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OGCC <br />Of Am e r c e <br />January 20, 2016 <br />VIA EMAIL <br />Joe Kerby, County Manager <br />La Plata County <br />1101 East 2nd Ave <br />Durango, CO 81301 <br />Re: Response to County Revisions to Draft Road Improvement Agreement <br />Dear Mr. Kerby: <br />As you know, GCC Energy ("GCC") has been in discussions with County Staff regarding a Road <br />Improvement Agreement as part of its Class II Land Use Permit process. On January 15, 2016, Daniel <br />Murray provided to the GCC team a revised Road Improvement Agreement along with a revised Exhibit A <br />(the "1.15.16 Draft RIA"). <br />In response to the 1.15.16 Draft RIA, we provide this letter to make sure the County understands the <br />position that GCC will be forced into if the 1. 15.16 Draft RIA is advanced in its current form to the <br />Planning Commission and Board of County Commissioners. GCC cannot, and will not, sign the 1.15.16 <br />Draft RIA without appropriate amendments. As discussed at our last meeting, any agreement between <br />the County and GCC needs to be just that, the mutual consensus reached by the parties, and there are <br />several provisions which make the 1.15.16 RIA a non-starter for GCC. <br />We can provide further or additional detail as needed, but wanted to communicate GCC's position <br />regarding the key remaining issues as quickly as possible to facilitate further discussion on the Road <br />Improvement Agreement. <br />1. Recital E -- Truck Limitations <br />As GCC's December 8, 2015 and December 23, 2015 letters further detail, contingent upon the <br />Board of County Commissioners' approval, GCC is willing to voluntarily limit coal truck traffic on <br />CR 120 until, and after, phases of the CR 120 improvements are completed. <br />That said, the following terms in the 1. 15.16 Draft RIA are unacceptable: (i) the limitation numbers <br />(GCC proposed 120 until Phase 3 is completed and 155 as a long-term limit); (ii) the average <br />being based on a 6 -day week (GCC proposed the average be based on a month to account for <br />weather and other contingencies); and (iii) the maximum daily limit (again, flexibility is needed to <br />account for weather). <br />GCC cannot agree to the 1.15.16 Draft RIA terms as they would cause GCC to: (i) breach <br />existing customer contracts causing possible legal claims and litigation against GCC; (ii) lay-off <br />employees; and (iii) consider closing the Mine as it would no longer earn sufficient revenue to pay <br />for its own operations, let alone the CR 120 improvements contemplated by the Road <br />Improvement Agreement. Based on our prior discussions, we do not anticipate this is the <br />