Presidents Report_Diane Exter_Issue 05_210828

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FINANCIAL REPORT Herb Selzer, Treasurer, reported that the Community finished the first quarter with a positive variance of $57K as compared to budget; Club income being favorable to budget by $63K and the POA favorable by $28k. Expenses related to the Oceanview Church Agreement totaled $33K and are listed as an extraordinary item on the P&L. Proceeds from the forgiven PPP loan have been allocated between the Club ’ s Capital Fund and the POA ’ s Capital Reserve. Total cash balances exceeded $19M at month - end. As of the first four months of our fiscal year, we have four new member completed sales and three new mem ber pending sales. Despite the low in ventory (only 2 homes on the market), we continue to see a significant interest by prospective buyers. Realtors are building their wait lists. INTEGRITY MOLD REPORT Two plus weeks ago, Integrity Mold Inspections conducted a two - and a - half - day investigation covering 100% of the clubhouse. Gary Rose, the owner of Integrity, joined our Board meeting to answer questions. Below are some of the con clusions: • Gary stated that this was the worst condition our building has been in since he has been testing over the last 8 years. Mold and mildew have permeated many parts of our build ing and continue to grow and flourish in our environment. • The building currently is producing an abnormal amount of mold due to the well - known problems with the

building's HVAC system and numerous intrusion leaks from the roof, walls, win dows and other sources. "It's like hav ing buckets of water sitting throughout the clubhouse while you are dehumidi fying." • The Club has had 7 thorough investiga tions by Integrity over the past 8 years. Each report contained a specific proto col describing the minimum work nec essary to mitigate the mold situation. Seven years ago, we hired a licensed mitigation company to do the work. Since then, we have hired clean ing companies and then switched to in house services to manage the prob lem. We have invested hundreds of thousands of dollars in equipment and labor to do this work but, partly due to the seriousness of the issues, we have not succeeded in managing the ongoing problem. • Humidity levels have been measured daily throughout the building for the last several months. Buildings should be optimally kept at 45 - 55% humidity. Our clubhouse consistently has humidity readings above 65% in certain rooms and in some rooms over 70%. Gary confirmed that mold can grow in our building at humidity ratings above 65%. • At this point, until the HVAC system is fully replaced, the Club could invest hundreds of thousands of additional dollars in equipment, professional ser vices, cleaning and engineering staff time and Gary believes that the prob lems would only be temporarily remedi ated. It was the general view of the professionals, management, staff and Board members that it would not make sense to spend these incremental