Laserfiche WebLink
<br /> <br />4. The Petitioner's witness, Mr. Calarco, and Respondent's <br />witness, Mr. Metzroth, both testified concerning the future demand <br />for the coal, market conditions, and expense factors. <br />5. While Mr. Calarco predicted a drop in the price of the <br />coal, his testimony does not dispute Mr. Metroth's opinion that <br />there will be an increased demand. The low sulphur content of this <br />coal and the increasingly stringent requirements of the federal <br />regulations concerning airborne particulates, combine to create a <br />reasonable expectation of not only continued, but expanded demand. <br />6. Market conditions are closely related to the expense <br />factors in this case. The testimony of Respondent's witness, Mr. <br />Metzroth, that this underground mine has the lowest operating coats <br />of any domestic mines reporting to his company goes unchallenged, <br />and is supported in the Cyprus financial reports to the <br />stockholders. In addition, the favorable transportation rates <br />provided by Southern Pacific Railroad, which serves a very active <br />low sulphur coal market in the eastern United States, increase the <br />marketability of this product by decreasing costs of delivery. <br />Also supporting the case for a favorable market are the increased <br />production schedules already in place and testified to by Mr. <br />Mills, Mr. Baer, and Mr. Dodd. <br />7. Actual and environmental impacts are the only remaining <br />factors that might adversely affect the economic life. Yet, even <br />in this area the outlook is favorable. Evidence and testimony <br />about the experiment in mining the alluvial valley floor suggest <br />that those areas previously deemed "sterile" might be opened up <br />with more advanced techniques developed as a result of the <br />experiment. There was testimony and evidence presented concerning <br />a 10 year permit from Routt County land use allowing the subsidence <br />of the county roads in the proposed Eastern District. <br />8. The procedures developed by the Division of Property <br />Taxation require the assessor to consider factors that might cause <br />the economic life of the reserves to be less than the physical life <br />of the reserves. If no adverse conditions are found, the physical <br />life is used in the calculation. The Board finds no evidence that <br />indicates the economic life to be less than the physical life. <br />While it is true that an accelerated production schedule would <br />cause the reserves to be used up in fewer years, this is wholly a <br />management decision. Further, the Assessor would have no resource <br />for determining physical life of the reserves other than the <br />production level of the previous year. <br />9. The Board does not consider the lack of long term <br />contractual commitments to be an indication of adverse economic <br />conditions. The federal clean air program is only in the second <br />stage of implementation. Long term contracts might prove to be a <br />liability if the increased demand causes prices to rise in the <br />future. <br />UA/A27512 <br />8 <br />