SACRAMENTO, Calif. (Legal Newsline)-Eight of California's largest cities and nine of its largest counties spent $504.1 million on lawsuits in 2007 and 2008, a report said Thursday.

The study by California Citizens Against Lawsuit Abuse found that local governments spent the taxpayer money on verdicts, settlements and outside legal counsel.

"California has 58 counties and 480 cities, so this is just the tip of the iceberg," said CALA Executive Director Tom Scott told Legal Newsline. "And we are not even looking at school districts and state agencies here."

Scott said the public at large does not realize just how much money their local community is shelling out in settlements and attorney fees.

"Very few people pay attention to public lawsuits, which I truly believe has a huge impact on taxpayers. This is a direct hit on your community and your pocketbook," he said. "My concern is that in light of economic stimulus packages people are sort of numb to numbers."

California's legal climate ranks in the bottom 10 of states. The state was ranked 44th in an annual survey by Harris Interactive of states' legal climates from the perspective of in-house corporate counsel around the nation.

The CALA report examined legal expenditures in the counties of: Alameda, Fresno, Kern, Los Angeles, Orange, Sacramento, San Diego, San Francisco, and Santa Clara, and the cities of: Anaheim, Bakersfield, Fresno, Los Angeles, Oakland, Sacramento, San Diego, and San Jose.

Last year, CALA reported that three cities and four counties spent more than $276 million in litigation costs for fiscal years 2005 and 2006.

"Citizens of California deserve to know where their tax dollars are going. Budget shortfalls don't just affect those who might lose their jobs or services they rely on, the effects ripple to the entire community and beyond," said Lorie Zapf, CALA's San Diego regional director.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.