HomeMy WebLinkAboutMillhollin Appeal CARMEL NACCASIIA LLP
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DALLAS K.HOSIER December 24, 2013 ALSO ADAIrrED IN ILLINOIS
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BRIAN).STACK
Via Overnight Mail jon @camaclaw.com
Department of Conservation
Office of Mining and Reclamation
801 K Street, MS 09-06
Sacramento, CA 95814
RE: Appeal of Lead Agency Financial Assurances Determination
Millhollin Quarry; Mine ID: 40-0001
11600 Santa Lucia Road, Atascadero, CA
To Whom It May Concern:
This firm represents Glenn Millhollin, the owner of the Millhollin Quarry (the "Quarry") located
at 11600 Santa Lucia Road, Atascadero, California (the "Property"). This appeal is being submitted to
the California Office of Mining and Reclamation ("OMR") pursuant to Public Resources Code Section
2770(e),I Specifically, section 2770(e) provides:
A person who, based on the evidence of the record, can substantiate that a lead agency
has either (1)Jailed to act according to due process or has relied on considerations not
related to the specific applicable requirements of Sections 2772. 2773, and 2773.1, and
the lead agency surface mining ordinance adopted pursuant to subdivision (a) of Section
2774. in reaching a decision to deny approval of a reclamation plan or financial
assurances for reclamation. (2)Jailed to act within a reasonable time of receipt of a
completed application, or (3)failed to review and approve reclamation plans orb financial
assurances as requires by subdivisions (c) and (d). may appeal that action or inaction to
the board.
The City of Atascadero ("City") is the lead agency for the Quarry. The Quarry is a permitted use
pursuant to Conditional Use Permit No. 96003 (the "CUP"), which was approved by the City in 1996.
We should note that we didn't see any appeal forms or any other specific OMR requirements with regard to appeals made
under Public Resources Code section 2770(e), except that question 5 in OMR's Financial Assurance Guidelines states that
"...the operator may appeal the lead agency's inaction or denial of financial assurances to the SMGB within 15 days of
exhausting his or her rights to appeal according to the procedures of the lead agency."Given the short 15 day time frame and
holidays, assuming that AMR does not decline to hear the appeal as provided in Public Resources Code section 27700), we
respectfully request the right to supplement our appeal to OMR with additional evidence from our client's engineer, Mr.
Robert Tartaglia.
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Page 2 of 3 CARMEL&NACCASHA LLP
December 24, 2013
On December 10, 2013, the Atascadero City Council denied our client's application for an interim
management plan. One of the reasons cited by the City for such a denial is that our client's proposed
financial assurances are inadequate to reclaim the Property. CUP No. 96003 included $11,888.00 in
financial assurances, which were in the form of a certificate of deposit. Since 1996, the amount of
financial has been virtually unchanged. In response to our client's IMP application, however, the City
prepared a preliminary opinion of probable cost, which estimates the costs of reclamation to be
$279,000,or roughly twenty three and one half times the amount of financial assurances that had been in
place for the past twenty years. A copy of the City's opinion of probable cost is attached hereto as
Exhibit A. The City did "update" its financial assurance determination in November of 2013 in
preparation of an appeal hearing for our client's IMP denial by way of an estimate prepared by
Diversified Projects Services International ("DPSI"). DPSI's estimate was $121,996, which included
approximately $34,856 in administration and contingency costs. A copy of DPSI's estimate is attached
as Exhibit B. Although DPSI's figure is less than fifty percent of the City's original estimate, their
number is still roughly twelve times the amount of financial assurances that have been in place over the
last twenty years. Based on the history of the Quarry and public sentiment about the use, it is clear that
the City's financial assurance determination was used in order to leverage the City's denial of our
client's IMP.
Public Resources Code section 2773.1(a) states that "[t]he amount of financial assurances
required of a surface mining operation for any one year shall be adjusted annually to account for new
lands disturbed by surface mining operations, inflation, and reclamation of lands accomplished in
accordance with the approved reclamation plan." Over the years, our client has mined aggregate and, at
the same time, reclaimed property that was disturbed. Our client submitted annual reports to the City
which included the amount of material that was mined for that year and the amount of financial
assurances to account for"new lands disturbed" and "reclamation of lands." The City had an obligation
to annually inspect the Quarry to ensure that the surface mining operation was in compliance with the
provisions of the Surface Mining and Reclamation Act("SMARA") and CUP. More specifically, Public
Resources Code section 2774(b) states, in pertinent part: "The lead agency shall conduct an inspection
of a surface mining operation within six months of receipt by the lead agency of the surface mining
operations report...solely to determine whether the surface mining operation is in compliance [with
SMARA]." In this case, the City had an obligation to inform our client and the State of any non-
compliance with SMARA, including having inadequate financial assurances.
Between 2006 and 2011, our client's mining operation was significantly reduced and the OMR
deemed the Quarry as being "idle" in 2011. Since 2011, our client has not extracted any material from
the mine due to a letter from the City prohibiting any further extractions. Around this same time, our
client submitted an IMP application which, as discussed above, was subsequently denied by the City.
The City failed to act according to due process in that it "accepted" the conditions of the Quarry
property and related financial assurances over many years and later increased the financial assurance
amount by over ten times without any additional lands that were disturbed from previous years. In other
words, our client is being held responsible for the City's failure to properly inspect and/or review our
client's financial assurances and is now looking at a six figure bill without any corresponding change in
the condition of the Property. Financial assurances are supposed to by dynamic and reflect the mining
operation itself, which is the reason why they are reviewed at least every year and why the language in
Public Resources Code section 2773.1 references "new lands disturbed" and "reclamation of lands." A
property owner shouldn't be penalized by having to come up with over ten times the amount of financial
assurances because the lead agency suddenly believes that previous amounts that they approved were
•
Page 3 of 3 CARMEL&NACCASIJA LLP
December 24, 2013
insufficient. Such a tactic could be used in order to financially shut down an operation because of a
change in attitude towards mining operations by the lead agency.
Furthermore, the City's estimates included incorrect information. For example, the City's and
DPSI's estimates indicate replacement of fifty trees that were proposed to be removed, however, due to
our client's operations, only seven trees were actually removed. Furthermore, assuming that some
additional reclamation needs to be performed on the Property in order to make the "finished Quarry
slopes be laid back and blended with adjacent grades to resemble a more natural condition" as described
in the CUP, the City grossly exaggerates the amount of material that needs to be moved. The City
estimated this work to include approximately 15,000 cubic yards of material, DPSI indicates it is 7,100
cubic yards and our engineer has indicated that it would be more to the tune of 2,163 cubic yards. Of
course, the "finished Quarry slopes" as described in the CUP assumed that all of the 120,000 cubic yards
of aggregate would be removed. Approximately 50,000 cubic yards of aggregate remains and the current
conditions of the Property substantially comply with the CUP/Reclamation Plan, which has been
reviewed and approved by the City on an annual basis.
In sum, after twenty plus years of operation, annual inspections, reviews and approvals, the City
is only now contending that the amount of financial assurances that are in place are inadequate. Such an
eleventh hour decision is fundamentally unfair and we respectfully request that OMR review this matter
as provided in Public Resources Code section 2770(e).
Please let us know if you have any questions, comments or would like any additional
information. 0 Sincely,
C a e r •casha LLP
` : I M. Ans. abehere
Cc: Brian Pierik, City Attorney
EXHIBIT "A"
ITEM NUMBER: B-2
DATE: 12-10-13
ATTACHMENT 20 — JUNE 20, 2013 LETTER TO MILLHOLLIN
CITY OF ATASCADERO
COMMUNITY DEVELOPMENT DEPARTMENT
June 20,2013
Page 27 of 99
Attachment 4: City Engineer's Preliminary Opinion of Probable Cost of Reclamation
MIIIhaRin Mine Reclatnntlon-Pretiminary Opinion of Probate Cost RThompson
9f27J2011
15g1L ThEiW6liel Oeantitr Yid Unit Cmt lean colt
1 MObigzatktn 1 LS $ 2,500.00 $ 2,500.00
2 Earthwork 15000 CY $ 800 $ 120,000.00
3 Disrbatlon of Topsoil 6000 CY $ 6.00 $ 36,000.00
4 ttydmseediog(75%of34 act 124000 SF $ 0.20 $ 24,800,00
5 Temporerylnigation(Drip to 50 trees) 1 L5 $ 3,500.00 5 3,500.00
6 Replacement Oak Tree Planting 50 EA $ 110.00 $ 5,50(100
7 Erosion Control MIN 1 L5 $ 7,500.00 $ 7,500.00
Sub-Total $ 299,800.00
Administration 20% $ 39,960.00
Inflation 10% $ 191980.00
Contingency 10% 5 19,98000
TetalEstimate $ 219,720.00
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EXHIBIT `B"
12-10-13'' ITEM NUMBER: B-2
ATTACHI—_ L N MINE RESTORATION ESTIMATE
DIVERSIFIED PROJECT SERVICES
INTEnNAT1ONAL
Millhollin Mine
Bonding Estimate
Atascadero CA
Millhollin Mine Reclamation - Bonding Estimate Quantity Unit $/Unit Extension
Mobilization/Demobilization 1 LS $1,800.00 $1,800.00
Earthwork-Cut 7100 CY $5.50 $39,050.00
Distribution of Top Soil 600 CY $5.50 $3,300.00
Hydroseeding with Soil Binder 56900 SF $0.10 $5,690.00
Temporary Irrigation 1 LS $10,000.00 $10,000.00
Replacment Oak Trees(1 gallon) 50 EA $36.00 $1,800.00
BMP's(Fiber Rolls) 3500 LF $2.00 $7,000.00
QSP Inspections(12 months) 250 EA $52.00 $13,000.00
QSD Reports&Fees 1 LS $5,500.00 $5,500.00
SUBTOTAL - - - $87,140.00
130921 1
12-10-13 ITEM NUMBER: B-2
ATTACH 2
I—_ N MINE RESTORATION ESTIMATE
DIVERSIFIED PROJECT SERVICES
INTERNATIONAL
Milihollin Mine Restoration - Atascadero CA
Rood Estimate
Outitei °.° ;:a;+ : - ._ �; ,
Road Construction Items $87,140.00
Total On Site Cost: $87,140.00
ToJil autlig'actios 4:56A3
Total On Site Cost: $87,140.00
20%Administration $17,428.00
20%Contingency $17,428.00
Total Construction Cost: $121,996.00
;,.;/ L.Alberto Lopez,PE,QSD/P
Director of Civil Engineering
11 -20 - 13
Date
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