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STATE OF COLORADO DIVISION OF MINERALS AND GEOLOGY Department of Natural Resources 7373 Sherman St., Room 215 Denver, Colorado 80203 Phone: (303) 866-3567 FAX: (303) 832106 COLORADO DIVISION O F MIN SRALS GEOLOGY 0.E CLAM ATION•NINING SAFETY•SCIENCE / Bill Owens / Gavemor June 23, 2004 Russell George Executive Director Ututed County Premier Brokers ATTN: Tim HiserPTom Smith Ronald w. Cattany Division Director 24$ E Hwy $0 Natural Resource Trustee Salida, CO 81201 )tE: Reason to Believe a Violation Exists at the Tom Smith Pit; DMG File # M-2004-045 Deaz Mr. Hiser/Smith: On June 10, 2004 the Division of Minerals and Geology conducted an inspection of the Tom Smith Property Pit located approximately 2 miles northeast of South Fork, Colorado and found the following: Mining and reclamation operations had been conducted on a portion of Section 29, Township 40 N, Range 4 E in Rio Grande County, Colorado. We believe that this is a violation of C.R.S. 34-32.$-109(1) for failure to obtain from the board or office a reclamation permit prior to engaging in a new mining operation. Specifically, significant mining and reclamation operations had occurred on a piece of property adjacent to the Rio Grande River neaz South Fork, Colorado on property owned or controlled by Tom Smith. Therefore, we have reason to believe that a violation exists to DMG FIle Number M-2004-045 and to the Law, and have scheduled this matter to appeaz before the Mined Land Reclamation Boazd. A Formal Public Hearing will be held during the July 28's and 29'", 2004 Boazd Meeting for consideration of a possible violation. The hearing will be held in Room 318 of 1313 Sherman Street, Denver, Colorado, beginning at 10:00 a.m. on July 28th or as soon thereafter as the matter can be considered. At that hearing you will leave the opportunity to be represented and heazd. It will be reiterated that there is reason to believe that you are in violation of the provisions noted above. If the Board fords a violation at this hearing, it may issue a Cease and Desist Order and/or assess a Civil Penalty in the amount of $ 1000.00 to $$,000.00 for each day of violation. If you have evidence indicating that the possible violations noted above do not exist or have been corrected, please provide it to us as soon as possible or bring it to the hearing. Following the hearing, all parties have an opportunity to review and comment on a draft ojihe Board's order before it becomes firsal. If you wish to do so, you must provide the Board with a written request to review the draft order prior to or at the time ofyour hearing, or you must inform the Board orally during the hearing that you request to review the draft order. You must include your mailing address and, ifpossible, a fax or email address. You will be provided a copy of the draft order for your review as soon as it is available. The Board must receive your comments on the draft order within ten (10) calendar days of the date the draft order is mailed, unless that deadline is extended. Please note that the Division of Minerals and Geolo2v has requested and will be allowed to review and comment on the drafr Board Order prior to mailine to any party. Submit all comments in writing to Mr. Tyson Powell, Assistant Attorney Genera[, 1515 Sherman Street, S"' Floor, Denver, Colorado 80103, or FAX #(303) 866-5395. The Board will resolve any issues regarding the form and suhstance ajthe order. This process does not affect your right to request reconsideration by the Board or appeal the form or substance of the order. Office of Office of Colorado Mined Land Reclamation Active and Inactive Mines Geological Survey