MEETING OF THE POINTE-AU-BARIL TRUSTEES Thursday, May 16, 2024 6:00 pm EDT By telephone Present: Trustees – Jean Montgomery, Kit Sawyer, Phil Schneider, John Schneider Guests: Julie Baker, Amy Schneider, Dave Schneider “Listening Grandchildren” ( members of the third generation who had been invited to listen to the meeting to be better informed.) Katherine Captain, Betsy Cushman, Margaret Sawyer John Schneider called the meeting to order at 6:04, acknowledging and thanking everyone for the work they have done to prepare for this meeting. 1 – John called on Dave to explain the Canadian Tax situation. Dave explained that this started in March, 2023, when a new law was passed requiring each owner to file a tax return on “Underutilized Property.” We learned that the title to the islands in held in the names of the four original trustees in each case “as Trustee,” a form which the Recorder of Deeds no longer permits. This raises the issue about how successor trustees could be appointed. The best solution is to have the trust create a Canadian corporation, wholly owned by it, for the exclusive purpose of holding the title, Dave has employed Patrick Sweeney, Canadian lawyer to do this. (Trustees, please be sure to respond promptly to Patrick’s requests for information.) The Corporation would be merely a Title Holder, where the island deeds will be held. A tax return will have to be filed by the Corporation, but since the expenses will exceed the rental “income” from the usage charge, there will be no tax to pay; however we will have to hire an accountant to do the filing and future Underutilized tax filings. The next step is for the lawyers to prepare documents for the four original trustees to transfer the deeds to the new corporation. After that, we will be able to appoint new trustees by simple resignations and appointments among the trustees, with no need for outside filings. Dave suggests the name PaBiscorp (“Pointe-au-Baril Island Corp) There was general agreement. Another issue emerged. There is a once every 21 year tax for Trusts which own property, as we have. This was to have been filed in 2010. The tax is on property that has been “deemed” to have been sold. In other words, whether or not the property has actually been sold, a tax must be paid on the appreciated value of the property. Dave has spend uncountable hours and aggravation, working with three to four different lawyers and firms throughout Canada to unravel these situations. He has succeeded in having the necessary tax return filed. It could be up to two years before the Canadian Government reviews the return and decides the actual taxable amount plus any penalties for late filing. This could be a sizable amount of money. The lawyers’ fees and current knowable taxes have been paid. (General clarification: It was discovered that any property rental requires filing a tax return, and that our method of charging $700/week would be considered “rent.” However since our expenses outweigh the “rent,” no tax will be due.) On behalf of everyone, John thanked Dave for all he has done. He replied, “Happy to do it,” pointing out that this rule that we had no reason to know about or expect, could be a big bill. He also asked to “editorialize,” saying that he is worried about the conditions of the properties, and he wishes us wisdom to make wise choices.” 2 – ISLAND MAINTENANCE Phil and Amy Amy reported that Rick Penfold is difficult to get responses from. Therefore, in March 2014, she contacted three other contractors. The best seemed to Ballantine, whom she asked for estimates on a couple of jobs, so we can compare prices. While this firm is not able to take us as a regular customer this year, they can do that next year, while doing some individual projects for us this year. Amy is impressed that they employ many specifically skilled workmen. Amy presented maintenance jobs in order of most to least urgent. All estimates are in Canadian dollars. 1 – The main holding tank on Buoy. Due to the urgency of this matter, trustees approved this job a week before this meeting, and Ballantine has already been paid $15,000 of what could be a total of $20,000 to $23,000. It must be made with different materials, and be below ground. It will be close to the old place, and be finished by June 20. The Dockside holding tank is OK. 2 – Crumbling chimney. Penfold can’t do this. Ballantine will have a mason evaluate how to proceed. Julie found in the records that in 2012 we paid $18,000 for chimney work to a vendor who is no longer in business. 3 – New decking. This includes the Workshop deck, stairs, perimeter, and railing, as well as the stairs to the Dockside bathroom. Penfold estimate - $16,500. Waiting for Ballantine estimate. Jean suggested that the boards be laid with enough distance between them that pine needles can naturally fall through, rather than collecting, holding moisture and rotting the boards. (Addendum 5/20/2024). Trustees voted to hire Penfold to do this work with pressure treated wood.) 4 – Touch-up painting, and repair rotting wood. Penfold estimate….$11,000 (Addendum 5/20/2024) Amy spoke to Rich Penfold who visited the island 5/19/2024 to evaluate and reported that the majority of the damaged wood trim is at the workshop and will be removed/resolved with the deck replacement. The fascia (the flat lumber that runs perpendicular and between the roof eves and the soffit) ideally should have been repaired when the new roof was installed. As replacing them now requires major demolition and reconstruction, Penfold recommended “several good coats of paint” to protect from further deterioration. He also checked the other cottages, and recommended only touch up painting. His original estimate of $11,000 still holds.) 5 – Two gang planks, ie the wooden walk between the dock and Main, and the one between Main and Dockside both need to be replaced. Penfold estimate…..$3600 Ballantine…..not yet submitted 6 – Two dead trees, should be removed to prevent bugs and dangerous toppling. Penfold…...$2200 Ballantine…...not submitted 7 – Adjusting back dock to be more accessible. General agreement was to consider this issue in 2025. 3 – Treasurer’s Report (attached) Please see Julie’s attachment. John suggested that we take any shortfall between ‘24 expected expenses and expected income from the bank accounts, where we have $75,000. Discussion included * We don’t want to price grandchildren out of being comfortable coming here. * We should raise the assessment on Trustees. * We are spending a lot of money on a place people don’t/can’t go to very often. * Some Trustees advise against holding a lot of money in Canadian banks. * All US funds are in money market accounts, getting the best interest possible. * Each of the older generation – Dave, John, Jean and Kit – have written into their wills a legacy of $100,000 to be deposited in the trusts. So someday there will additional interest to fund the islands. TRUSTEES VOTED TO INCREASE FEES as of July 1, 2024 Grandchildren yearly assessment…..$1000 Weekly “user fee”……………………$1000 Trustees yearly assessment …………$6000 The meeting was adjourned.