A settlement agreement has cleared the pending litigation involving the Life Foundation Building, enabling Monterey County to complete its long-planned acquisition of its Department of Social Services’ headquarters on South Main Street in Salinas.
County officials announced Wednesday that the agreement settles legal disputes between the Life Foundation Monterey LLC, affiliate entities and founder Barnett Davis II. The resolution concludes a lawsuit filed by the county in October 2024 over litigation related to the building’s finances, lease obligations and control of reserve accounts.
The Life Foundation Building has housed the Monterey County Department of Social Services for nearly 40 years, standing as a primary service center for programs such as CalFresh, CalWORKs, Medi-Cal, In-Home Supportive Services and Aging and Adult Services. More than 550 county employees work at the site, which serves thousands of residents annually.
How the legal dispute began
Due to its deep operational commitments in the property, the county has had tentative plans to buy the building for almost two decades, since a 2007 lease granted Monterey County an option to purchase the building in 2026.
However, conflict surfaced in October 2024, when Monterey County filed a lawsuit against The Life Foundation Monterey LLC, temporarily threatening the county’s acquisition of the building.
The dispute expanded to include allegations over lease obligations and building finances, ultimately leading to the appointment of a court-appointed receiver, who took temporary control over the property’s finances, and nearly two years of litigation before a settlement was reached this month.
Transfer of ownership to Monterey County
According to the settlement agreement, the county will place $7 million into escrow to acquire the 102,000-square-foot building and surrounding parking areas. An additional $890,000 from restricted funds controlled by the Life Foundation will be used to retire the remaining bond balance on the property. The agreement also requires an $800,000 payment to the county following the close of escrow.
The transfer is expected to occur on or about July 1 and will be overseen by the court-appointed receiver.
County officials said the agreement serves taxpayers by preserving the county’s contractual right to purchase the property while avoiding the costs and uncertainty of continued court proceedings.
“The agreement protects the county’s legal interests, secures a valuable public asset, resolves longstanding financial and operational issues, and provides certainty for the future delivery of essential services to Monterey County residents,” Deputy County Counsel Henry Bluestone Smith said in a statement.
The settlement also transfers building reserve and operating accounts currently under receivership to county control, providing funding for future maintenance and capital improvements.
With the settlement in place, the county is set to secure the Department of Social Services building as a permanent county-owned facility.
County officials said ownership of the facility will provide long-term stability for public services while preserving a major employment center in South Salinas.