“You’ve protected the town in a reasonable, prudent way, albiet one that is still difficult to accept,” town attorney Bob Welsh told the Burns Harbor Town Council last night.

Members appropriated $44,000 in unspent 2011 funds to pay for a negotiated settlement that will end a five-year dispute over town marshal Jerry Price’s arrest of a suspected intoxicated driver who turned out to be having a diabetic reaction.

No one commented Wednesday other than seeking clarification during a required public hearing on the appropriation.

The money comes from four separate funds in the Police Department budget, three of them related to insurance. The $44,000 will be appropriated to the Town Council legal services line item for payment on behalf of Frank McAllister of Portage for attorney fees tied to his $1 million civil-rights claim alleging excessive force by Price resulting in McAllister’s fractured hip.

Two months ago a federal jury awarded McAllister $2,000 but no punitive damages. Welsh said how the hip was injured wasn’t proven.

Nevertheless, the award opened the door, Welsh explained, for McAllister to seek reimbursement for his legal fees up to $250,000. He sought $62,500 and both parties agreed on $44,000. The money is not covered under the town’s liability-insurance policy.

"This is understandably a chicken bone that goes down sideways,” Welsh told the council. “It is what it is.”

With the $44,000 payment McAllister agrees to drop any plans to appeal the jury award and to release the town from all claims, known and unknown, now and in the future. Since the final documents won’t be available for signature until after Jan. 1, the outgoing Town Council voted to authorize the president of the incoming 2012 council to sign the paperwork.

According to current councilman Mike Perrine, “The $44,000 payment to the plaintiff in no way reflects on the validity of the complaint against Chief Price.” Perrine noted that allowing reimbursement for legal fees, even if the jury award is minuscule, makes it easier for lawyers to get paid for filing lawsuits of little or no merit.

“Ditto,” responded council member Cliff Fleming, a lawyer, who is retiring from the board.

Welsh agreed it is a disturbing trend that courts are allowing attorney fees that in no way track the nominal amount of an award.

Council member Jim McGee, who like Perrine was re-elected to a new four-year term and takes office Jan. 1, said it’s some consolation that the $44,000 comes from the Police Department budget alone. Retiring council member Toni Biancardi joined the others in voting for the appropriation that seals the settlement.

Retiring council member Louis Bain was absent.

Taking office Jan. 1 with Perrine and McGee are Jeff Freeze, Gregory Miller and Gene Weibl. The new Town Council meets at 2 p.m. that day for a swearing-in and reorganization but no actual business. Clerk-treasurer Jane Jordan begins a new term as well.