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June 26, 2007 Chris Crouch Balsam Mountain Preserve, LLC 52 Sugar Loaf Road Sylva, NC 28779 Re: Notice of Civil Penalties Assessed In Violation of Article 1400 of the Jackson County Sediment Control Ordinance (PIN# Reference 7672-90-6321) (Golf Course – Phase III). Dear Mr. Crouch: Consistent with responsibilities described in Jackson County Sediment Control Ordinance: the decision has been made to assess civil penalties by way of a standard operating procedure. For certain time periods the above referenced tract has been in violation of the Ordinance. In accordance with Article 1400 of the Jackson County Sediment Control ordinance, it is my duty to present to you a demand for payment of the civil penalties assessed against Balsam Mountain Preserve, LLC. Here are the specific areas where your company has been in violation of the Ordinance: For the time period of February 23, 2007 through June 22, 2007 (120 days, the date of our last visit ), there were five consistent violations which were: 1) Failure to follow approved plan, 2) Failure to provide adequate groundcover, 3) Insufficient measures to retain sediment on site, 4) Inadequate buffer zone, 5) Unprotected exposed slopes,. At $500.00 per violation per day, the total for that non-compliance period is $300,000.00. Penalties continue to accrue until paid. The total civil penalty due is $300.000.00 (three hundred thousand dollars-US). Your payment of these penalties may be made to the Jackson County Planning Office, 401 Grindstaff Cove Road, Sylva, NC 28779. Your payment of the civil penalties is due to Jackson County no later than 30 days of the receipt of this notice. Failure to pay the civil penalty stated hereinabove, in addition to other remedies against you, shall be subject you to the payment of reasonable attorney’s fees, not to exceed 15 percent of the outstanding balance, including the principal amount of the penalty and interest accruing thereon. I remind you that the tract must be brought into compliance with the Ordinance in order for civil penalties to stop accruing.

Balsam Mountain Preserve, LLC June 26, 2007 Page 2

You have 5 days from receipt of this notice to appeal this assessment to the Sediment Control Appeals Board. The appeal request and demand for a hearing must be in submitted to the Planning Office in written form. A hearing will be set for no later than 30 calendar days from the appeal request. Sincerely

Robert Shelton, Compliance Officer

Linda Cable, Planning Director

Attachments: Sediment Control Ordinance and Notice of Violation Reports

CC: Ken Westmoreland, County Manager Paul Holt, County Attorney