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SEAT BY~PMHS 4-28-94 ;12~OOPM ; 3032953040 303 832 8106;8 3 Robert Krassa, Esq. April 28, 1994 Page -2- of the Golden Eagle !Sine operation permit that will adequately protect current and future surface owners. on the other hand, there is nn ongoing federal rulemakinq regarding mine operators' obligations Por subaidanoe damage. That action may change the acopa of Sasin's obligations in ways we cannot determine at this time. When the federal rules become final, the State of Colorado will have to review its statute and rules for conformity. Whatever changes take place will offset Basin's obligations for its current permit term, and into the future. Basin is unwilling to undertake a oaparnte and very stringent contractual obligation with a third party such as Raton West, in light o! these ongoing regulatory activities. 2. The proposed agreement would seem to lnterposa Raton West as a party in Basin's permit. While Raton West is validly a party in the permit renewal proceeding, it appears that its role in Rancho Escondido will end at soma point. Lots continue to be sold to third parties, who will be the parties of interest in the future. Basin's obligations to aurfaca owners will be enforced by the Division of tiinerals and Geology through the operating permit. The. existing rules are adequate to this task, and a separate agreement.rafarnnced or included in the permit is unnecessary and not in Basin's interests. Following are some of the specilic comments with the proposal: 1. Sarin believes that preliminary design work may or may not help mitigate future subsidence damage. Basin ie interested in working wftti Lea Animas County to ensure-that Basin anfl surface owners are notified prior to any conatruetiori in Rancho Escondido. Basin may approach individual owners on a case-by-case basis vith suggestions regarding agreements to mitigate and/or repair subsidence damage. Hovnvar, the proposal detailed on April 5, is too rigid given the widely varying nature of potential effects. Furthermore, it makes much more sense, for both Basin and the individual surface owner, to conclude any such agreements directly with the individual lot owner, and not vith Raton West. 2. The provisions far protection or replacement of water walla are too broad, am premature,.,and should be concluded with individual lot owners who may decide to drill any ouch wells or other water sources. 3. Basin dlsputea any obligation to reimburse Raton West Lor any "diminution" in value resulting from the existence o! the (temporary) ventilation Lan. The Pan commenced operation in July, 1991. Charles Baldwin purchased Rancho Escondido 1n December, 1991; obviously with full knowledge of the presence of the Lan,