Plattsburgh Passes Cryptocurrency Regs, Maintains Moratorium

Oct 26, 2018

In March, Plattsburgh officials imposed an 18-month moratorium on new cryptocurrency operations in the city.  Last night, the Common Council adopted a local law placing regulations on such operations – but did not end the moratorium.

Local Law P-7 would require a Special Use Permit for any new commercial cryptocurrency mining operation or any expansion of pre-existing operations in the city of Plattsburgh.  It also regulates the industry’s fire safety, heat, and nuisance abatement.

During a public hearing prior to its consideration, Adirondack Townhouse Condominiums resident Sue Quinn said she used to live in a quiet neighborhood before the data miners began operations in the nearby industrial park.   “The noise permeates the house.  People that were south-facing couldn’t even sleep in their south-facing bedrooms. They’d have to move to a north-facing bedroom. It was a whine similar to the engines revving up when the Air Force Base used to be here. I mean we moved there because it was a quiet place. You could hear the falls from the Imperial Dam. You you can’t hear that.”

The new law restricts cryptocurrency mining operations to 90 decibels at a distance of 25 feet from the structure.   While the number of jobs created and the volume of electricity used was mentioned, noise was the focus of the councilors’ discussion.   Ward 4 Independent Peter Ensel said he shares residents’ concerns that the 90-decibel threshold may be too high.  “When you look at 90 decibels that is equivalent to a motorcycle going by at 25 feet.”
Ward 1 Democrat Rachelle Armstrong:  “At 90 decibels you know you should be thinking about the distance of 200 to 500 feet.”
Ward 6 Councilor Joshua Kretser: “Where was that 90 decibel, where did that come from?”
Mayor Colin Read: “We researched it on noise levels of industrial sites. Actually the numbers were higher and we lowered them somewhat from what other states had adopted. What I would encourage we do is look at the noise issue industrial properties in general.”
Ward 5 Democrat Patrick McFarlin:  “So just so I’m clear. Peter’s suggesting maybe amending it to lower it down to 70 decibels. Rachelle is saying maybe amend it to add any distance clarification. The mayor is saying maybe amend to take out decibels entirely and have a new local law that applies a decibel level to all industries?”
Mayor Read: “No. Pass this and immediately consider a new local law with regard to noise of all industries. So that’d be just as quick in applying to this but it’d also give the advantage of applying to other industries as well.”

The law passed unanimously.  Zafra LLC is one of two cryptocurrency operations in Plattsburgh that continue to operate under a grandfathered allowance.  Managing Partner Tom Pillsworth says the city risks being left behind in the emerging blockchain industry.  “There’s ample opportunity for Plattsburgh to embrace this to create industry, jobs and tech without the massive use that Bitcoin specifically does. So I think that the door is still wide open. You know the heat thing, the electricity thing, the noise thing, I just think that could’ve been tweaked before they passed it because I don’t it portrays Plattsburgh as open for any type of business.”  

Zafra’s CEO Ryan Brienza  says if the council doesn’t deal with the moratorium soon, the company will move.  “I thought at least with the passing of this the moratorium would be lifted which will let us expand because we’re the local guys in town and it’s really hurt our business.  If this doesn’t get I guess resolved quickly then we’re moving out of town.”

Mayor Colin Read was surprised that noise dominated the discussion.  “One of the really novel aspects of what the city of Plattsburgh tried to accomplish with the cryptocurrency zoning requirements is for heat recirculation. It’s quite novel. There’s no discussion on that one at all. But I think that was the most fascinating part of this effort.”

The mayor expects councilors to consider lifting the moratorium in about a month.

The local law creating cryptocurrency regulations is effective as soon as it is filed with the New York Secretary of State’s office.