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III. September 14, 2001 Notice of Reason to Believe Violation Exists By letter dated September 14, 2001, DMG sent MPC a second Notice of Reason to Believe Violation Exists ("September 14 Notice"). The Notice alleges violations of C.R.S. § 34-32.5-116(4)(1) and Construction Materials Rule 3.1.5(3) for failure to protect areas outside the affected land "and other damage." The Notice also alleges violations of C.R.S. § 34-32.5-116(4)(h) and Construction Materials Rule 3.1.6(1) for failure to minimize impacts to the prevailing hydrologic balance. The Division bases the alleged violations on the following conditions the Division has reportedly discovered: (1)1,000 linear feet of severely eroded and unstable cut banks of the Bull Seep Slough within the permit area; (2) 2,100 linear feet of severely eroded and unstable cut banks of the Bull Seep Slough outside the permit area; (3) the invert of the Bull Seep Slough channel outside the permit area has dropped or downcut 3.5 to 6.0 feet from known levels prior to the May 5, 2001 flood event; and (4) the Bull Seep Slough channel outside the permit area and has widened up to an additional 90 feet. The DMG further asserts in the September 14 Notice that "these damages are the direct result of Mobile Premix Concrete, Inc. not installing the relocated Bull Seep channel in the approved location, and not properly installing the other associated drainage control structures as required by the approved reclamation plan." (Emphasis added) MPC denies the allegations set forth in the September 14 Notice, which denial includes any all allegations that the present location and configuration of the Bull Seep has had any direct or proximate causal relationship to events that occurred on the South Platter River on May 5, 2001 in areas located near the Bull Seep Slough. A. The Present Location and Configuration of the Bull Seep Did Not Contribute in Any Way to the Bank Failure on May 5, 2001 or Damages Resulting From Such Failure. Exhibit A to this Prehearing Statement and Answer is a report and series of figures prepared by Applegate Group, Inc. ("Applegate Report"). The Applegate Report and figures detail an exhaustive review of the historical aerial photographic record of the Bull Seep and Bull Seep Slough. The Applegate Report concludes that the May 5, 2001 breach would have occurred regardless of the alignment of the Bull Seep. The riverbank breached into the Bull Seep Slough, which was itself created during an approximate 100-year flood in 1973, and at a location that exhibited an existing breach at least five (5) months before the May 5, 2001 event. See Applegate Figure 1-7. Once the May 5, 2001 event developed, the remaining portions of the riverbank appear to have failed to the South Platte River by "head" cutting back along the existing channel. Key findings in the Applegate Report are summarized immediately below. (1) On June 17, 1965, prior to an approximate 100-year flood, what is now known as the Bull Seep Slough could not be easily identified, although evidence of water in low spots adjacent to South Platte River bank in the area of the May 5, 2001 event in the approximate location of the relocated Bull Seep can be seen. 5