I don't know how but it looks to have gone away. Not sure if this had anything to do with it:
1) stopped raising the dirt;
2) dig the hole larger on all sizes (if the pickaxe causes the dirt to pop back up then leave it alone);
3) check the hole periodically to see if changes level on its own (several game days);
4) raise dirt to desired level.

Once the land was level, I left it alone again & used the hoe to test the ground (w/ level ground setting). All that and I have had no issues. Just black magic. Sorry I don't have a better explanation.