Regulation
Six of eight cryptocurrency mining resolutions fall short of Arkansas House • Arkansas Advocate
The Arkansas House authorized the introduction of two bills on Wednesday proposing stricter regulations on cryptocurrency mining while six other proposals failed to gain enough votes.
All of the proposed bills would have amended Act 851 of 2023, or the Arkansas Data Center Lawwhich was passed with bipartisan support and limited the ability of state and local governments to regulate cryptocurrency mining operations.
The resolutions required a two-thirds majority vote in both houses of the legislature to be introduced during the fiscal session. The Senate passed all eight resolutions with at least a minimum of 24 votes.
Six resolutions sponsored by Rep. Josh Miller, R-Heber Springs, fell short of the 67 votes needed to pass the House on Wednesday.
Sen. Bryan King, R-Green Forest, has sponsored identical resolutions in the Senate and has been the legislature’s biggest advocate for regulating cryptocurrency mining. In an interview after the House vote, he said he believes “the solution is there” for cryptocurrency mining to come and thrive in Arkansas.
Senator Bryan King, R-Green Forest (Arkansas Legislature)
Cryptocurrency mines, large clusters of computers that harvest digital currency, are often found in rural areas because they take up a lot of space. They also require a significant amount of energy to operate and water to keep computers cool.
There are cryptocurrency mines in DeWitt and the Bono community near the Greenbrier, and officials have raised concerns about foreign ownership and whether the mines pose a national security risk. Additionally, residents in the Greenbrier area have filed a lawsuit alleging noise pollution caused by a cryptocurrency mine.
One of two policy proposals approved by the House would place noise limits on Arkansas cryptocurrency mines and prohibit them from being owned by certain foreign entities. Sen. Joshua Bryant, R-Rogers, and Rep. Rick McClure, R-Malvern, sponsored the resolution, which received 80 yes votes.
Bryant and McClure also sponsored Act 851 last year. King said the resolution they sponsored was essentially “pro-cryptocurrency.”
The other resolution, sponsored by Rep. Jeremiah Moore, R-Clarendon, would require cryptocurrency mines to be licensed by the state Department of Energy and Environment. It would also require the department to brief legislative committees on its methods of regulating cryptocurrency mining. It passed the House with 84 votes and had the patronage of Sen. Missy Irvin, R-Mountain View, in the other chamber.
Bryant and Irvin filed Senate Bill 78 AND Senate Bill 79respectively, Wednesday afternoon after their resolutions passed the House.
Debate in the room
Rep. David Ray, R-Maumelle, spoke against all six of Miller’s resolutions. He said he doesn’t believe they have addressed the three main problems he sees in crypto mining—noise, foreign ownership and proximity to residential areas—while he believes the Moore and McClure resolutions have.
Ray also said the Legislature should be careful about what non-budgetary issues are addressed as legislation during the fiscal session.
“We can do a better job of looking at these individual resolutions and choosing one or two to bring to the committee that addresses these issues that we know Arkansans are dealing with,” Ray said.
He called House Resolution 1019, which would have called for a fee based on electricity use, “the worst of the bunch” and “a de facto ban on bitcoin mining.”
Miller noted that businesses in many other industries are required to pay taxes to the state. He also said requiring notice before a cryptocurrency mining operation buys land would give citizens a warning not to buy property in an area where property values would likely decline due to noise and high utility bills.
Several lawmakers agreed with Miller that the House should allow all cryptocurrency bills to be filed so they could be debated and amended as members saw fit in committee.
“It may take a little longer to do this, but I think the time will be well invested,” said Rep. Marcus Richmond, R-Harvey. “…The only thing worse than doing nothing is doing something halfway and then going to our constituents and trying to explain to them why we got it wrong the second time anyway.”
Rep. Stephen Meeks, R-Greenbrier, said he supports all of the resolutions, especially because the cryptocurrency mine in the Faulkner County portion of his district is facing a lawsuit from local residents.
“If we fail to address this problem, we fail to protect our citizens as we should,” Meeks said.
Elsewhere in Faulkner County, the Vilonia Planning Commission voted against unanimously granting a permit to build a cryptocurrency mine in the area last June. The vote came after the city council listened to citizens’ concerns about cryptocurrency mining and voted to limit noise throughout the city in preparation for the mine’s arrival. Little Rock Public Radio reported.
Rep. Cameron Cooper, R-Romance, represents Vilonia and told the House he has received numerous complaints from constituents about the proposed mine. He said the situation led him to oppose Law 851, not yet in force as of June, even though he hadn’t previously given it much thought.
“Thankfully, the city avoided that disaster,” Cooper said. “…Self [the law] they were already in place, I don’t think they could have prevented it.”
Rep. Ron McNair, R-Alpena, said he hoped to discuss the cryptocurrency industry during the special session called by Gov. Sarah Huckabee Sanders last September, but “was told there wasn’t enough interest.”
Cryptocurrency mining came to Harrison’s McNair District in 2022, and Bill 851 encouraged the industry to continue moving into the state, he said.
“After the session, in my first town hall, there was a gentleman from New York who came to Harrison with him [Act] 851 in his hand and said, ‘We’re here because you did this,'” McNair said. “That’s what the public saw.”