Discussion and possible action on any and all matters regarding a third amendment to the Operating Agreement with LaSalle Corrections to clarify payments of the City of San Luis License Fee, and variable fees for the City of San Luis and LaSalle corrections before, during and after the forbearance periods. (Kay Marion Macuil, General Counsel)

Background 
The Operating and Management Agreement with LaSalle Corrections has an expiration date of November 30, 2024.

On  September 3, the Board passed a first amendment, which LaSalle never signed.

On September 19, 2024, the Board passed a Second Amendment, which LaSalle Corrections had signed the day before.  The Second Amendment extended the Agreement indefinitely but allows for termination upon 75 days' notice.

This Third Amendment to the Agreement preserves the indefinite extension of the Second Amendment with termination upon 75 days' notice to the other party. 

Purpose of the Third Amendment
This Third Amendment clarifies the payments before the forbearance periods, during the September 2024 forbearance, during the May 2025 forbearance, and after the May 2025 forbearance ends.

The Third Amendment spells out, in Sections 5 and 6, the payments affected by the forbearance periods, specifically:

• The City of San Luis License Fee,
• LaSalle's Variable Incentive Fee, and
• The City of San Luis Variable Business License Fee.

The above fees that accrued prior to the September 1, 2024, forbearance remain owing, except for the City of San Luis Variable Business License Fee, which is discharged through this 3rd Amendment. This fee comes at the bottom of the waterfall, right before the last payment to the surplus account. None of the fees accrue duing the forbearance periods.  Once the forbearance terminates, all the fees will resume, either payable or accruing, depending on the revenues generated. 

It is hoped this amendment will help the Parties and the Trustee accurately calculate these payments going forward.