Annual Report to Shareholders

1. Annual Report to Shareholders

2. Annual Report to Shareholders • Agenda • Introduction of WSAC – FSC Board Members & Staff • Brief History of WSAC – FSC • Overview of Current Product Endorsements & Business Development • Report on County Inmate Program • 2009 – A Look Ahead • Financial Report • Appointment of WSAC – FSC Board of Directors for 2009

3. Annual Report to Shareholders Ownership WSAC Financial Services Corporation is a wholly owned for-profit subsidiary of Washington State Association of Counties. Mission The mission of the WSAC Financial Services Corporation is to develop and deliver needed services and products of high quality and competitive pricing to our customers and the people they serve.

4. Annual Report to Shareholders WSAC – FSC Organization 2008 Board of Directors Appointed by WSAC to manage the business and affairs of the corporation Claire Hauge, Chairman Mike Shelton, Secretary/Treasurer Patrick Dunn, Board Member Bettie Ingham Cochran, Board Member Mary Hunt, Board Member Eric Johnson, Board Member Note: Jim Nall resigned in September 2008 to devote more time to his private business.

5. Annual Report to Shareholders WSAC - FSC Organization Staff Provide project coordination, financial services & FSC Board administrative support Bill Vogler WSAC Finance Staff

6. Annual Report to Shareholders • Concept of Role of WSAC – FSC • Create and manage cost-effective individual and group finance programs benefiting Washington counties. • Promote cooperative purchasing to leverage county purchasing power & lower costs to all. • Partner with private and public organizations to bring innovative cost savings products and services to counties.

7. Annual Report to Shareholders • Concept of Role of WSAC – FSC • Foster entrepreneurism in the provision of products and services to counties on a fundamentally non-political basis. • Operate a state-wide conduit for pooled debt issuance for local governments and private entities providing economic and social benefits to communities.

8. Annual Report to Shareholders • History of WSAC - FSC • 2004 a WSAC retreat identified several goals, one of which was to provide WSAC members with: • quality services at competitive prices • reduce dues burden on members • Quality services desired (among others) • cooperative purchasing • technology enhancements • technical assistance • insurance and financing services

9. Annual Report to Shareholders • History of WSAC - FSC • November 2005 • WSAC authorized the formation of a wholly owned for-profit subsidiary • Delineate core lobbying responsibilities of WSAC from the • for-profit operations of WSAC - FSC • Provide for separate governance and over-sight of profit-related activities • Provide mechanism to create and market core products & services

10. Annual Report to Shareholders • History of WSAC - FSC • January 2006 • WSAC Financial Services Corporation (WSAC-FSC) incorporated • WSAC is the sole shareholder • Initial Board of Directors (unpaid) was appointed • FSC was funded with initial loan of $50,000 from non-governmental funds of WSAC; subsequent additional cash infusions have occurred; total loan amount was $175,000.

11. Annual Report to Shareholders History of WSAC - FSC 2006 Accomplishments Corporate Organization: By-laws Selection of Corporate Attorney Purchased Insurance Board Policies & Mission Statement WSAC Services Agreement Bank Accounts Established Logo Design Website Development

12. Annual Report to Shareholders History of WSAC - FSC 2006 Accomplishments (continued) Constituent Services & Product Endorsements √ EKO Systems (natural resource data management software) √ NACO U.S. Communities Cooperative Purchasing Program Business Development √ Investigated Pooled Bonding Opportunities √ Considered Equipment Pooling Program √ Explored Jail Inmate Medial Discount Program

13. Annual Report to Shareholders History of WSAC - FSC 2007 Accomplishments Constituent Services & Product Endorsements √ EKO Systems (natural resource data management software) continued to market & promote √ Permitting in a Box (planning & building permit tracking system) Business Development √ Developed Jail Inmate Medial Discount Program to Counties √ Investigated Pharmacy Discount Program

14. Annual Report to Shareholders • History of WSAC - FSC • 2008 Accomplishments • Business Development • √ Marketed & Implemented Jail Pharmacy Discount Program • √ County Jail Inmate Program • County Letters of Agreements: Option 1 or Option 2 • County Letters of Participation- Actuary Study – • Self-Insurance Pool • Contract with Actuary • Data Collection

15. Annual Report to Shareholders 2009 – a Look Ahead Constituent Services & Product Endorsements √ EKO Systems (natural resource data management software) √ Permitting in a Box (planning & building permit tracking system) √ NACO U.S. Communities Cooperative Purchasing Program √ Management Service Contractors (labor, budget, etc.) √ Next ?? √ Next ??

16. Annual Report to Shareholders 2009 – a Look Ahead Business Development √ Pharmacy Discount Program √ County Inmate Program Plan 1 – self-insured Pool Plan 2 – expand & refine the discount program √ ATS System √ Next ?? √ Next ??

17. Annual Report to Shareholders WSAC – FSC Financial Report Sources of Income: U.S. Communities contract EKO endorsement Permitting in a Box Jail Inmate Program – claims administration fees

18. Annual Report to Shareholders WSAC – FSC Financial Report Expenses: Staff Board (meetings & travel) Legal D&O Insurance Marketing Jail Inmate Program (TPA, actuary) Note payable to WSAC

19. Annual Report to Shareholders Questions from Shareholders? Shareholders to Appoint FSC Directors for 2009 Other Business? Adjourn Shareholder’s Annual Meeting