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Peter Wayland July 23, 2012 Page 2 Approval of this substitute water supply plan does not relieve the Applicant and /or landowner of the requirement to obtain a Water Court decree approving a permanent plan for augmentation or mitigation to ensure the permanent replacement of all depletions, including long -term evaporation losses and lagged depletions after gravel mining operations have ceased. An application for a plan for augmentation is required to be filed with the Water Court by December 31, 2012. Approval of this plan does not imply approval by this office of any related litigation. By that date the Applicant or its successor in ownership must have either filed an application with the Water Court for a court- approved augmentation plan or commenced backfilling of the site. In accordance with the letter dated April 30, 2010 (copy attached) from the Colorado Division of Reclamation, Mining, and Safety ( "DRMS "), all sand and gravel mining operators must comply with the requirements of the Colorado Reclamation Act and the Mineral Rules and Regulations for the protection of water resources. The April 30, 2010 letter from DRMS requires that you provide information to DRMS to demonstrate you can replace long term injurious stream depletions that result from mining related exposure of ground water. In accordance with approach no. 4, you have provided an affidavit dated January 27, 2012, that dedicates 0.5 shares of Hillsborough Ditch water as replacement water solely for this SWSP for as long as there are depletions at this gravel pit site or until such time as another replacement source is obtained. A copy of the affidavit is attached to this letter. For the purposes of this SWSP, this affidavit will be accepted for the dedication of the shares; however, if the State Engineer determines that a different affidavit or dedication process is necessary to assure proper dedication of the shares, additional information may be required prior to future SWSP approvals. Depletions Consumptive use of water at the property consists of 45.92 acre -feet of evaporation from up to 21.49 acres of exposed after December 31, 1980. Depletions from evaporation at the mine site will accrue to Big Thompson River. Computation of evaporation under this plan was also reduced during the ice covered period. You have assumed the ice covered period to occur during the months of January, February and December, based on the average temperatures of 27.5 °F for January, 30.6 °F for February and 29.1 °F for December; taken from the Fort Collins weather station. However, for the purpose of this SWSP, the Applicant shall replace the net evaporation depletions from the exposed ground water surface area that may occur during the assumed ice covered period (the months of January, February and December) for any time that the pit is not completely covered by ice. You have provided a monthly breakdown of the annual depletions at this site in your attached Table AI.1. The IDS AWAS stream depletion model was used to determine the lagged depletions from evaporation to the Big Thompson River. The aquifer characteristics used in the model are: transmissivity (T) = 44,883 gallons per day per foot and specific yield, (SY) = 0.2, the distance from the centroid of the exposed ground water to the stream = 860 feet, and the location of the parallel impermeable boundary was estimated to be 3,500 feet from the stream.