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August 24, 2021 Page 4 that the new crusher facility and doubling the permitted crushing capacity on the Applicant's property could destabilize the Tailings Storage Facility. See JVA Memo. As explained in the JVA Memo, the District is under a compliance schedule to reduce inflow and infiltration into its collection system. The increased seismic activity nearby could also affect the District's efforts to reduce inflow and infiltration. Damage to the collection system could result in seepage of wastewater into the ground. Again, the most recent analysis on geotechnical stability dates from 2011, a decade ago and well before the Applicant's recent proposal to increase the size of its operations. Application, Appendices 22-5 and 22-6. Access Agreement The District understands that the Applicant does not have access to its property for the operations that it plans. As shown in Figures 3-1 and 3-2 in the Application, Al Phillips owns the strip of land between the Applicant's property and Highway 24. He previously gave permission orally to the Applicant's predecessor allowing access but told the Applicant that he would allow access across his land only for 200 tons of material (not 200 tons per day). The fact that the Applicant does not have legal access to its property for the expansion of operations is an another reason the permit conversion should be denied. In addition, the Applicant does not have permission from the Colorado Department of Transportation to truck 400 tons per day of ore into its property. For so much truck traffic it may be necessary to install a deceleration lane on Highway 24, which may have to be built on Mr. Phillips's land. He objects to the taking of his land for such construction. Financial Warranty Under Rule 1.11.2 of the Mined Land Reclamation Board, "[a]ll warranty and permit processing requirements shall apply as though the Conversion application were a new permit application." The Applicant has not demonstrated in its Application that the amount of the financial warranty will be sufficient to cover reclamation, especially if there is leakage or other problems at the facility. Rule 4.2.3 provides that "[t]he conversion of any 110 Permit into any 112 Permit shall require a Financial Warranty in an amount equal to the estimated cost of reclamation." In Section 12.1 of the Application the Applicant estimates that reclamation will cost$77,258,but in Appendix 12-1 it estimates the total reclamation cost to be$85,636 and leaves a blank for the cost for cyanide and"OTHERS?"for monitoring wells. Regardless of which of these numbers is the one proposed, anything under$100,000 seems wildly optimistic for reclaiming a major milling site and ensuring that the District and other neighbors will not be stuck with paying for any environmental damage