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DATE: September 9, 1991 TO: Frank Johnson, Steve Renner FROM: Tom Gillis, CMLRD _~/f,1 1 1, iii iiiiiiiiniiiiii 999 RE: Purchase of Hawk's Nest East Property via tax lien I have put together some additional comments that may have some bearing on the matter of Mr. Russel Brown's purchase of the Hawk's Nest East Property, as follows: 1. Although the tax notice purchased by Mr. Brown on 11/28/88 for 510,148.13 lists the total value of land and improvements at 5816,750, the actual value of the property both at the time of purchase and prior to commencement of reclamation work was probably significantly less than that, based on the following considerations: * Prior to the date of purchase of the lien, the State knows of one sales contract between the previous owner of the property, Western Slope Carbon, and a company named Repair King, Inc. that purchased a large quantity of equipment, materials, and possibly structures from the property. The bill of sale was recorded in Gunnison County on 6/30/88. * The title & lien search conducted by the AG's office for the Division on 5/11/89 revealed 2 liens against the operator, one from the Delta-Montrose Electric Association filed on 6/6/88 and one from Art Beavers Construction filed on 7/20/88. The DMEA lien was satisfied from what I under- stand through a sheriff's sale of some electrical facilities from the east mine area. I do not know the status of of the lien from Beavers Construction. * The Division had reason to believe that Western Slope Carbon still owned the property and improvements at least until the late fall of 1990 because a person, Mr. Jim Drew, represented himself as an agent for Western Slope Carbon and claimed he was responsible for selling all salvageable materials from the mine for Western Slope Carbon, Inc. This individual did sell a considerable quantity of equipment, materials, and structures from the East Mine Area up until (to my knowledge) September of 1990. # Other individuals were found removing structures and equip. from the East Mine Area up to the time the Reclamation Con- tract was awarded on 9/07/90. These removals consisted of bins, conveyors, and fixtures inside the wash plant facility represented to the Division as being the property of a Mr. Tom Muncie (or Muncy) who from what I understand had a business interest in the mining operation. Additional re- movals between 3/89 and 9/90 were simply thefts of various items from the property. Bear Coal Co. was also purported to have taken items from the East Mine Property. ~ Some of the facilities had been damaged by landslides prior to the Division's involvement in the reclamation of the property. It is unknown if the assessed value of the property had factored in this damage.