A legal settlement filed in federal court Wednesday will for the next three years limit the ability of Los Angeles police and city workers to seize items stored on streets and sidewalks in Downtown Los Angeles.

The settlement, which had already been approved by the Los Angeles City Council earlier this year on a contentious 10-2 vote, stems from a 2016 lawsuit brought by homeless residents who claimed that police officers had confiscated and destroyed their personal possessions, including blankets, tents, and medication.

In response to the complaint, a U.S. District Court judge ordered the city to stop seizing items in the Skid Row area without evidence “that it is abandoned, presents an immediate threat to public health/safety, is evidence of a crime, or is contraband.”

Under the terms of the settlement, which became public Wednesday, that policy will be extended until 2022 in the area of Downtown LA encompassed by Second Street to the north, Eighth Street to the south, Spring Street to the west, and Alameda Street to the east.

That will make it tough for police to enforce city laws limiting the size of items homeless residents can carry with them, particularly in the Downtown area.

Earlier this year, homeless advocates applauded the city’s decision to settle the case, saying it would protect the rights of residents forced to store their belongings on city sidewalks.

But Downtown LA business groups and service providers argue the settlement places arbitrary restrictions on a wide swath of the neighborhood that includes parts of the Historic Core and Little Tokyo.

“This settlement removes limits on personal goods and will worsen the serious public health conditions that are already present in Downtown and in the entire city,” said Central City Association president Jessica Lall in a statement Wednesday.

City Councilmember Jose Huizar, who represents the Downtown area and voted against settling the case, said Wednesday that the agreement would have a “detrimental effect on setting sound homelessness policy” for the entire city.

He said a “comprehensive settlement” encompassing areas outside of Downtown LA would have set local officials on a more “proactive path” toward addressing the homelessness crisis.

Under the terms of the settlement, the city will also pay out $645,000 in damages and legal fees.