Lady Creek Water System Annual Members’ Meeting April 16, 2018 Welcome! Please sign in at the entrance table Take a copy of last year’s minutes, financial statements, and bylaws if you need them The materials are also on our website The minutes will not be read aloud during the meeting. 1

Objectives of Annual Meeting Inform and educate the membership about the water system Review recent activities & accomplishments Present plans for current year and beyond Answer your questions Feel free to ask as we go, or at end of meeting If you wish to make a statement or ask a question, please give your name and cabin location first Conduct corporate business 2

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 3

Introductions Board consists of volunteers from the membership; all are cabin owners Each Board member will introduce themselves Name and current position with LCWS Length of time on LCWS Board Vocation or background Cabin location Length of time with cabin 4

Introductions; Contractors Water Master, David Jacob of Hydra Engineering (9 years) Executive Secretary, Marilyn and Eric Peterson of Mountain Quail Business Services (6 years)

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 6

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 7

Mission Statement The mission of Lady Creek Water System is to provide clean, safe water service to the member cabins on a consistent and reliable basis at a reasonable cost. 8

2017 President’s Report Replaced Zig Zag River mainline bridge (Road 35) damaged during December 2015 wind storm We repaired some of the damage at the headworks caused by storms last winter Lightening strike knocked out some components Other items damaged by wind We found 28 leaks representing a potential of 138 gallons per minute (gpm) water loss We had sound financial performance again and lowered dues for 2017 9

Operating Objectives Reliability Goal: Water available to members at all times except for planned shutdown days due to major repairs or upgrades. Results: 0 system-wide days w/o water in 2017; Storage tank was never empty. No system- wide outages since May 2008. However, other limited and localized outages are occasionally experienced. 11

Operating Objectives Reasonable Cost Goal: Keep costs of water service reasonable; use members’ money wisely. Complete transparency with funds raised for capital improvements. History: We have significantly reduced annual member dues and operating costs of LCWS. Capital assessments are tracked separately and all use of funds is reported to the membership each year. 12

Operating Objectives Reasonable costs 13

Key Operating Statistics 2017 2008 Total gallons (000’s) 9,625 22,228 Minimum water flow (gpm) 6 18 Unplanned days w/o water 0 10 Test failures 0 0 Water leaks located (gpm) 138 54 14

Recap of 2017 Replaced Zig Zag River mainline crossing bridge and restored full service to Road 35 members Repaired components damaged at headworks Found & eliminated leaks representing 128 gpm of potential water loss Financial results better than budget Any questions about 2016? 16

Future Plans Continue to make system improvements Prepare project plans to submit to USFS Replace remaining old mainlines Plan for fourth well at headworks Eliminate problem service lines & connections Keep costs low Keep water flowing consistently Continue to operate in a business like manner

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 18

Water Master David Jacob David has been Water Master of LCWS since March 2008 During his stewardship, we have dramatically improved our system Chronic out-of-service conditions eliminated Water flows dramatically reduced Mainline replacement program re-invigorated All system improvements done to proper standards In March 2017, David was awarded Water Operator of the Year by Oregon Association of Water Utilities 19

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 20

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 21

Capital Planning 2016 recap of actual spending vs budget Proposal for 2018-2020 system improvements 22

2018 – 2020 Rolling Capital Plan Board of Directors recommends approval of the following: Approve 2 more years (2019-2020) capital assessment of $140 per member per year (already approved 2017-2018) Approve the list of projects as presented in the rolling 2018-2020 capital plan 23

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 24

Election of Directors The Board of Directors consists of 7 members, each serving a three-year term on a staggered basis. Currently, we have one unfilled position (vacancy). Every year, some board terms expire and an open election is held to fill the vacancies. This year 3 terms expire, plus we have a vacant position. Nominations are now open: 25

Election of Directors Introduction of any new nominees: Name Cabin location and years ownership Background/vocation Prior service on LCWS Board? Reason(s) for wanting to serve on Board Election of Directors 26

Agenda Welcome and introductions Approval of 2017 Annual Meeting minutes President’s report Water Master’s report 2017 Financial report and 2018 operating budget Capital Improvements Plan Election of Directors to the Board Question and answer session 27