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3. In July 2006, the Board found the Operator in violation of § 34-32.5.109(1), <br />C.R.S., for mining without a permit and issued an Order on August 16, 2006 (the 2006 <br />Order). The Board issued a Cease and Desist Order prohibiting further mining activities <br />outside of the approved permit boundaries until the entire site was properly permitted. The <br />Board ordered the Operator to obtain approval of a Section 112c reclamation permit for the <br />entire operation within 160 days of the signed Board Order. The Board ordered the Operator <br />to pay $56,132.80 in civil penalties, suspending all but $3,132.80 if the Operator completed <br />the corrective actions in a timely manner. The Operator paid the unsuspended portion of the <br />civil penalty in September 2006. <br />4. The Operator submitted the required conversion application (CN-01) in <br />September 2006 to address the disturbed areas outside the permit area and add new acreage <br />for future mining development. The Operator proposed adding 6.6-acres to the permit for a <br />16.4-acre total permit area. As a result of the permit conversion application, the Division <br />recalculated the financial warranty for the site to $52,000. In January 2007, the Division <br />approved the conversion application and informed the Operator of the $36,000 increase in <br />financial warranty and that the conversion would not be final until the Division approved the <br />bond. <br />5. The Operator did not post the bond. The Division discovered during a routine <br />file review in March 2009, that the Operator had not submitted the financial warranty for the <br />site's conversion application, CN-l. Several phone calls between Division staff and Mr. <br />Pelino followed. On May 22, 2009, Mr. Pelino called and informed the Division that the <br />site's bond would be posted the following week. The bond was not posted the following <br />week. The Operator failed to submit the financial warranty and therefore did not obtain a <br />reclamation permit as required by the 2006 Order. <br />6. Mr. Pelino testified that he overlooked getting the bond increase back in 2007. <br />He said that the Division's presentation was accurate. He also said that he is in over his head <br />in debt and has no employees, after recently having 45 employees. He has tried but is unable <br />to raise his bond amount to $52,000. <br />7. The Division inspected the site on July 17, 2009. The inspector saw evidence <br />of mining activities occurring outside of the approved permit boundaries including scale <br />construction, a processing plant, stockpiled material, and highwall excavation within the <br />conversion area. Photos taken during the inspection, and aerial photographs taken on August <br />28, 2009, show a recently excavated area, a new haul road, and stockpiled materials outside <br />of the approved permit area and in the conversion area, without regard for the existing permit <br />boundaries. <br />8. On July 28, 2009 the Division mailed the Operator a copy of the July 17, 2009 <br />Inspection Report. <br />. 9. On August 28, 2009 the Division mailed the Operator a Notice of Possible <br />Violation letter and conducted an aerial inspection of the site. The letter provided the <br />Pelino Inc. <br />Mining Without a Permit and Failure to Comply 2 <br />M-1984-043 <br />MV-2009-032