Plan to Sell Library Rejected a 2nd Time : City Hall: Mayor’s aggressive lobbying fails to persuade the council to vote for lease-back deal with Philip Morris. Wachs calls the proposal politically unsellable.

Despite Mayor Richard Riordan’s lobbying, the Los Angeles City Council on Friday again rejected a proposal to sell part of the landmark Central Library to a subsidiary of tobacco giant Philip Morris.

Riordan, accustomed to brokering complicated deals from his days as a venture capitalist, dispatched his top lieutenants to the council chamber and telephoned council members in an effort to change their minds. But he picked up only one vote from a week ago when the council turned down the proposal 13 to 0.

Councilman Joel Wachs spoke for the council majority in saying it would be politically unwise to support such a plan.

“Frankly, the risk of this transaction is the risk of not being able to explain it to anybody in the city of Los Angeles,” Wachs said.

Friday’s vote was 11 to 1, as Philip Morris officials monitored the debate over the telephone from their New York headquarters.

The plan called for the city to sell the pyramid-topped Goodhue building in Downtown for $71 million to a Philip Morris subsidiary, which would have gained tax credits under historic preservation laws.

Philip Morris would have had no voice over operation of the library, which the city would have leased back for $5 million a year with the right to repurchase the structure in 20 years.

The deal drew opposition from council members representing hard-pressed inner-city districts because it called for taking the city’s $5-million annual lease payment from redevelopment money now used to fund construction of low-income housing.

In effort to win over opponents, Riordan proposed that the bulk of proceeds from the sale--about $45 million--be earmarked for housing.

But opponents, led by council members Mark Ridley-Thomas and Rita Walters, argued that there was no way to ensure that the council would use the funds for low-income housing.

Riordan had proposed that another $12 million be set aside to buy government bonds that would raise the $49 million required in 20 years to repurchase the library. That would still leave $11.5 million to reduce the city’s budget deficit, the mayor said.

Councilman Hal Bernson, who cast the lone vote in support of the sale, said afterward: “We just threw away $11.5 million.”

Riordan was philosophical in defeat. “In a pure world, it would pass,” the mayor said. “But we are in a world of politics.”

The mayor said he does not consider the vote a personal defeat because the sale was originally proposed by the Community Redevelopment Agency under then-Mayor Tom Bradley.

Peirre Lorenger, deputy administrator of finance for the CRA, said he spoke to Philip Morris officials after the vote. “They couldn’t believe it,” he said.

The debate over the issue became heated in recent days. Upon hearing Deputy Mayor Michael Keeley pushing the deal on a radio talk show Thursday, Walters called the show from her car phone to argue against it.

Friday’s vote came after dozens of housing advocates and library supporters objected to the deal at a public hearing.

Times staff writer James Rainey contributed to this story.