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Pismo Beach won't pay LAFCO legal fees

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The City of Pismo said ‘No’ to the San Luis Obispo Local Agency Formation Commission’s (LAFCO) request to reimburse them for legal fees accrued in a battle against land developers.

Developers of a now-defunct project calling for the construction of 250 homes and 60 senior apartments filed suit against LAFCO on May 8.

The project, Los Robles del Mar, first attempted to break ground in 1987, shortly after 154 acres of land was purchased just east of the city. Construction has been stymied by LAFCO, a California state governmental agency that oversees city boundary expansions.

LAFCO denied the developer’s requests to be annexed into the city twice, citing an inadequate and potentially unsustainable water supply as the primary hindrance. According to the lawsuit, LAFCO told the developer to secure “state water project water” in order to get approval. The lawsuit alleges that project backers then spent more than $3.5 million to obtain the water as requested, only to have LAFCO deny them again.

Larry Persons is the developer behind LRDM; he’s also one of three people to own the land in question. Persons told New Times LAFCO “violated due process” when they made the decision to deny the project. According to Persons, city engineers and LAFCO’s own experts said there was sufficient water to support the project.

Pismo Beach City Attorney David Fleishman did not return requests for comment as of press time.

Last summer, Pismo Beach submitted an application for the land to be annexed to city. At that time, city reps signed an agreement holding themselves accountable for lawsuits brought against LAFCO.

“The city signed an agreement saying they would pay any cost associated with a lawsuit,” LAFCO Executive Officer David Church told New Times. He added it was a standard agreement they have everyone sign when they come in the door.

When asked if $21,000 was an accurate estimate of costs associated with the lawsuit, Church said: “Yes—and the expenses continue to increase.” When New Times asked Persons the same question, he responded, “I’m much higher than that.”

The lawsuit asks LAFCO to “rescind, nullify and void” their decision to deny annexation of the property. In addition, the developers are seeking damages arising from LAFCO’s alleged violation of due process and equal protection rights under the Fourteenth Amendment.

Persons told New Times he believes the case will move ahead in late November.

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