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PROPOSED DECISION As required by Rule 3.03.2(5)(a), this document wnstitutes written notification of the Division of Minerals and Geology (Division) decision to approve a Phase II bond release request for the Colorado Coal Mine No. i (GCMG No. 1), permit no. C-81-024, submitted by Kaiser Ventures, Inc. The rationale for this approval are as outlined below. BACKGROUND The CCMC No. 1 is a surface mine which was permitted and operated by Kaiser Ventures, Inc. The mine is located in Huerfano County, northwest of the town of Walsenburg, in portions of sections 25 and 36, T27S, R67W. 73.5 acres were disturbed and reclaimed at this site. The land for which bond release has been requested is privately owned by Kaiser Ventures, Inc, and coal which was mined from the area was also privately owned. Reclamation of areas for which bond release has been requested was completed during November of 1989 and February of 1992. This Phase II request includes all of the 73.5 acres originally disturbed and reclaimed. RECLAMATION BOND HISTORY The original performance bond for the CCMC No. 1 was $250,000.00. The Division previously reduced the reclamation liability by $150,000.00 as a result of a Phase I bond release of the entire disturbed area, which was approved in December of 1990. The Division currently holds a performance bond (letter of credit) of $100,000.00. As a result of this Phase II bond release request, the Division proposes to release $62,000.00 of reclamation liability. This amount, when added to the Phase I bond release amount of $150,000.00 totals $212,000.00 or 84.8% of the original bond. The remaining $38,000 is more than sufficient to cover the cost of reestablishing vegetation on the entire 73.5 acres, should the re-vegetation effort fail. PROCEDURES AND SUMMARY OF THE REVIEW PROCESS Kaiser Ventures, Inc. applied for Phase II bond release under the Colorado Surface Coal Mining Reclamation Act following reclamation of the CCMC No. 1. An application for Phase II bond release was received by the Division on September 16, 1996. The application was deemed complete on September 26, 1996, after the Division received proof of publication of the applicant's public notice. Kaiser Ventures, Inc. published notice of the bond release application in Huerfano World once weekly for four consecutive weeks, beginning August 15, 1996. Kaiser Ventures, Inc. also notified land owners within and adjacent to the mine permit area, and other interested parties of the application for bond release, as required by Rule 3.03.2(1). 2 - -....... -