Attatchment 2. ECMA Board Members. DATE: February 10, SUBJECT: Q4 Financial Summary. 12/31/15 Balance Sheet:

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3 Attatchment 2 TO: FROM: ECMA Board Members Robin Dowty DATE: February 10, 2016 SUBJECT: Q4 Financial Summary 12/31/15 Balance Sheet: The 2015 Accounts Receivable balance is $13,370. The two main accounts that have balances are EHOA in the amount of $3,380 for Q4 which was paid in January 2016 and $7, due from ECMA Rsv for an invoice that should have been reserve not operating. The $18,601 in prepaid is from Worldmark. 12/31/15 Income Statement: Facilities: The yearend forecast ending fund balance was $17,159 compared to the actual ending fund balance of $21,770 resulting in a positive variance of $4,692. Below is a quick summary of the variances of actual to forecast. Redtail Hawk Pool R&M The forecast was conservative in anticipating any unexpected repairs during the fourth quarter. The actual expenses that occurred were not as high as projected, resulting in a $4,793 positive variance. Snow Removal - The forecast was equal to budget given the fact that snow removal is impossible to predict. The year ended with a $3,390 positive variance. Insurance The percentages were split differently than forecast after contacting Crystal & Company. The insurance line in Sports Center and Water and Sewer are less than forecast and Facilities was more than forecast but consolidated premiums are very close to forecast. Director Travel, Consultants, Legal and Audit fees Director travel is in a separate line item and not combined with consultants. (CPA/Legal expenses will also be reported separately in 2016). Combined, the main reason this expense line is over forecast is due to Eagle Crest Hospitality not sending out the City Ledger billing until the end of the year. Consequently, there were director stays in the Lodge throughout the year for board meetings that we were not aware of until December and did not get into the forecast. Sports Center: The yearend forecast ending fund balance was $129,011 compared to the actual ending fund balance of $144,905 resulting in a positive variance of $14,895. Below is a summary of the variances of actual to forecast.

4 Merchandise sales exceeded forecast by $3,072. COS ended the year at 62.01% resulting in a positive variance of $11,390. COS percentage is closer to the 2014 year end actual of 59.4% compared to the 2015 forecast or budget. Repair and Maintenance Repairs and Maintenance are lower than anticipated due to expected repairs that were not completed by year end, resulting in a positive variance of $2,611. Utilities The forecast was an average of the annualized and actual figures through September 2015 and Q4 of The positive variance of $3,633 was due to the timing of the propane tank being filled. Supplies The forecast comprised of actual expenses through September 2015 and Q4 of Actual expenses were $2,116 less than forecast. Water & Sewer: The yearend forecast ending fund balance was $91,275 compared to the actual ending fund balance of $97,568 resulting in a positive variance of $6,293. There were several small variances that contributed to the positive surplus. Pumping Costs When forecasting, the actual YTD 2015 plus the actual of Q was used. The actual Q expenses were $1,218 higher than Q4 2014, causing the negative variance. All other expenses were at or below forecast. Reserves: Please see the reserve report for expense details. The Water System Infrastructure fund did not budget for any planned expenses in However, during 2015, there were two water main breaks that occurred plus other approved projects totaling $35,223 in expenses. Interest income reported on the reserve funds vary to the reserve study estimate (used for the budget) for a variety of reasons. For the Golf Course fund, the reserve study projects $0 interest income due to the expense assumptions in the study. Interest income for the reserve funds in total is also impacted by the accounting involved in purchasing the marketable securities. The marketable securities, which consist of mortgage-backed securities, are carried at amortized cost which approximates market at the balance sheet date. When you buy a bond it carries a price percentage of face value. The cost is determined with premiums and discounts amortized over collections. Principal return is always 100% of the unpaid balance of the remaining bond. When a bond is purchased at a premium, that amount affects the amount of interest that is recorded. In addition, the amount of bonds purchased and redeemed throughout the year also causes the interest amount to fluctuate.

5 Attatchment 3 EAGLE CREST MASTER ASSOCIATION BALANCE SHEET DECEMBER 31, 2015 WITH COMPARATIVE TOTALS FOR DECEMBER 31, 2014 ASSETS Cash and Investments: Edward Jones 12/31/ /31/14 OPERATING RESERVE FUND FUND TOTAL TOTAL $ $ 89,057 $ 89,057 $ 117,081 Bank of the Cascades 885, , ,154 Wells Fargo 245, , ,114 Northwest Bank 152, , ,377 Total cash and investments $ 245,463 $ 1,126,891 $ 1,372,354 $ 1,152,728 Receivables 13,370 13,370 9,880 Less: Allowance for doubtful accounts Prepaid real estate taxes 14,792 14,792 14,670 Prepaid insurance 31,824 31,824 30,455 Inventory sports center 17,805 17,805 15,927 TOTAL ASSETS $ 323,254 $ 1,126,891 $ 1,450,145 $ 1,223,660 LIABILITIES Accounts payable and accrued expenses $ 36,008 $ 38,687 $ 74,695 $ 84,098 Prepaid Dues & Fees $ 18,601 $ 18,601 TOTAL LIABILITIES $ 54,609 $ 38,687 $ 93,296 $ 84,098 Beginning Fund Balance $ 178,807 $ 960,756 1,139,563 $ 925,932 Current year net income (loss) 89, , , ,631 Ending Fund Balance $ 268,645 $ 1,088,204 $ 1,356,849 $ 1,139,563 TOTAL LIABILITIES AND FUND BALANCES $ 323,254 $ 1,126,891 $ 1,450,145 $ 1,223,660

6 EC MASTER ASSOCIATION Operating Fund 04A02 For the twelve months ending December 31, 2015 Variance Actual to Actuals Budget Variance Forecast Forecast Revenues: Golf Course Rental $ 30,780 $ 30, % $ 30,780 $ Miscellaneous % 100 (80) Member assessments: 0 VROA 104, , % 104,160 0 FVA 26,880 26, % 26,880 0 RVA 39,480 39, % 39,480 0 EHOA 152, , % 152,880 0 RR Properties 3,360 3, % 3,360 0 WorldMark 68,880 68, % 68,880 0 Conference center 3,360 3, % 3,360 0 Hotel 26,880 26, % 26,880 0 Total Revenue $ 456,680 $ 456, % $ 456,760 $ (80) Expenses: Repairs and maintenance $ 14,517 $ 14, % $ 14,000 $ 517 Equestrian Pasture Mtc 1,805 2,000 90% 1,804 1 Redtail Hawk Pool (R&M) 10,207 15,000 68% 15,000 (4,793) Electric 3,024 3,500 86% 3, Snow removal 1,610 5,000 32% 5,000 (3,390) Insurance 12,825 11, % 10,762 2,064 VROA Sport Ctr rent % Postage, printing, annual meeting costs 4,403 4, % 4,500 (97) Consultants, Legal/CPA fees 25,508 20, % 26,000 (492) Director Travel 1,622 0% 1,622 Ladder Fuel Reduction 5,000 5, % 5,000 0 Reserve Contribution 50,000 50, % 50,000 0 Safety services 40,912 40, % 40,912 0 Landscaping 133, , % 133,240 0 General administration 13,946 13, % 13,946 0 Pools & Spa (Redtail Hawk) 13,576 13, % 13,576 0 Subtotal Expenses: $ 332,796 $ 331, % $ 337,339 $ (4,544) Management fee 19,918 19, % 19,918 0 Resort management services 28,023 28, % 28,023 0 Property taxes 3,269 7,085 46% 3,417 (148) Reserve Contribution Golf Course 41,040 41, % 41,040 0 Total Expenses $ 425,046 $ 428,040 99% $ 429,737 $ (4,692) Net Income/(Loss) $ 31,634 $ 28,720 $ 27,023 Beginning Fund Balance $ (9,864) $ (9,864) Ending Fund Balance $ 21,770 $ 17,159

7 EC MASTER ASSOCIATION Sports Center 04C02 For the twelve months ending December 31, 2015 Variance Actual to Actuals Budget Variance Forecast Forecast Revenue: Merchant Sales Revenue $ 116,619 $ 100, % $ 113,547 $ 3,072 Commercial rent 1,200 1, % 1,200 Bike Rentals 71,155 75,000 95% 72,036 (881) Guest fees 9,360 10,000 94% 9,912 (552) Sports center user fees: VROA 211, , % 211,908 FVA whole owners 9,007 9, % 9,007 (0) FVA fractional owners 2,624 2,733 96% 2,733 (109) RVVE fractional owners 20,343 20, % 20, RVVE whole owners 2,079 2, % 2,079 RECOA 236, , % 236,782 (0) EHOA 63,052 63, % 63,052 0 WorldMark at Eagle Crest 135, , % 135,057 (0) Sports Ctr Fee Ridge lot owners 206,629 Total Revenue: $ 879,186 $ 866, % $ 877,602 $ 1,584 Cost of sales Percentage 62.01% 66.43% Expenses: Cost of sales $ 116,442 $ 116, % $ 127,833 $ (11,390) Linen Cleaning 18,945 20,000 95% 19,858 (913) Uniforms 1,485 1,500 99% 1,500 (15) R&M 15,509 29,808 52% 18,120 (2,611) Janitorial 29,403 27, % 28, Utilities (gas,electric, cable, phone,garbage) 65,020 80,000 81% 68,653 (3,633) Water/Sewer 6,960 6, % 6,960 Insurance 26,932 27,997 96% 28,440 (1,508) Supplies 24,528 30,000 82% 26,644 (2,116) Taxes/Licenses 2,751 1, % 2, Travel % 500 (373) Credit Card Fee 3,473 3, % 3, Reserve Contribution 130, , % 130,000 Sports center payroll 215, ,390 99% 207,833 7,186 General administration 50,733 50, % 50,733 Night audit 11,513 11, % 11,513 Landscaping 12,304 12, % 12,304 Pool/Spa payroll 25,004 25, % 25,004 Safety services 31,820 31, % 31,820 Subtotal Expenses: $ 787,969 $ 822,471 96% $ 802,279 $ (14,310) Management fee 49,435 49, % 49,435 Resort management services 7,463 7, % 7,463 Property Taxes 16,757 16, % 16,757 (1) Insurance Claims Ded 1,000 0% Total Expenses $ 861,624 $ 896,729 96% $ 875,934 $ (14,311) Net Income/(Loss) $ 17,562 $ (29,823) $ 1,668 $ 15,895 Beginning Fund Balance $ 127,343 $ 127,343 Ending Fund Balance $ 144,905 $ 129,011

8 EC MASTER ASSOCIATION Utility 04B(D)02 For the twelve months ending December 31, 2015 Variance Actual to Actual Budget Variance Forecast Forecast Revenue: Water & Sewer Fee Rec Center $ 6,960 $ 6, % $ 6,960 $ Water & Sewer Fee VROA 86,304 86, % 86,304 0 Water & Sewer Fee FVA 22,272 22, % 22,272 0 Water & Sewer Fee RVA 32,712 32, % 32,712 0 Water & Sewer Fee EHOA 116, , % 111,360 4,652 Water & Sewer Fee EHOA Undev 3,547 5,095 70% 5,095 (1,548) Water & Sewer Fee RR Properties 2,088 2, % 2,088 0 Water & Sewer Fee Worldmark 57,072 57, % 57,072 0 Water & Sewer Fee Golf Pro Shop 4,176 4, % 4,176 0 Water & Sewer Fee Hotel 50,112 50, % 50,112 0 Water & Sewer Fee Conf Ctr 3,480 3, % 3,480 0 Water & Sewer Fee Mtce/Golf Mt % Total Revenue: $ 385,431 $ 382, % $ 382,327 $ 3,104 Expenses: Water: R&M $ 9,306 $ 10,000 93% $ 10,000 $ (694) Testing 1,808 2,000 90% 2,000 (192) Consumer Conf Report % CBU Water Purchase 2,166 7,350 29% 2,200 (34) Pumping Costs 35,718 36,050 99% 34,500 1,218 Insurance 1,622 1,919 85% 1,919 (297) General Administration 12,618 12, % 12,618 0 Consultants 4,169 5,000 83% 5,000 (831) CBU PR Reim 46,555 57,986 80% 47,810 (1,255) License & fees 1,041 1, % Safety Services Expenses 19,865 19, % 19,865 0 Water Infrastructure Reserve Contribution 22,000 22, % 22,000 0 Capital Expenses SCADA Well #4 & 2(A) enhanceme 15,722 15, % 15,722 0 ECMI Mgmt Fee 11,486 11, % 11,486 0 Property taxes 9,286 9,526 97% 9,287 (1) TOTAL WATER EXPENSES $ 193,512 $ 212,450 91% $ 195,523 $ (2,011) Sewer: R&M $ 9,197 $ 8, % $ 9,500 $ (303) Testing 2,674 2, % 2, Supplies 75 0% 0 Consultants % 807 (254) CBU PR Reim 37,829 47,120 80% 38,850 (1,021) CBU ECX Operating Expense 8,000 8, % 8,000 0 Permit Renewal % Subtotal sewer operating expenses: 59,092 67,245 88% 60,271 (1,179) ECMI Mgmt Fee 4,035 4, % 4,035 0 TOTAL SEWER EXPENSES $ 63,127 $ 71,280 89% $ 64,306 $ (1,179) Reserve Contribution Water/Sewer 85,000 85, % 85,000 0 ECMI Mgmt Fee 5,100 5, % 5,100 0 Water Carry Forward of Prior Yr (Surplus)/Loss Total Water/Sewer Expenses $ 346,740 $ 373,830 93% $ 349,929 (3,189) Net Income/(Loss) $ 38,691 $ 8,498 $ 32,398 6,293 Beginning Fund Balance $ 58,877 $ 58,877 Ending Fund Balance $ 97,568 $ 91,275

9 EC MASTER ASSOCIATION Reserve Fund For the twelve months ending December 31, 2015 Facilities Utilities YTD Annual % of Actual YTD Annual % of Actual Actual Budget to Budget Actual Budget to Budget Revenues: Revenues: Facilities Contribution $ 50,000 $ 50, % Utilities Contribution $ 85,000 $ 85, % Interest 5,374 9,775 55% Interest 9,137 9,429 97% Total Revenue: $ 55,374 $ 59,775 93% Total Revenue: $ 94,137 $ 94, % Expenses: Expenses: R&M Facilities $ 14,063 $ 29,732 47% R&M Utilities $ 13,482 $ 172,271 8% Licenses and fees Licenses and fees Income taxes Income taxes 0% Total Expenses $ 14,463 $ 29,982 48% Total Expenses $ 13,532 $ 172,321 8% Net Income/(Loss) $ 40,911 $ 29,793 Net Income/(Loss) $ 80,606 $ (77,892) Reserve fund account balance 1/1/15 $ 366,028 Reserve fund account balance 1/1/15 $ 472,874 Reserve fund account balance 12/31/15 $ 406,939 Reserve fund account balance 12/31/15 $ 553, % 48.12% Revenues: Revenues: Water System Contribution $ 22,000 $ 22, % Golf Course Contribution $ 41,040 $ 41, % Interest 2,365 1, % Interest 4,411 0% Total Revenue: $ 24,365 $ 23, % Total Revenue: $ 45,451 $ 41, % Expenses: Expenses: R&M Water Infrastructure $ 35,233 $ 0% R&M Golf Course $ 28,553 $ 40,180 71% Licenses and fees 50 0% Licenses and fees % Income taxes 0% Income taxes 0% Net Income/(Loss) $ (10,918) $ 23,925 Net Income/(Loss) $ 16,848 $ 810 Reserve fund account balance 1/1/15 $ 51,075 Reserve fund account balance 1/1/15 $ 74,260 Reserve fund account balance 12/31/15 $ 40,158 Reserve fund account balance 12/31/15 $ 91, % 7.92%

10 Cline Butte Water, LLC. & Cline Butte Environmental, LLC. Attatchment 4 TO: FROM: ECMA Board of Directors Bob McDaniel / Brett Limbeck Cline Butte Utilities DATE: February 2016 SUBJECT: Utilities Report WATER SYSTEM OPERATIONS Reserve Expense Projects: Water Booster Pump Refurbish: The 2016 planned reserve expenditures include refurbishment of the water booster pump. This equipment boosts the water to the services located at higher elevations. Refinishing the pump will require taking that pump offline during the time it is rebuilt, so the preference would be to install a spare pump during this time to avoid a significant drop in water pressure to the owners at those higher-elevation properties. We identified this issue shortly after the completion and approval of the 2016 Utility reserve study; however, we believe this spare pump purchase is important enough to bring to the ECMA Board for approval as a 2016 expense variance. Not only would the spare pump be important for this refurbishment time frame, it would also be on the shelf for immediate installation in the event of booster pump failure. ACTION REQUESTED: Approve the purchase of a new booster pump (20 HP) at a bid cost of $6,155 and also proceed with the current pump refurbishing at a bid price of $1,535. The 2016 Utility reserve study carries a cost estimate of $3,921 for the refurbishing (in 2016), and a 20 HP pump replacement cost estimate of $19,532 (in 2021). This approval request is included in the 2016 Reserve Expense report. Capital Expense Projects: SCADA enhancement (dosing tank): Included in the approved 2016 budget are capital funds in the amount of $9,600 to expand the SCADA system to include the dosing tank. Meetings have been requested with the engineer with the work to be scheduled as soon as the engineer s schedule allows. Service Connections: As the EHOA neighborhood nears build-out and has had increased construction activity lately, we discovered there are five lots on which we have been unable to locate services (either water or sewer, or both). Contractors have utilized ground penetrating radar systems to determine location of the service connections, but that method has unfortunately been unsuccessful. These systems will have to be "hot tapped" into the main line to provide service connections to 1230 Golden Pheasant Dr. Redmond, OR CCB # Operations: FAX: Billing: cbu@eagle-crest.com

11 these lots. Hot taps are achieved by tapping into an in-service pipe using a specialized, watertight machine that "taps" through a valve. The valve is then closed and the machine removed, creating a new service connection. Two of these lots are currently under construction and in need of the sewer service connections (the water connections were able to be located), so the work will be completed as soon as possible. A bid has been received for the sewer service installation in the amount of $3,692 per lot. This price is specific to one Osprey hot tap, but we think the next sewer service cost will be somewhat similar as the sewer line is on the edge of the road on the same side of the lot that needs the second hot tap. This price can change significantly if it happens to be on the opposite side of the road as we would have to cut more road and trench. ACTION REQUESTED: Approve proceeding with the hot taps as needed to provide necessary sewer and/or water service connections to five lots with best estimate of costs at this time being $20,000, which of course is subject to change based on line location. It would be helpful if the Board would authorize the President to approve variances to this total estimated capital expense (this is not a system operating expense). Operational activities and issues include: As you know, during the main line break incident near Well #2, broken valves were discovered in lines serving the VROA neighborhood. Approval was granted to replace the valves at a budget of $17,163. This work was completed in early October at the previously approved amount, and expenses for this project will be reflected in the fourth quarter financial statements. As the water system continues to age, breaks in the main line will likely occur from time to time, so it s important that all isolation valves are properly operational. Without properly operating valves, CBU is forced to shut down a larger portion of service area when it s necessary to isolate areas of broken main line. A cluster of four valves was replaced during 2015 as noted above, and at the November 2015 meeting, it was reported that there are additional valves that require replacement on Mt. Quail Drive between the gate and the hotel. A rough estimate was received for a total of $17,667 for these four valves. ACTION REQUESTED: We request approval to proceed with these valve (4) replacements with a 10% contingency added (total rounded to $19,500). This approval request is included in the 2016 Reserve Expense report (the Water Infrastructure Repair and Estimate Plan reserve fund). Since the last meeting, the ECMA water system encountered main line breaks on November 24 th and January 1 st. The November break was in the EHOA neighborhood with the break fairly quickly isolated and repaired with limited service outages. The January 1 st break was on Mountain Quail Drive near the mailbox station and primarily affected water service to the hotel. In both cases, settling onto rock caused the pipes to incur significant horizontal breaks. After excavation and removal of the damaged section of pipe, rock was removed, and soil added, so the replacement section is now properly bedded. Unfortunately at the time of the January break, the asphalt plants were closed for winter, so the paving repairs have not yet been completed. (No paving repairs were required for the November break.) We are hopeful that with the recent warmer weather, the plants will open soon and allow for 1230 Golden Pheasant Dr. Redmond, OR CCB # Operations: FAX: Billing: cbu@eagle-crest.com

12 the paving repairs to be completed. The November break totaled $1,477 and the January break totaled $4,989. The asphalt repair costs will be billed separately after completion. These costs are reported in the 2015 and 2016 Reserve Expense reports as variances with an estimated amount included for the asphalt repair. SEWER SYSTEM OPERATIONS Reserve Expense Projects: Drain Field Beds Valve and Pipe Maintenance: The 2016 reserve study includes a budget for valve and pipe maintenance in drainfield beds as a proactive step to avoid line/valve breaks and resulting sewage spills. There were also funds for valve and pipe maintenance included the 2015 study which was unable to be completed by the end of the year, so those funds were carried forward into CBU has identified some valves to address; the work has not yet been scheduled. Operational activities and issues include: There are no sewer system operational matters to report at this time Golden Pheasant Dr. Redmond, OR CCB # Operations: FAX: Billing: cbu@eagle-crest.com

13 Attatchment 5 ITEM DESCRIPTION - FACILITIES PLANNED BUDGET Gutters, Equestrian Center "P" $ 874 Paint, Exterior, Equestrian Center "P" 1,688 Restroom, Equestrian Center Toilet "P" 1,031 Roof, Equestrian Center "P" 2,065 Water Heater, 50 Gallon, Equestrian Center "P" 754 Siding, Equestrian Center "P" 8,702 Septic Tank Pump, Equestrian Center 1,001 Septic Tank Screen, Equestrian Center A1 278 EAGLE CREST MASTER ASSOCIATION EVALUATION OF RESERVE ACCOUNT EXPENDITURES VS. BUDGET PER 2015 RESERVE STUDY February 9, 2016 SHADING = new over budget items requiring director approval SHADING = denotes all items of variance previously approved P = Planned Expenditure $ PAID TO DATE VARIANCE COMMENTS Equestrian Center work moved to 2016 Removed from study - no pump/screen Removed from study - no pump/screen Paint, Exterior Pool Building "P" 1, (518) All pool bldg work completed, below budget Paint, Interior Pool Building "P" 1, (284) Restroom Fixtures, Pool "P" 5,534 4,971 (563) Restroom Flooring, Pool "P" Septic Tank Pump, Pool 1,001 - (1,001) Not replaced Septic Tank Screen, Pool (278) Not replaced Septic Tank Pump, Soccer Field RR 1, (32) Completed Septic Tank Screen, Soccer Field RR (203) Screens were cleaned not replaced Thunderbird Court, Seal Coat "P" 2,052 2,023 (29) Completed TOTAL: $ 29,982 $ 10,742 $ (2,847) ITEM DESCRIPTION - UTILITY PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Water: Well #2, Pump Motor Spare "P" $ 1,700 $ 1,956 $ 256 See Utilities Report Well #2, Pressure Compressor 7,360 - Expense moved to 2016 study Sewer: Permit Conditions/Requirement WPCF 145,000 - Expense moved to 2016 study Comp Filter Panel Breakers 1,259 - Expense moved to 2016 study Drain Field Beds, Valve and Pipe Maint. PH 1 "P" 8,002 Not completed - see Utilities Report Pump, Dosing Tank 1 "P" 9,000 8,147 (853) Complete TOTAL: $ 172,321 $ 10,103 $ (597) ITEM DESCRIPTION - GOLF COURSE PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Cart Path Overlays - 12th Tee "P" $ 5,500 $ 5,634 $ 134 $1,000 variance projected for all overlay work, approved by President Cart Path Overlays - 14th Tee & Green "P" 7,600 6,314 (1,287) Seal coat #12 tee, #13 green, #15 green to complete in May 2016 ($750) Cart Path Overlays - 15 Green "P" 1,700 2, Cart Path Overlays - 13 Green "P" 8,780 2,851 (5,929) Cart Path Overlays - 18 Green "P" 1,650 1, Irrigation Upgrades "P" 7,000 7, Tee Box Signage 13 & 18 "P" 4,000 (4,000) Work in progress; est total of $2K Hole 6 Remove Trees "P" 1,000 1, Hole 11 Expand Tee Box "P" 3,000 - (3,000) Completed by GC staff at $0 charge TOTAL: $ 40,230 $ 27,811 $ (12,420)

14 2014 Expenditures to be completed in 2015: ITEM DESCRIPTION - COMMON AREA PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Lighting, Main Entrance P $ 6,500 $ 4,200 $ (2,300) Lighting Complete per ECM Well #4 Flow Meter Domestic P 3,500 3,443 (57) Upgrade for SCADA compatibility Main Line Break Repairs (Water Utility Infrastructure) 4,623 4,623 - Break Repair Costs TOTAL: $ 14,623 $ 12,266 $ (2,357) Unbudgeted Items Water Infrastructure Repair Estimation Plan: Valves $ 17,163 $ 17,163 $ - 4 Valves - See Utilities Report submitted in Feb Main Line Break Repairs (Pave Repairs) 6,343 6,131 (212) See Utilities Report submitted in Feb Well #4 Flow Meter Replacement 3,341 3,341 - Main Line Break Repairs (October 2015) 10,988 10,988 Repair complete, incl asphalt repair Main Line Break Repairs (November 2015) 1,478 1,478 Minor repair - complete TOTAL: $ 26,847 $ 39,100 $ 12,253 GRAND TOTAL TO DATE: $ 284,003 $ 100,021 Notes: Main Line Break Repairs (January 2016) to be reported on 2016 reserve expense report.

15 Attatchment 6

16 Attatchment 7 TO: FROM: ECMA Board of Directors Debbie Hahn DATE: February 2016 SUBJECT: Use Agreement and Lease Renewals The third amendment to the Pasture Use and Maintenance Agreement for the front pasture along Cline Falls Road expires February 28, 2016 and Sanctuary and Sacred Spaces has expressed an interest in continuing the agreement for an additional year under the same terms. Please note this agreement can be terminated by either party without cause with 30 days written notice. This use/maintenance agreement is in no way related to any type of usage of the Equestrian area. Management regularly receives positive comments from owners and guests regarding their enjoyment of seeing the horses in the front pasture and supports an extension of this agreement. A recommended Fourth Amendment to Pasture Use and Maintenance Agreement is attached for your consideration and approval, and a proposed motion for this action is listed below. RESOLVED, that the Fourth Amendment to Pasture Use and Maintenance Agreement, extending the agreement to February 28, 2017, be hereby approved. The lease for The Dive poolside grill currently expires May 27, The terms of the lease (Section 14.1) allow for one renewal option for a period of one year. The tenant has provided a letter of interest (copy attached) to continue the agreement to operate the poolside grill. You will see in the tenant s letter that she is requesting permission from the board to begin serving beer, subject to licensing and approval from OLCC. Terms of the current lease include a rent of $400 per month of operation (summer months only; partial months are pro-rated), with the option for an increase in monthly rent of up to 10% if the option to renew is exercised. Management has been pleased with The Dive operation, believes this is a valued service for the owners/guests of the Resort Sports Center, and would recommend extending the lease term for an additional year at the current rent of $400. A recommended First Amendment to Lease is attached for your consideration. A proposed motion for the renewal action is listed below. This motion does not address the request to serve beer, so will need to be included should the board approve that request: RESOLVED, that the lease of the grill space for The Dive be extended for a one year period under the same terms and conditions including rent of $400 per month for the months in operation, and that the President be authorized to sign the sublease extension document. Management requests board action on both agreements.

17 Attatchment 8 FOURTH AMENDMENT TO PASTURE USE AND MAINTENANCE AGREEMENT THIS FOURTH AMENDMENT TO PASTURE USE AND MAINTENANCE AGREEMENT is made and entered into this day of, 2016, by and between Eagle Crest Master Association, an Oregon nonprofit corporation ( ECMA ) and The Sanctuary & Sacred Spaces, an Oregon nonprofit corporation ( Sanctuary ). RECITALS: A. On or about March 1, 2012, ECMA and Sanctuary entered into that certain Pasture Use and Maintenance Agreement (the Agreement ) for the use and maintenance of the fenced pasture located adjacent to Cline Falls Road. By First Amendment to the Agreement, the parties extended the term of the Agreement for one year to February 28, By Second Amendment to the Agreement, the parties extended the term of the Agreement for one year to February 28, By Third Amendment to the Agreement, the parties extended the term of the Agreement for one year to February 28, B. By this Fourth Amendment to the Agreement, the parties desire to extend the term of the Agreement as provided herein. NOW THEREFORE, in consideration of the mutual promises, covenants and agreements contained herein, the parties agree as follows: 1. TERM. The term of the Agreement shall be extended for a one (1) year period beginning on March 1, 2016 and ending on February 28, 2017 unless earlier terminated as provided in the Agreement. 2. FULL FORCE AND EFFECT. Except as specifically set forth above, the Agreement shall remain in full force and effect without change. IN WITNESS WHEREOF, the parties hereto have executed this Fourth Amendment to the Agreement as of the date first written above. ECMA: EAGLE CREST MASTER ASSOCIATION, an Oregon nonprofit corporation BY Its SANCTUARY: THE SANCTUARY & SACRED SPACES an Oregon nonprofit corporation BY Its ECMA-Sanctuary Pasture Use Agreement Fourth Amendment

18 Attatchment 9

19 Attatchment 10 FIRST AMENDMENT TO LEASE THIS FIRST AMENDMENT TO LEASE is made and entered into this day of, 2016, by and between Eagle Crest Master Association, an Oregon nonprofit corporation ( Landlord ) and Deborah Brunot, a sole proprietor doing business as The Dive ( Tenant ). RECITALS: A. On or about May 28, 2015, Landlord and Tenant entered into that certain Lease (the Lease ) of a restaurant space located at the Resort Sports Center at Eagle Crest Resort, Redmond, Oregon. B. The Parties recognize that Landlord leases the premises covered by the Lease from Vacation Resort Owners Association, an Oregon nonprofit corporation ( VROA ) and that the Lease is, therefore, a sublease by Landlord. The Parties further recognize that Eagle Crest Management, Inc. serves as managing agent for both Landlord and Vacation Resort Owners Association. C. Tenant has exercised the one (1) option to renew the Lease as provided in Section 14.1 of the Lease; and D. By this First Amendment to Lease, the parties desire to extend the term of the Lease as provided herein. NOW THEREFORE, in consideration of the mutual promises, covenants and agreements contained herein, the parties agree as follows: 1. DEFINITIONS. All capitalized terms not defined herein shall have the meanings ascribed to them in the Lease executed between Landlord and Tenant. 2. EXTENDED TERM. The term of the Lease shall be extended for a one (1) year period beginning on May 28, 2016 and ending on May 27, 2017 unless earlier terminated as provided in the Lease. 3. BASIC RENT. Rent shall be payable to Landlord for the months of June, July, August and September only, and is due on the first day of these months. Tenant shall pay to Landlord as rent for these months the sum of $400 per month during the extended term. In any month in which the restaurant is open for business, Tenant shall pay pro rata rent (total monthly rent divided by 30) for each day the restaurant is open for business. 4. FULL FORCE AND EFFECT. Except as specifically set forth above, the Lease shall remain in full force and effect without change. ECMA-Brunot Lease First Amendment Page 1

20 IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to Lease as of the date first written above. Landlord Eagle Crest Master Association, an Oregon nonprofit corporation By: Its Print Name: P. O. Box 1215 Redmond, OR Vacation Resort Owners Association, an Oregon nonprofit corporation By: Its Print Name: P. O. Box 1215 Redmond, OR Tenant Deborah Brunot, a sole proprietor doing business as The Dive By: Its Print Name: Eagle Crest Management, LLC, an Oregon corporation By: Its Print Name: P. O. Box 1215 Redmond, OR ECMA-Brunot Lease First Amendment Page 2

21 Attatchment 11 EAGLE CREST MASTER ASSOCIATION EVALUATION OF RESERVE ACCOUNT EXPENDITURES VS. BUDGET PER 2016 RESERVE STUDY February 9, 2016 SHADING = new over budget items requiring director approval SHADING = denotes all items of variance previously approved P = Planned Expenditure ITEM DESCRIPTION - FACILITIES PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Gutters, Equestrian Center P $ 900 Paint, Exterior, Equestrian Center P 1,737 Restroom, Equestrian Center Toilet 458 Roof, Equestrian Center P 2,128 Water Heater, 50 Gallon, Equestrian Center 777 Siding, Equestrian Center P 8,954 ADA Lift Cover, Pool P 424 Air Blower, Spa P 1,074 Filter, Pool P 2,769 2,688 (81) Complete Septic Tank Pump, Pool 1,075 Septic Tank Screen, Pool 286 Signs, Main Entry, Refinish P 1,787 Signs, Street, Stop, Directional, Misc. P 34,370 Trail Repair, Middle Section (River) P 4,957 Walkpaths - Seal Coat P 16,304 Cline Falls to 4-way; Falcon Crest to Robin Ct; +Original paths TOTAL: $ 78,000 $ 2,688 ITEM DESCRIPTION - UTILITY PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Water: Water Booster Pump Refurbish P $ 3,921 Cascade Pump bid price of $1535 Well #2, Pressure Compressor 7,360 Sewer: Permit Conditions/Requirement WPCF 145,000 Comp Filter Fan 2,641 Comp Filter Panel Breakers 1,258 Drain Field Beds, Valve and Pipe Maint. PH 2 P 8,242 Drain Field Beds 74,524 Logic Controller 17,729 TOTAL: $ 260,675 $ - ITEM DESCRIPTION - WTR INFRASTRUCUTRE PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Group 30 - Water Service /1 P $ 1, angle meter stop/meter box Group 30 - Water Valve and Hydrant P 9,567 Est. for 2 air-release valves, 1 hydrant TOTAL: $ 11,418 $ - ITEM DESCRIPTION - GOLF COURSE PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Cart Path Overlays - Hole 1 P $ 5,723 Cart Path Overlays - Hole 4 P 5,833 Cart Path Overlays - Hole 6 Tee P 2,379 Path Overlay - Pro Shop Area P 20,211 Irrigation Upgrades, Annual, controllers P 7,196 Driving Range Upgrade P 8,240 TOTAL: $ 49,582 $ - RESERVE STUDY 2016 EXPENSES (NOT 5 YR PLAN) - INFORMATION ONLY $ 86,942

22 2015 Expenditures to be completed in 2016: ITEM DESCRIPTION - VARIOUS PLANNED BUDGET PAID TO DATE VARIANCE COMMENTS Golf Course - Tee Box Signage 13 & 18 P $ 4,000 Work in progress; est cost of $2K Golf Course - Cart Path Seal Coat (12, 13, 15) P 750 Budget is from the Tri-County Paving bid Sewer - Drain Field Beds Valve/Pipes Ph 1 P 8,002 Planned to complete in 2016 TOTAL: $ 12,752 $ - Unbudgeted expenses ITEM DESCRIPTION - VARIOUS FUND PROPOSED PAID TO DATE VARIANCE COMMENTS Main Line Break Repairs (January 2016) WIREP $ 6,490 $ 4,990 Asphalt repair work estimated at $1500 Water Booster Pump - Spare UTILITY 6,155 See utility report Water System Valve Replacement (4) /2 WIREP 19,500 See utility report TOTAL: $ 32,145 $ 4,990 $ - GRAND TOTAL TO DATE: $ 444,572 $ 7,678 Notes: "/1 "Group 30" assumes repair needs at 30 YRS "/2 See funding recommendation for the Water Infrastructure Repair Estimation Plan

23 Attatchment 12 Resort Resources, Inc. 5 N W GREENWOOD AVENUE BEND, OR FAX MEMORANDUM TO: ECMA BOARD OF DIRECTORS FROM: KAREN SMITH SUBJECT: WATER INFRASTRUCTURE REPAIR ESTIMATION PLAN RESERVE FUND DATE: FEBRUARY 10, 2016 CC: EAGLE CREST MANAGEMENT; CLINE BUTTE UTILITIES As stated in the reserve study/fund title, the cost estimates in this reserve study are only repair estimation costs, both as to timing and frequency of infrastructure repair needs. Since the 2016 reserve study was finalized, there have been three water main breaks with associated repair costs. Two occurred in 2015 with repair costs of $12,466. These additional costs bring the beginning 2016 fund balance to about $40,000 as opposed to the study estimate of $50,700. Add to this impact the January 2016 water main break repair costs and proposed additional 2016 expenses, and the WIREP fund balance drops further. At the same time, the financial statements for the utility operations reports a better than forecasted ending fund balance of $97,568. The positive variance to forecast is $6,293. My recommendation to the Board is to transfer that positive variance to the WIREP fund. See below for a summary of all these costs, 2016 contribution and the recommended transfer. Actual 2016 beginning fund balance $ 40, WIREP fund contribution $ 30, reserve study cost estimates $(11,418) January 2016 estimated water main break repairs $( 6,490) Proposed valve replacements (4) $(19,500) Resulting WIREP fund balance $ 32,750 Transfer from Utility operating fund $ 6,293 Improved WIREP fund balance $ 39,043 It is difficult to know if the recent main line break experiences will foretell the future. However, I believe these recent experiences with the water infrastructure repair costs suggest the need to revisit the logic and purpose behind the WIREP reserve study and funding. /ks

24 Resort Resources, Inc. 5 N W GREENWOOD AVENUE BEND, OR FAX Attatchment 13 MEMORANDUM TO: ECMA BOARD OF DIRECTORS FROM: KAREN SMITH SUBJECT: BOARD OPERATING PROCEDURES DATE: FEBRUARY 11, 2016 CC: EAGLE CREST MANAGEMENT During a director discussion prior to the November board meeting, directors agreed to schedule a discussion regarding standard operating procedures for the Board during this upcoming Q board meeting. To assist with the discussion, I have prepared an outline of topics that I would consider the bones of a procedure document with meat to be added through your discussion and adoption process. I have purposely left a lot of white space in the document for notes and ideas. This Board has operated for 25+ years so obviously has a number of established practices 1, therefore, some of this process will result in memorializing certain procedures. But it will be good to evaluate everything and consciously create adopted procedures. Thoughts for your consideration on approaching this project: Encl. /ks When setting specific schedule requirements (eg. number of days, weeks, etc. to produce a result), keep in mind some reasonable/best efforts concepts since there are obviously human factors and other external factors (such as, the weather?) involved. Q Initial discussion and find consensus on as many procedures as makes sense to you as a group, and identify new topics or topics that require additional research or information. Request a procedure document draft based on the Q1 discussions. Q Depending on progress in Q1 meeting, the next procedure document could be ready for final discussion or review or may require additional work. However, at this point the procedure document could/should be ready for attorney review after this meeting. Attorney review is recommended so as not to adopt procedures in conflict with an Oregon statutory or governing document requirement. Next meeting Final review, adoption Consider phased adoption since some topics may be simpler to approach or more important to address. 1 An EP abbreviation is added to several items in the procedure outline to indicate what/where there are established practices. This is informational only and not a suggestion that EP s are automatically adopted or approved.

25 I. ADMINISTRATIVE - SOP A. Board Meetings ECMA BOARD OPERATING POLICIES AND PROCEDURES OUTLINE FOR DISCUSSION FEBRUARY 19, 2016 (Note: EP means Established Practice) 1. Roberts Rules of Order a. Small Boards determine what s applicable 2. Open Meetings 3. Agenda a. Owner attendance welcome (EP) b. Owner comment period Decide schedule and protocol c. Policies for reports, discussion Chair to govern reports and discussion (EP) d. Motions Drafts prepared in advance? Required or optional? a. Schedule for agenda draft (Regular Meeting) * x days in advance of meeting; who prepares * Review process for draft who reviews and approves b. Procedures for director review/additions send to? Input from? Schedule? c. Agenda posting procedures schedule and place(s); (EP is mailbox station on Mtn Quail Dr and website; 3 days in advance minimum) c. Agenda consent at board meeting By motion d. Board meeting materials available only to directors or others prior/during meeting; (EP: directors only until after meeting) 4. Regular Meetings (Article III, Section 6) a. Schedule Quarterly (required by Bylaws) * Schedule at Q4 board mtg for following yr (EP) * Post schedule on website (EP)

26 5. Special Meetings (Article III, Section 7) a. Called by President, or VP (if president n/a), or 2 directors * Consult bylaws for more info 6. Minutes of Board Meetings B. Board Communications a. EP: Staff records, Secretary approves b. Add motion made/seconded (name directors); add numbering system c. Schedule for draft minutes to Board? To others before adopted? d. Post approved minutes on website e. Minutes attachments include or available on request? 1. Authority to represent the Board policy statement on who speaks for Board, contact with third parties (vendors, contractors, consultants, etc.); 2. Policies for Board for scheduling, discussion, not for business 3. Director contact information set up website addresses? What is released? C. Attorney / Consultants Decide on who has authority to engage, assign work D. Decision-making Standards what is outside of management authority? * New Contracts or contract renewals * Unbudgeted expense over $ * Other? E. Management Company reporting Set standards for reporting to Board, President * Schedule and content * EP: Qtrly management reports to Board * EP: President advised of out of ordinary matters * Other?

27 II. FINANCIAL A. Budget Adoption 1. DRAFT budget from management on Oct 1 (90 days prior) 2. CCRs distribute budget 45 days in advance 3. Budget study session prior to board meeting (EP) schedule? B. Financial Reporting 1. Qtrly financial statements (accrual) to directors; post on website after acceptance? 2. Annual financials w/in 90 days after YE post on website for members 3. OR PCA govern s re review/audit doing audit C. Authorizations 1. Bylaws Article IX, Section 1 review 2 signatures (banks don t enforce) 2. Frequency for signature authorizations D. Investment Policy Draft and adopt? E. Contracts 1. Standards for decision making for management company vs outside contractor a. Scope of work approval b. Form for evaluation c. Requirements for outside contractors III. PHYSICAL / PROPERTY MANAGEMENT A. Community Wide Standards Written? B. Management Procedures and Reporting - Establish C. Other?

28 IV. COMMITTEES A. Existing committees: 1. Environmental control committee CCR driven; committee guidelines established 2. Covenant compliance committee Board established, w/guidelines B. Procedures for new committees 1. Determine standing or temporary (ad hoc) 2. Purpose statement and guidelines for operations OTHER: