The Albert Lea City Council on Monday approved a settlement agreement with Dima Corp., the owner of a large yellow portable sign often seen promoting events and messages around the city.

The settlement authorizes Dima Corp. to place the sign on any commercial or industrial property with permission of the owner and with a city permit, but it cannot place the sign in residential areas, said City Manager Chad Adams.

The action comes after the company in March 2012 sued the city for not allowing the sign in the North Broadway parking lot at the corner of Broadway and Fountain Street. The sign was set to promote an event at the Marion Ross Performing Arts Center.

At the time, the city had enacted a new sign ordinance limiting the size of portable signs, and Dima Corp. challenged the city’s interpretation of the ordinance. The company argued a First Amendment right to rent the sign to customers, according to court documents.

The sign is about 8 feet tall and 20 feet long and is mounted on a frame with two axles and four wheels so it can be towed.

After a Freeborn County District Court judge denied the company’s request to temporarily place the signs while the matter was pending, Dima Corp. appealed to the Minnesota Court of Appeals.

The court overturned the local court’s decision.

This was not the first time Dima Corp. has taken the city to court. In 2006, the city issued a citation to one of the company’s customers for using the sign in violation of city ordinance.

Dima Corp. took civil action against the city in the United States District Court, alleging that the city’s ordinance was contrary to the First Amendment.

In 2007 as part of a settlement agreement, the city agreed to not enforce the ordinance against the company, court documents state.

In 2008, the sign became a source of controversy in the community after children threw rocks at it during the Third of July Parade. The sign carried a message about illegal immigration from the Minnesota Coalition for Immigration Reduction.

One of the rocks missed the sign and hit a woman in the face.

Dima Corp. declined to comment.

In other action, the City Council:

• Approved the rules and procedures for the council in 2014.

The changes include putting the public forum before the consent agenda and changing the amount of time required to notify the public of a special meeting. There is an added portion on maintaining civility.

• Approved plans for a new building to house the wastewater treatment plant’s gas microturbine. Bids for the project will open Feb. 4.

• Voted to purchase an Envirosight Rovver X Crawler Sewer inspection camera for about $86,000. The previous camera quit working.

It will be paid for through the sanitary sewer budget.

• Voted to purchase a 2014 Vactor Jet Vac truck, replacing the city’s same truck purchased in 2005.

It is used to clean sanitary sewers, sanitary sewer lift stations, storm sewers, storm sewer lift stations and manholes, according to background information provided by the city. It also locates sewer lines and underground utilities and repairs water main breaks.

• Authorized the city to offer a phased retirement option.

Adams said eligible employees have to be 62.

• Named the Albert Lea Tribune as the city’s official newspaper for 2014 for legal notices.

• Designated US Bank of Albert Lea, UBS Financial Services Inc. of Rochester, RBC Capital Markets LLC. and the Minnesota Municipal Money Market Fund as depositories for city funds.

• Approved membership in the Minnesota Environmental Science and Economic Review Board. The board researches environmental issues important to the state and assists members with permitting requirements and other legal issues pertaining to wastewater treatment.

• Combined four lots at 2124 W. Edgewater Drive into one lot for resale purposes.

• Converted three lots into two at 1461 Nicklaus Drive. The owner plans to build a house there.