(02-28) 19:44 PST SAN FRANCISCO -- Two Bay Area regional planning agencies announced late Friday that they had settled a lawsuit from the home-building industry challenging a regional transportation and land-use plan adopted in 2013.

The Metropolitan Transportation Commission and the Association of Bay Area Governments released a joint statement saying they had reached an out-of-court settlement with the Building Industry Association of the Bay Area over Plan Bay Area, a nine-county regional plan that melded transportation planning and funding with land-use strategy.

The plan steers development toward urban areas near mass transit and aims to stem suburban sprawl. It's the Bay Area's attempt to satisfy state legislation mandating 18 metropolitan areas to develop plans to house future population growth while reducing greenhouse gas emissions from cars.

The association filed suit in August, saying the plan violated state law "by failing to provide enough housing to accommodate the Bay Area's projected population growth and failing to establish a realistic development pattern to accommodate residential growth."

According to the regional agencies' statement, MTC and ABAG agree to monitor regional development patterns, including keeping track of types of residential development and issuance of building permits. The agencies also commit to a process that invites, and discloses, public comment when developing new strategies for the next Plan Bay Area, which is to be updated in 2017.

"We're pleased to have been able to work so quickly and effectively with the BIA to craft an agreement that addresses the BIA's concerns, safeguards MTC's and ABAG's essential planning functions and saves each party the time and expense of an unnecessary court case," said Amy Rein Worth, commission chairwoman and an Orinda councilwoman, in a statement.

Officials with the building association could not be reached for comment Friday evening.

The regional agencies still face three lawsuits over Plan Bay Area from groups representing interests all along the political spectrum. Bay Area Citizens, a group backed by a conservative political foundation, alleges the plan violates state law by failing to include alternative development plans. The Post-Sustainability Institute contends the plan violates constitutional property rights and usurps city and county control over planning.

A suit by a coalition of environmental groups including the Sierra Club, Earthjustice and Communities for a Better Environment contends the plan spends too much money on highways, not enough on transit and fails to meet state requirements for reducing greenhouse gases.