The Anaheim City Council Tuesday night will likely OK a settlement of an American Civil Liberties Union lawsuit that would put the issue of district elections on the November ballot, according to sources close to the situation.

Neither side would talk publicly about the proposed settlement, but sources said it will pave the way for Anaheim residents to begin electing their City Council by districts in 2016.

The agreement would end a battle over the city’s electoral system and whether it adequately represents Latino neighborhoods that has been raging in court and in the public arena for more than a year.

The ACLU suit argues that under the California Voting Rights Act, Latinos, who constitute 54 percent of the city’s population, are not fairly represented on the City Council.

All members of the current council are white, and none live in Latino neighborhoods. Activists say the result of this inadequate representation is a council that represents major business interests and affluent communities over the needs of working-class neighborhoods fraught with social and economic challenges.

A system that elects council members by districts would restrict voting to candidates in the geographic district where they live. With some mostly Latino districts, the system would guarantee adequate representation of Latino neighborhoods, say ACLU attorneys and activists.

Opponents of the lawsuit have said a council districts system would balkanize the council and result in political gridlock. They also say it actually diminishes voters’ representation by limiting their votes to candidates in their districts.

Members of Anaheim council’s majority seemed intent on fighting the suit, having spent nearly $800,000 in city funds on outside lawyers as of last October. But they entered into settlement talks just as depositions of city leaders and former council members — such as former mayor turned influential lobbyist Curt Pringle — were being scheduled.

A settlement means Anaheim would join a wave of transitions to the system that has broken across the state. Many cities made the change after lawsuits from the ACLU, and Assemblyman Roger Hernandez, D-West Covina, has pushed for a new bill that would require noncharter cities to adopt district elections.

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