2014-08-01_REVISION - M1993059 (3)

Home Browse Search

Colorado Division of Reclamation and Safety Department of Natural Resources 1313 Sherman Street, Room 215 Denver Colorado 80203 RECEIVED Attention: Amy Eschberger `AUG 01 2014 DIVISION OF RECLAMATION Reference: Midwestern Farms, DRMS Permit No. M-1993-059 MINING AND SAFETY Financial Warranty Increase, Surety Increase SI-01 Dear Ms. Eschberger, On May 5, 2014 Eastern Colorado Aggregates was issued a letter from the Colorado Division of Reclamation and Safety accompanied by an inspection report which indicated a problem regarding the warranty amount on the mine referenced above was inadequate to complete the reclamation per the approved reclamation plan. Furthermore the letter increased the required surety amount to $1,583,000.00, an increase of$864,248.00, which is more than a 100% increase. When reviewing the estimated cost of reclamation provided with the letter ECA noticed a few areas that seem to high. In addition to some of the areas having an estimate above what we feel is reasonable there has been a development that will remove one of the areas addressed in the estimate altogether. The following items are the areas where we feel adjustments should be made, along with a description of why. 1. Removal of the sand pile:This item should be deleted from the estimate because ECA has just entered into an agreement with Dondlinger Construction to sell them all of the material in the sand pile to be used on the CDOT Prowers County Road project on Highway 50. Please find attached the letter of intent from Dondlinger for the purchase of the material. Find also the page from the project specifications which says the project will be completed in 265 working days, which means the material will be removed in much less time than 265 days since the embankment is one of the first items completed on a highway project.This reduces the direct cost by the total amount of this item of$382,181.84. 2. Replace topsoil: Kirkland Construction feels,from our long history of moving dirt with such short hauls,that the estimate to replace the topsoil is high by about$0.30 per cubic yard. Using the quantities shown in the DMRS estimate the amount for this item would be reduced by $149,492.74 at$0.80/CY instead of$1.11 as shown in the DMRS estimate. 3. Revegetation: The sub-item crimping with tractor, appears to be about three times what it should cost to accomplish the task. ECA is confident that work can be done for less than $25.00 per acre since it only involves one tractor covering the acreage one time. Based on that there is a savings of$45.89 per acre for 228.8 acres which comes to a $9,343.05 reduction. The attached spreadsheet shows all of these direct cost numbers compared to the DMRS estimate numbers. It also calculates the indirect numbers using the same percentages as shown in the DMRS estimate.The hours of supervision were reduced based on the percentage of the change in the direct costs.The total Bond amount we are requesting, based on the direct and indirect numbers shown on the spreadsheet is$902,599.68.