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(Page 2) MINE ID # OR PROSPECTING ID # M-2002-106 INSPECTION DATE 9/23/02 INSPECTOR'S INITIALS RCO The permit file for this site was never made part of the Division's database, which is believed to be mainly due to the fact that this file originally shared a permit number with another active, permitted mining operation: M-1978-126. The original applicant, Manuel L. Mondragon, submitted the 110 application on 4/6/78, plus additional materials on 4/27/78 and 6/9/78. The permit application was approved by the Mined Land Reclamation Board at its 6/29/78 meeting. Bond was set at $1,000, and submitted by the operator on 9/11/78. The original permit was issued on 9/22/78. This site was inspected by the Division in 1981, at which time the operation was found to be in compliance with its approved mining plan, though a problem was noted: no annual reports or annual fees had been submitted by the operator for the years of 1979, 1980, or 1981, and they were now due 13 years @ 550/year = 51501. No annual reports, annual fees, or further correspondence were ever received from the operator, and no further materials were ever sent to the operator by this Division. No materials originating from the Division after the 1981 inspection report indicates that the record of the file was "lost." Current search of the Division's database confirms that there is no record of this site or this permit. The operator will note that this document now shows a new permit file number: M-2002-106. This is a unique number, and will appear on all future materials sent to the operator, and should aoaear on all materials sent by the operator to this Division. Early in 2002, Division staff discovered a 51,000 certificate of deposit filed with the State treasurer, presumably as a permit bond, but could find record of which operation it was posted for. It was returned to the operator several months ~~ One copy of this 110 permit file exists in the Division's records. Soon after the bond was returned to the operator, the Division's Durango field office staff who holds this file, contacted the operator to inquire about the operation described in the single permit file mentioned above. Staff spoke with the original operator's son, Larry Mondragon, who took over the business of the operation after the passing several years ago of the original operator. Larry Mondragon confirmed that the bentonite pit still existed, and that he was interested in continuing its operation. He apparently was under the impression that the site was permitted and in full compliance. However, he has not had access to the records in his father's 1978 permit file, and was unaware of the details of the operation as they were described in the original application and as approved for this permit. He also asked why the Division returned his bond. The situation described in the paragraphs above was explained. An inspection of the site was scheduled, to verify the amount of disturbance and to meet and discuss the matter of getting this site "fully" permitted and adequately bonded. This inspection report will attempt to include all relevant issues involved with the file and the need to ensure proper permitting and adequate bonding. The Division had documented knowledge that mining had occurred here up to the point of the 1981 inspection. This current inspection was performed by the Division to determine whether mining activities had continued after that time, perhaps up to the present date, and whether the operation was at all in conformance with the approved mining and reclamation plans. The operator's representative was present during the inspection. The original permit was approved for a maximum disturbed area of 3 acres. Topsoil (sometimes referred to as "overburden" in the application and by Mr. Mondragon during this inspection) is stripped from the area to be mined and piled near the edge of the pit. Extraction is performed by loader and truck as the need for material occurs, with no processing or stockpiling onsite. The pit was found to be located where it is described in the file, and roughly in the correct configuration. 1981 inspection slides show that there were 2 adjoining pits leach holding water). This inspection found the same 2 pits, but now they had been backsloped carefully to 3:1 gradients, with irregular, sinuous margins. The site was dry, with no water impounded in the pits. Fairly old piles of topsoil and several newer piles of topsoil were observed around the margins of the site disturbance. Newest extraction has occurred on the southern end of the south pit, where a small section of the highwall has not been graded down to 3:1. There were no bentonite stockpiles; there was a wheeled loader in the south pit. The method of operation appears consistent with the approved plan in the file. The operator stated that he would grade down the remaining vertical highwall to 3:1, then remove the loader from the site, in the next few days. If possible, he stated that he would spread topsoil on much of the north pit where extraction is finished, and seed those areas, this fall. Topsoil piles were not seeded to grass for erosion protection, but older ones were vegetated with local brushy vegetation, and were mostly low in configuration and stable. The surfaces of the piles exhibits a clayey crust which is assumed to be resistant to wind erosion. There was no debris or junk equipment, and no contaminants.