Motion to reconsider item 26 fails after debate over indemnity for development project

The Los Angeles City Council on Wednesday rejected a motion to reconsider item 26 that would have referred the matter back to the Budget and Finance Committee for review of indemnity issues related to a development project.

Councilmember Holden moved to reconsider the item and send it back to committee so the City Attorney could examine whether the city would be protected if a contractor declared bankruptcy or went out of business and whether indemnification obligations would transfer to subsequent owners. “I would respectfully request that we reconsider item 26 … for the purpose of referring it back to the Budget and Finance Committee, and have them review whether or not their ways and means to indemnify the city should such a problem arise,” Holden said.

Councilmember Galantra (as recorded in the transcript) opposed reconsideration, saying the City Attorney had explained the city would be liable only for areas that become city property—streets and roadways—and that the matter had been disposed of in the prior session. “The City would not be liable for anything that happened on the private property,” she said, urging that the council not rehash prior discussion.

The clerk recorded the vote on the reconsideration as 7 ayes and 5 nos; the motion therefore failed and the council did not refer item 26 back to committee. The transcript records the debate focused on indemnity and potential exposure if a developer or subsequent owner becomes insolvent; no new indemnity terms or committee instructions were adopted.