HEARST corporation VIA EMAIL September 71, 2020 Charlie Grace Kerry O'Toole San Simeon Community Services District Land & Rasnre Manes 111 Pico Avenue Whstorm Proportice San Simeon, CA 93452 Dear Charlie, Ithas recently come to the attention of the Hearst Holdings, Inc. that the RO facility constructed by San Simeon Community Services District (SSCSD) in 2016 was partially built on two parcels owned by Hearst Holdings, Inc, Attached please find a survey analysis that confirms such encroachment, Although SSCSD stayed within the existing fenceline between Hearst and SSCSD properties, it is clear from the attached survey that such fenecline does not represent the boundary line betweon Hearst and SSCSD properties. Hearst never would have allowed such encroachment, and we ure shocked that SSCSD constructed the building without a boundary survey As youare aware, the Hearst-owned parcels on which the RO facility was built are encumbered by a Conservation Easement, held by Califomia Rangeland Trust (CRT). ‘Therefore, any resolution to SSCSD's encroachment must be approved by CRT, including any proposed long term resolution that would allow the building to remain in its existing location. While Hearst, SSCSD and CRT work through this issue, Hearst is willing to grant to SSCSD a revocable encroachment license on the terms and conditions of the attached License Agreement. Such agreement would remain in place until terminated as provided in the attached I icense Agreement. As Thave notified you, all expenses borne by Hearst and CRT in resolving $SCSD’s encroachment must be reimbursed by SSCSD as provided in the attached License Agreement. Please review the attached License Agreement and let me know if you have any questions. Thank you, lou Dike Kerry O'Toole Land and Resource Program Manager cc: SSCSD Board of Directors Steve Hearst Michael Delbar Russell Austin Ben Higgins