Palomino Lakes Mutual Water Company

Annual Meeting Minutes

· May 15, 2010

· 11:00 AM

· Directors

· Howard Blake (present)

· Rick Corriea (present)

· Lee Tolbert (present))

· Financials (as of 4/1/10):

On hand $3,721.23

Capital Improvement $37,748.81

Well Contingency $27,914.02

Reserve $25,000.00

· President’s Report:

· Andy Grose was introduced as Supervisor of Elections. Association members were invited to observe as Mr. Grose then proceeded to open and count ballots at a table to one side of the room

· President Blake presented a list of planned improvement projects and briefly discussed the need and priority of each project.

· The lack of progress on a new well was discussed. After more than six years of ongoing effort, the company has been unable to reach agreement with the property owner and we are no closer than when we started. The potential of expensive, protracted legal actions was discussed. No final decisions have been made.

· Vice-President’s Report:

· Vice-President Tolbert reported that water quality testing requirements have been increased and that we will be required to do a good deal more water testing.

· Treasurer’s Report:

· Treasurer Corriea reviewed the Company’s 2010/2011 budget and presented the 2009/2010 financial statement. The Company is solvent, paying its bills and has an adequate contingency fund. Last summer the Company was forced to reduce operations spending and delay planned maintenance because of last year’s drought and water restrictions. Residents reduced water consumption by 40% last summer and the Company’s income fell proportionally. Funds had to be transferred from the capital projects account to make up for the short fall in operations revenue. The Company anticipates an increase in revenue this year as no water restrictions are anticipated but it is entirely possible that any increase will be modest and may not completely cover expenses.

· Election Results:

· Supervisor of Elections Grose announced the results of the election:

· Howard Blake, Rick Corriea and Lee Tolbert were elected.

· Adjournment:

· The meeting was adjourned at approximately 12:00 PM.