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MOSES, WITTEMYER, HARRISON AND WOODRUFF, P.C. <br />t.nw orrtcp <br />DAVBIL XARltaOa <br />ullEt R warrouae~r <br />twomr I. eanrBll <br />veaorncri w srewatl <br />y~ •• <br />IR'1WD7. MBIO871' <br />OABRm.D. CAR7BR <br />aWN.,,1WVr!@I <br />IBOQ W~u+vrsreeer,svlrelBo <br />Bw~RCOUlluootowr <br />rayons: pol)hran: <br />. ~ .r~x:twr}w~nvq .. <br />• ADDRH$COARPdMlBIQ~Ca TO; . <br />~. 0. BOIL lM0 <br />BOULDal. W70>OHIW •. <br />March 8, 2005 <br />Paul Gesso <br />Maureen Jacoby <br />Banks aad Gesso LLC <br />720 Kipling Street, Suite 117 <br />Lakewood, CO 80215 <br />CXARLaf to WOODRU/I <br />(isn•nwl <br />caurl~, <br />4I ... RMHFFIL MO~'f <br />• IOIBi WIITPLIYaS <br />Re: Water Sully for Kine Mountain Gravel Ooeration. Roritt County. Colorado <br />Dear Paul and Maureen: <br />• You have asked me to address the status of water rights acquired by Angus <br />l Investment LLC with the King Mountain grnvel mining property and to identify the options for <br />~ obtaining a water supply for the expanded gravel operetion that is the subject of a permit application <br />pending before the State Division of Minerals and Geology (DMG}. <br />~. . <br />Angus Investment acquired the King Mountain grave] property and associated water <br />rights in June 2004. The water rights acquired with that property include various decreed priorities <br />for diversion from Egeria Creek and various springs lribntary tc Egeria Creek or Smith Creek with <br />appropriation dates ranging from August 1889 to December 1991. The water rights are described <br />on the bargain and sale deed attached to this letter. The older water tights are adjudicated for <br />L irrigation use, while some of the more junior water rights are adjudicated for irrigation, <br />stockwatering, domestic, fire protection and fish culture, including several small storage waterrights. <br />L . It is my understanding that a small gravel extraction operation has been operating at <br />the site for a number of years, with water being diverted for dust suppression and, perhaps, some <br />I small amount of gravel washing, The water used for those purposes has been diverted from Smith <br />L_. Creek just upstream of its confluence with Egeria Creek with the knowledge of the local water <br />commissioner. Since the water rights acquired with the property are not specifically decreed for <br />I industrial or gravel extraction purposes, we must assume that the diversions of such water for tbose <br />t_.. uses took place at times when there was unappropriated water available in the Egeria Creek basin. <br />Under Colorado law, a water user may appropriate and use water from natural streams so long as that <br />water ie not needed to satisfy prior appropriators from the stream system. When a prior appropriator <br />needs the water, he/she places a "call" with the State water officials who may curtail diversions from <br />the system under water rights junior to the calling right or those without a decreed priority, as <br />~ deemed necessary by the State water officials to satisfy the calling right(s). The condition where <br />