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<br />15. Toward the economic life issue, he stated that the <br />current business plan projects mining levels to increase to 4.86 <br />million tons in 1994 and 7.2 million tone in 1996. The commitments <br />on contracts as of January 1, 1994 do not exceed the tonnage of <br />reserves that are in the current active permitted area. The <br />increased production will shorten the life of the reserves in the <br />active area, and there is no guarantee that the Eastern District <br />will be permitted. The higher costs of driving the main access <br />shaft and satisfying environmental and safety concerns in order to <br />develop the Northern District may make it economically unfeasible. <br />He considers the economic life of the mine to be 5 to 15 years and <br />reported 15 years to the Assessor. The Assessor used the prior <br />year's production of 3.3 million tons divided into the reported <br />reserves to determine a life of 22 years. He believes this could <br />be considered the physical life of the mine, but it is not the <br />economic life, and the economic life is required in the procedures. <br />16. Toward the issue of the reserves, Mr. Baer testified that <br />he reported the tonnage of reserves controlled by the company, but <br />he now believes that he should have reported only the tonnage <br />within the life of mine boundary. He stated that the geologist <br />estimated approximately 70 million tons of the reserves were within <br />the boundary, but no evidence or direct testimony was given to <br />support this figure. <br />17. The Assessor, Amy Williams, was called as an adverse <br />witness to testify as to the valuation procedure she used to set <br />the 1994 value and her understanding of the information requested <br />on the declaration form. <br />18. The Assessor stated that she used the formula as <br />prescribed in the Assessor's Reference Library. She used the BTU <br />data to determine the price per ton to select from the table <br />published by the Division of Property Taxation. The total <br />recoverable reserves were divided by the prior year's production to <br />obtain the economic life of 22 years. The remaining data for the <br />calculation of the assessed value came from tables published by the <br />Division of Property Taxation. <br />19. Ms. Williams stated that her understanding of the term <br />"recoverable reserves" was all minable tonnage within the life of <br />mine boundary. When questioned about the method she uses to <br />determine the economic life of other mines, she stated that it was <br />the same as employed in this case: the reported reserves divided by <br />the prior year's production. When asked about physical versus <br />economic life, she affirmed that external problems might make the <br />economic life different from the physical life, but that she had <br />seen no evidence of adverse conditions. <br />20. Petitioner's witness, Vincent Calarco, vice president of <br />market planning and development, testified about market <br />considerations and how they would affect the economic life of the <br />mine. <br />UA/A27512 <br />4 <br />