Cowlitz Falls LLC ready set go statement

****SEE ATTACHMENTS***

Cowlitz Falls, L.L.C.
March 27, 2009

Dear Extended MacDonald Family,


This information is pertinent to every member of the MacDonald family present and future!


We are very happy to announce that the Cowlitz Falls, LLC has made some milestone accomplishments towards forming a physical segregation of property for the MacDonald Family Preserve. This letter is to inform you of events and recent changes that have taken place.

The CFLLC's #1 objective is to make Family Preserve acreage sub-divided and legally ready to be owned in perpetuity by the MacDonald Family organization.

What at first seemed like a wonderful and simple idea in 2003, that we could just go to the Lewis County offices in Chehalis and file an permit application for, has turned out to be much more complicated and expensive than we knew at the outset-!

Brief Overview:

• 2003 CFLLC takes a land loan from Security State Bank and begins to make monthly payments.

• Soon after obtaining ownership, we learned that our neighbor, John Linder is using the "grandfathered in" spring for all of his water use. This is the same spring that granddad and dad improved for their water use back in the 1950’s and improved again in 1969. Since then there have been no improvements or any significant maintenance. The Linder’s water is poor and at times completely dries up. They need a well and cannot get a permit to build one on less than 2 acres of land. So we agreed to sell John 1.8 acres, after our survey was complete. So he has been waiting for a long time for this to complete.

• 2004 CFLLC decides to log about 10 acres to help pay for the necessary survey and fund the permitting process to subdivide the land in the four parcels: one for each of Fred, Amy, and Gordon, and one for the “Family Preserve.

• Late 2004, hire Butler Surveying. We had many meetings with the surveyor to discuss our goals and wants. Subsequently, Butler surveyed the entire property, found all previous survey markers, did title search, etc. The process turned up the whole history of ownership and changes of the acres. There have been numerous changes out there over the last century. The Survey required 2-3 different trips to The Falls by a crew of surveyors. The end product of the survey included, new parcel descriptions, survey markers, and survey maps, all delivered to us and to our lawyer, then filed with Lewis County. The entire survey process took 4 YEARS

Important Distinction: **The current moratorium on growth will allow for only 3 parcels of land on our 87 acres. So, in order to pave the way for a legal segregation of property at some future date, the survey has delineated and described 5 separate parcels.**

• Many consultations with planners at Lewis County - have revealed that a small portion of our property is affected by a moratorium for segregation, which was placed on protected land use areas. Washington State's Growth Management Act http://www.gmhb.wa.gov/gma/index.html. The GMA requires that the three boards meet jointly at least annually to share information that promotes the goals and purposes of the GMA. Over the past 5 years that we have been following the situation, the moratorium has been lifted in some areas but not all, and we still have a small sliver of land along the river that falls under their protected area.

•2008 Hire Scott Blinks, Attorney. Consultations with Mr. Blinks to determine the best case scenario towards our goals for The Falls. With the new survey filed at the county, we were now able to file for a "Boundary Line Agreement ". This is not the final solution, but a very necessary step in the process.

• February 2, 2009: “Red Letter Day”
Filed the completed survey at Lewis County.
Filed an amendment to the survey; a Boundary Line Agreement with John Linder, allowing us to sell 1.8 acres to him.

• March 9, 2009. Sell 1.8 acres to John Linder giving him his deed and new legal description.

• March 9, 2009. Signed a new land loan contract with the bank, using most of the proceeds from the Linder sale towards our principle loan. Our monthly payments will pay the mortgage in about 10 years, unless we pay it off early.

So, what CAN we do with The Family Preserve while we wait for the legal segregation of property?
Almost anything we want to do. The attorney has written "easements" into the legal description. The CFLLC still owns and pays taxes for that land but the Family Organization has easement to "MacDonald Road" and to the 11 acres along the river. See the maps attached. The family can improve the road, bring in power, water, build cabins, tent sites etc, etc... The only restriction is that we do not build a place with a permanent plumbing (like a bathroom), because that is when the county requires a residential building permit. We need to have that acreage sub-divided before the final property sub-division. It is now time for the Family organization to rise up and get busy... no need to wait for the LLC at this point.


What Happens when the moratorium is lifted?
The CFLLC will follow through with it's #1 goal to segregate and gift the property to the family organization. Fortunately it will not require 5 years of legal and survey work to get it ready. Those things are already done and paid for. The CFLLC will do what the county requires at that time, for a subdivision of property. When complete, the family can take legal ownership and build it up further. A family lodge, etc. There are implications of maintenance, property taxes and land designation that will become issues that the family organization will assume at that time.

What about the rest of the acreage?
The LLC will continue to own the balance of the land. Members of the LLC will have the opportunity for individual ownership of one of the parcels after the balance of the mortgage is paid off and the family preserve is gifted to the family organization. Members of the CFLLC have unanimously agreed that these properties will remain in CFLLC ownership until them. Thereafter, it is our intent to keep the other parcels in the family.

The CFLLC as a group have kept our eye on the prize throughout this whole process. We know that our ultimate goal has not yet been met, but that the groundwork has been laid. Amazingly, the resources have been there, through the harvesting of granddad's over-grown Christmas trees, and our individual monthly loan payments. The fuel behind it all is the family's recent resurgent support towards gaining a MacDonald Family Preserve & Dad and Mom's constant hospitality providing our home base at The Falls.

See the attachment showing The Falls property in 2 phases:
Phase #1 – 3 parcels with easements for The MacDonald Family Preserve.
Phase #2 – 5 subdivided parcels - MacDonald Family Preserve ready for the family organization to take legal ownership.