On Thursday, January 5, 2023, employees of the Caribou and Cross Mines were given five days’ notice to vacate their domiciles located at 110 North Jefferson Street, above Kathmandu restaurant. The workforce of the mines has reportedly dropped from 60 to less than 20 employees, with many of those let go over the holiday season also required to find new housing with very short notice.

Following last year’s $17,000 fine imposed by the state Mined Land Reclamation Board for violating the Colorado Water Quality Control Act the owners of Caribou and Cross mines, Grand Island Resources (GIR), have been working on “good faith” efforts to install such equipment as a water filtration system. Such cleanup and containment initiatives are required due to an agreed suspension of $12,000 of the original fine.

Last year GIR were having a previous cease and desist order reviewed by the state which involved the failing to submit pollutant reports in March and April of 2021. The state discovered in their review several pollutant violations from December 2020 to August 2021 involving excessive and toxic traces of copper and lead found in the watershed. The heavy metals were released into water which pools from both mines, travels by pipeline and is discharged into Coon Track Creek, which leads into Barker Reservoir and Boulder Creek.

The Colorado Department of Public Health and the Environment’s Water Quality Control Division issued the violation notice to GIR in November 2022; the cease and desist order was imposed in January 2022 and is scheduled to expire this month.

Seemingly as a result of the last year under the cease and desist order, workforce for the mines has significantly decreased in the last few months, with some associated with the Caribou and Cross Mines claiming that employees were not paid for a total of 49 days, through Christmas and into the new year. In response to the diminishing of their workforce, GIR has reportedly begun either altering or abandoning its lease agreements with several Nederland property owners.

“Permission to take from this document is given if it is printed in its entirety. Due to the reduction in our current workforce, Nederland Mining Consultants Inc. (NMC) is giving back some of our properties that were leased to provide housing for our employees and contractors over the last few years,” Richard Mittasch, Vice President of NMC, provided this official statement to The Mountain-Ear.

“NMC is the tenant under the lease and will remain on some leases to preserve our option for the future when we resume regular operations. We are working with State regulators and, in part of our commitment to the community, we have installed a new water treatment system that has exceeded all state and federal water quality standards. We look forward to working with community businesses and residents moving forward.”

“Our leases are through December 31, 2023, with an option to renew through December 31, 2024, and they include a right to sublet subject to the owners’ prior written consent, exercised in good faith. By subletting the units we preserve our future options,” Attorney for GIR Ed Byrne stated in an email response to The Mountain-Ear, quoting portions of Section 11 of their lease agreement with Nepal LLC.

Representatives for the Caribou and Cross Mines referred mostly to the five apartment units at 110 North Jefferson Street owned by Nepal LLC, specifying that they are subletting the now vacant apartments as per their original agreement with the owner.

“We have had to scale back our current work force temporarily, so we decided to re-lease some of our properties. The units are ready for immediate occupancy.” Je’an-Paul Brewer, Mine Manager and Director of Operations for NMC wrote in an official statement.

“NMC will remain the primary tenant under the lease to preserve our options for the future when we expect to resume our property clean-up and mine rehabilitation operations.”

According to their lease agreement with Nepal LLC, NMC pays a base rent of $7,225 per month, plus a utility payment of $150, for a total monthly rental payment of $7,375 for all five units. Without considering the dimensions and specifications of each apartment, the cost to NMC is roughly $1,475 for each unit.

On Monday, January 9, the remaining residents at 110 North Jefferson Street had until the end of the day to completely vacate; the apartments were already being advertised on social media. When inquiring about the available rentals an email response from rentals@nedmining.com includes a brochure which states that the 861 square foot one bedroom studio apartment on the first floor goes for $1,500 a month, utilities not included.

The three 935 square foot two bedroom apartments are going for $2,500 a month, and the biggest apartment at 1095 square feet is going for $2,600, utilities not included.

There are other properties throughout Nederland that were also leased by the mines for the same purpose as those owned by Nepal LLC, to house the staff for the mines. The owner of some of these properties reported to The Mountain-Ear that GIR was not in compliance with how they pulled out of their lease agreement.

“I got a call three weeks ago on December 16 that GIR were unilaterally canceling their two-year lease eight months early, with no notice and no compensation,” the property owner wrote in an email. “They vacated my properties on December 23 without doing closeout items agreed to in our lease agreement.”

According to the property owner, a representative of GIR claimed that an agreement with the Colorado Division of Reclamation, Mining and Safety and the Colorado Department of Health & Public Environment to mandate four quarterly water inspections of their new water system to be completed in 2023 before they can resume operations in 2024, is the cause for the severe cuts to their workforce.

Brewer noted in a phone call conversation with The Mountain-Ear that though this claim is not wrong, it is not the sole reason for the layoffs, nor is it the full picture of the water inspections that personnel at the mines conduct regularly themselves in addition to those conducted by the state.

Brewer explained that there were many factors contributing to the unfortunate layoffs; some that were a recurring part of the mining business, such as seasonal employment, and other factors that were directly a result of the cease and desist order. These factors include cleaning up containment ponds and past mining operations, and updating old water filtration systems and “obsolete” infrastructure to not just adhere to current health and safety standards but to develop beyond them to sustain “environmentally friendly mining”.

Brewer indicated that certain concessions need to be made in order for a major company to survive through its tougher times, though he regrets that losing more than 60% of their workforce is one such concession. Despite the challenges facing the Caribou and Cross mines, some Nederland property owners believe they are being negatively impacted from GIR tightening its budget.

“I see no legal path to recovering what GIR still owes us, and I think that other Ned property owners feel the same way. We are unlikely to want to lease any of our properties to GIR in the future,” the property owner continued in their email.

“GIR claims that it is adequately capitalized to make it through the next year running with a skeleton crew. They claim that through 2021 their monthly payroll was $750,000 plus $50,000 in monthly rental expenses.”

“I’ve asked Town staff to keep a tight watch on our monthly sales tax revenues to see how this staff reduction plays out. Mine employees kept our restaurants and hardware store busy through the Covid years,” the property owner added that though they are not sure of which property owners in Nederland would work “amiably” with GIR, they still hope for the mines to return to normal operations successfully and soon.

When asked to clarify some of the property owners claims, GIR Attorney Byrne noted that a conversation with the property owner was had on December 16 regarding the early exit from the lease. Byrne stated that there was only six months left in the lease, not eight, at the time of the conversation and that compensation was not discussed and was never refused.

Byrne mentioned that the property owner allegedly spoke of expecting the phone call due to GIR “paying rent on an empty house”, and that the properties were rented out to new tenants “within a matter of days”.

“GIR has made and will continue to make substantial investments to demonstrate that these historic mines can be operated in a manner that is environmentally responsible, economically resilient, and beneficial to the community in which many of our employees reside,” Brewer’s emailed statement to The Mountain-Ear continued.

“GIR believes they will be able to employ these same means and methods to establish a model using private capital which can be used to restore and reclaim abandoned mining sites throughout the United States.”

“We will also continue working with local universities and our federal, state, and local government regulators to demonstrate that it is now possible to make Colorado’s mining industry cleaner, safer, and more compatible with the Colorado environment and all the people who live in and visit in our great state.”

Please continue to watch for developments on this issue and other news from the Caribou and Cross Mines here in The Mountain-Ear.