The leader of Harrow Borough Council has called for the authority to work more "consistently and constructively" with voluntary groups.
Councillor Susan Hall made the comments after it was announced Flash Musicals, in Methuen Road, Edgware, would have a new lease on the authority owned property it uses.
A total of £72,000 of rent was owed to Harrow Borough Council’s Housing Revenue Account, which under the new deal will be cleared.
Cllr Hall said: "I met with representatives of the voluntary sector to consult on a way forward on Flash Musicals.
“They were of the view that the original decision was a reasonable attempt to draw a line in the sand over a long-running issue.”
In September last year the original plan to wipe the dept in exchange for services provided by Flash Musicals during the five years of its lease was re-examined by the council following concerns from some members.
Last month Harrow council’s cabinet agreed to sign a new lease agreement with the charity that will see the debt with the Housing Revenue Account cleared.
Cllr Hall added that due to the variety of voluntary sector organisations in the borough the council can’t have a 'one size fits all' method of working with them.
She says she will look into setting out a set of principles to help work more consistently and constructively with organisations in the future.
Last year’s deal was agreed under then member for major contracts Councillor Thaya Idaikkadar.
It set out money from the council’s general fund would be used to settle the outstanding rent in recognition of services delivered by Flash Musicals over the past five years.
However councillors from both Labour and Conservative groups called for this decision to be re-examined by cabinet.