March 31, 2024 at 1:46 a.m.
by John Brummett
9 Comments
What appears to have happened is that the cryptocurrency-mining industry--which few in Arkansas knew anything about--delivered to the pliable, business-coveting legislators of Arkansas a piece of legislation it wrote for itself.
Arkansas tends to be a write-your-own-law state, if you're an industry.
The bill forbade local governments from restricting these crypto mines in any way. It specifically exempted any noise level from restriction, which ought to have been an alert to investigate it, not pass it perfunctorily. But the bill became law on an end-of-session fast track with only one "no" vote in the entire General Assembly.
The legislation made the industry's facilities sound like newfangled modern advancements that were nothing more than innocent data centers that will put our people to work.
The bill got moved only at the very end of the last session. That was tactical. Historically, our legislators will pass anything that shows up on the calendar on the last day or two while they are trying to clear the agenda and get home.
They rely on their committees, as if our legislative committees had command and depth and were anything more than mere subsets of the bad legislators who populate the full chambers. The committees are as harried at the end as the full chambers. So, in these committees, you get a lot of "move it out, do pass" and "let's eat." If a committee gives a late bill a do-pass--and if there are dozens of budget bills to deal with by the end of the day so that adjournment can take place the next day--then the members on the floor, inattentive and frazzled on top of being wrong on issues even when attentive and calm, pass the bill in deference to, or with misplaced trust in, the committee.
And, of course, Gov. Sarah Sanders will sign it because she has a special devotion to hurried and bad legislation that will serve her conservative national brand.
Crypto mining encompasses a facility often in a rural field that contains hundreds of 24-hour computers applying complicated algorithms to arrive at values for these relatively new entirely digital alternative currencies. (I don't know what I just wrote there, but at least I didn't vote for the bill.) The government doesn't manage those currencies, so there must be a way to confirm valuations. Powerful computers running all day and all night in a former farm field can do that.
These places employ very few people. They don't need people. They need places where land and electricity are available and affordable, and where political resistance is scarce.
These plants get so hot inside that the facilities are equipped with loud fans blaring noises from the roofs that neighbors describe as incessant and oppressive. The facilities use massive amounts of electricity, already about 2 percent of electricity consumed nationwide.
People living near such installations describe themselves at their wit's end. They figure their residential values are shot. Their only hope is that these mines will find some other place with cheaper electricity and go there, although the utter prohibition on local regulation makes any Arkansas site competitive, which is to say exploitable.
I found an article from 2022 rounding up state laws on crypto mining. A few of what are generally considered progressive states--California, Oregon, New York, places that Arkansas legislators hold in disdain--had already put on their books regulations and processes. New York had a waiting period. Some states had addressed taxation levels and energy issues.
About a dozen states--Arkansas first among them alphabetically--had no law at all.
It is my mere speculation that the industry looked at Arkansas and saw a backwoods blank slate with vacant land led by an inattentive and nationally obsessed governor and a know-nothing, commerce-hungry Legislature interested in regulating what schoolteachers say but not what business harms. They saw they might be able to pass a self-serving law by putting sweet-sounding euphemisms in a bill and running it late amid the usual frenzy. They apparently got some good local advice.
On Wednesday, the chief sponsor of the bill, Rep. Josh Bryant of Rogers, told a meeting of the City County and Local Affairs Committee that he'd only been trying to help the American crypto-mining industry stave off the Chinese. He said he didn't want any local government "capriciously shutting down" these industries. He said it had since turned out that there are some "bad actors" in the industry.
He called on the committee to work with him on proposing a regulatory bill for the regular session next year. In other words, he called for extensive study of a bill he passed last time without any study.
In the future, legislators might consider slowing down, not speeding up, when they get confronted with bills on subjects that they know nothing about. That might mean a lot of slowness out at the Capitol, which would be a significant improvement.
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John Brummett, whose column appears regularly in the Arkansas Democrat-Gazette, is a member of the Arkansas Writers' Hall of Fame. Email him at [email protected] . Read his @johnbrummett feed on X, formerly Twitter.