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Applegate <br />Group, inc. <br />ec-s? ?j LJ <br />March 29, 2011 <br />Mr. Tony Waldron <br />Colorado Division of Reclamation, Mining and Safety <br />1313 Sherman Street, Room 215 <br />Denver, CO 80203 <br />ReeLlIven <br />R-31?oil <br />Divi-3ion of Reclame?ffon. <br />1? Mining & ,Safety <br />RE: Substitute Water Su I PIS' for Kauffman #1 Pit (WDID 0402530) <br />DRMS Permit No. -78-327 <br />E V2, Section 20, T5N; R68W, 6th P.M. <br />Water Division 1, Water District 4, Larimer County <br />Dear Mr. Waldron: <br />This letter is written on behalf of our client, Jake Kauffman & Son, Inc. and their gravel pit listed <br />above, called Kauffman #1 Pit. We recently received approval for a Substitute Water Supply <br />Plan (SWSP) from the Division of Water Resources (DWR) in their February 14, 2011 letter to <br />us (please see attached). The DWR approval letter referenced an April 30, 2010 letter from the <br />Colorado Division of Reclamation, Mining and Safety (DRMS) requesting compliance from all <br />gravel pit operators within both the Colorado Land Reclamation Act for the Extraction of <br />Construction Materials and the Mineral Rules and Regulations of the Colorado Mined Land <br />Reclamation Board for the Extraction of Construction Materials. The DRMS letter outlined four <br />different options for gaining compliance within the stated rules and act, and requested every <br />gravel pit operator to select one of these options and provide the DRMS with proof of the <br />selected option. Additionally, the DWR also requested a copy of the letter providing proof of <br />compliance with the DRMS. <br />Therefore, we would like to inform the DRMS that for the Kauffman #1 Pit, we have selected <br />Option No. l: file a financial warranty that will ensure backfilling of the pit to cover the exposed <br />groundwater to a depth of two feet above the static ground water level. The financial warranty <br />for said pit has already been filed with the DRMS for many years. Attached, you will find a June <br />12, 2006 letter from the Colorado Division of Minerals and Geology stating approval of the <br />proposed financial warranty reduction for the Kauffman #1 Pit. We have also included the May <br />23, 2006 letter from Applegate Group, Inc. on behalf of Jake Kauffman & Son, Inc. which <br />outlines the then proposed and now approved, financial warranty plan. The financial warranty for <br />the reclamation of the mining area has been in effect since the mining permit was first issued in <br />1978. Only the most recent revision and approval are included with this letter. <br />It should be noted that though the Kauffman #1 Pit carries a reclamation plan that involves <br />leaving an exposed water surface, the total exposed acreage will be less than the pre-1981 credit <br />1499 W. 1201h Avenue, Suite 200 118 W. 61h Street, Suite 100 <br />Denver, CO 80234 Glenwood Springs, CO 81601 <br />303-452-6611 <br />www.applegategroup.com