LA City Council Moving Forward On Measures To Add Transparency To Development Decisions

Los Angeles City Council members voted Tuesday to move forward with a pair of measures aimed at preventing future abuses of power such as those federal prosecutors allege former Council Member Jose Huizar is awaiting trial for.

One measure called for high-value projects to go directly before the City Council, skipping the review of the planning and land use management committee. It would also place time limits by which all projects would need to go before the council. The other seeks to alter the way developers and city council members and staff communicate outside of official meetings. 

The council’s approval means city departments will compile reports about how to implement these measures, including determining a definition of a high-value project. 

The measures are in direct response to methods that Huizar allegedly employed to abuse his power. Huizar, who federal officials claim built a criminal enterprise around his position as a council member and committed bribery, money laundering and a slew of other offenses, was the chairman of the PLUM committee for roughly five years. A federal complaint made public in June 2020 alleged that Huizar dangled spots on the agenda over developers, asking them for contributions before important votes and at times taking projects off the agenda if developers did not come through.

Another council member and PLUM committee member, Mitchell Englander, was sentenced in January to 14 months in prison for lying to federal officials about receiving money and other favors from a businessman who, in return, sought introductions to developers who might buy the building materials he sold.

Developers of projects in Downtown LA, which was part of Huizar's district, were also swept up in the case. Carmel Partners agreed to pay $1.2M to resolve the federal criminal investigation into its relationship with Huizar. A Chinese developer and a subsidiary company were named in a November indictment in the corruption case along with a local developer who hoped to build a condo tower in Downtown.

“The city has been plagued with a series of corruption scandals related to how we deal with the approval of development projects,” City Council President Nury Martinez said.

“These incidents have seriously eroded public trust in this body and in the city as a whole,” she said, but the system that determines how these decisions are made was broken and had been since before the corruption scandal rocked the city.

“We don’t need to reform our system, we need to entirely remake it,” Martinez said, adding that these motions, along with three other land use and housing-related motions on the docket, were “the first steps in doing so.” 

But others were not convinced these “first steps” were heading in the right direction. 

The efficacy of having certain projects circumvent the PLUM committee was called into question by several other council members, who voiced concerns that it could actually lead to less scrutiny of what were likely to be the biggest and most expensive projects that would come before the council, as well as by members of local political watchdog organizations. 

“I wonder what the intent is here: to speed up development? To avoid corruption?” said Rob Quan of Unrig LA, an organization that works to diminish the influence of money in city politics, speaking about the possibility of sending high-value projects to the council instead of a committee. “It seems as though we want to avoid concentrating power in a few hands, but instead of having multiple key players, now we [would] just have the council president with a whole lot of discretion.”

Holland & Knight Partner Ryan Leaderman said he had issues with getting projects put onto the agenda for the PLUM committee while Council Member Huizar was still in office, and that because that process depends now on the discretion of the council members, “we had no tools to force PLUM to agendize something.”

A mechanism for doing so wasn’t written into the motion, but Leaderman said he hoped the final ordinance that comes out of these first-stage efforts would include something like it.

As it stands now, Leaderman said, council members can “delay a project or not give it the time of day as a result of whatever concerns they have about the project. And they may be legitimate concerns, but they have all that power.” 

The other measure sought to add criteria to city rules that govern when entitlements including legislative actions and conditional use permits would be granted and offer new protocols around how communication happens between developers, council members and their staff, the motion read.

Though no developers spoke at the council meeting, commercial real estate development association NAIOP SoCal said it was keeping tabs on the motions and the effects they might have on developers. 

“We fully support transparency in government decision-making and expect any new communications protocols would apply equally to all industries and other organizations that have business before the council,” NAIOP SoCal CEO Tim Jemal said in an email to Bisnow. 

Jemal added that changes to the way entitlements are handled “should consider the major contributions commercial real estate makes to the Los Angeles economy by supporting thousands of jobs and improving quality of life for residents.”