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PERMIT #: M- 2010 -049 <br />INSPECTOR'S INITIALS: PSH <br />INSPECTION DATE: January 31, 2013 <br />2011 and withdrew the technical revision on November 6, 2012. An alternate flood analysis and flood control <br />plan was submitted as TR -02 on November 9, 2012 and approved by the Division on January 9, 2013. The <br />financial warranty for TR -02 has not been submitted by the Operator; therefore the revision has not been <br />issued by the Division. The Operator submitted TR -03 on November 14, 2012 and was approved by the <br />Division on November 19, 2012 to modify Permit Stipulation #1 as discussed below. <br />Complete Inspection /Mining Plan: <br />A processing plant and product stockpiles were located in Tract A. A portion of the northeast section in Tract <br />A has been mined according to the Operator. Tract B is mostly mined out and is approximately 15 feet deep. <br />A small reserve of gravel remains on the pit floor. Backfilling and clay lining activities have started in Tract B. <br />Active mining activity was observed in the southern half of Tract C, as allowed by TR -03. The depth of <br />excavation was approximately ten feet deep. Black gravel was observed in the active excavation. Varra stated <br />the gravel was stained black due to iron oxide precipitation and a chemical reaction with the lime previously <br />used at the site. Varra stated the black gravel occurred in Tract B also and was tested by their environmental <br />consultant to verify it was not hazardous. The Division requested a copy of the report for the Division's review <br />and records. Garrett Varra emailed a copy of the report on January 31, 2012 after the inspection. <br />Financial Warranty: <br />The Division currently holds a financial warranty in the amount of $127,210.00. The Division estimated a <br />financial warranty increase of $664,000.00 for a total bond amount of $791,210.00 as a result of mining and <br />reclamation plan changes resulting from the approval of TR -02. Varra stated they have received lower <br />estimates for the materials and work required by the technical revision and will submit a response to the <br />Division bond estimate soon. The Division will review the estimates once submitted and contact the Operator <br />under separate cover. <br />Hydrologic Balance: <br />A well permit has been issued for the site by the Colorado Division of Water Resources. The site is dry mined <br />by dewatering each tract and discharging the water to the Cache La Poudre River under a CDPHE discharge <br />permit. The Division does not have record of an approved SWSP for the site. <br />Gen. Compliance With Mine Plan: <br />The site was actively mining, processing and hauling aggregate during the inspection. The site appeared in <br />compliance with the approved mining plan. <br />Signs and Markers: <br />As cited as a problem above, the mine sign was not in compliance with Rule 3.1.12 and all of the permit <br />boundary markers were not observed during the inspection. The Operator will need to comply with the <br />corrective actions noted above by the due date. <br />Permit Stipulations: <br />On November 19, 2012 the Division approved Technical Revision No. 2, which revised the original stipulation <br />requiring the following: Prior to affecting land in Tract C and Tract D, Varra Companies, Inc. shall submit and <br />obtain approval of a Technical Revision addressing a flood analysis and flood control plan for the Western Sugar <br />Reclamation Land Development Project. <br />Page 2 of 4 <br />