HomeMy WebLinkAbout2018-02-15 Morris Ltr to City of San Luis Obispo re Orcutt Reimbursement AgreementFOLEY
FOLEY & LARDNER LLP
February 15, 2018
Via Fax and U.S. Mail
City of San Luis Obispo
Attention: City Administrative Officer
990 Palm Street
San Luis Obispo, CA 93401
ATTORNEYS AT LAW
3579 VALLEY CENTRE DRIVE, SUITE 300
SAN DIEGO, CA 92130
858.847.6700 TEL
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999100-0201
Re: Reimbursement Agreement Dated October 2, 2007, as
amended
Dear Sir or Madam:
This firm is counsel to and represents Orcutt Associates, LLC ("Orcutt"), in
conjunction with that certain Reimbursement Agreement Improvements to Orcutt Road and the
Intersection of Broad Street, dated October 2, 2007, by and between the City of San Luis Obispo
("City"), and Orcutt, recorded as Document No. 2007078654, Official Records of the County of
San Luis Obispo, as amended by that certain First Amendment to Reimbursement Agreement, dated
July 22, 2011, by and between the City and Orcutt (collectively, the "Reimbursement Agreement").
Capitalized terms used in this letter without definition shall have the means ascribed to such terms in
the Reimbursement Agreement.
Pursuant to the Reimbursement Agreement, the City is obligated to use "best efforts"
to collect and to reimburse Orcutt for the Reimbursement Payment. Orcutt is informed and believes
that various opportunities have arisen that have afforded the City with an opportunity to collect fees
from property owners/developers in the Benefit Area such that, if these fees would have been
collected, the City would have been able to satisfy its obligation to pay the Reimbursement Payment
to Orcutt. By way of example, Orcutt understands that the City has agreed to accept the sum of
approximately $257,000 as a reimbursement payment from a developer of all or a portion of the
Benefit Area. Unfortunately, the City has made not made a good faith effort (let alone expended
best efforts) to collect the Reimbursement Payment from this developer. Worse yet, the City has
elected to retain the entire approximately $257,000 and not pay all or any portion of the same to
Orcutt. As a result, it is Orcutt's position that the City has failed to meet and satisfy its obligation to
use "best efforts' to collect such fees, that the City has failed to meet and satisfy its obligation to
pay to Orcutt the Reimbursement Payment and therefore, the City is in breach of its obligations
under the Reimbursement Agreement.
BOSTON JACKSONVILLE MILWAUKEE SAN DIEGO TAMPA
BRUSSELS LOS ANGELES NEW YORK SAN FRANCISCO TOKYO
CHICAGO MADISON ORLANDO SILICON VALLEY WASHINGTON, D.C.
DETROIT MIAMI SACRAMENTO TALLAHASSEE
4812-8798-7293.1
FOLEY
FOLEY & LARDNER LLP
February 15, 2018
Page 2
Demand is hereby made for the City to fully and completely perform its obligations
under the Reimbursement Agreement. If the City fails to do so, then Orcutt will have no alternative
but to pursue all of its legal rights and remedies pursuant to the Reimbursement Agreement and
under applicable law.
Sincerely.
keT1jLU11 n A.. orris
BJM:vlg
M. Jon Ansolabehere, Assistant City Attorney
Diane Dostalek, Senior Civil Engineer
Michael E. Delehunt, Esq.
Van A. Tengberg, Esq.
Mr. James Murar
Mr. Randall Jenson
Mr. Nathan Birchall
4812-8798-7293.1