Updated, 1:09 p.m. | The Bloomberg administration has decided to settle a longstanding class-action lawsuit over homeless families’ access to shelter in New York City, ending costly litigation that has dragged on since May 1983, through four mayoral administrations. The settlement, which Mayor Michael R. Bloomberg announced at a news conference this morning, comes as city officials acknowledge that the mayor’s plan to reduce homelessness by two-thirds by 2009 has fallen far short of it goals.

While the number of homeless single adults has fallen a bit, the number of homeless families has risen. There are about 9,000 homeless families, including about 14,000 children, sleeping in city shelters every night this month. City spending on homelessness prevention has risen, to $191.2 million in 2007 from $160.6 million in 2004, and spending on homeless shelters has grown to $603.5 million from $563.4 million, the city’s Independent Budget Office found in a study [pdf] last month.

The main lawsuit being settled, McCain v. Koch, was filed in 1983 by the Legal Aid Society to draw attention to the plight of homeless families, after similar lawsuits had been filed over the rights of homeless men and women. Those lawsuits had resulted in the establishment, unusual in the United States, of a right to shelter in New York City.

The McCain suit argued that the city had failed to provide adequate shelter or develop standards governing shelter for families. (The named plaintiff in the suit was Yvonne McCain, who was evicted from a Brooklyn apartment in 1982 after withholding rent to protest her landlord’s refusal to make repairs.)

Over the years, related lawsuits were filed arguing, like the McCain case, that homeless families were improperly denied shelter or even barred from applying for it; those lawsuits, too, are part of today’s settlement.

A court-appointed panel of special masters had urged an end to the litigation nearly three years ago. But the litigation resumed in 2005, after a two-year hiatus. The city moved in 2006 to dismiss the lawsuit, saying it had taken major steps to transform the system, but the case dragged. The settlement announced today occurred after talks between the city’s top lawyer, Corporation Counsel Michael A. Cardozo, and Steven M. Banks, attorney in chief at the Legal Aid Society.

Under the settlement, the parties agreed a new case would be filed and, following a class action settlement hearing, all cases against the city and state, as well as the new one, would be dismissed. The city will regain full control and oversight of its family services system, “no longer having to enforce over 40 highly-detailed court orders or spend precious staff time and agency resources complying with or litigating these cases,” City Hall said in a statement.

The statement added:

As part of the settlement, the parties have agreed that New York City would continue its long-standing interpretation of state and local laws ensuring safe and decent emergency shelter for homeless families with children. The settlement also includes provisions that outline current agency standards and protocols for assessing shelter eligibility; under the terms of the agreement, these provisions sunset on Dec. 31, 2010, unless the agency were to be found in “systemic non-compliance” with its provisions in a separate successful litigation.