2-24-18 Treasurer Report

Agenda items Funds on hand (Bank Balances) Bills paid Legal costs IRS Trail cost clarification Efforts on collection of dues Reserve study Insurance

Bank Balances Checking- $33,508.30 Reserves- $39,824.50 Total- $73,332.80 Bonds- $73,506.48 Reduction of $13,871.11 Available from Bonds to transfer not yet determined but believe approximately $20,000 is available to pay back in to reserve account.

Bills paid Compromised (not to be disclosed) settlement to Sal Culcasi to settle claim This was a financial decision to avoid higher insurance costs and a significant reduction of claim amount. $3,320.00 legal bill on 2-7-18 $3,963.75 total for 2015/2016 review and sync accounting and Sync with Larry Johnson final accounting. Normal Operational expenses ( Office Manager salary, office supplies, office phone bills)

Current Legal Costs Majority of Costs are associated defense of Labor dept investigation Zero cost having anything to do with trails. No negotiations as accused by a member nor has any advice been solicited or given this board on trail issue ALL Trail issue costs from legal were from previous board PRIOR to election. No advise has been requested, offered on ANY issues dealing with trails since election

IRS Visit/ Taxes All back taxes are now up to date for 1st time since 2014 Penalties are paid and up to date IRS has sent an additional bill for $721.93 for payroll taxes from 3-31-2017 but on further investigation, determined it was part of what we paid on 1-16-18 and are current. IRS informed us it will take up to 8 weeks to reconcile and currently have a credit of $1,112.51 that will apply to the outstanding bill/penalty. We are now in good standing with State ,IRS on Payroll taxes, Income taxes, Workers Comp Insurance and Past Due Penalties Form 2848 discussed in last months meting as required by IRS has been completed and received by IRS in order to release rest of information needed. 1099’s from 2014 and 2015 are still in question and will clarify on next IRS visit

1099’s Filed for 2017 John Howland $4,041.43 for Architectural reviews and “Contract work for John Sperry trail” ( explanation on later slides) Some adjustment needed on a reimbursement that showed as a payment Hannah Clayborn $625. - $225 for research documents requested by Anne Vernon, then $400 for “email research” Mark Mann Excavation $23,731.75 for Culvert repair and Tree work on Lee drive

1099 Clarification December report listed $1800 to John Howland for “Contract work on John Sperry Trail This was disputed as a reimbursement 1-29-18 Sue Ellen provided time sheets for 3 workers paid that prompted reimbursement ( final cutoff for filing 1099’s was 1-31-18) All 3 were for $600 each which require W-9’s and 1099’s sent to IRS No W-9 information was sent on these 3 workers to enable HOA to pay them directly and submit proper forms per Federal Tax Law and since the HOA did not pay workers directly so 1099 was issued to recipient as required by law

Trails continued 2 other workers had filled out W-9’s. One was $400 payment, one $320 where HOA cut checks to pay them. Time sheets provided to HOA for the 3 worked paid $600 each were not signed Lack of W-9 information required to pay workers directly from HOA created the need to send 1099 to John due to the payment and receipt showing payment for “Contract Work on John Sperry Trail” CPA advised us this was proper action by law as 1099’s needed to be submitted

Dues collection update 3 properties significantly behind Current dues have been mailed out As stated earlier, one not collectable and property abandoned. 2 others being billed for delinquent dues Timber Cove Road property behind approximately $6,800 we have found correspondence on November 10, 2016 from the Former HOA president stating he represented the new owners and was assisting them in securing water hook up. The office Manager at that time reminded him they owed money to TCHA as well as water board and had fire abatement violations. We asked him for contact their contact information but he would not provide it John Gray was able to find contact information from surveyor after learning of a survey to find common access to property and PUE.

RESERVE STUDY Dues currently being billed and mailed out We expect approximately $90,000 in revenue based on who has been paying on time Additional assessment is likely to get us to minimum funding Board will work to keep cost to a minimum CPA will be completing reserve study soon to determine shortfall Most Road work will likely be postponed until funding is back to appropriate levels.

Insurance History 3-17-15 Insurance was canceled for failure to renew HOA president at the time found new insurance at a better price but we had lapsed for what appears to be approx. 4 months. We got lucky Policy for 7-15-16 to 7-15-17 This insurer sent notice of non renewal in May of 2017 after HOA unsuccessfully attempted to use legal council to force them to pay Brian Todd’s legal bill. Insurance obtained 7-15-17 was then canceled for signed application with multiple mis statements in December 2017 New insurance obtained 12-29-17 at a cost over 2 times last policy and specific restrictions. Insurer excluded certain members from coverage if they were to join board, and requires we post trails not maintained by HOA. Trails were NOT required to be closed , simply inform all that they are not currently being maintained by HOA

Request from Member at last meeting One member raised a question about 2015 insurance and stated there was no lapse and demanded proof of cancelation of insurance Some debate between a couple members transpired Previous insurer provided the cancelation letter sent on March 17, 2015. Attached next slide