To pay out legal claims, the city is digging deeper into the public wallet than it was a decade ago.

A report released yesterday by the Independent Budget Office found that the amount of money spent to settle lawsuits more than doubled between 1995 and 2004. In 2004, the city paid $575.6 million in legal settlements, compared with $265.1 million in 1995.

The increased payouts are partly due to a city effort to chip away at the backlog of lingering claims. In the decade reviewed by the IBO, the number of claims filed against the city decreased, but the number of cases settled doubled, to about 12,000.

In recent years, the city’s strategy has been to settle lawsuits and avert the costlier option of court and potentially sky-high jury payouts. The city is estimating that settlements costs will increase to $800 million by 2010.

“It’s the number of settlements in and out of court along with the city’s effort to reduce the backlog of cases,” the chief of staff at the IBO, Doug Turetsky, said in explaining the increased payouts.

The deputy chief of the tort division at the city’s Law Department, Ellen Lombardi, said the city “took action by increasing the number of meritorious” cases it has settled.

“A decade ago, there were approximately 60,000 personal injury and property damage cases pending against the city, and it was forecast that there would be 85,000 by 2006,” she said in a statement.

That “inventory” has been reduced to 33,000 pending suits, Ms. Lombardi said. She also said that although payouts have increased over the past decade, they dropped by 13% last year, to $490 million. That number was not included in the IBO report.

The city’s comptroller, William Thompson Jr., who has been named as a possible mayoral candidate, said that although the settlements represent a significant cost to the city, the IBO report “ignores the fact” that costs have remained relatively flat in the past few years.

His office has teamed with Cybersettle, a Web site that uses a double-blind system to settle claims online. Last year, he announced the system saved taxpayers $11 million during its first year of operation.

According to the latest report, 90% of payouts in 2004 went to people who filed personal injury claims against the city for things like falling on a public sidewalk that needed repair, water damage after water main breaks, or medical injuries at city public hospitals.

Medical practice claims accounted for 3% of personal injury lawsuits filed each year, but the cost of settling those suits ate up 30% of the overall payout in 2004. Since 2000, there have been more than 40 claims each year settled for at least $1 million.

Sidewalk settlements have actually dropped. The decrease is attributed to a law that Mayor Bloomberg pushed in 2003 that shifts primary liability away from the city in many such cases.

Also yesterday, the city’s chief lawyer, Michael Cardozo, criticized the state Assembly’s Judiciary Committee for killing a bill to end “double-dipping” by public employees who are injured on the job. He said the bill would have saved taxpayers millions of dollars by ending the dual payouts such employees are eligible for through their pensions and lawsuit payouts.

In a last-minute move, the committee added three new members and blocked the bill from getting a full Assembly vote.