PROJ00090

• Contract/PO #: FS0015X
• Contractor Name: Powderhorn Metropolitan District No. 1 and No. 2
• Contract Type: Loan
• Water District: 0
• County: Mesa
• Loan Projects - Doc Type: Feasibility Study

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The duties and responsibilities of the Directors consist of, generally, the oversight of all
District operations, and the specific control over the financial functions of the Districts.
To a certain extent, specific ministerial functions may be delegated to individual members
of the Board or the District's management team and consultants. However, the ultimate
responsibility for all District functions remains with the Board of Directors. Presently,
the Board meets once a month to discuss and act on various District functions.

From the date of their organization, the Districts have constructed, owned and operated
all of the utility, road, transportation and fire protection services afforded the Powderhom
Ski Resort. While the operation of the ski area was not initially placed within the day to
day operations of the Districts, as part of the bankruptcy of the Mesa Ski Corporation the
ski assets were transferred to Metropolitan District No.2, to be operated by Metropolitan
District No. 1.

By way of history, from 1986 until approximately 1989, the Districts and the development
proceeded as originally planned with the District constructing and operating support
facilities and the developer refurbishing, constructing and selling vacation time shares.
In approximately 1989, however, the developer's financial position became strained and
for the next couple of years both development and additional District infrastructure
construction came to a stand still. Subsequently, both the developer and Powderhom
Metropolitan District No.2 sought protection under the federal bankruptcy laws, from
which they emerged in 1994. Since that time, both the development and the Districts
have operated without event. At present, the two Districts are renegotiating their
intergovernmental relations, which negotiations should come to a close within the next
month. There will be no material change in the matter of how the two Districts operate,
though there will be increased cooperation between the two Boards. The boundaries and
intended service areas remain identical to those originally contemplated.

The existing property within the Powderhom Metropolitan Districts No. I & II boundary
is shown in Exhibit A. Exhibit E provides financial information and assets of the
Districts and includes:

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