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While the Center has addressed most of the critical issues from last year, we are challenged every month financially due primarily to continued heavy debt service. The Board Is cognizant of the Executive Director's accrued salary as a liability to the organization and has taken steps to cure the outstanding balance. At the June 2012 board meeting, the Board agreed to present an agreement for deferred compensation with a payment structure / timeline to cure the accrued salary and decrease its debt. In spite of the progress made to date, a realistic analysis shows that reaching organizational sustainability is taking longer than expected.Although the organization could possibly survive without the cities' help,the requested financial support would allow the Center to take care of all of the outstanding issues and secure a strong financial footing for the future.The proposal is structured to be comprehensive and to address all anticipated needs for the future to make the organization self-sufficient. If the financial support is in the form of a loan,the new loan debt will be covered by current rent revenue from the residential unit ($1,164/month) and monthly realized savings. The anticipated savings are shown in Table 2. Table 2 - Description of Anticipated Savings Annual Monthly Selling Building Pay off first mortgage(includes forbearance loan) $ 65,252 $5,43E Property Taxes $ 10,000 $ 833 Insurance on commercial parcel $ 2,000 $ 167 Contractor Pay off $ 20,025 $ 1,669 Maintenance Costs commercial parcel $ 4,000 $ 330 Anticipated Annual Savings: j $101,277 $8,437 In summary, the Center's debt restructure would allow the organization to have a modest operating reserve for the first time. The Center sees this as its final request to the cities to deal with emergency funding to support the reorganization of the Center. As noted above, this proposal is different than the request submitted last year and the Center would work out the terms collectively with the participating cities. If this funding request is approved, the Center will be in a better position to refinance and subsequently pay off the NCCLF note, and reduce the amount of interest being charged by existing loans, which will result in savings of approximately $76,000 in the first year, and $65,000 annually thereafter.Thank you for your consideration of this request Fitt•ectfully submitted, Milly Seibel Executive Director attachment Page 4