The Oregon Department of Agriculture has given up faith that the state's second-largest dairy can comply with its permits -- just two months after settling with the owner.

Agriculture officials said Thursday they plan to work with the Department of Justice to pursue "every legal option to stop violations to the confined animal feeding operation permit that may threaten the environment." That could include suing to shut down the dairy.

Lost Valley Farms, which is allowed 30,000 animals, started violating its environmental and agricultural permits within months of opening. The violations have come nearly nonstop since then, including six since an April settlement with the state when it promised to do better.

The Department of Agriculture's statement comes days after environmental, food safety, animal rights and some agricultural groups renewed calls for the dairy to be shut down.

They say that the dairy, which has been mired in controversy since it applied for permits, has shown that it cannot abide by strict rules from the departments of agriculture and environmental quality.

"We request that ODA and DEQ rise above the powerful agribusiness interests and elected officials that advocated for a facility of this magnitude," the letter said. "Lost Valley failed to deliver on a promise to comply with the law and deliver an economic boon to rural Oregon."

Spokeswoman Andrea Cantu-Schomus noted recent testing shows that Lost Valley's frequent wastewater and manure overruns have not impacted groundwater. The Boardman area where the dairy is located is already overloaded with nitrate.

Lost Valley Farms was already in trouble before this week's backlash.

Dairy owner Greg te Velde, a California dairyman who had three operations going, has declared bankruptcy in California for three mega-dairies. He claims he owes more than $162 million between his two dairies in California and one in Boardman.

"ODA will continue to enforce the (dairy's) permit, issue violations and work with DOJ to ensure the health of the environment and natural resources. The bankruptcy filing is a separate legal proceeding that does not prevent ODA from enforcing the CAFO permit," said Cantu-Schomus.

In February, Oregon agriculture officials sued to stop te Velde's 7,288-acre Boardman operation. Lost Valley had been issued citations nearly every month it was open, and officials said te Velde and his general manager repeatedly flouted the corrective measures they were told to take.

Documents in the case said that Lost Valley stored waste and wastewater in areas not permitted for it; never completed building all the required lagoons and other facilities to store it; the existing facilities regularly overflowed when it rained; the operation removed parts from a storage tank after agreeing not to; and the container that held dead animals leaked.

Photographs taken by an inspector showed cows standing hoof-deep in their own excrement.

The Oregon Department of Agriculture agreed in March to let Lost Valley Farms continue operating. Under the new agreement, Lost Valley is allowed to generate up to 65,000 gallons of wastewater per day – well below what the 514,000 the dairy estimated it would need. It also must comply with other terms of its permit, such as notifying the state if there is a wastewater or manure spill. And the dairy was told to remove 24.4 million gallons of liquid manure from its overloaded storage facilities by summer, so that it can avoid polluting local water sources during a heavy rainstorm.

If the dairy stays in line for a year, it would be allowed to resume operating with only the restrictions laid out in its permit. If it fails, the Department of Agriculture could take away its license to operate or temporarily stop its operations.

The groups that signed on to the letter said that there is no need to wait that long.

The letter was signed by Animal Legal Defense Fund, Center for Biological Diversity, Center for Food Safety, Columbia Riverkeeper, Food & Water Watch, Friends of the Columbia Gorge, Friends of Family Farmers, Humane Oregon, Humane Society of the United States, Oregon Rural Action, the Oregon chapter of the Sierra Club and Socially Responsible Agricultural Project.

Prior to declaring bankruptcy, Te Velde was sued at least four times, which are now pending. At least seven companies in Oregon, Washington and Idaho have sued him because they were never paid for their work, which includes construction of the ranch, managing the harvest of the farm and providing equipment.

He also claims to owe $96,000 in federal, state and local taxes, including to Oregon and Morrow County.

Te Velde's Tipton, California, dairy had about 11,000 animals at the time of his bankruptcy filing, his Corcoran, California, dairy had 25,000 and his Boardman one has about 13,000.

That number has fallen from what was listed on previous public statements and documents. The state said the dairy would likely only have 16,500 cows in its first year. In court filings, the dairy was listed as having at least 17,000. Te Velde also claimed he would hire about 150 people from the Morrow County area. He has 70 employees as of a year later, according to te Velde's court filings in the case.

Te Velde made $110 million in revenue last year from the three dairies -- a significant jump from the $32 million in 2017. So far in 2018, he has made $24 million.

However, some businesses suing him say they have gotten only a few small payments from te Velde in the years he owed them tens to hundreds of thousands of dollars.

Te Velde was arrested in August in Washington on charges of patronizing a prostitute and possession of methamphetamine. He pleaded guilty to possession of methamphetamine in December and the other charge was dropped.

-- Molly Harbarger

mharbarger@oregonian.com

503-294-5923

@MollyHarbarger