Council May Reverse Itself on Loan Pact

The City Council will meet in closed session today to discuss whether to reconsider a controversial decision made last month to end a loan agreement with a developer.

Under the agreement, the city’s Redevelopment Agency was to lend $1 million to a developer who planned to build a low-income-housing project downtown. Council members, sitting as agency directors, terminated the agreement on a 3-2 vote even though they were told by their attorney that they had no legal basis for doing so.

Now a lawsuit has been threatened, and the agency may decide to loan the money to Ajit Development and Investments Inc. of Los Angeles after all. ADI owner Ajit Mithaiwala could not be reached for comment Monday.

Councilman and agency director F. Richard Jones, who voted with colleagues Chris Norby and Julie Sa to terminate the agreement, said he may change his mind.

“We are reconsidering the vote,” Jones said.

The agency will discuss the matter with attorneys behind closed doors. If directors overturn their original vote, they will make an announcement at the 4 p.m. council meeting at City Hall, 303 W. Commonwealth Ave.