City Council Holds Special Session on Kensington Project

With less than a 24-hour notice, the Sierra Madre City Council came together Tuesday night for a special session to discuss the indemnification agreement with developer attorneys for the proposed for 33 N. Hermosa Avenue and 245 W. Sierra Madre Blvd.

Mayor Josh Moran, away on vacation, chimed in during the meeting via conference call, but there were only a few members of the public present. City Manager Elaine Aguilar noted that there was an urgency to have this special session as Tuesday Aug. 7 was the deadline to submit the language to the County in order to make the Nov. 6 ballot. Residents would get the chance to vote on changing the density restriction for the two parcels in question, the main sticking point for this project to move forward.

On July 24, The Council approved various resolutions placing an initiative to amend the density limitation of Measure V and approved a Kensington Election Indemnification and Hold Harmless Agreement, but it was stated that if modifications were made, it would come back to Council for consideration. The goal is to have this item before voters on the Nov. 6 election.

The purpose of the Election Indemnification and Hold Harmless Agreement is to hold the developer responsible to pay the costs of the election, to protect the City in the event of a third party lawsuit over the proposed project by holding the developer responsible for paying such costs, and lastly, to assure that the developer will not sue the City themselves if the amendment does not pass.

The developer (Fountain Square Development West, L.L.C.), has requested a modification so that they will only incur the costs of a lawsuit if the amendment to Measure V passes. In the current language, the developer would also have to pay the cost of a lawsuit even if the amendment does not pass and the project doesn’t move forward. The developer’s point was that if the amendment does not pass, they will just move on to the next project.

Also, though the developers have agreed that they would not sue the City in the event the amendment does not pass, they did call for the striking of the language “of denial of due process” in the Waiver Of Claims Against City section of the Hold Harmless agreement as they did not want their due process rights given away.

The developer, William Shields, who was not present, was also concerned that if a procedural irregularity was the actual cause of the failure at the ballot, that they should not have to waive the claim against the City.

The proposed language changes were agreed upon by Interim City Attorney Teresa Highsmith. “With these couple of tweaks…I do not believe that the risk shifting that this agreement provides for the City is terribly diluted,” Highsmith said.

was bothered by some of the language in the Waiver Of Claims section, mainly the section stating that the waiver shall not apply in a claim involving bad faith. “It seems too broad, anybody at anytime can be accused of bad faith,” Capoccia noted. Highsmith agreed that the developer should strike the term.

Capoccia and Highsmith also agreed that they should not strike the language “including but not limited to” in the Waiver Of Claims as requested by the developers. Striking this language would limit the reasons why the developers cannot waiver a claim against the City.

There were a few other rewording suggestions made by Mayor Moran and Council members.

Unfortunately, due to the short notice of this meeting, the main representatives for the developers could not be present. Attorney Dale Pelch spoke on behalf of the applicant, but noted that he was not authorized to make any final decisions regarding language, which cause a bit of a dilemma considering the urgency of the issue as stated by City Manager Aguilar.

Pelch noted that he did not feel any of the suggested changes would be an issue, but reiterated that he could not speak for the developers.

The Mayor, Council, the City Attorney and City Manager urged Pelch to try to contact the developer representative Scott Jenkins, who was at another City Council Meeting, so that they can get this agreement signed as City Attorney Highsmith stated it was their “last, best final offer.”

Pelch did so during a short recess, but was unable to reach Mr. Jenkins, but said “we should be able to get this wrapped up and signed tomorrow.” With that, Council unanimously voted to make the suggested language changes in hopes that there would be no further changes made by the developers.

Council is expected to further discuss the Kensington Project status at a future meeting to be announced.  

Due to this special session, the regular meeting of the General Planning Steering Committee was rescheduled for Monday, August 13.

Corrections: The original version of this article stated that the purpose of the meeting was to discuss ballot language and that voters would vote Nov. 6 to define a "dwelling unit." The Council gathered Tuesday to discuss the indemnification agreement. Voters would vote Nov. 6 to change the density restriction for the two parcels in question. Patch apologizes for the error.