A long-running legal battle over the rights of people with intellectual disabilities that has so far cost Tennessee taxpayers more than $40 million is one step closer to resolution.

State officials and lawyers representing people with intellectual disabilities have agreed to finalize the lawsuit involving conditions at three state institutions within 120 days.

The legal battle dates back to 1995 when disability advocates sued the state over dangerous and neglectful conditions at three state institutions: Clover Bottom Developmental Center and Harold Jordan Center, both in Nashville, and Greene Valley Developmental Center in Greeneville.

At the time, the state agreed to improve conditions for residents and to give them a choice in whether to move out of institutions into home-like settings. The state also agreed to standards of care set by the court and independently reviewed by court-appointed overseers.

While reviews have found more humane conditions for remaining residents, reviewers also identified serious problems that remain, including the slow pace in moving residents out of institutions.

Officials with the Department of Intellectual and Developmental Disabilities plan to close Clover Bottom permanently in 2015, five years behind their original schedule. The state has no plans to close Greene Valley, where dozens of residents were deemed fit to move back into their communities years ago, but continue to live at the institution.

Thus far, state officials have spent $11.4…