Not wanting to risk the possibility of an application for the development of cryptocurrency mining in the coming months, Lansing City Council intends to draft and approve a local law in March that will prohibit such developments in the municipality.
This decision was made in light of a report submitted by the Lansing Advisory Committee on the Future of Power Plants (LAC-PPF) to the council in December 2021 outlining the committee’s suspicions that a cryptocurrency mining facility, specifically Bitcoin, is proposed. on the site of the former Cayuga power plant by the plant owners.
The news of this potential development blinded the council as it understood that the data center would not be used to undermine cryptocurrency. In 2019, the board passed a resolution expressing support for the Cayuga Operating Company’s decision to build a data center on the site. At a special meeting on February 2, 2022, Councilman Joe Wetmore quoted an information leaflet that the council received on the proposed data center, stating directly that the company “is not targeting Bitcoin or any other cyber currency. “with project.
Although it has not yet been confirmed whether or not the data center would be used as a facility for cryptocurrency mining, the council chooses not to wait and see. Thus, the council has chosen to hold an extraordinary meeting last Wednesday to discuss strategies for moving forward.
One of the main questions that was sought to be answered was whether the council wants to address this dilemma through a moratorium on the development of cryptocurrency mining and then revise the city’s zoning code, or simply wants to dive into the review and revision of the zoning.
City attorney Guy Krogh said it depends on how soon the council believes a request can be sent to the city for a cryptocurrency mining development.
“Whether it’s a moratorium or a zoning change, both would involve local law; “It’s a question of what you want to invest in, and whether or not the horizon is so close that you have no choice but to seek a moratorium,” Krogh said.
One of the biggest challenges, according to Krogh, the council will face is how it wants to define the “nebulous industry,” as it refers to it, of cryptocurrency mining in its zoning code.
“The tension in the law obviously when it comes to land use is that you have to define what you want to stay or ban during moratoriums, or what you want to exclude as permitted use in any area or in any area of the city, be it by overlapping district, either by general prohibition, or by updating the definitions of what is small industry, which is computer companies, whatever is going to be done, ”he said.
The city should also be wary of writing these definitions in a non-discriminatory manner.
“If you want to allow restaurants, but ban Olive Garden, that’s a problem,” Krogh said. “If you want to allow retail but ban Rexall medicines, that’s a problem. So you have these uniformity rules and what you’re trying to regulate is the nature of the land use or the community impacts and not who owns it. “If you’re going to allow storage, but you don’t allow storage of building materials, it’s allowed. I think it’s going to take a little thought to understand what exactly this business is and what its definitions are.”
Two deterrents to cryptocurrency mining facilities are that they require a significant amount of energy to operate and do not typically produce a large amount of employment in a community. The city supervisor asked whether to set zoning parameters around limiting the development of energy-intensive and / or low-employment businesses, to which Krogh responded by saying that such parameters would be too risky legally.
“If you want to talk about something that can have a high energy consumption, but with low job creation, you may be describing a lot of kindergartens and kindergartens,” Krogh said. “Not on the same scale, but how do you reason? Is the number of employees per megawatt hour? I can see a lot of problems with that wide network. What I think might be better is just not allowing land uses in the city that you don’t want in the city “But not in a discriminatory way, but on a political basis born in its comprehensive plan. Encouraging employment, promoting energy saving, are all the tools you have.”
In general, the city could ban the development of cryptocurrency mining companies if such methods are used.
“As long as you get the definition good enough that you can capture what you want to capture and not all other industries, I think you can choose what you want to allow in the city,” Krogh said.
At the end of the discussion, the council took up the issue of whether or not to implement a moratorium, and finally decided to delay it and try to change the zoning code in a short period of time.
The plan that was finally decided was to draft a local law for zoning changes and its implementation and do so to allow the right time to set up a public hearing for the law at the March 16 town hall meeting (and possibly set another hearing public for its April 20 meeting if necessary.).
There has been some deliberation on whether that goal is achievable or not, but several board members felt it was the right time for the situation.
“I know it’s optimistic, but … we don’t want a request to come up while we’re doing this,” said Councilwoman Bronwyn Losey. “So if we’re going to do the definition and get the job done, let’s go ahead and do it.”