fees and costs from the settlement.

The settlement is the result of a lawsuit filed in May 2004 against SBC (now AT&T's landline division), Sprint, Alltel, Cingular (now AT&T Mobility) and Nextel. The city has netted $11.76 million from the other settlements; the suit with AT&T's landline company is still unresolved.