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SLO tale of falsified documents, code violations and water theft

August 13, 2015
John Belsher and Ryan Petetit

John Belsher and Ryan Petetit

By KAREN VELIE

Editor’s note: This is the second in an exclusive series about developers Ryan Petetit and John Belsher, their development projects, their failures to abide by building requirements, legal troubles, and unpaid monies owed to subcontractors and investors. Read part one here.

Two San Luis Obispo-based developers find it easy to obtain building permits, as well as what appear to be special favors, from city staff and officials – despite falsifying contractor license numbers, disabling water meters and violating a variety of building codes.

John Belsher, 61, and Ryan Petetit, 28, principals of PB Companies, are involved in more than a dozen proposed projects that once completed, they say, will be be worth more than $300 million. Belsher and Petetit have worked together for more than three years, but PB Companies have yet to finish construction of any of its residential or commercial structures.

One example of development issues plaguing the pair is renovation of a single-family residence at 1179 San Carlos Drive in San Luis Obispo that turned into the demolition of the home and a plan to build a new house at the address.

In 2011, Petetit purchased the home with funds from multiple sources. Several investors said the developers claimed they were remodeling the home, with plans to sell it in about six months.

However, Rush Sheppel, a partner in several PB Company projects and an investor in the San Carlos Drive property, said the developers told him their plans were to construct a home for Petetit to occupy. After a new home would be constructed on the lot, Petetit would get a mortgage to pay back the investors, Sheppel said.

In mid-2011, Petetit began applying for permits for an extensive remodel under a contractor’s license number belonging to HJ Construction. After city inspectors became aware of multiple code violations, they contacted HJ Construction President Dominic Judge, who said he had never worked on, or even bid to work on, the project.

“I am not affiliated with or working on the remodel,” Judge said in a April 3, 2012, letter to the city.

After receiving multiple citations for violating water drainage requirements, in July 2012, the city suspended Petetit’s building permits. In Sept. 2013, Petetit paid his outstanding fees and fines, and his permit was reinstated.

In Jan. 2014, Petetit demolished the home. Following the demolition, the city slapped him with several notices of violation and an administrative citation, according to superior court records.

Several of the investors filed three foreclosures on the property for a total of approximately $200,000, according to property records.

On Oct. 14, 2014, the city of San Luis Obispo filed a claim for injunctive relief because of Petetit’s repeated code violations and because the property had become a public nuisance, according to court documents. The city’s claim referred to 17 notices of violation, two permit suspensions and eight field corrections.

On Nov. 18, 2014, the city entered into an agreement with Petetit in which the city agreed to lower his fines from $14,700 to $1,500, and Petetit agreed to diligently pursue construction of the residence, according to the contract.

Since then, the property has remained essentially untouched.

On June 23, Assistant City Attorney Jon Ansolabehere sent a letter to Belsher saying that Petetit had failed to comply with his part of the agreement to begin construction and that the city would no longer stand by its agreement.

In addition, Ansolabehere noted that Petetit tampered with a water meter in order to steal water.

“The city’s investigation revealed that the city water meter had been altered and water had been illegally consumed in violation of San Luis Obispo Municipal Code sections 13.04.070 and 13.04.150,” the letter says.

In May of this year, just days before a scheduled foreclosure sale, Petetit paid several disgruntled investors and was able to curtail the foreclosure, according to property records.

Even though planning documents are public records, planning staff reported that City Attorney Christine Dietrick has ordered them not to disclose Petetit’s notices of violations and agreements.

A neighbor who lives across the street from the project, Terry Mohan, said that he has been told that the city has negotiated another deal with Belsher to give Petetit another chance to build his home, though the city has refused to release the document.

“Now we find out some back room deal at city hall negotiated by John Belsher is giving Petetit yet another chance to torment the neighborhood,” Mohan said. “This smacks of political cronyism at least, and perhaps corruption and political payback at worst.”

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Within an hour of this article posting the city released a copy of the new agreement to the neighborhood. Now we can monitor whether Petetit is complying with the agreement.


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How many real estate scams will people fall for on the central coast? Here is an idea. If you can’t afford to purchase propert on your own, stay out of it.


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Yeah, but 25% return is great and the guy guaranteed it, plus he talks a good game and says all the right things. Even though it is my life savings and would mean I would have no retirement if it was lost, he swears that won’t happen, and wasn’t he citizen of the month day pr something????? Here have all my money…..


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Two excellent candidates for citizen of year.


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Such the pair, the self proclaimed wolf of San Luis County development and a liar. So they take investor money and never produce a project? So they hire consultants and pay them at their whim? Then the reality check, do they know what they are doing or not? I believe they do, always screw up the projects and have code compliance issues, thus project delays because of the agency, then it truly isn’t your fault, go back to the investors for more money because of the delays caused by the agency, put more money from the investors into your pocket = sly like a fox? Is this, what is going on here or are they simply victims of various agencies out to get them?


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If I was a pile of crap for a person (aka developer), I would steal as much as possible (remember: developers never use their own money) then cut as many corners as possible – so obvious that even a city employee would notice. Then get the big list of fines (about the only thing the city is competent at). Then pass that big list of fines, while blaming agency BS on it (there’s enough government BS out there that who would doubt it?). So you tell the investors, “Oh, we’re so close – this damn $15K bill from the city is holding us up!” Then get the $14.7K, meanwhile, bribing your whores to lower the fine to $1500, which they’re such cheap whores, that’s good enough, and you now have $13.2K to pocket.


Rinse. Repeat. Multiply that for each “project” and you can steal a good amount before having to flee.


But this is just me being a pessimist. I’m sure all the people involved are morally upstanding folks who deserve all that they work so hard to earn.


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Great article Karen. Keep up the pressure and maybe we will be able to rid our community of at least these two undesirables. Then we can go after their cohorts in SLO government.


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There seems to be a LOT of corruption going around SLO County. Take advise from the activists in the South County…you can clean up your government, but it takes the “village” to keep an eye on the chiefs!


As proven with the Arroyo Grande Mayor write in campaign, the people can make a difference! My advise is to not just complain and write about it here on CNN, but to organize yourselves and start taking action! This means you will need to read agendas, attend meetings and, most important, speak up.


It is not an overnight change, but the corrupt actions have been going on for too many years. It is time to put a stop to it. They are robbing from the people, and the people need to make it known that they are aware of this.


Don’t be afraid to challenge the government officials. Find leaders who agree with you and ask for their help. Help get HONEST people elected. That means campaigning for the good ones. It is a good feeling when you see results of your actions, and know that the future seems a bit brighter.


Good luck to you, city of SLO. And, all of us in the county need to work at that level as well, starting with honest County Supervisors.


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Only problem is SLO aint’ AG. Here people are asleep, lulled into slumber by their eternal “happiness” and indifferent — those are the 30% who own property and should care — and the other 70% don’t care because they’re transients. Or something like that. We SHOULD be able to do what you suggest, but somehow can’t seem to get it together. There are maybe 100 people out of 45,000 who actually care enough to try to change things.


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All planning and building regulations in SLO are enforced (if at all) on a sliding scale based on who you are and who you know. I have a little list…


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It is the City if SLO and obviously they think they don’t have to follow the rules they made for everyone else. Let’s see, Dietrich – City Attorney, Jon Ansolabehere – Assistant City Attorney, Jan Marx – Mayor (Attorney by profession), and they pull this crap.


Isn’t Jan Marx the one that worked for Copeland Brothers when the had all that debacle with Ernie Dalidio and his attempts to develop his San Luis Obispo property, you know, that one that developer Grossman now owns and is developing. The same Mr. Grossman who has contributed $50,000 to Dee Torres’s new homeless outlaw corral, also contributed to Adam Hill campaign as well as to the City of SLO sales tax initative, and Jan Marx’s campaig.


Just follow the money, these two bozos will be making a big campaign contribution to someone in SLO, that is how they play their game.


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Why didn’t Marx go to prison for her shenanigans?


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The Copeland’s (and Madonna – remember when Target was going to go on the Dalidio located on Madonna Rd and ends up on Madonna’s site on LOVR) and the local banker, Dave Booker protected here and her reward = she is Mayor of SLO… Great world we live in!


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Because she did nothing criminal.


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Don’t forget Grossman was also a big contributor to former Supervisor Caren Ray’s campaign.


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It’s simple, Always follow the money. Anyone doing business in San Luis (and most of America) has learned you can openly bribe officials at city hall, all the way to top politicians. Since bribes are illegal, you “donate” to election campaigns to buy what you need as Mr Grossman has done. A political shopping cart. Ernie Dalido tried to develop without “donating” and was shut down repeatedly. As soon as Grossman made it rain $ on council members they all became lap dancers. Attorney Christine Dietrick needs to be called out on her illegal proclamation to aid these crooks in fleecing investors. Clearly, the Fibune never reports local political corruption, so we can only hope CCN continues the battle like they did in AG, maybe sue for the paper trail Christine Dietrick is trying to cover up.


BTW, did AG Community Development Director Teresa McClish end up keeping her job? If so I’m sure she’s due for a raise.


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Grossman has outed himself in another publication as a gay developer. You’d be surprised how much that works in his favor in SLO!! He immediately becomes a cute underdog, even though the reality is he’s a bazillionaire developer with questionable ethics.


But there’s another reason. Dalidio wasn’t very smart — he had many, many opportunities to develop over the years, but always shot himself in the foot at the last minute. When he finally agreed to a development scheme with the city and secretly got it inserted into the general plan, then he came back and instead of doing what he agreed to do, decided he wanted more. That led to the city ballot measure.


Grossman came in and offered something that more or less conforms to the general plan.


All you conspiracy critics of the situation always forget to mention these important facts.


Anyway, Dalidio did quite well. He inherited the land, and sold it for almost $20 million. Hard to feel sorry for him. He got his.


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Your facts are misspoken . The land was in the County, County approves site but Ernie had to get City approval for water and sewer. City says, too much development, reduce commercial, add a few more houses, and a big organic farm so something in that order. City (Copeland/Madonna) did not want that much commercial development by Ernie. Copeland’s only had to pay a $80,000 FFCCP fine. Ernie did not want to pay the bribes and he paid the price, bottom line!


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Thanks Karen for getting this story out. I wonder if your next story will be their Grand Avenue grandstanding?


The city doesn’t treat all equally. In this case, it’s clear that Belsher, a big-time development attorney, and Dietrick are doing some behind the scenes private give and take. The reduction of the fine to an insignificant level is typical of SLO city hall: carry a big stick, wave it in the air, then put it back in the cupboard. By the time you get a fine down to $1500, it’s nothing more than a minor cost of doing business. It’s wink and nod — attorney Dietrick gets her prosecution, developer gets away with whatever they did with next to no punishment, ready to do the same thing a few more times. We see this corrupt practice all the time in SLO. Now, if somebody dirty and smelly smoked a joint in front of city hall . . . How do you suppose that would turn out?


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“planning documents are public record, planning staff said that Attorney Christine Dietrick has ordered them not to disclose notices of violations and agreements”…


HOW THE HELL DOES THE MOST INCOMPETENT CITY ATTORNEY IN THE COUNTY, DIETRICH, GET AWAY WITH SUPRESSING PUBLIC RECORDS!!!


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That’s what they keep giving her pay raises every year to do. Blame the city council — they hire her, and are supposed to tell HER what to do, but instead they let her tell THEM what to do. This air-headed rubber-stamp council is why the city’s so corrupt. They don’t even know who’s supposed to be in charge. Recall anybody?


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Its simple and as old as money. Will you do this? No, it’s illegal. What if I donate $50.000. The end.


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Anyone here ever had a “run-in” with John Belsher or received a threatening letter from him? In the realm of attorneys, he is known as a bulldog; i.e., stubborn, unrelenting, ability to fight, and determined with stubborn tenacity. In other words…Attorney Belsher pushes and shoves until he gets his way. Quite obviously, Harry, he has worked out a coverup deal with SLO City Attorney Christine Dietrick!


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Must be why Dan Duvall used him !


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A man’s gotta do what a man gotta do if you want to exist in the County and especially in SLO.


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It sounded like you were describing Tacker and Rice!


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@HarryMalone. I am wondering the same thing! Now I’m curious about what they are hiding. Hopefully CCN will request the records under the Freedom of Information Act.


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