RECORD OF PROCEEDINGS

MINUTES OF A REGULAR MEETING OF THE BOARD OF DIRECTORS OF

ST. MARY’S GLACIER WATER AND SANITATION DISTRICT

Held: Monday, May 14, 2007 at 6:00 pm at the Alice School House, Silver Creek Road, Idaho Springs, CO.

ATTENDANCE: A regular meeting of the Board of Directors of the St. Mary’s Glacier Water and Sanitation District, Clear Creek County, CO, was called and held as shown above and in accordance with the applicable statutes of the State of Colorado, with the following directors present and acting:

Paul Johnson

John Wood

C.J. Galbraith

John Pacetta

Also in attendance: Fred Huff, District Counsel, Carmen Barker, District Bookkeeper, Jack Barker of AAA, District Manager, Mike Lutz of Integra Engineering, and members of the public.

CALL TO ORDER: John Pacetta called the meeting to order at 6:00 pm.

APPROVAL OF MINUTES: Minutes for March 2007 were approved as submitted. As the date for the April meeting was incorrectly posted, the following actions taken on April 9, 2007 are hereby motioned: Ratification of payment of invoices in the amount of $28,611.07 and transfer of $20,000 from the Peak Money Operating Account to Peak Money Market account. Unanimously passed. Ratification of authorization of Bart Productions to do a photo shoot on the lakes (re Colorado Chamber of Tourism), and donate the proceeds to the POA. Fred Huff will confirm that all insurance documentation is in order. Motioned and unanimously approved.

FINANCIALS: The Board moved and unanimously approved unpaid invoices in the amount of $33,075.10. The Board also moved and unanimously approved transfer of $10,000 to the Peak Money Market Account from the Peak Operating Account.

MANAGER’S REPORT The Manager’s Report indicated that water main leaks on Alice Road and Crest Drive will be fixed as soon as weather permits. About 40 hours of additional work needs to be completed on PRV valves.

PUBLIC MATTERS A general discussion of the overall state of the District’s water and sanitation lines, and fiscal options, was discussed at length, with Mike Lutz, District Engineer providing technical information and Fred Huff, Counsel for the District providing information re bond options to finance capital improvements. An estimate of several years ago, regarding replacing the District’s water mains, came in around $2 million; today Mr. Lutz estimated that number would be closer to $3 million. The main issue in the lines is leakage from the 35 year old rubber gaskets, which are degrading over time. Mr. Lutz and Mr. Huff both emphasized that grants such as the one that facilitated construction of the wastewater treatment plant are no longer available, due to depleted state resources. Another alternative, which would entail the voters approving a general obligation bond, would increase the annual household tax burden in the District by approximately $1800, assuming it was obtained on the same terms and conditions as current bond. There did appear to be some public interest in pursuing this as an alternative, with the thought that an improved system would attract new homeowners and increase property values. At the present time, the District policy is to upgrade lines as repairs are made; monies in the capital funds have been directed to installing the headgate at Lake Quivera (which was mandated by the state), the completion of Well # 5 and the water storage tank, which has enabled the District to bring pressure levels within the aging pipes to a more acceptable level. Additionally upgrading the PRV’s in the system has also been very effective in minimizing wear and tear on an aging system. The option of installing the automated metering system for additional water conservation was not discussed at great length due to time constraints.

Ms. Melanie Grech voiced her concern that the company that served as District Manager also kept the District books. It was explained that numerous problems have arisen in the past in having a ‘work at home’ bookkeeper try to serve the public in a timely fashion during weekdays. It should also be noted that Ms. Barker works under the close supervision of the Directors of the Board.

A few members of the public felt that prior to renewal of AAA’s contract for the upcoming year, a bid for the contract be issued (as it was done the year that AAA was initially hired). Director Pacetta indicated he had no problem with that.

OTHER MATTERS: The issue of the protruding manhole cover at Outlook Court (and from time to time elsewhere in the District) needs further review. Frederick Avery also spoke to issues of sewage leakage on his property at 94 Beaver, a long standing problem. A motion was made and unanimously passed to repair the sewer line at that location and explore issues with the water line. Another resident of the District suggested putting information on the quarterly bills about winterizing lines when households will not be occupied during the winter months.

There being no further business, meeting was adjourned at 8:30 pm.

Approved at District meeting on June 18, 2007.

C.J. Galbraith, Secretary

St. Mary’s Glacier Water and Sanitation District