PROVOLT — A loophole in state law has paved the way for an unwelcome gravel operation that has state officials at odds with Jackson County over whether it should be called a mine or an agricultural pond.

PROVOLT — A loophole in state law has paved the way for an unwelcome gravel operation that has state officials at odds with Jackson County over whether it should be called a mine or an agricultural pond.

John Renz, regional representative for the state Department of Land Conservation and Development, said Jackson County has approved the extraction of rock from the John and Wesley Hill property off Highway 238 in the Applegate Valley by granting a grading permit for a farm, which is far less stringent than seeking a permit for a mining operation.

"It's an affront to the law and the neighborhood," he said.

Copeland Sand and Gravel of Murphy has been excavating a 4-acre pond on the property for the past two weeks.

In the past, neighbors in the Applegate area successfully blocked mining operations at the Hill property and other land in the area, citing noise, traffic and environmental concerns.

Neighbor Michael Riding said the county's action is only going to encourage more mining in the Applegate Valley. He said he's had to endure a constant rumble of gravel trucks coming and going every five minutes on Highway 238.

"I can foresee so many ponds built up and down this valley that it is going to look like the Lake District," he said, referring to the national park in England.

Jackson County planning officials believe Oregon Revised Statutes 215.298 and 517.755 don't forbid hauling away material during construction of an agricultural pond or other grading operation on a farm. As a result, they have concluded the excavation by Copeland is not considered a mining operation.

However, Renz's interpretation of the statute is that the excavated material can be used by the farm only to build roads or other on-site improvements. Hauling the rock away would be considered mining, he said.

The Oregon Department of Geology and Mineral Industries (DOGAMI) also considers the Hill excavation a mining operation and has issued a mining permit because 93,000 tons of material will be hauled away.

Renz said he has told county officials their reading of the statutes is incorrect.

"They refuse to honor our interpretation and say it's mining," he said.

Kelly Madding, the county's Development Services director, said Hill applied for a grading permit to build an agricultural pond, which is not an unusual permit application for the county to receive.

She said that as part of the permit, the county advised Hill that there would be no mining on the property, relying on state law to define what is mining and what is moving soil, rock or other material as part of an agricultural operation.

She said the DLCD, which has not given its opinion in writing, has told the county that it doesn't think the gravel can be moved off-site to Copeland's Murphy operation.

"My reading of the statute doesn't lend itself to that interpretation," she said.

In particular, the statute she cites states, "'Surface mining' does not include ... excavation or grading operations reasonably necessary for farming."

Other parts of the same statute make distinctions between on-site excavations and off-site excavations and between farming activities and mining activities.

Madding said that if a person came into her office asking for a 4.9-acre pond on a 5-acre property, she would say no because it would use up all the agricultural land.

However, she said she would have to carefully review the application if a 2.5-acre pond were requested on the same property, but said she might approve it.

Madding said there is no requirement under this type of permit to determine how much rock might be removed. There is also no authority to determine how often gravel trucks come and go over a property to remove the material, she said.

Madding said that if owners of the 102-acre Hill property requested a larger pond, it would likely be approved based on her interpretation of the law.

Because this was just a grading permit, Madding said it was approved by her planning staff and wasn't considered by county commissioners.

Gary Lynch, assistant director of DOGAMI, said his department looked at the grading permit approved by the county and determined that hauling that quantity of gravel and rock isn't just an agricultural use.

"It puts us in the position where it looks, smells and tastes like mining," he said.

However, the county has the ability to interpret state law in its own way, even if it might conflict with a state agency, he said.

He said DOGAMI doesn't have the authority to undergo any public hearings under a land-use process, relying on the county to undertake this responsibility, if necessary.

He said his department has run into this situation before in other counties.

"We look at the grading permit as somehow a loophole to get materials into the markets," he said. "I think if you're doing this under a grading permit, there is an unfair advantage in this situation."

Copeland officials say it is not unusual for their company to build ponds for farmers and wineries in the Applegate and then to salvage materials that can help offset the cost of the work.

"We've had several folks who have come to us seeking similar kinds of arrangements," said Bill Peterson, Copeland's director of administration.

In 2009, he said his company built four ponds in the Rogue Valley. He said he wouldn't disclose the dollar amount received by property owners who had salvageable rock, noting it varies between customers.

"It's been going on for years and years," Peterson said. "It's not some magic new thing."

He said high-quality rock has been found while excavating the Hill pond.

Copeland runs five to seven trucks, which each make about nine or 10 round trips, to carry materials away. Each truck carries 21 tons of rock.

Michele Riding, who is in earshot of the extraction operation, said, "We're all confused and don't understand how this is allowed."

She said neighbors who have rallied before to stop mining operations are exploring their options to legally contest the county's action.

Jimmy MacLeod of the land-use watchdog group Rogue Advocates said the county's approval of a grading permit is a contradiction of state law and is an attempt to find a way around court battles and land-use hearings that have blocked mining on the Hill property.

In May 2005, Jackson County Circuit Court Judge Mark Schiveley rejected an agreement between the county and John and Wesley Hill over a proposed gravel mining operation. Schiveley chided the county for failing to conduct itself in a public manner.

Steve Rouse, one of the neighbors who challenged the county decision, said the latest action by Jackson County flies in the face of the judge's decision and clearly defies state law.

"The activity development is either mining or farming, not both," he said.

Reach reporter Damian Mann at 776-4476, or e-mail