The meeting was called to order by Mike Deck at 4:05 PM. Those in attendance were board members (Mark Johns, Nick Bennett, Rick Moeller and Bob Champ) and Water System Operators Dick Winters and Frank Hauke. Mary Wagner (Bookkeeper), Dick Lyons (legal) and Terry Kenyon (Engineering) were present. No members of the public were present.

The minutes of the 9 August 2004 minutes were discussed. It was decided to explore an agreement with Baseline Water District whereby our operator (Dick Winters) would backup their operator (Daryl Sartin) in emergency situations this agreement would be reciprocal. Mark Johns will investigate this matter and see if it can be done. Mark Johns made the motion that we approve the minutes of the 9 August 2004 meeting. Rick Moeller seconded the motion, which passed unanimously.

Mary Wagner e-mailed the Profit and Loss YTD Comparison, Profit and Loss by Fund, Balance Sheet, Profit and Loss Budget vs. Actual and the checking transaction report to the board. We have not yet invested in the CDs with Heritage Bank. Mark will make the investment in the next month. The arrangement for paying Terry was discussed. Terry will separate work on the storage tank from the work involved with the County Requirements. Overall, nothing out of the ordinary was noted with the financials.

Late and non payment of water bills were discussed. Dick Lyons noted that the lien on property for unpaid water bills is perpetual and we will not lose any rights by letting interest accrue and not taking out a lien on the property immediately. It was decided to amass the debt on unpaid bills and accrue interest. The lien will occur on sale of the property or when we so decide.

• We put in 3.5 hrs monitoring and 5.5 hrs maintaining the system from August 3 through September 6, 2004.

• Took water sample for E-Coli lab test from fire hydrant at 510 Ponderosa Drive. We also flushed and maintained the fire hydrant per procedure. Chlorine measured 0.05 mg/l. Sample passed. Water initially showed no chlorine, we had to flush the hydrant about 10 minutes to get some chlorine in the water.

• Read meters on 8-31-2004.

• Worked with Mike’s Backhoe in capping well #3 output pipe and modifying meter pit at 7233 Spring Court.

• Three meter covers are broken, one pit has a broken bonnet and two pits need trimming of vegetation.

• Meter pit at 11 Bench Mark is sill full of water. We think the water is coming from a spring.

• Mike’s Backhoe installed a pit and meter at 777 Skyway Drive (Lot 60 in Panorama Park).

It was decided to replace two meter covers at our cost. Cost is about $11 each. A meter cover located in a driveway will not be replaced because it is thought that it will just get broken again and functionality is not affected.

The meter pit at 11 Benchmark was discussed and it was decided to just watch it in the future, as it appears to be drying up at this time.

It was also decided to flush the fire hydrant at the end of our line on Pondersoa every quarter to ensure satisfactory chlorine levels.

It was also decided to go off the standby fee when the meter is noted on (by virtue of noting a positive usage of water).

Unfinished Business:

Banking Resolution (Heritage Bank):

Previously discussed under finance. The investment in CDs will be made as noted previously.

Legal (Lot 4 Land Use Issues):

Mike reviewed the history of and the current situation on Lot 4. The county suggested to Arnold Turner (Vectra Bank) that quit claim deeding and subsequent easements would solve the problem. This turned out to be erroneous in that there can be only one primary use per lot and the pumphouse/water storage is a primary use. Therefore, this renders the remaining portion of the lot unbuildable. The approach that will be used to satisfy the county requirements will be to create two non-contiguous outlots (one the exact perimeter of the pumphouse and the other the exact perimeter of the storage tank). The existing easements will remain for all the pipes and pathways. This approach will not affect Lot 3, which then can become an easement only via a quit claim deed/ easement switch.

Terry will fill out the paper work with the drawing for the Exemption Plat process and it will be submitted to the county. We will pay the necessary expenses involved with creating the outlots (surveying and legal fees).

An agreement with the Chintallapallys will have to be effected. This agreement will then allow them to sign the Location and Extent Review Application. They will ultimately own the outlot and give to us an easement for the pumphouse/Storage Tank along with the existing easements on their buildable lot. We have an agreement in place for them to sign. The only question in the agreement is the amount we will pay for their legal fees. Nick Bennett made the motion that we allow the president (Mike Deck) or the vice president (Rick Moeller) to sign the final contract with the Chintallapallys with legal fees of $3000, not to exceed $5000, and included in the contract will be the Exemption Plat paperwork and drawings. Mark Johns seconded the motion, which passed unanimously.

Mike noted that he has reviewed the tax liabilities on outlots for some of the outlots in Boulder County and there is no tax liability for the outlots.

Terry will meet with Frank and Dick next week to review particulars regarding the storage tank.

Also, we will separate the Landscaping for lot 4 out of the bidding for construction and handle it as a separate matter. The bidding process was discussed and it was decided that this process could begin after the exemption plat process and the Building lot determination was finalized.

New Business:

Budget 2005: Appointment of Budget Officer, review of calendar

Mike noted that we should appoint a Budget Officer who would be responsible for presenting a proposed budget to the board at the October 11, 2004 meeting. A budget hearing would then be held at the November regular meeting and a final budget would be filed with the county after the final mil levy is calculated. This must be done by 15 December 2004. Bob Champ made the motion that we nominate Nick Bennett as the Budget Officer. Rick Moeller seconded the motion, which passed unanimously.

Water usage patterns: analysis and recommendations for rate setting

Nick Bennett had assembled for the Board 3 packets, which incorporated the usage patterns of the District and water rate models. Water rates are our only means of generating revenue for operating the district. These packets were discussed in some detail with respect to the three proposed rate models. All of the models increased cost exponentially with increasing water usage. It was decided the board should review the packets and try to determine what the philosophy of the Board should be. The matter was then tabled for discussion at the next meeting.

A motion was made to adjourn by Nick Bennett, seconded by Mark Johns and unanimously approved. The meeting was adjourned at 7:00 PM.

The above is respectfully submitted by the secretary…Bob Champ, September 14, 2004.