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HomeMy WebLinkAboutSupplemental info Toandos ForestJefferson County Conservation Futures Proposal 2025 Upper Yarr Creek Acquisition Project SUPPLEMENTAL MATERIALS Proof of willing seller: See narrative, project sponsor proposing to sell deed restriction to property already owned by NWI. Estimate of value: No appraisal required. Requesting $20,000 or less. Site location map: See separate PDF, maps and photos Critical areas map: See separate PDF, maps and photos Project boundary map: See separate PDF, maps and photos Color images: See separate PDF, maps and photos Development plan or Narrative: NA Proof of 501c3 status Current budget: 2024-2025 Board roster: 2024-2025 Staff roster: 2025 Financial statements: last fiscal year July 2023-June 2024 Resolution to submit proposal: NWI executive committee resolution Cultural Resources letter from Port Gamble S’Klallam Tribe, Feb 27, 2025 RESTRICTED APPRAISAL REPORT HOUGH PROPERTY 1125 TOANDOS ROADQUILCENE, WASHINGTON 98376 SH&H FILE 16344-25 February 26, 2025 Peter Bahls Executive Director Northwest Watershed Institute 3407 Eddy Street Port Townsend, Washington 98368 Re: Restricted Appraisal Report Hough Property 1125 Toandos Road Quilcene, WA 98376 SH&H File 16344-25 Dear Mr. Bahls: At your request, I am providing you with an appraisal of the above referenced property. Per our agreement, this report is provided in a Restricted Appraisal Report format. This appraisal report has been prepared with the intent to conform with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute, which includes the Uniform Standards of Professional Appraisal Practice (USPAP) as promulgated by The Appraisal Foundation. In addition, this report is intended to comply with the reporting requirements set forth under Standards Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice for a Restricted Appraisal Report. As such, it presents limited discussions of the data, reasoning, and analyses that were used in the appraisal process to develop the appraiser’s opinion of value. Supporting documentation concerning the data, reasoning, and analyses is retained in the appraiser’s file. The depth of discussion contained in this report is specific to the needs of the client stated within this report. In completing this assignment, sufficient background information and supporting facts have been analyzed to arrive at a value conclusion, with some of this information being retained in a file memorandum by the appraiser. It is my understanding that this report will be utilized to assist you in establishing the value attributed to the subject's real property as of the effective date of value. The property is currently subject to a Purchase and Sale Agreement with the Northwest Watershed Institute, dated November 2024. The contract price is identified as the greater of $120,000 or the “Fair Market Value” of the property as determined by an appraisal. According to the prospective buyer’s representative, the $120,000 threshold was generally based on the assessed value of the property. Thus, this appraisal report will be utilized to determine a final contract price for the property. The subject of this appraisal is comprised of one Jefferson County Assessor’s parcel with a total area of 6.38 acres, according to Jefferson County GIS information and a Purchase and Sale Agreement document provided. The subject site is located along the easterly side of Toandos Road, westerly of Coyle Road, in the Quilcene - Dabob area of unincorporated Jefferson County (Quilcene address), Washington. The site is forested and gently sloped upward in an easterly direction. The site is improved with a cabin/carport structure containing 168 square feet of enclosed area. Electrical and telephone service are available to the site; however, the site does not have public water access nor is a well or approved septic system installed. The site is, however, currently served by an unapproved septic system, although the legal ability to continue to use this infrastructure is speculative to assume. The purpose of this appraisal is to provide an estimate of the market value of the fee simple interest in the property, as of the date of inspection. The market value of the subject property, as of the date of inspection, February 20, 2025, is estimated at: ONE HUNDRED FORTY-FIVE THOUSAND DOLLARS $145,000 The market value conclusion herein is based on an estimated marketing time of twelve months or less, based on sales of similar properties in the greater market. This estimate of marketing time assumes that the property is competently marketed and priced commensurate with current market parameters. The appraisal report that follows summarizes the assignment, describes the area and the subject property, and explains the valuation techniques and reasoning leading to the final opinion of market value. As in the case of any appraisal, the reader’s attention is directed to the underlying Assumptions and Limiting Conditions that are included in the accompanying report. Respectfully submitted, ______________________________ Chad C. Johnson, MAI State of Washington Certification 1101662 TABLE OF CONTENTS Title Page ........................................................................................................................... i Letter of Transmittal ......................................................................................................... ii Table of Contents ............................................................................................................. iv Subject Photographs.......................................................................................................... v Factual Description Property Identification ...................................................................................................... 1 Intended Use and User of the Appraisal ........................................................................... 1 Property Rights Appraised ................................................................................................ 2 Legal Description .............................................................................................................. 2 Sales History ..................................................................................................................... 2 Purpose of the Appraisal ................................................................................................... 3 Scope of the Appraisal ...................................................................................................... 4 Location Data .................................................................................................................... 4 Property Description ......................................................................................................... 7 Zoning ............................................................................................................................. 11 Taxes and Assessments ................................................................................................... 12 Improvements Description .............................................................................................. 12 Analysis of Data and Opinions of Appraiser Highest and Best Use ...................................................................................................... 13 Property Valuation .......................................................................................................... 13 Sales Comparison Approach ........................................................................................... 13 Reconciliation ................................................................................................................. 31 Certification .................................................................................................................... 32 Qualifications .................................................................................................................. 34 Assumptions and Limiting Conditions ........................................................................... 37 Extraordinary Assumptions and/or Hypothetical Conditions ......................................... 42 SUBJECT PHOTOGRAPHS SOUTHERLY VIEW OF TOANDOS ROAD DRIVEWAY TO THE SUBJECT PROPERTY VIEW OF THE SUBJECT PROPERTY SITE ADDITIONAL VIEW OF THE SUBJECT PROPERTY SITE VIEW OF CABIN/CARPORT STRUCTURE INTERIOR OF CABIN INTERIOR OF SUBJECT SITE SHED RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 1 SH&H File 16344-25 Chad C. Johnson, MAI This Appraisal Report is prepared with the intent to comply with the reporting requirements set forth under the Uniform Standards of Professional Appraisal Practice for a Restricted Appraisal Report. The depth of discussion contained in this report is specific to the needs of the client stated within this report. Diligent effort has been made to fully comply with USPAP. If authorized users of this limited scope appraisal find the information provided is in any way inadequate or insufficient, rather than be misled or confused by this report, they must seek clarification or additional information from the appraiser. APPRAISER Chad C. Johnson, MAI SH&H Valuation and Consulting 3609 Market Place West, Suite 201 University Place, WA 98466 CLIENT Peter Bahls Executive Director Northwest Watershed Institute 3407 Eddy Street Port Townsend, Washington 98368 PROPERTY IDENTIFICATION Hough Property 1125 Toandos Road Quilcene, Washington 98376 INTENDED USE AND USER OF THE APPRAISAL This appraisal is presented in a Restricted Appraisal Report format and is intended to be used only by the client and intended user, Northwest Watershed Institute. The intended use of the report is to establish the market value of the property to determine an appropriate sale price relevant to a pending transaction. Use of this report by others is not intended by the appraisers or the client. A Client is defined as: “The party or parties (i.e., individual, group, or entity) who engage an appraiser by employment or contract in a specific assignment, whether directly or through an agent.”1 1 Uniform Standards of Professional Appraisal Practice, 2024 Edition, Appraisal Standards Board, The Appraisal Foundation, Washington D.C.,, p. 4. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 2 SH&H File 16344-25 Chad C. Johnson, MAI PROPERTY RIGHTS APPRAISED The subject property is appraised as to the fee simple interest. Fee simple interest is defined as follows: “absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.”2 LEGAL DESCRIPTION A title report, dated September 16, 2024, completed by First American Title Insurance Company, was provided and contains a full legal description of the subject property. A copy of this document, inclusive of the legal description, is included in the addenda section of this report. SALES HISTORY According to the title report provided, ownership of the subject property is vested with Thomas J. Hough, a single man. Mr. Hough purchased the property on July 10, 1991. The seller was Discovery Investments and the sale was recorded via Statutory Warranty Deed under Jefferson County Auditor’s file number 341821. I am not aware of any arm’s length or market-based transfers of ownership during the previous ten years. The property is currently subject to a Purchase and Sale Agreement between the seller (Mr. Hough) and the Northwest Watershed Institute (NWI). The contract price is identified as “the greater sum of ONE HUNDRED AND TWENTY THOUSAND U.S. Dollars ($120,000) or the Fair Market Value of the Property as determined by a qualified appraiser in an appraisal commissioned and paid for by the buyer.” The Purchase and Sale Agreement goes on to state that “if the Fair Market Value exceeds $120,000, the Parties agree to amend this Agreement to make such amount the Purchase Price.” A copy of the Purchas and Sale Agreement is included in the Addenda of this report. Thus, it is my understanding that the intended use of this Restricted Appraisal report is to help establish a final purchase price relevant to the pending transaction. 2 The Dictionary of Real Estate Appraisal, 7th Edition, Appraisal Institute, Chicago, 2022, p. 73 RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 3 SH&H File 16344-25 Chad C. Johnson, MAI EFFECTIVE VALUATION DATES Date of Report: February 26, 2025 Date of Inspection/Effective Date of Value: February 20, 2025 MARKETING/EXPOSURE PERIOD The indicated exposure time (i.e., the length of time the subject property would have been exposed for sale in the market had it sold at the market value concluded in this analysis as of the date of this valuation) would have been twelve months or less. The estimated marketing time (i.e., the amount of time it would probably take to sell the subject property if exposed in the market beginning on the date of this valuation) is estimated to be twelve months or less. These conclusions are based on sales of similar type properties in the market. PROBABLE BUYER The most probable buyer of the subject property would likely be an owner user. PURPOSE OF THE APPRAISAL The purpose of the appraisal is to estimate the “as is” market value of the property as of the date of inspection. DEFINITION OF MARKET VALUE Market Value is defined as “the most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress.”3 DEFINITION OF “AS IS” MARKET VALUE “The estimate of the market value of real property in its current physical condition, use, and zoning as of the appraisal date.”4 3 The Appraisal of Real Estate, 15th Edition, Appraisal Institute, Chicago, 2020, p. 48. 4 The Dictionary of Real Estate Appraisal, 7th Edition, Appraisal Institute, Chicago, 2022, p. 10. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 4 SH&H File 16344-25 Chad C. Johnson, MAI SCOPE OF THE APPRAISAL The scope of this appraisal encompasses the necessary research and analysis to prepare a report in accordance with the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute and the Uniform Standards of Professional Appraisal Practice (USPAP) as promulgated by The Appraisal Foundation. The scope of this restricted assignment relates to the field work, inspection, research, and analysis conducted for preparation and valuation of the subject property's estimated value subject to the limitations detailed in this report. This limited scope appraisal assignment involved an inspection of the subject property on February 20, 2025. Statistical, descriptive, and demographic data was gathered using various informational systems such as the Northwest Multiple Listing Service and Jefferson County public records. In the case of the subject property, given that the property is mostly undeveloped with the exception of a cabin and some site infrastructure, the most (and only) applicable and relevant approach to value is the Sales Comparison Approach. In arriving at the value of the subject property by this approach, sales of similar properties were considered. The other typical approaches (Income Approach and Cost Approach) are not typically relied upon in the subject market for these types of properties and are thus not relevant. The exclusion of the other approaches does not detract from the overall reliability of the value conclusion reported herein. UNAVAILABILITY OF INFORMATION A wetland delineation report, site specific soils study, and environmental report were not provided during the timeframe of this assignment. Therefore, any information that would have been provided by these documents is not known or considered. LOCATION DATA A map showing the subject property’s location within the Puget Sound metropolitan area is presented on the following page. A second map showing the subject property’s location within the immediate neighborhood is presented following the area map. In general, the subject is located in the Quilcene area of easterly Jefferson County. This area is comprised of a mixture of forestry/resource properties as well as single family development, primarily on larger/low-density parcels. Many homesites in the area benefit from marine views of Hood Canal/associated water bodies and/or the Olympic Mountain Range. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 5 SH&H File 16344-25 Chad C. Johnson, MAI AREA MAP N RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 6 SH&H File 16344-25 Chad C. Johnson, MAI LOCATION MAP N RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 7 SH&H File 16344-25 Chad C. Johnson, MAI PROPERTY DESCRIPTION The site description provided below is derived from observations made during the site inspection as well as information provided by the client and public records. Site Description The subject property consists of one Jefferson County assessor’s parcel (APN 701153003) containing 6.38 acres, according to Jefferson County GIS information and the Purchase and Sale Agreement. It is located along the easterly side of Toandos Road, westerly of Coyle Road, in the Quilcene - Dabob area of unincorporated Jefferson County (Quilcene address), Washington. The site is forested and gently sloped upward in an easterly direction. The site is improved with a cabin/carport structure containing 168 square feet of enclosed area. Electrical and telephone service are available to the site; however, the site does not have public water access nor is a well or approved septic system installed. The site is, however, currently served by an unapproved septic system, although the legal ability to continue to use this utility is speculative to assume. The owner currently utilizes a rain catchment system for ancillary water purposes and also uses water from an adjacent property owner (by a hose) under an informal agreement for potable purposes. The property does not have a permanent/conventional water system. An aerial view of the subject, with the approximate boundaries of the subject site outlined in red, is provided on the following page. Further details of the subject site are as follows: Location: The subject site is located along the easterly side of Toandos Road, westerly of Coyle Road, in the Quilcene - Dabob area of unincorporated Jefferson County, Washington. Municipal Jurisdiction: Jefferson County. Address: 1125 Toandos Road Quilcene, Washington 98376 Access: The subject site is accessed by way of a driveway extending off of Toandos Road, a private, gated road extending southwesterly off of Coyle Road. The gate is operated by a keypad system. The road is gravel-surfaced but in good condition and appears to be adequately maintained. Site Area: The subject site is comprised of one assessor’s parcel (APN 701153003). According to Jefferson County Assessor’s records, the site contains an area of 6.38 acres. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 8 SH&H File 16344-25 Chad C. Johnson, MAI AERIAL VIEW OF SUBJECT SITE SUBJECT PROPERTY OUTLINED IN RED N RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 9 SH&H File 16344-25 Chad C. Johnson, MAI Shape: Generally rectangular/slightly irregular Utilities: Electrical and telephone service are available to the site. Well and septic systems would be necessary for conventional homesite development. While the property has a septic system adjacent to the cabin, no permits were obtained when it was installed and the legal ability to continue to utilize this system is unknown and speculative to assume. Topography and Coverage: The site contains a combination of sloped and level topography. A topographic map obtained from the Jefferson County GIS mapping system is presented on the following page. Coverage consist primarily mixed conifer species, along with other areas of brush and grasses. Wetlands: I was not provided with any reports or studies relative to wetlands delineation for the subject property. Based on the National Wetlands Inventory map provided by the U.S. Fish and Wildlife Service and the Jefferson County GIS mapping system, there do not appear to be any wetlands on the subject site. Flood Plain: According to Flood Insurance Rate Map Number 53031C0910C, dated June 7, 2019, the subject property is located outside of any flood zones. Soils: Soils reports/studies for the subject site were not available. Instead, data from the United States Department of Agriculture (USDA) Natural Resources Conservation Service mapping system is utilized. The subject property is primarily composed of Sinclair gravelly sandy loam, 0 to 15 percent slopes (SnC). The Sinclair series consists of moderately well drained soils that formed in glacial till on glacial terraces. Vegetation is mainly Douglas fir, western redcedar, red alder, willow, rhododendron, and salal. Most of the acreage of this soil is used for the production of trees, small ranches, and rural homesites. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 10 SH&H File 16344-25 Chad C. Johnson, MAI TOPOGRAPHY MAP SUBJECT PROPERTY OUTLINED IN RED N RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 11 SH&H File 16344-25 Chad C. Johnson, MAI Environmental Issues: An environmental report was not provided. It is noted that there are some areas of debris on the subject property, including an old trailer, vehicle and general debris. I am not aware of any adverse environmental issues that would impact the highest and best use of the subject property. Easements/ Encroachments: A title report relevant to the subject property was provided. There do not appear to be any easements encumbering the subject property that would adversely impact the highest and best use of the site. Surrounding Uses: Surrounding uses in the vicinity of the subject property includes residential uses on larger acreage properties and sites that are managed for the commercial harvest of timber. Views: The site has territorial views. ZONING The subject property consists of one Jefferson County assessor’s parcel (701153003). The zoning for the subject property is Rural Residential 5 (RR-5), per the Jefferson County Code. The purpose of this district is to “Allow for continued residential development in areas of Jefferson County consisting of relatively high-density pre-existing patterns of development, along the county’s coastal areas, and within areas within or adjacent to rural centers and rural crossroads. In addition, this district seeks to support and foster Jefferson County’s existing rural residential landscape and character by restricting new land divisions to a base density of one unit per five acres.” This zoning designation allows for a base density of one dwelling unit per five acres. Outright permitted uses include, but are not limited to, single-family residences, duplexes, home businesses, bed and breakfast residences, mineral extraction activities, parks and playfields, recreational facilities, and aquaculture activities and uses. The subject property contains a reported area of 6.38 acres. The subject is improved with a small cabin and carport. While this is a legal use of the subject site, more permanent/conventional residential development would likely require a well be installed and that the existing septic either be approved by Jefferson County (the outcome of which would be speculative to assume) or a new system installed. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 12 SH&H File 16344-25 Chad C. Johnson, MAI TAXES AND ASSESSMENTS The subject property is carried on the Jefferson County Tax and Assessment roll under one assessor’s parcel number. Tax and assessment information for the subject property is summarized in the chart below. The 2025 taxes are based on the 2024 assessed values and result in an amount of $1,016.62 as shown in the above chart. Experience has shown that the assessed value of a property is often an unreliable indicator of market value, despite the assessor’s mandate to assess all properties at 100% of market value. This appears to be the case with the subject as the assessed value is lower than the appraised value herein. According to Jefferson County Assessor records, the taxes for the subject are paid current. IMPROVEMENTS DESCRIPTION The subject is improved with a cabin and carport structure. The structure is of wood frame construction and was built in 1999. The enclosed cabin contains one room and has a total area of 168 square feet, according to measurements taken during the physical observation. The interior is sparsely finished and has electrical service; however, the site does not contain a well nor access to public water, nor is there an approved septic system. The carport is adjacent to the cabin and contains an area of 126 square feet. The site is further improved with a rainwater catchment system, as well as a storage shed containing 120 square feet. The structures are overall in average condition. Land Improve.Total 2025 Parcel Number Value Value Value Taxes 701153003 $105,644 $18,613 $124,257 $1,016.62 RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 13 SH&H File 16344-25 Chad C. Johnson, MAI HIGHEST AND BEST USE “As Though Vacant” Considering the limited allowed legal uses according to zoning, as well as the physical characteristics of the site, the highest and best use of the property “as though vacant” is for development of the site with one single-family residence. “As Improved” The subject is improved with a small cabin and carport structure; however, there is no well or approved septic system in place. The structure has utilitarian value to the site for recreational use. Therefore, the highest and best use as improved is for continued use of the existing recreational improvement in the interim, with the potential for single-family residential development in the future, as dictated by demand. PROPERTY VALUATION The subject site is a rural residential site and is improved with a cabin/carport structure. Although all three approaches to value were considered, based on the characteristics of the subject property, the only applicable and relevant approach to value is the Sales Comparison Approach. The Sales Comparison Approach is considered to provide sufficient data to arrive at a reasonable and supportable value conclusion for the subject property. SALES COMPARISON APPROACH The Sales Comparison Approach involves the process of comparing improved properties which have recently sold, with the subject property, noting and adjusting for similarities and dissimilarities between the property being appraised and the sale comparables. This approach to value considers a physical unit of comparison, the price per site in this case. Within this approach, I will evaluate comparable sales data to formulate a value estimate for the subject property. The research for comparable sales focused on rural residential properties with similar use potential as the subject. The search first focused on the sale of rural properties that contained outbuildings and/or small residential/cabin structures. Two sales were identified (L-2 and L-4). The search was then expanded to include unimproved properties with similar development potential as the subject. To that end, two additional closed sales were identified (L-3 and L-5), as well as one current listing (L-1). RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 14 SH&H File 16344-25 Chad C. Johnson, MAI All of the comparables are located within the subject’s general neighborhood of Quilcene, and all of the closed sales have occurred within the past six months. A total of four closed comparable sales and one current listing were selected for the analysis of the subject property. The exhibit below summarizes the comparables utilized, with a location map shown on the page after the chart. Following the map, more detailed information for the comparables is presented, together with a parcel map. In this instance, the most appropriate unit of comparison is the price per site. Size Sale Location Sale Date (Acres)Sales Price L-1 11573 Coyle Road Listing 4.67 $89,000 Quilcene L-2 82 Camelot Road Jul-24 7.10 $120,000 Quilcene L-3 24XX Munn Road Oct-24 5.51 $135,000 Quilcene L-4 771 Lakenes Road Nov-24 5.05 $150,000 Quilcene L-5 4 Mt. Walker View Drive Jan-25 4.97 $150,000 Quilcene SALE COMPARABLES RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 15 SH&H File 16344-25 Chad C. Johnson, MAI COMPARABLE LAND SALES MAP N RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 16 SH&H File 16344-25 Chad C. Johnson, MAI Land Listing No. 1 Property Identification Record ID 15925 Property Type Residential Address 11573 Coyle Road, Quilcene, Jefferson County, Washington 98376 Location Toandos Peninsula Assessor’s Parcel Number 601222007 Instrument Statutory Warranty Deed Sale Data Grantor Brian L. Spain Survey Date February 24, 2025 Property Rights Fee Simple Verification Tim Horvath, listing agent (360) 531-0980 Listing Price $89,000 Land Data Zoning RR5, Jefferson County Topography Sloped & forested Utilities Electric in street; approved septic design Shape Rectangular Land Size Information Gross Land Size 4.670 Acres or 203,425 SF Indicators List Price/Site $89,000 Remarks This is the listing of a rural residential site located along Coyle Road, in the Toandos Peninsula area outside of Quilcene, in unincorporated Jefferson County. The site contains 4.67 acres, is sloped and heavily forested and is rectangular in shape. There is electrical service available in the street. There is an approved 5-bedroom septic permit; however, installation of the septic system, along with a well, are required for development. A GeoTech study has been completed for the property and has identified adequate buildable space for a single-family residential development. The property has been listed for sale multiple times over the past few years. According to the listing agent, the buildable area of the site is greatly diminished due to significant sloping; however, a small portion is buildable. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 17 SH&H File 16344-25 Chad C. Johnson, MAI TOANDOS PENINSULA 11573 COYLE ROAD RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 18 SH&H File 16344-25 Chad C. Johnson, MAI Land Sale No. 2 Property Identification Record ID 15926 Property Type Residential Address 82 Camelot Road, Quilcene, Jefferson County, Washington 98376 Location Easterly of SR 101 Assessor’s Parcel Number 702131023 Instrument Statutory Warranty Deed Sale Data Grantor Steven & Bernita Moul Grantee David Metoyer & Anthony Metoyer Sale Date July 24, 2024 Auditor’s File Number 667019 Property Rights Fee Simple Financing Cash Sale History Sold 11/2020 for $75,000 Verification Kalan Hatton, selling agent; 360-531-4419 Sale Price $120,000 Land Data Zoning RR5, Jefferson County Topography Sloped & heavily forested Utilities See remarks Shape Triangular Land Size Information Gross Land Size 7.100 Acres or 309,276 SF Front Footage 980 ft Center Road Indicators Sale Price/Site $120,000 RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 19 SH&H File 16344-25 Chad C. Johnson, MAI Land Sale No. 2 (Cont.) Remarks This is the July 2024 sale of a rural residential site located in the Quilcene area of unincorporated Jefferson County. There is access to the site by way of Camelot Road, a gravel access easement extending northerly off of Center Road, as well as a gated driveway extending off of Center Road. The triangular site has approximately 980 feet of frontage along Center Road. The site contains 7.1 acres and is sloped and heavily forested. Electrical service is available in Center Road. There is a low producing well at the top end of the allowable chloride level. Septic is needed for development. The site is improved with an enclosed metal shed/garage containing 300 square feet with a gravel floor and a seven-foot high garage door. There is also an open walled carport. According to the selling broker, both outbuildings are in average condition. The site was listed for sale for $135,000 and was on the market for 257 days before selling for $120,000, or 89% of its list price. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 20 SH&H File 16344-25 Chad C. Johnson, MAI EASTERLY OF SR 101 82 CAMELOT ROAD RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 21 SH&H File 16344-25 Chad C. Johnson, MAI Land Sale No. 3 Property Identification Record ID 15927 Property Type Residential Address 24XX Munn Road, Quilcene, Jefferson County, Washington 98376 Location Lake Leland area Assessor’s Parcel Number 802261019 Instrument Statutory Warranty Deed Sale Data Grantor Sara Brown Grantee Virginia Navrides Sale Date October 22, 2024 Auditor’s File Number 668485 Property Rights Fee Simple Financing Seller financed at typical terms Verification Sher Kirkpatrick, selling agent; 360-909-8636 Sale Price $135,000 Land Data Zoning RR 20, Jefferson County Topography Portions steeply sloped & forested Utilities Electric in the street Shape Rectangular Land Size Information Gross Land Size 5.510 Acres or 240,016 SF Indicators Sale Price/Site $135,000 Remarks This is the October 2024 sale of a rural residential site located near Lake Leland, in the Quilcene area of unincorporated Jefferson County. The site contains 5.51 acres. The topography is a combination of steeply sloped and level site area. It is heavily forested; however, there is reportedly no merchantable timber. Electrical service is available at the property line and well and septic are needed for development. There is a clear-cut dirt road extending from Munn Road to a buildable area. The property was listed for $135,000 and was on the market for 85 days before selling it for its full list price. According to the selling agent, there was nothing atypical about the property or transaction, which was seller financed, which is common in the area. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 22 SH&H File 16344-25 Chad C. Johnson, MAI LAKE LELAND AREA 24XX MUNN ROAD RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 23 SH&H File 16344-25 Chad C. Johnson, MAI Land Sale No. 4 Property Identification Record ID 15928 Property Type Residential Address 771 Lakenes Road, Quilcene, Jefferson County, Washington 98376 Location Lords Lake area Assessor’s Parcel Number 702121003 Instrument Statutory Warranty Deed Sale Data Grantor Peter L. Tennigkeit Grantee Andrew & Kimberly Luly Sale Date November 06, 2024 Auditor’s File Number 668694 Property Rights Fee Simple Verification Jenn Forest, selling agent; 360-316-1147 Sale Price $150,000 Land Data Zoning RR5, Jefferson County Topography Sloped upward SW to NE, forested Utilities See remarks Shape Rectangular Land Size Information Gross Land Size 5.050 Acres or 219,978 SF Indicators Sale Price/Site $150,000 Remarks This is the November 2024 sale of a rural residential site located in the Lords Lake area, off of Lakenes Road, in the Quilcene area of unincorporated Jefferson County. The site contains 5.05 acres and has a view of the Olympic Mountains. The topography is sloped upward in a southwesterly to a northeasterly direction, with adequate level site area for development. It is forested. Electrical service is available a few parcels down Lakenes Road. Septic and well are needed for development. The site is improved with an unpermitted tiny home in average/good, newer condition. The tiny home contains a kitchenette and loft sleeping area. There is a solar power system, a composting toilet and a rainwater catchment system in place. The site is improved with multiple smaller outbuildings used for storage and small animal husbandry. The property was listed for $185,000 and sold for $150,000 after being on the market for 67 days. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 24 SH&H File 16344-25 Chad C. Johnson, MAI LORDS LAKE AREA 771 LAKENES ROAD RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 25 SH&H File 16344-25 Chad C. Johnson, MAI Land Sale No. 5 Property Identification Record ID 15931 Property Type Residential Address Mt Walker View Drive, Quilcene, Jefferson County, Washington 98376 Location Toandos Peninsula Assessor’s Parcel Number 601225012 Instrument Statutory Warranty Deed Sale Data Grantor Jason & Cheryl Wright Grantee Keith Mast, Jacob & Emily Moushey Sale Date January 25, 2025 Auditor’s File Number 669834 Property Rights Fee Simple Financing Typical Verification Tim Horvath, listing agent (360) 531-0980 Sale Price $150,000 Land Data Zoning RR5, Jefferson County Topography Gently sloped & forested Utilities Electric in street; well & septic needed Shape Rectangular Land Size Information Gross Land Size 4.970 Acres or 216,493 SF Indicators Sale Price/Site $150,000 Remarks This is the January 2025 sale of a rural residential site located in the Mt Walker View subdivision. The property is located at the end of Mt. Walker View Drive (Starry Night Place), which is identified on a plat map as a small, cul-de-sac subdivision. The site is located on the Toandos Peninsula, outside of the Quilcene area, in unincorporated Jefferson County. The site contains 4.97 acres and is gently sloped and forested. There is a view of Mt. Walker. Electrical service is available in the street, and septic and well are needed for development. The property was listed for $159,950 and sold for $150,000 after being on the market for 170 days. The site has an approved Site Development Review in place. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 26 SH&H File 16344-25 Chad C. Johnson, MAI TOANDOS PENINSULA MT WALKER VIEW DRIVE RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 27 SH&H File 16344-25 Chad C. Johnson, MAI Analysis of Land Sales A basic principle in the valuation of real estate is that no two properties are identical, which means that adjustments are necessary to reflect the various differences of the properties being considered. An adjustment process is applied to the comparables, with an adjustment chart presented following the discussion of the comparables. The adjustment process allows the appraiser to consider the thought process often followed by buyers and sellers in comparing different properties. Within the discussion of each sale detailed herein, the sales’ characteristics are noted and compared to the subject, resulting in conclusions requiring adjustments to the indicated unit prices of the comparables. Qualitative adjustments are applied, either positive or negative, to account for physical differences between the comparables and the subject property. In this instance, the price per site has been utilized for analysis purposes. Quantitative Adjustments The property rights conveyed, financing, conditions of sale, and buyer expenditures/other do not require any quantitative adjustments for the comparables. Market Conditions In analyzing the influence of the market conditions at the time of sale of the comparables in relation to the market conditions as of the date of appraisal, the key factor is the passage of time. More specifically, the question to be answered in its simplest form is whether there is any trend in general prices through time. The date of sale for the comparables ranges from July 2024 to January 2025, as well as a current listing. All of the closed sales have occurred within the last six months, with one of the sales occurring a few weeks before the date of inspection for the subject. The rural residential market in Jefferson County has historically exhibited gradual signs of growth. Therefore, due to the relatively recent dates of sale, no market conditions adjustments are applied to the comparables. After quantitative adjustments, the comparables indicate a range on a price per site basis from $89,000 to $150,000 per site. The next step is to consider the appropriate qualitative adjustments to apply to the comparables for the analysis of the subject. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 28 SH&H File 16344-25 Chad C. Johnson, MAI Qualitative Adjustments The individual comparable sales are now compared to the subject as it relates to qualitative adjustments, including Location, Site Size (Acres), Site Utility, Utilities in Place, and Improvements. An adjustment grid has been prepared, as shown on the following page, simulating the thought process a prudent and knowledgeable purchaser might use if involved in comparing the comparables to the subject property. This chart is presented as an aid in depicting the positive and negative influences that impact the market value of properties in this market segment. Location The subject is located on the Toandos Peninsula, off of Toandos Road, which is a private, gated road finished with gravel and dirt. L-1 and L-5 are also located on the Toandos Peninsula, but are accessed off of Coyle Road, which is a finished and county-maintained arterial. Additionally, L-5 is located in a subdivision plat. These comparables are therefore adjusted downward for location. L-2 contains a considerable amount of frontage along a higher trafficked arterial (Center Road), which is a less desirable attribute for a rural residential property. Thus, this comparable is adjusted upward for location. The remaining sales are similar enough when compared to the subject in location that no adjustment is needed for this factor. Site Size The subject contains 6.38 acres. All of the comparables are similar enough in size to forgo an adjustment. Site Utility The subject property has a combination of sloped and level topography. L-1 and L-2 have more sloped topography and are adjusted upward, with L-1 reported to have a very confined potential homesite due to topography. Thus, upward adjustments are appropriate for this factor, with a stronger adjustment applied to L-1. L-5 has less areas of sloping than the subject and is adjusted downward. The remaining comparables are generally similar to the subject in site utility and no adjustments are applied. RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 29 SH&H File 16344-25 Chad C. Johnson, MAI Utilities in Place The subject has electrical service, but a well and septic system are needed for conventional residential development. Although the subject currently has a septic system in place, it was not approved at the time of installation and the ability to legally utilize this infrastructure is speculative. Therefore, the property is essentially viewed as not having a septic system for analysis purposes. The historical functionality of the existing system, however, suggests that the site’s soils are capable of supporting such a system. L-1 also has electrical service and there is an approved septic design in place. This comparable is adjusted downward for utilities. L-2 has electrical service as well as a drilled well and is also adjusted downward for this factor. L-4 does not have electrical service and is adjusted upward. L-3 and L-5 are similar to the subject in this regard and no adjustments are needed. Comparable Number L-1 L-2 L-3 L-4 L-5 Sale Price n/a $89,000 $120,000 $135,000 $150,000 $150,000 Property Rights Conveyed Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Adjustment $0 $0 $0 $0 $0 Adjusted Price $89,000 $120,000 $135,000 $150,000 $150,000 Financing Cash to Seller Cash to Seller Cash to Seller Cash to Seller Cash to Seller Cash to Seller Adjustment $0 $0 $0 $0 $0 Adjusted Price $89,000 $120,000 $135,000 $150,000 $150,000 Conditions of Sale Arms Length Arms Length Arms Length Arms Length Arms Length Arms Length Adjustment $0 $0 $0 $0 $0 Adjusted Price $89,000 $120,000 $135,000 $150,000 $150,000 Buyer Expenditures/Other None None None None None Adjustment $0 $0 $0 $0 $0 Adjusted Price $89,000 $120,000 $135,000 $150,000 $150,000 Date of Sale Feb-25 Listing Jul-24 Oct-24 Nov-24 Jan-25 Months Since Sale 0 6 3 3 0 Adjustment 0.00%0.00%0.00%0.00%0.00% Adjusted Price $89,000 $120,000 $135,000 $150,000 $150,000 Adjusted Price/Site $89,000 $120,000 $135,000 $150,000 $150,000 Qualitative Adjustments Location Superior Inferior Similar Similar Superior Adjustment - + - Size (Acres)6.38 4.67 7.10 5.51 5.05 4.97 Adjustment Site Utility Inferior Inferior Similar Similar Superior Adjustment + + + - Utilities in Place Superior Superior Similar Inferior Similar Adjustment - - + Improvements Inferior Similar Inferior Superior Inferior Adjustment + + - - + Total Adjustment Upward Upward Upward Downward Downward RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 30 SH&H File 16344-25 Chad C. Johnson, MAI Improvements The subject is improved with a small cabin/carport structure, as well as a storage shed. L- 4 has a newer tiny home in average/good condition; thus, a strong downward adjustment is applied to this comparable. L-2 is improved with some outbuildings; thus, no adjustment is applied to this comparable. L-1, L-3 and L-5 do not contain improvements or outbuildings. These comparables are adjusted upward for this factor. Conclusion The five comparables indicate a range from $89,000 to $150,000 per site. Predicated upon the previous discussion and taking into consideration the location and quality of the subject property, a value higher than L-3 ($135,000/site), but lower than L-4 ($150,000) and L-5 ($150,000/site) is reasonable. Based on my analysis and discussion herein, a value estimate of $145,000, as bracketed and supported by the central tendencies of L-3 and L-4, is concluded for subject property, resulting in an overall value, as follows: Predicated upon the previous analysis, the opinion of value for the subject property by the Sales Comparison Approach is as follows: Market Value Indication by the Sales Comparison Approach, as of February 20, 2025: $145,000 Acres Value 6.38 $145,000 VALUE BY THE SALES COMPARISON APPROACH RESTRICTED APPRAISAL REPORT HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 31 SH&H File 16344-25 Chad C. Johnson, MAI Reconciliation Only the Sales Comparison Approach is utilized for this appraisal assignment. The Sales Comparison Approach allows for the comparison of similar type properties to the subject, noting for similarities and differences between the comparables and the subject property. This approach contributes a credible value conclusion and is the most (and only) relevant approach for this type of property. Based upon the preceding data and discussions, the “as is” market value of the subject property, as of the date of inspection, February 20, 2025, is estimated at: ONE HUNDRED FORTY-FIVE THOUSAND DOLLARS $145,000 CERTIFICATION HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 32 SH&H File 16344-25 Chad C. Johnson, MAI I certify that, to the best of my knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions, and represent my personal, impartial and unbiased professional analyses, opinions, and conclusions. 3. I have no present or prospective interest in the property that is the subject of this report and have no personal interest with respect to the parties involved. 4. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment. 5. My engagement in this assignment was not contingent upon developing or reporting predetermined results. 6. My compensation for completing this assignment is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 7. I have made personal inspections of the property that is the subject of this report. 8 Katherine E. Tiffany, License Number 1002112, provided significant real property appraisal assistance to the person signing this report relevant to the subject research, market research, comparable confirmation, analysis and/or report preparation. 9. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and the Standards of Professional Appraisal Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice. 10. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 11. This appraisal assignment was not based on a requested minimum valuation, a specific valuation, or an approval of a loan. CERTIFICATION HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 33 SH&H File 16344-25 Chad C. Johnson, MAI 12. I am competent and qualified to perform the appraisal assignment. 13. I have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment. 14. As of the date of this report, I have completed the continuing education program for Designated Members of the Appraisal Institute. _____________________________ Chad C. Johnson, MAI State of Washington Certification 1101662 QUALIFICATIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 34 SH&H File 16344-25 Chad C. Johnson, MAI CHAD C. JOHNSON, MAI GENERAL EDUCATION BA, Business Administration, Option in Real Estate, Washington State University Relevant Coursework Real Estate Principles Real Estate Finance Real Estate Valuation Real Estate Investment Real Estate Law CERTIFICATIONS Washington State Certified General Real Estate Appraiser Certification 1101662 Issue Date: March 31, 2005 PROFESSIONAL DESIGNATION MAI, Appraisal Institute PROFESSIONAL EXPERIENCE Real Estate Appraiser and Consultant SH&H Valuation and Consulting (formerly Strickland, Heischman & Hoss, Inc.) June 2001 to Present SELECTED APPRAISAL INSTITUTE COURSES Course 310, Basic Income Capitalization (February 2002) Course 320, General Applications (December 2004) Course 410, Standards of Professional Practice, Part A (September 2001) Course 420, Standards of Professional Practice, Part B (September 2001) Course 510, Advanced Income Capitalization (December 2002) Course 520, Highest & Best Use and Market Analysis (September 2006) Course 530, Advanced Sales Comparison and Cost Approaches (September 2008) Course 540, Report Writing and Valuation Analysis (August 2003) Course 550, Advanced Applications (January 2009) Uniform Appraisal Standards for Federal Land Acquisitions – Practical Applications (May 2017) Eminent Domain and Condemnation (August 2018) Fundamentals of the Uniform Appraisal Standards for Federal Land Acquisitions (October 2020) Various Continuing Education Courses and Seminars QUALIFICATIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 35 SH&H File 16344-25 Chad C. Johnson, MAI PARTIAL LIST OF PROPERTY TYPES APPRAISED Apartments Industrial Subdivisions Agricultural Properties Institutional Properties Aquaculture Properties Leasehold Interests Automobile Dealerships Medical Offices Automobile Repair Facilities Mineral Extraction Operations Banks Mixed-Use Properties Bowling Alleys Natatoriums Business Parks Nurseries Cardlock Fueling Facilities Private Schools Carwashes Professional Offices Churches Recreational Properties Commercial Land Religious Retreats Commercial Subdivisions Residential Land Condominium Developments Residential Subdivisions Conservation Easements Resource and Forest Land Properties Daycare Centers Restaurants Food Processing Plants Retail Properties Gas Station/Convenience Stores Right-of-Way Acquisitions Golf Courses Self-Storage Facilities Health Clubs Shellfish Processing Plants Hotels/Motels Single-Family Residences Industrial Properties Waterfront Properties APPRAISAL EXPERIENCE IN THE FOLLOWING WASHINGTON COUNTIES Benton County Lewis County Clallam County Mason County Clark County Okanogan County Cowlitz County Pacific County Franklin County Pierce County Grant County San Juan County Grays Harbor County Skagit County Island County Snohomish County Jefferson County Spokane County King County Thurston County Kitsap County Whatcom County Kittitas County Yakima County QUALIFICATIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 36 SH&H File 16344-25 Chad C. Johnson, MAI PARTIAL LIST OF CLIENTS FOR WHICH I HAVE COMPLETED APPRAISALS 1st Security Bank (formerly Anchor Bank) Northwest Watershed Institute Alaska USA Federal Credit Union O Bee Credit Union Bank of America Olympia Federal Bank of the Pacific Pierce County Bank of the West Peoples Bank Bank of Washington Port of Silverdale BECU Portage Bank Capitol Land Trust PUD No. 1 of Clallam County Center for Natural Lands Management Puyallup School District Central Kitsap School District Quinault Nation Enterprise Board City of Enumclaw Security State Bank City of Kent Snohomish County City of Tacoma South Whidbey Parks & Recreation District City of University Place Sportsmen’s National Land Trust City of Yakima Sunwest Bank Columbia Bank TAPCO Credit Union Commencement Bank Thurston County Community National Bank & Trust Thurston First Bank CUSG/CU Services Group Timberland Bank First Federal Trust for Public Lands Forterra Tukwila School District Grays Harbor County Umpqua Bank Great Peninsula Conservancy UniBank Harborstone Credit Union US Bank Heritage Bank US Department of Agriculture – Forest Service HomeStreet Bank US Department of the Interior (DOI-AVSO) Hood Canal Salmon Enhancement Group Washington Department of Fish and Wildlife Jefferson County Washington Department of Natural Resources Jefferson Land Trust Washington Farm Service Agency Key Bank Washington Parks & Recreation Commission Kitsap Bank Washington Business Bank Kitsap Credit Union Washington Trust Bank Mountain Pacific Bank WCLA Credit Union Native American Bank, NA WSECU Nature Conservancy of Washington Wells Fargo Bank Nisqually Land Trust Wells Fargo Wealth Management North Kitsap School District Whidbey Camano Land Trust North Olympic Land Trust Yakima County Public Services Northwest Christian Credit Union Zions First National Bank Northwest Farm Credit Services Various Attorneys, Accountants & Individuals ASSUMPTIONS AND LIMITING CONDITIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 37 SH&H File 16344-25 Chad C. Johnson, MAI Unless noted otherwise in the body of the report, this appraisal is subject to the following assumptions and limiting conditions. 1. No responsibility is assumed for legal or title considerations. Title to the subject property is marketable and free and clear of all liens, encumbrances, encroachments, easements and restrictions. The property is assumed to be under responsible ownership and competent management and is assumed available for its highest and best use. 2. There are no existing judgments or pending or threatened litigation that impact the value of the property. 3. There are no hidden or undisclosed conditions of the land or of the improvements that impact the value of the property. 4. Information, public and private, relevant to sale price indications is assumed to be correct. 5. The property is in compliance with all applicable building, environmental, zoning, and other federal, state and local laws, regulations and codes. 6. Information, estimates and opinions contained in the report, obtained from others, including third-party sources, are assumed to be reliable and have not been independently verified and no warranty is given for accuracy. 7. An appraisal is inherently subjective and represents my opinion as to the value of the property appraised. 8. The conclusions stated in my appraisal apply only as of the effective date of the appraisal, and no representation is made as to the effect of subsequent events. 9. No changes in any federal, state or local laws, regulations or codes (including, without limitation, the Internal Revenue Code) are anticipated. 10. When environmental impact studies are not provided in conjunction with the appraisal, I reserve the right to revise or rescind any of the value opinions based upon any subsequent environmental impact studies. If any environmental impact statement is required by law, the appraisal assumes that such statement will be favorable and will be approved by the appropriate regulatory bodies. ASSUMPTIONS AND LIMITING CONDITIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 38 SH&H File 16344-25 Chad C. Johnson, MAI 11. Unless otherwise agreed to in writing, I am not required to give testimony, respond to any subpoena or attend any court, governmental or other hearing with reference to the property without compensation relative to such additional employment. 12. I have made no survey of the property and assume no responsibility in connection with such matters. Any sketch or survey of the property included in this report is for illustrative purposes only and should not be considered to be scaled accurately for size. The appraisal covers the property as described in this report, and the areas and dimensions set forth are assumed to be correct. 13. No opinion is expressed as to the value of subsurface oil, gas or mineral rights, if any, and I have assumed that the property is not subject to surface entry for the exploration or removal of such materials, unless otherwise noted in my appraisal. 14. I accept no responsibility for considerations requiring expertise in other fields. Such considerations include, but are not limited to, legal descriptions and other legal matters such as legal title, geologic considerations such as soils and seismic stability, and civil, mechanical, electrical, structural and other engineering and environmental matters. 15. The distribution of the total valuation in the report between land and improvements applies only under the reported highest and best use of the property. The allocations of value for land and improvements must not be used in conjunction with any other appraisal and are invalid if so used. The appraisal report shall be considered only in its entirety. No part of the appraisal report shall be utilized separately or out of context. 16. Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraisers, or any reference to the Appraisal Institute) shall be disseminated through advertising media, public relations media, news media or any other means of communication (including without limitation prospectuses, private offering memoranda and other offering material provided to prospective investors) without the prior written consent of the person signing the report. 17. Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results. ASSUMPTIONS AND LIMITING CONDITIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 39 SH&H File 16344-25 Chad C. Johnson, MAI 18. If the property is subject to one or more leases, any estimate of residual value contained in the appraisal may be particularly affected by significant changes in the condition of the economy, of the real estate industry, or of the appraised property at the time these leases expire or otherwise terminate. 19. No consideration has been given to personal property located on the premises or to the cost of moving or relocating such personal property; only the real property has been considered. 20. The current purchasing power of the dollar is the basis for the value stated herein. I have assumed that no extreme fluctuations in economic cycles will occur. 21. The analyses contained in the report necessarily incorporate numerous estimates and assumptions regarding property performance, general and local business and economic conditions, the absence of material changes in the competitive environment and other matters. Some estimates or assumptions, however, inevitably will not materialize, and unanticipated events and circumstances may occur; therefore, actual results achieved during the period covered by my analysis will vary from my estimates, and the variations may be material. The Americans with Disabilities Act (ADA) became effective in the 1990s. I have not made a specific survey or analysis of the property to determine whether the physical aspects of the improvements meet the ADA accessibility guidelines. I claim no expertise in ADA issues, and render no opinion regarding compliance of the subject with ADA regulations. Inasmuch as compliance matches each owner's financial ability with the cost to cure the non-conforming physical characteristics of a property, a specific study of both the owner's financial ability and the cost to cure any deficiencies would be needed for the Department of Justice to determine compliance. 22. No studies have been provided to me indicating the presence or absence of hazardous materials on the subject property or in the improvements, and my valuation is predicated upon the assumption that the subject property is free and clear of any environmental hazards including, without limitation, hazardous wastes, toxic substances and mold. No representations or warranties are made regarding the environmental condition of the subject property and the person signing the report shall not be responsible for any such environmental conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because I am not experts in the field of environmental conditions, the appraisal report cannot be considered as an environmental assessment of the subject property. ASSUMPTIONS AND LIMITING CONDITIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 40 SH&H File 16344-25 Chad C. Johnson, MAI 23. The person signing the report may have reviewed available flood maps and may have noted in the appraisal report whether the subject property is located in an identified Special Flood Hazard Area. I am not qualified to detect such areas and therefore do not guarantee such determinations. The presence of flood plain areas and/or wetlands may affect the value of the property, and the value conclusion is predicated on the assumption that wetlands are non-existent or minimal. 24. The appraisal report and the value conclusion within the appraisal is predicated upon the assumption that the satisfactory completion of construction, repairs or alterations will be performed in a workmanlike manner. 25. It is expressly acknowledged that in any action which may be brought against SH&H Valuation and Consulting, or their respective officers, owners, managers, directors, agents, subcontractors or employees (the "SH&H Valuation and Consulting Parties"), arising out of, relating to, or in any way pertaining to this engagement, the appraisal reports, or any estimates or information contained therein, the “SH&H Valuation and Consulting Parties” shall not be responsible or liable for an incidental or consequential damages or losses, unless the appraisal was fraudulent or prepared with gross negligence. It is further acknowledged that the collective liability of the “SH&H Valuation and Consulting Parties” in any such action shall not exceed the fees paid for the preparation of the appraisal report unless the appraisal was fraudulent or prepared with gross negligence. Finally, it is acknowledged that the fees charged herein are in reliance upon the foregoing limitations of liability. 26. SH&H Valuation and Consulting, an independently owned and operated company, has prepared the appraisal for the specific purpose stated elsewhere in the report. The intended use of the appraisal is stated in the report. The use of the appraisal report by anyone other than the Client is prohibited except as otherwise provided. Accordingly, the appraisal report is addressed to and shall be solely for the Client's use and benefit unless I provide my prior written consent. I expressly reserve the unrestricted right to withhold my consent to your disclosure of the appraisal report (or any part thereof including, without limitation, conclusions of value and our identity), to any third parties. Stated again for clarification, unless my prior written consent is obtained, no third party may rely on the appraisal report (even if their reliance was foreseeable). ASSUMPTIONS AND LIMITING CONDITIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 41 SH&H File 16344-25 Chad C. Johnson, MAI 27. The conclusions contained in this report are estimates based on known current trends and reasonably foreseeable future occurrences. These estimates are based partly on property information, data obtained in public records, interviews, existing trends, buyer-seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable. SH&H Valuation and Consulting and the undersigned are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this assignment. Furthermore, it is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance. While I am of the opinion that my findings are reasonable based on current market conditions, I do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty. Moreover, I assume competent and effective management and marketing for the duration of the projected holding period of this property. 28. Any prospective value estimates presented in this report are estimates and forecasts which are prospective in nature and are subject to considerable risk and uncertainty. In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of my estimates such as, but not limited to changes in the economy, interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc. It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future. 29. The value estimate herein is subject to these and to any other assumptions or conditions set forth in the body of this report, but which may have been omitted from this list of Assumptions and Limiting Conditions. EXTRAORDINARY ASSUMPTIONS AND/OR HYPOTHETICAL CONDITIONS HOUGH PROPERTY, 1125 TOANDOS ROAD, QUILCENE, JEFFERSON COUNTY, WA 98376 Page 42 SH&H File 16344-25 Chad C. Johnson, MAI 1. Extraordinary Assumption: “an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.”5 Extraordinary assumptions assume as fact otherwise uncertain information about physical, legal, or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends; or about the integrity of data used in analysis. There are no extraordinary assumptions relevant to this appraisal. 2. Hypothetical Conditions: “a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.”6 A hypothetical condition assumes conditions contrary to known facts about physical, legal, or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends; or about the integrity of data used in analysis. There are no hypothetical conditions relevant to this appraisal. 5 Uniform Standards of Professional Appraisal Practice, 2024 Edition, Appraisal Standards Board, The Appraisal Foundation, Washington D.C., p. 4. 6 Ibid, p. 4. ADDENDA American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 1 of 9 ALTA COMMITMENT FOR TITLE INSURANCE issued by FIRST AMERICAN TITLE INSURANCE COMPANY NOTICE IMPORTANT – READ CAREFULLY: THIS COMMITMENT IS AN OFFER TO ISSUE ONE OR MORE TITLE INSURANCE POLICIES. ALL CLAIMS OR REMEDIES SOUGHT AGAINST THE COMPANY INVOLVING THE CONTENT OF THIS COMMITMENT OR THE POLICY MUST BE BASED SOLELY IN CONTRACT. THIS COMMITMENT IS NOT AN ABSTRACT OF TITLE, REPORT OF THE CONDITION OF TITLE, LEGAL OPINION, OPINION OF TITLE, OR OTHER REPRESENTATION OF THE STATUS OF TITLE. THE PROCEDURES USED BY THE COMPANY TO DETERMINE INSURABILITY OF THE TITLE, INCLUDING ANY SEARCH AND EXAMINATION, ARE PROPRIETARY TO THE COMPANY, WERE PERFORMED SOLELY FOR THE BENEFIT OF THE COMPANY, AND CREATE NO EXTRACONTRACTUAL LIABILITY TO ANY PERSON, INCLUDING A PROPOSED INSURED. THE COMPANY’S OBLIGATION UNDER THIS COMMITMENT IS TO ISSUE A POLICY TO A PROPOSED INSURED IDENTIFIED IN SCHEDULE A IN ACCORDANCE WITH THE TERMS AND PROVISIONS OF THIS COMMITMENT. THE COMPANY HAS NO LIABILITY OR OBLIGATION INVOLVING THE CONTENT OF THIS COMMITMENT TO ANY OTHER PERSON. COMMITMENT TO ISSUE POLICY Subject to the Notice; Schedule B, Part I – Requirements; Schedule B, Part II – Exceptions; and the Commitment Conditions, First American Title Insurance Company, a Nebraska corporation (the “Company”), commits to issue the Policy according to the terms and provisions of this Commitment. This Commitment is effective as of the Commitment Date shown in Schedule A for each Policy described in Schedule A, only when the Company has entered in Schedule A both the specified dollar amount as the Proposed Amount of Insurance and the name of the Proposed Insured. If all of the Schedule B, Part I – Requirements have not been met within 180 days after the Commitment Date, this Commitment terminates and the Company’s liability and obligation end. COMMITMENT CONDITIONS 1.DEFINITIONS a. “Discriminatory Covenant”: Any covenant, condition, restriction, or limitation that is unenforceable under applicable law because it illegally discriminates against a class of individuals based on personal characteristics such as race, color, religion, sex, sexual orientation, gender identity, familial status, disability, national origin, or other legally protected class. b. “Knowledge” or “Known”: Actual knowledge or actual notice, but not constructive notice imparted by the Public Records. c. “Land”: The land described in Item 5 of Schedule A and improvements located on that land that by State law constitute real property. The term “Land” does not include any property beyond that described in Schedule A, nor any right, title, interest, estate, or easement in any abutting street, road, avenue, alley, lane, right-of-way, body of water, or waterway, but does not modify or limit the extent that a right of access to and from the Land is to be insured by the Policy. d. “Mortgage”: A mortgage, deed of trust, trust deed, security deed, or other real property security instrument, including one evidenced by electronic means authorized by law. e. “Policy”: Each contract of title insurance, in a form adopted by the American Land Title Association, issued or to be issued by the Company pursuant to this Commitment. f. “Proposed Amount of Insurance”: Each dollar amount specified in Schedule A as the Proposed Amount of Insurance of each Policy to be issued pursuant to this Commitment. g. “Proposed Insured”: Each person identified in Schedule A as the Proposed Insured of each Policy to be issued pursuant to this Commitment. American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 2 of 9 h. “Public Records”: The recording or filing system established under State statutes in effect at the Commitment Date under which a document must be recorded or filed to impart constructive notice of matters relating to the Title to a purchaser for value without Knowledge. The term “Public Records” does not include any other recording or filing system, including any pertaining to environmental remediation or protection, planning, permitting, zoning, licensing, building, health, public safety, or national security matters. i. “State”: The state or commonwealth of the United States within whose exterior boundaries the Land is located. The term “State” also includes the District of Columbia, the Commonwealth of Puerto Rico, the U.S. Virgin Islands, and Guam. j. “Title”: The estate or interest in the Land identified in Item 3 of Schedule A. 2.If all of the Schedule B, Part I – Requirements have not been met within the time period specified in the Commitment to Issue Policy, this Commitment terminates and the Company’s liability and obligation end. 3.The Company’s liability and obligation is limited by and this Commitment is not valid without: a. the Notice; b. the Commitment to Issue Policy; c. the Commitment Conditions; d. Schedule A; e. Schedule B, Part I – Requirements; f. Schedule B, Part II – Exceptions; and g. a counter-signature by the Company or its issuing agent that may be in electronic form. 4.COMPANY’S RIGHT TO AMEND The Company may amend this Commitment at any time. If the Company amends this Commitment to add a defect, lien, encumbrance, adverse claim, or other matter recorded in the Public Records prior to the Commitment Date, any liability of the Company is limited by Commitment Condition 5. The Company is not liable for any other amendment to this Commitment. 5.LIMITATIONS OF LIABILITY a. The Company’s liability under Commitment Condition 4 is limited to the Proposed Insured’s actual expense incurred in the interval between the Company’s delivery to the Proposed Insured of the Commitment and the delivery of the amended Commitment, resulting from the Proposed Insured’s good faith reliance to: i. comply with the Schedule B, Part I – Requirements; ii. eliminate, with the Company’s written consent, any Schedule B, Part II – Exceptions; or iii. acquire the Title or create the Mortgage covered by this Commitment. b. The Company is not liable under Commitment Condition 5.a. if the Proposed Insured requested the amendment or had Knowledge of the matter and did not notify the Company about it in writing. c. The Company is only liable under Commitment Condition 4 if the Proposed Insured would not have incurred the expense had the Commitment included the added matter when the Commitment was first delivered to the Proposed Insured. d. The Company’s liability does not exceed the lesser of the Proposed Insured’s actual expense incurred in good faith and described in Commitment Condition 5.a.or the Proposed Amount of Insurance. e. The Company is not liable for the content of the Transaction Identification Data, if any. f. The Company is not obligated to issue the Policy referred to in this Commitment unless all of the Schedule B, Part I – Requirements have been met to the satisfaction of the Company. g. The Company’s liability is further limited by the terms and provisions of the Policy to be issued to the Proposed Insured. 6.LIABILITY OF THE COMPANY MUST BE BASED ON THIS COMMITMENT; CHOICE OF LAW AND CHOICE OF FORUM a. Only a Proposed Insured identified in Schedule A, and no other person, may make a claim under this Commitment. b. Any claim must be based in contract under the State law of the State where the Land is located and is restricted to the terms and provisions of this Commitment. Any litigation or other proceeding brought by the Proposed Insured against the Company must be filed only in a State or federal court having jurisdiction. American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 3 of 9 c. This Commitment, as last revised, is the exclusive and entire agreement between the parties with respect to the subject matter of this Commitment and supersedes all prior commitment negotiations, representations, and proposals of any kind, whether written or oral, express or implied, relating to the subject matter of this Commitment. d. The deletion or modification of any Schedule B, Part II – Exception does not constitute an agreement or obligation to provide coverage beyond the terms and provisions of this Commitment or the Policy. e. Any amendment or endorsement to this Commitment must be in writing and authenticated by a person authorized by the Company. f. When the Policy is issued, all liability and obligation under this Commitment will end and the Company’s only liability will be under the Policy. 7.IF THIS COMMITMENT IS ISSUED BY AN ISSUING AGENT The issuing agent is the Company’s agent only for the limited purpose of issuing title insurance commitments and policies. The issuing agent is not the Company’s agent for closing, settlement, escrow, or any other purpose. 8.PRO-FORMA POLICY The Company may provide, at the request of a Proposed Insured, a pro-forma policy illustrating the coverage that the Company may provide. A pro-forma policy neither reflects the status of Title at the time that the pro-forma policy is delivered to a Proposed Insured, nor is it a commitment to insure. 9.CLAIMS PROCEDURES This Commitment incorporates by reference all Conditions for making a claim in the Policy to be issued to the Proposed Insured. Commitment Condition 9 does not modify the limitations of liability in Commitment Conditions 5 and 6. 10.CLASS ACTION ALL CLAIMS AND DISPUTES ARISING OUT OF OR RELATING TO THIS COMMITMENT, INCLUDING ANY SERVICE OR OTHER MATTER IN CONNECTION WITH ISSUING THIS COMMITMENT, ANY BREACH OF A COMMITMENT PROVISION, OR ANY OTHER CLAIM OR DISPUTE ARISING OUT OF OR RELATING TO THE TRANSACTION GIVING RISE TO THIS COMMITMENT, MUST BE BROUGHT IN AN INDIVIDUAL CAPACITY. NO PARTY MAY SERVE AS PLAINTIFF, CLASS MEMBER, OR PARTICIPANT IN ANY CLASS OR REPRESENTATIVE PROCEEDING. ANY POLICY ISSUED PURSUANT TO THIS COMMITMENT WILL CONTAIN A CLASS ACTION CONDITION. FIRST AMERICAN TITLE INSURANCE COMPANY 1 First American Way, Santa Ana, CA 92707 By: Kenneth D. DeGiorgio, President By: Lisa W. Cornehl, Secretary American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 4 of 9 Transaction Identification Data, for which the Company assumes no liability as set forth in Commitment Condition 5.e.: Issuing Agent: Horizon Title Group, Inc. Issuing Office: 2424 South Park Avenue, PO Box 598 Port Townsend, WA 98368 Issuing Office’s ALTA® Registry ID: 1167581 Loan ID Number: Commitment Number: 05-5234-TTJ Issuing Office File Number: 05-5234-TTJ Property Address: 1125 Toandos Road, Quilcene, WA 98376 SCHEDULE A 1.Commitment Date: September 16, 2024 8:00 AM 2.Policy to be issued: AMOUNT PREMIUM TAX TOTAL a. 2021 ALTA Owner's Standard Policy $$0.00 $$0.00 PROPOSED INSURED:Northwest Watershed Institute Inc., a Washington nonprofit corporation The estate or interest to be insured:fee simple 3.The estate or interest in the Land at the Commitment Date is: fee simple 4.The Title is, at the Commitment Date, vested in: Thomas J. Hough, a single man 5.The Land is described as follows: See Exhibit A attached hereto and made a part hereof. HORIZON TITLE GROUP, INC. 2424 South Park Avenue, PO Box 598, Port Townsend, WA 98368 Telephone: (360) 385-1322 Countersigned by: Rochelle Lewis Horizon Title Group, Inc., License #603575523 FIRST AMERICAN TITLE INSURANCE COMPANY 1 First American Way, Santa Ana, CA 92707 By: Kenneth D. DeGiorgio, President By: Lisa W. Cornehl, Secretary American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 5 of 9 SCHEDULE B, PART I – Requirements All of the following Requirements must be met: 1. The Proposed Insured must notify the Company in writing of the name of any party not referred to in this Commitment who will obtain an interest in the Land or who will make a loan on the Land. The Company may then make additional Requirements or Exceptions. 2. Pay the agreed amount for the estate or interest to be insured. 3. Pay the premiums, fees, and charges for the Policy to the Company. 4. Documents satisfactory to the Company that convey the Title or create the Mortgage to be insured, or both, must be properly authorized, executed, delivered, and recorded in the Public Records. Duly authorized and executed Deed from Thomas J. Hough, a single man, to Northwest Watershed Institute Inc., a Washington nonprofit corporation, to be executed and recorded at closing. 5. Lien of the real estate excise sales tax and surcharge upon any sale of said Land, if unpaid. 6. General Taxes. The first portion $441.77 becomes delinquent after April 30th. The second portion $441.17 becomes delinquent after October 31st. Year: 2024 Amount Billed: $882.94 Amount Paid: $882.94 Amount Due: $0.00, plus interest and penalty, if delinquent Tax Account No.: 701 153 003 Assessed value: $110,654.00 PID No.: 17274 7. The Company has been asked to issue a policy(ies) without disclosure of the liability amount. This commitment shall be effective only when the amount of the policy(ies) committed for has been inserted in Schedule “A” hereof. The forthcoming policy must be issued in an amount at least equal to the full value of the estate insured in accordance with our rating schedule on file in the office of the Washington State Insurance Commissioner. The Company may have further requirements if the undisclosed amount to be insured exceeds the current assessed valuation. 8. The Land described in this commitment appears to be residential in nature and may be subject to the provisions of RCW 6.13.010, et seq. (homestead statute) if the Land is occupied as a primary residence. If the Land is occupied as a primary residence, RCW 6.13.060 requires that all documents conveying or encumbering the Land must be executed by each spouse or domestic partner, individually. Alternatively, the company will accept a deed identifying the non-vested spouse occupying the Land as the Grantor and the vested spouse as the Grantee. This applies if the non-vested spouse currently resided in the residence or if the vested spouse resides in the residence and the non- vested spouse doesn’t reside in the residence but has lived there within the previous 6 months. In the event that the company receives documents to insure that are not executed as required, the company may be unable to record or to insure the transaction. Please contact your Title Officer if you have any questions. American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 6 of 9 SCHEDULE B, PART II – Exceptions Some historical land records contain Discriminatory Covenants that are illegal and unenforceable by law. This Commitment and the Policy treat any Discriminatory Covenant in a document referenced in Schedule B as if each Discriminatory Covenant is redacted, repudiated, removed, and not republished or recirculated. Only the remaining provisions of the document will be excepted from coverage. The Policy will not insure against loss or damage resulting from the terms and conditions of any lease or easement identified in Schedule A, and will include the following Exceptions unless cleared to the satisfaction of the Company: 1. Any defect, lien, encumbrance, adverse claim, or other matter that appears for the first time in the Public Records or is created, attaches, or is disclosed between the Commitment Date and the date on which all of the Schedule B, Part I - Requirements are met. 2. Taxes or assessments which are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records. 3. Any facts, rights, interest, or claims which are not shown by the Public Records but which could be ascertained by an inspection of the Land or by making inquiry of persons in possession thereof. 4. Easements, claims of easements, or encumbrances which are not shown by the Public Records. 5. Discrepancies, conflicts in boundary lines, shortages in area, encroachments, or any other facts which a correct survey would disclose, and which are not shown by the Public Records. 6. (a) Unpatented mining claims; (b) Reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) Water rights, claims or title to water, ditch or ditch right, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records; (d) Indian Tribal Codes or Regulations, Indian Treaty or Aboriginal Rights, including easements or equitable servitudes. 7. Any lien or right to a lien for services, labor, equipment or material or medical assistance, unless such lien is shown by the Public Records as of Date of Policy. 8. Any service, installation, connection, maintenance, construction, tap or reimbursement charges/costs for sewer, water, garbage or electricity. 9. Any claim to (a) ownership of or rights to minerals and similar substances, including but not limited to ores, metals, coal, lignite, oil, gas, uranium, clay, rock, sand, and gravel located in, on, or under the Land or produced from the Land, whether such ownership or rights arise by lease, grant, exception, conveyance, reservation, or otherwise; and (b) any rights, privileges, immunities, rights of way, and easements associated therewith or appurtenant thereto, whether or not the interests or rights excepted in (a) or (b) appear in the Public Records. American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 7 of 9 10. Easement, including terms and provisions contained therein: Disclosed by: Decree entered in Jefferson County Superior Court Cause No. 7222 For: Ingress and egress over road as it existed on October 06, 1966 11. Easement, including terms and provisions contained therein: Recorded: December 30, 1969 Recording No.: 203763 For: Road purposes 12. Easement, including terms and provisions contained therein: Recorded: June 12, 1990 Recording No.: 331591 For: Underground electric transmission and/or distribution system 13. Easement, including terms and provisions contained therein: Recorded: September 19, 2011 Recording No.: 562353 For: Electric transmission and/or distribution system American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 8 of 9 EXHIBIT “A” The Land referred to herein below is situated in the County of Jefferson, State of Washington and is described as follows: Tract 4, described as follows: That portion of the East 1/2 of the Southwest 1/4 of Section 15, Township 27 North, Range 1 West, W.M., described as follows: Beginning at the center of said Section; thence South along the North and South center line of said Section, 758 feet to the True Point of Beginning; thence West a distance of 752.77 feet to intersect the Easterly line of that certain tract of land sold to Gene Ray Myers by Real Estate Contract recorded March 8, 1971, Auditor’s No. 208162; thence along said Myers Tract, South 15° 42’ S4" East, 19.22 feet; Thence continue along said Easterly line of Myers Tract, South 33° 56’ 38" East, 209.75 feet; . thence continuing along said Easterly line of Myers Tract, South 34° 96’ 24" East, 190.24 feet; thence East a distance of 521.44 feet to intersect the North and South center line of said Section 15 at a point 350 feet South of the Point of Beginning; thence North to the Point of Beginning. Situate in the County of Jefferson, State of Washington. American Land Title Association Commitment for Title Insurance 2021 v. 01.00 (07-01-2021) This page is only a part of a 2021 ALTA Commitment for Title Insurance issued by First American Title Insurance Company. This Commitment is not valid without the Notice; the Commitment to Issue Policy; the Commitment Conditions; Schedule A; Schedule B, Part I – Requirements; and Schedule B, Part II – Exceptions; and a counter-signature by the Company or its issuing agent that may be in electronic form. Copyright 2021 American Land Title Association. All rights reserved. The use of this Form (or any derivative thereof) is restricted to ALTA licensees and ALTA members in good standing as of the date of use. All other uses are prohibited. Reprinted under license from the American Land Title Association. Page 9 of 9 INFORMATIONAL NOTES 1.The Company requires the proposed insured to verify that the Land covered by this commitment is the Land intended to be conveyed in this transaction. The description of the Land may be incorrect, if the application for title insurance contained incomplete or inaccurate information. Notify the Company well before closing if changes are necessary. Closing instructions must indicate that the legal description has been reviewed and approved by all parties. 2.As of the date hereof there are no matters against Northwest Watershed Institute Inc., a Washington nonprofit corporation, which would appear as exceptions in the policy to issue, except as shown herein. 3.Abbreviated Legal Description: PTN E1/2 SW S15 T27 R1W (TAX 2) 4.The vestee(s) herein acquired title by deed recorded July 10, 1991 under Auditor's File No. 341821 .pdf). The record discloses no other conveyances of the property herein described within the last 24 months. 5.The situs address of the Land herein described is: 1125 Toandos Road, Quilcene, WA 98376 6.Map 7.Combined Exception Documents 8. RECORDING PACKAGE INSTRUCTIONS: Jefferson, Clallam, Kitsap, Mason, and San Juan County recording packages must be sent to the following address: Horizon Title Group, Inc. 2424 South Park Avenue Port Townsend, WA 98368 Pacific County recording packages must be sent to the following address: Horizon Title Group, Inc. 1308 37th Street Seaview, WA 98644 9.PLEASE NOTE: THERE WILL BE A FEE OF $5.00 + TAX PER E-RECORDED DOCUMENT INCLUDED ON ALL RECORDING INVOICES. 10.NOTE: A FEE MAY BE CHARGED UPON THE CANCELLATION OF THIS COMMITMENT PURSUANT TO WASHINGTON STATE INSURANCE CODE AND THE FILED RATE SCHEDULE OF THIS COMPANY. 3609 Market Place West, Suite 201, University Place, WA 98466 p. 253.564.3230 | f. 253.564.3143 INTERNAL REVENUE SERVICEP. O. BOX 2508 CINCfNNATT, OH 4520L DEPARTMENT OF THE TREASURY Employer ldentification Number :Date: nf 24ffi 93 -t325820 DI,N: L7 05325977 8026 NORTi{WEST WATERSHED INSTf TUTE Cont.act Person: 3407 EDDY STREE? CLINTON L FORTNER ID# 31163 PORT TOWNSEND, WA 98358-0000 Contact. Telephone Number:(877) 829-ss00 Publ j"c Charity Status: 170 (b) (1) (Ai (vi) Dear Applicant; Our l-etter dated JANUARY 2002, stated you would be exempt from Federal income tax under section 501(c)(3) of lhe fnternal Revenue Code, and you wouLdbe treated as a public charity, ralher than as a privale foundation, duringan advance ruling period. Based on the information you submitted, lou are classified as a public charityunder the Code secti-on listed in the heading of this l-etter. Since your exempt st.atus was not under consideration, you cont.inue to be classifi-ed asan organi-zation exemp! from Federal income Lax under section 50L (c) (3) of the Code. Publication 557, Tax-Exempt Status for Your organization, provides detailedinformation about your rights and responsj.bilities as an exempt organizat.ion. You may request a copy by calling lhe toll-free number for forms,(800) 829-3676. fnformation is also available on our fnEernet Web Site at www. irs .gov. ff you have general guestions aboul exempt organizations, please call ourtoll-free number shown in the heading Please keep this l-etter in your permanent records. Sincerely yours, da,Afu Lois G . #.n.tDirector, Exempt OrganizationsRulings and Agreements Letter 10s0 {DOICC) Jul '24 - Jun 25 Ordinary Income/Expense Income Grant Revenue 4010 · Federal Funds 1,500,000.00 4020 · Foundation 2,000.00 4030 · State Funds 42,000.00 Total Grant Revenue 1,544,000.00 Contributed Income 4040 · Restricted 131,000.00 4050 · Unrestricted 120,000.00 Contributed Income - Other 0.00 Total Contributed Income 251,000.00 Rental/Lease Income 4165 · Olson tideland lease 4,000.00 4175 · Rental Income Reinertsen Rental 18,000.00 4182 · Rental Income - Yarr Caretaker 6,000.00 Total Rental/Lease Income 28,000.00 Consulting/Miscellaneous 4210 · Consulting Fees 2,000.00 Total Consulting/Miscellaneous 2,000.00 Total Income 1,825,000.00 Gross Profit 1,825,000.00 Expense Health benefits 6096 · Health insurance 34,000.00 6094 · HSA Contribution 10,600.00 Total Health benefits 44,600.00 6041 · Paypal Fees 300.00 6010 · Advertising 100.00 6030 · Automobile Expense 2,500.00 6040 · Bank Service Charges 500.00 6060 · Depreciation Expense 1,600.00 Insurance 6091 · Auto 4,000.00 6093 · Liability Insurance 4,000.00 Total Insurance 8,000.00 Land Acquisition 6170 · Closing Expenses 40,000.00 6150 · Land 1,300,000.00 Land Acquisition - Other 0.00 Total Land Acquisition 1,340,000.00 6180 · Licenses and Permits 0.00 6210 · Miscellaneous 0.00 Payroll Expenses Gross wages 6237 · Education Director 24,000.00 6231 · Director 90,000.00 6232 · Stewardship Director 36,000.00 6233 · Project Assistant 7,000.00 6234 · Field Crew 88,000.00 Total Gross wages 245,000.00 10:38 AM Northwest Watershed Institute 02/25/25 Profit & Loss Budget Overview Accrual Basis July 2024 through June 2025 Page 1 Jul '24 - Jun 25 Payroll Taxes 6246 · Paid Family and Medical Leave 0.00 6240 · Medicare 3,500.00 6241 · Social Security 15,000.00 6243 · Workers Comp 11,000.00 6245 · WA State Unemployment 3,600.00 Total Payroll Taxes 33,100.00 Payroll Expenses - Other 0.00 Total Payroll Expenses 278,100.00 6250 · Postage and Delivery 750.00 6260 · Printing and Reproduction 750.00 Professional Fees 6271 · Accounting 1,500.00 6274 · Legal Fees 2,000.00 Total Professional Fees 3,500.00 Program Expense 6284 · Student Stipend 2,000.00 6282 · Fees 1,600.00 6283 · Project subcontractors 40,000.00 6286 · Overrun 0.00 Total Program Expense 43,600.00 6290 · Rent 12,000.00 Repairs and Maintenance 6350 · Septic Repair 0.00 6310 · Building Repairs 50,000.00 6320 · Computer Repairs 250.00 6330 · Equipment Repairs 3,000.00 Repairs and Maintenance - Other 500.00 Total Repairs and Maintenance 53,750.00 Supplies 6420 · Field Supplies 30,000.00 6440 · Office Supplies 2,000.00 Total Supplies 32,000.00 Taxes 6510 · Property Taxes 5,000.00 Total Taxes 5,000.00 Telephone/Communications 6650 · Mobile phone 1,800.00 6610 · Internet Server 800.00 6620 · Telephone - Local 0.00 Telephone/Communications - Other 0.00 Total Telephone/Communications 2,600.00 Travel & Ent 6720 · Meals 140.00 Total Travel & Ent 140.00 Utilities 6810 · Gas and Electric 600.00 Utilities - Other 0.00 Total Utilities 600.00 10:38 AM Northwest Watershed Institute 02/25/25 Profit & Loss Budget Overview Accrual Basis July 2024 through June 2025 Page 2 Jul '24 - Jun 25 9000 · Suspense 0.00 Total Expense 1,830,390.00 Net Ordinary Income -5,390.00 Other Income/Expense Other Income 7010 · Interest Income 10,000.00 Total Other Income 10,000.00 Other Expense 8016 · Conservation Ease/Deed Restri 0.00 Total Other Expense 0.00 Net Other Income 10,000.00 Net Income 4,610.00 10:38 AM Northwest Watershed Institute 02/25/25 Profit & Loss Budget Overview Accrual Basis July 2024 through June 2025 Page 3 Northwest Watershed Institute BOARD OF DIRECTORS 2024-25 Board Members and Officers Affiliation and Term on the Board of Directors Peter Bahls President, Vice-President, Treasurer 3407 Eddy Street Port Townsend, WA 98368 Peter Bahls is currently full time Executive Director and Conservation Biologist for Northwest Watershed Institute. Term – 2023-2025 Jean Ball Board Member 10221 Center Road, Quilcene, WA 98368 Jean Ball is a farmer and naturalist in Quilcene, Washington. Term – 2024-2026 Scott Calhoun Board Member 5710 59th Ave NE Seattle, WA 98105 Scott Calhoun studied biology and geology in college and graduate school where he specialized in shorelines and watersheds. He owns forestland in the Tarboo watershed. Term – 2024-2026 Janis Henry Secretary 14445 SE 55th Street Bellevue, WA 98006 Janis Henry is a retired biotech patent attorney and chemist with over 30 years of experience. She is a life-long nature enthusiast and embraces adventure travel. Term – 2023-2025 Gene Jones Board Member 5860 NE Totten Road Poulsbo, WA 98370 Gene Jones is a member of the Port Gamble S’Klallam Tribe and spiritual leader for four Tribes in the Olympic Peninsula region. Term – 2023-2025 Liz Hoenig Kanieski 1005 Lawrence Street Port Townsend, WA 98368 Liz Hoenig Kanieski has over 25 years of experience as a field biologist, environmental educator, and environmental planner. Much of her work has focused on watershed protection, citizen engagement and water resources. Term – 2023-2025 Keith Lazelle Board Member PO Box 192 Quilcene, WA 98376 Keith Lazelle is an award-winning nature photographer who lives on Dabob Bay. His work has been used by many environmental organizations including Audubon, Hoh River Trust, The Nature Conservancy, and NWI. Term – 2024-2026 Northwest Watershed Institute STAFF ROSTER 2025 Peter Bahls, Executive Director Wesley Meyers, Stewardship Director Megan Brookens, Education and Outreach Director Robin Enge, Administrative Assistant Eva Ellis, Field Crew Bernt Goodson, Field Crew Zack Hawkes, Field Crew Hanna Petersen, Field Crew Veronica Phelan, Field Crew Grace Rabbitt Burke, Field Crew Trevor Williams, Field Crew Abel Dances, Carpenter Jul '23 - Jun 24 Ordinary Income/Expense Income Grant Revenue 4010 · Federal Funds 2,057,763.40 4020 · Foundation 1,614.27 4030 · State Funds 41,710.22 Total Grant Revenue 2,101,087.89 Contributed Income 4040 · Restricted 130,710.00 4050 · Unrestricted 116,423.00 Contributed Income - Other 520.00 Total Contributed Income 247,653.00 Rental/Lease Income 4165 · Olson tideland lease 4,000.00 4175 · Rental Income Reinertsen Rental 7,673.37 4182 · Rental Income - Yarr Caretaker 4,139.46 Total Rental/Lease Income 15,812.83 Consulting/Miscellaneous 4210 · Consulting Fees 1,155.00 Total Consulting/Miscellaneous 1,155.00 Total Income 2,365,708.72 Gross Profit 2,365,708.72 Expense Health benefits 6096 · Health insurance 31,075.72 6094 · HSA Contribution 10,300.00 Total Health benefits 41,375.72 6041 · Paypal Fees 289.80 6010 · Advertising 127.05 6030 · Automobile Expense 2,033.19 6040 · Bank Service Charges 499.77 6060 · Depreciation Expense 1,600.00 Insurance 6091 · Auto 4,130.00 6093 · Liability Insurance 4,059.45 Total Insurance 8,189.45 Land Acquisition 6170 · Closing Expenses 0.00 Total Land Acquisition 0.00 6180 · Licenses and Permits 15.00 6210 · Miscellaneous 163.37 Payroll Expenses Gross wages 6237 · Education Director 23,754.50 6231 · Director 73,333.48 6232 · Stewardship Director 33,682.00 6233 · Project Assistant 6,119.00 6234 · Field Crew 86,245.20 Total Gross wages 223,134.18 12:53 PM Northwest Watershed Institute 01/10/25 Profit & Loss Accrual Basis July 2023 through June 2024 Page 1 Jul '23 - Jun 24 Payroll Taxes 6246 · Paid Family and Medical Leave 1.19 6240 · Medicare 3,305.81 6241 · Social Security 14,169.09 6243 · Workers Comp 10,942.09 6245 · WA State Unemployment 3,687.53 Total Payroll Taxes 32,105.71 Payroll Expenses - Other 4,853.32 Total Payroll Expenses 260,093.21 6250 · Postage and Delivery 744.74 6260 · Printing and Reproduction 758.11 Professional Fees 6271 · Accounting 1,375.00 6274 · Legal Fees 324.50 Total Professional Fees 1,699.50 Program Expense 6284 · Student Stipend 0.00 6282 · Fees 1,553.89 6283 · Project subcontractors 82,835.44 6286 · Overrun 68.55 Total Program Expense 84,457.88 6290 · Rent 12,000.00 Repairs and Maintenance 6350 · Septic Repair 9,769.44 6310 · Building Repairs 9,207.34 6320 · Computer Repairs 248.20 6330 · Equipment Repairs 2,868.14 Repairs and Maintenance - Other 474.37 Total Repairs and Maintenance 22,567.49 Supplies 6420 · Field Supplies 8,204.99 6440 · Office Supplies 1,951.11 Total Supplies 10,156.10 Taxes 6510 · Property Taxes 4,963.81 Total Taxes 4,963.81 Telephone/Communications 6650 · Mobile phone 1,567.40 6610 · Internet Server 758.50 6620 · Telephone - Local 81.26 Telephone/Communications - Other 142.28 Total Telephone/Communications 2,549.44 Travel & Ent 6720 · Meals 144.65 Total Travel & Ent 144.65 Utilities 6810 · Gas and Electric 696.03 Utilities - Other 770.16 Total Utilities 1,466.19 12:53 PM Northwest Watershed Institute 01/10/25 Profit & Loss Accrual Basis July 2023 through June 2024 Page 2 Jul '23 - Jun 24 9000 · Suspense 267.06 Total Expense 456,161.53 Net Ordinary Income 1,909,547.19 Other Income/Expense Other Income 7010 · Interest Income 9,952.06 Total Other Income 9,952.06 Other Expense 8016 · Conservation Ease/Deed Restri 782,040.09 Total Other Expense 782,040.09 Net Other Income -772,088.03 Net Income 1,137,459.16 12:53 PM Northwest Watershed Institute 01/10/25 Profit & Loss Accrual Basis July 2023 through June 2024 Page 3 Jun 30, 24 ASSETS Current Assets Checking/Savings First Fed CD -3090 51,430.51 First Federal CD -3091 51,523.58 First Fed Savings 52,417.11 1020 · Checking - Kitsap 59,986.66 Total Checking/Savings 215,357.86 Accounts Receivable 1200 · Accounts Receivable 22,048.75 Total Accounts Receivable 22,048.75 Other Current Assets 1250 · Prepaid Insurance 2,115.50 1300 · Employee advance 163.88 1499 · Undeposited Funds 111,313.33 Total Other Current Assets 113,592.71 Total Current Assets 350,999.32 Fixed Assets 1513 · Vehicle - 2001 Ford xtra Cab 8,000.00 1554 · Trailers 4,000.00 1512 · Vehicle - Ford pickup 4,150.00 1530 · Kubota Tractor 16,709.10 1590 · Accumulated Depreciation -28,592.08 Property 1555 · Capital Improvements 3,035.20 1551 · Land 2,197,217.48 Total Property 2,200,252.68 Total Fixed Assets 2,204,519.70 TOTAL ASSETS 2,555,519.02 LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable 2000 · Accounts Payable 5,965.77 Total Accounts Payable 5,965.77 Other Current Liabilities 2100 · Payroll Liabilities 2105 · Fica, Medicare, FWH Payable 5,148.22 2109 · WA - Paid Fam Med Leave Emp.446.33 2120 · Workers Comp Payable 5,013.23 2130 · SUTA & EAF Payable 1,663.44 2125 · FUTA Payable 267.06 2100 · Payroll Liabilities - Other 489.77 Total 2100 · Payroll Liabilities 13,028.05 2250 · Rental Security Deposit 3,000.00 Total Other Current Liabilities 16,028.05 Total Current Liabilities 21,993.82 Total Liabilities 21,993.82 12:55 PM Northwest Watershed Institute 01/10/25 Balance Sheet Accrual Basis As of June 30, 2024 Page 1 Jun 30, 24 Equity 1110 · Retained Earnings 1,396,066.04 Net Income 1,137,459.16 Total Equity 2,533,525.20 TOTAL LIABILITIES & EQUITY 2,555,519.02 12:55 PM Northwest Watershed Institute 01/10/25 Balance Sheet Accrual Basis As of June 30, 2024 Page 2 Northwest Watershed Institute Memo I 3407 Eddy Street I Port Townsend, Washington 98368 voice 360.385.6786 fax 360.385.2839 email peter@nwwatershed.org I www.nwwatershed.org To: Tarboo Creek Conservation Project Fife From: Peter Bahls, Executive Director CC: Date: February 25, 2025 Re: Executive Committee Resolution to Submit Jefferson County Conservation Futures 2025 Application for the Toandos Forest project. At its Annual Board Meeting of June 21, 2024, the Board of Directors of Northwest Watershed Institute unanimously approved the following resolution - An executive committee comprised of Peter Bahls and Janis Henry shall serve as an executive committee to have the power to make on-going decisions between Board meetings per the existing by-laws. On February 25, 2025 the executive committee approved the following resolution - DECIDED -Northwest Watershed Institute shall sponsor and submit a grant application for Jefferson County Conservation Futures 2025 Program for the Toandos Forest project within the boundaries of the state's Dabob Bay Natural Area. Priority: The Toandos Forest property is 6x the size of the Upper Yarr property and is at high risk of development if JCCF funding is not awarded, so it is considered the top priority for NWI. Peter Bahls President ~#v'A1P,. • Henrv~ j~nis I ~---.,' Secretary February 27, 2025 Peter Bahls, Executive Director Northwest Watershed Institute 3407 Eddy Street Port Townsend, WA 98368 Dear Mr. Bahls: I understand that Northwest Watershed Institute is applying for Jefferson County Conservation Futures (JCCF) grant funding to acquire and protect Toandos Forest, 6.38 acres of forestland within the state’s Dabob Bay Natural Area boundaries. If successful, the grant funding will protect the forest under county deed restrictions and allow older forest habitats to develop, while permitting some limited harvest of trees and other forest products. We strongly support this project and want to convey the importance of the forest as a cultural resource to the Tribes. The JCCF grant application states that cultural resources include “…traditional, religious, ceremonial, and social uses and activities of affected Indian Tribes…”. I want to make it clear that the Toandos Forest is a cultural resource under this definition and the proposed plan for protection and restoration would help grow its importance. Four tribes - Port Gamble S’Klallam Tribe, Jamestown S’Klallam Tribe, Lower Elwha S’Klallam Tribe, and Skokomish Tribe - are signatories to the Point No Point Treaty and retain the right to hunt and gather within their Usual and Accustomed Area, including the Tarboo watershed. These Tribes continue to rely upon the forests of the region, as they have for thousands of years, as places where they gather traditional food, medicine, and materials for use in all aspects of their cultural life, including social and religious. Currently, the Tribe is enjoying a renaissance of weavers and artists using traditional methods and materials; especially materials from the cedar tree. For example, tribal members harvest the inner bark of large cedar trees for weaving baskets and clothing used for ceremonial purposes. They also harvest wood from cedar, big leaf maple, and alder trees to make large box drums, masks, and other traditional objects that the Tribes have used for thousands of years for religious and social ceremonies. However, with the conversion of vast areas to private industrial tree farms and development projects, it is increasing difficult for the Tribes to access forests suitable for traditional cultural uses. The proposed project will protect an important cultural resource for the Tribes: a growing native forest where, with good stewardship, the benefits to the Tribes will continue to grow as the forest develops into an older, biologically diverse forest with a large variety of indigenous plants and trees of cultural importance. The Tarboo forest is significant not just for the materials it can offer over time, but the opportunity for the Tribe to harvest locally; the process of harvesting itself is infused with traditional, social and religious meaning that we want to pass on to the coming generations. Sincerely, Laura Price Cultural Resources Director Port Gamble S’Klallam Tribe 31912 Little Boston RD NE Kingston WA 98346 Office: 360-297-9655 Cell: 360-509-7723 1 4899-1951-4625v.6 0046182-000042 EXAMPLE OF RE-RECORD OF SWD FOR CONSERVATION FUTURES PURPOSES AFTER RECORDING RETURN TO: Northwest Watershed Institute 3407 Eddy Street Port Townsend, WA 98368 DOCUMENT TITLE: Statutory Warranty Deed – Re-Record GRANTOR: Rosie L. von Engel GRANTEE: Northwest Watershed Institute ABBREVIATED LEGAL DESCRIPTION (Complete description on Page 1): S29 T28 R1W Tax 2 ASSESSOR’S TAX PARCEL NUMBER(S): 801 293 003 REFERENCE NUMBERS OF RELATED DOCUMENTS: 658592 The par3es are re-recording the Statutory Warranty Deed, recorded on 01/17/2023 in the official records of Jefferson County, Washington, under Auditor’s File No. 658592 (a copy of which is aQached hereto as Exhibit A), for the sole purpose of including language required by Jefferson County providing funding to Grantee Northwest Watershed Ins3tute’s acquisi3on of the property described in said Statutory Warranty Deed, and without addi3onal considera3on from Grantee to Grantor. 2 4899-1951-4625v.6 0046182-000042 STATUTORY WARRANTY DEED (RE-RECORD) THE GRANTOR Rosie L. von Engel, now according to the application for title insurance Rose/Marie Ludmilla von Engel, as her separate estate for an in consideration of TEN DOLLARS AND OTHER GOOD AND VALUABLE CONSIDERATION in hand paid, conveys and warrants to Northwest Watershed Institute, a Washington nonprofit corporation the following described real estate, situated in the County of Jefferson, State of Washington (the “Property”): Tax Parcel Number(s): 801 293 003 That portion of the North 100 feet of the Southeast ¼ of the Southwest ¼ of Section 29, Township 28 North, Range 1 West, W.M. and that portion of the Northeast ¼ of the Southwest ¼ of said Section 29 lying Easterly of the Quilcene-Center County Road right of way as conveyed by Deed recorded March 13, 1956 under Auditor’s File No. 149069 and Southerly of the Old Tarboo Lake Road as conveyed by Deed recorded March 1, 1948 under Auditor’s File No. 112974, in Jefferson County, Washington; Together with the West 158 feet of the North 100 feet of the Southwest ¼ of the Southeast ¼ in said Section 29. Situate in the County of Jefferson, State of Washington. SUBJECT TO: Covenants, Conditions, Restrictions, Easements, Plats and Surveys, if any, affecting title, which may appear in the public record Grantee’s costs of acquiring the Property were provided in part by grant funding from the Jefferson County Conservation Futures property tax authorized by Washington law. Grantee hereby agrees to be bound by Jefferson County Code (JCC) 3.08.030(9), the uses authorized under RCW 84.34.230, including the obligation to ensure the long-term conservation of the Property in accordance with the terms and conditions of this Notice of Grant Restrictions and Restrictive Covenants for Conservation Purposes, and to obtain the consent of Jefferson County prior to any conveyance of any interest acquired hereby. Consistent with JCC 3.08.030(9), the Property shall not be converted to a different use unless and only if other equivalent lands or interest in lands within Jefferson County are received by Grantee in exchange. {Signature page(s) to follow} 3 4899-1951-4625v.6 0046182-000042 IN WITNESS WHEREOF, Grantor has caused this instrument to be executed and delivered as of the ______ day of ________, 2025. GRANTOR: ______________________________ Rosie L. von Engel State of Washington ) ) ss. County of _________ ) On this _____ day of ________________, 2025, Rosie L. von Engel, known to me or proved by satisfactory evidence to be the individual described in this instrument, acknowledged before me that she signed this instrument as her free and voluntary act and deed for the uses and purposes stated therein. ___ Notary Public for State of Washington Residing at: ___ My commission expires: ___ 4 4899-1951-4625v.6 0046182-000042 IN WITNESS WHEREOF, Grantee has caused this instrument to be executed and delivered as of the ______ day of ________, 2025. GRANTEE: NORTHWEST WATERSHED INSTITUTE By: Its: Date: State of Washington ) ) ss. County of _________ ) On this _____ day of ________________, 2025, Peter Bahls, known to me or proved by satisfactory evidence to be the individual described in this instrument, acting in his capacity as Executive Director of Northwest Watershed Institute, acknowledged before me that he signed this instrument as the free and voluntary act and deed of such corporation for the uses and purposes stated therein. _ Notary Public for State of Washington Residing at: _ My commission expires: _ 5 4899-1951-4625v.6 0046182-000042 EXHIBIT A Original Statutory Warranty Deed {attached}