June 26, 1978
Mr. Don Dahlin, Secretary
Department of Public Safety
118 West Capitol
Pierre, South Dakota 57501
Official Opinion No. 78-28
What constitutes “mining” under SDCL 32-9-3?
Dear Mr. Dahlin:
You have requested an official opinion from this office based upon the following factual situation:
FACTS:
SDCL 32-9-3(9) as amended by S.B. 24, 1978 S.L., exempts motor vehicles operated by or for its owner and exclusively used to transport products originating in or produced from mining operations when such products are produced or owned by such motor vehicle owner from being classified as a “Commercial Motor Vehicle” as defined by SDCL 32-9-1(10). This exemption thus provides that motor vehicles used as described in SDCL 32-9-3(9) as amended by S.B. 24, 1978 S.L., may be licensed as noncommercial motor vehicles and pay the license fees as prescribed by SDCL 32-5-6, which are determined by the manufacturer's shipping weight of that motor vehicle rather than under the provisions of SDCL 32-9-15, which provides that the fees for commercial motor vehicle licenses are based on the gross weight of the motor vehicle (the actual weight of the motor vehicle and the weight of the load carried by it). The amending of SDCL 32-9-3(9) S.D. 24, 1978 S.L., thus provides that motor vehicles exempted from the license fees prescribed in SDCL 32-9-15 and allowed to be licensed under the provisions of SDCL 32-5-6 with a large reduction in license fees and a revenue loss to the State of South Dakota.
Based on the above factual situation, you have asked the following questions:
QUESTIONS:
1. There is a definite conflict between previous Attorney General Opinions as to what constitutes mining and mining operations and SDCL 45-6A-2(9). Does SDCL 45-6A-2(9) prevail and thus exempt motor vehicles operated by or for its owner and exclusively used to transport products originating in or produced from surface mining by means of surface entry of coal, stone, sand, gravel and other minerals and mineral deposit, and the removal, disposition and deposit of over burden disturbed in connection therewith from the definition of a motor carrier as provided in SDCL 32-9-1(10)?
2. If the answer to Question No. 1 is no, could the fact that several federal mine safety acts are applied to these operations requiring compliance by the owner/operators with these mining safety regulations be construed to mean the operations described in Question No. 1 are mining operations?
3. If the answer to Question No. 1 is yes, would the quarrying of limestone and/or granite be considered mining operations?
4. In the event that the answer to Question No. 1 is yes, would the stockpiling of these materials for use or transportation at a later date be construed as a continuation of the mining process and thus an exempt operation as a motor carrier, or would such an operation be considered a separate and distinct operation and thus not eligible for the “mining” exemption provided for in SDCL 32-9-3(9) as amended by S.B. 24, 1978 S.L.?
SDCL 45-6A-2(9) defines the term “surface mining” for purposes of the Surface Mining Land and Reclamation Act (SDCL 45-6A).
(9) “Surface mining,” removal by means of surface entry of coal, clay, stone, sand, gravel and other mineral and mineral deposits, and the removal, disposition and deposit of overburden disturbed in connection therewith;
IN RE QUESTION NO. 1:
In response to your first question, it appears to me that if the removal of sand and gravel is mining for purposes of Chapter 45-6A, and the regulations promulgated thereunder, it should also be construed as being “mining” for purposes of interpreting SDCL 32-9-3(9). (See SDCL 2-14-4.) As stated in your fact situation, the 1978 Legislative Session amended this provision to once again include a mining exemption from what was historically the compensation plate fee structure. It may well be that the Legislature did not consider this possible relationship of Chapter 45-6A to the licensing of motor vehicles, but it is rather difficult to distinguish and justify why a sand and gravel operation is mining for some purposes but is not mining for others. Further, the statutes do not indicate plain intention that the statutes be interpreted differently as per § 2-14-4. In view of the above, it is my opinion that sand and gravel extraction does constitute “mining” for purposes of the exclusions created by section 32-9-3(9).
IN RE QUESTION NO. 2:
In view of the answer to your first question, it is not necessary to answer your second question. I would state, however, that assuming the facts stated that several federal mine safety acts do apply to these operations only tends to support my conclusion in regard to your first question.
IN RE QUESTION NO. 3:
In response to your third question, I would again refer you to the definition of “surface mining” found in subdivision (9) of section 45-6A-3 cited above. In that definition, stone is included. In my opinion, both limestone and granite would be included within the general category of “stone” and would thereby be included within the exemptions created in subdivision (9) of 32-9-3 as amended in the 1978 Legislative Session. I recognize that this conclusion is contrary to that expressed by my predecessor at 1963-64 AGR 76, but I think it is important to note that when that opinion and other previous opinions on point were written, South Dakota law did not contain the Surface Mining Land Reclamation Act and its statutory definitions which have expanded the areas of mining recognized as being “mining.”
IN RE QUESTION NO. 4:
In the case of Mitchell Produce Company v. Morris, 63 S.D. 127, 257 N.W. 47 (1934), the South Dakota Supreme Court discussed the statutory language very similar to that involved here. The Court there said in part:
We do not believe we are driven to a construction which is so absolutely literal and at the same time so entirely out of harmony with the object and intention of the statute. The legislature was exempting from the general purview of the statute persons who operate motor vehicles in certain specified transportations. Plainly the legislature wished to exempt from payment of compensation transportations in both directions quite directly connected with and incidental to farming, mining, and logging operations. But we do not think the words “products originating in and/or produced from or necessary to or for farming, mining and/or logging operations” can or should be deemed to apply solely and exclusively to the nature of the property being carried or should be construed as utterly disconnected and disassociated from the specific transportation claimed to be exempt. Doubtless more precise language might have been adopted, but we think it quite plainly appears that the legislature intended the words last quoted above to have application not only as to the nature of the property but also with reference to the particular transportation claiming exemption. So far as concerns the transportation of products originating or produced from farming, mining or logging, it is not enough merely that property transported shall have been at some previous point in its existence so produced or that at some time or other it thus originated. It must thus originate or must be thus produced to the particular transportation claiming exemption.
In 1943-44 AGR 164, a similar issue was under consideration. Reference there was made to a former opinion which had held that the owner of a quarry from which limestone was taken and treated in a kiln and hydrated and placed in 50 pound bags and transported in a truck owned by the owner of the quarry to a defense project about one hundred miles away was required to have plates for his trucks. This opinion did not pass on the question of whether the hydrated lime was a mining operation, but rather upon whether the exemption provision did not apply because “the transportation in question is in no sense incidental to the industry of quarrying or in any manner concurrently related to the production in the business, but rather is an incident of and related to the business of marketing the processed limestone.”
I would concur in the statement of my predecessor in this matter since I believe the exemptions created by the Legislature must be narrowly construed and must be seen as being applicable only to transportation which is incidental to the industry of mining, not merely incidental to the process of marketing the results of the mining. Thus, if the stockpiling is an integral part of the industry of mining, and is not merely an incident of the marketing of the product of the mining, the exemption would seem to apply. If, however, the stockpiling merely becomes an incident of the business of marketing the mined product, I do not believe the exemption applies.
Respectfully submitted,
William J. Janklow
Attorney General
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