We all hate to come home with things that don’t fit or work. The wrong spark plug for the lawnmower, for instance. Or the wrong belt for the vacuum cleaner. Such are the inconveniences of life when we don’t do our due diligence. Some of those decisions are reversible and some aren’t, but rarely do they run into what would be a ruinous amount of money for most people.
We are referring to the plan to put a cryptocurrency mining operation in the old Pine Bluff Commercial building, and we use the term “plan” loosely.
Late last year, the building, which has been vacant since September 2020, was going up for auction. One fellow contacted the newspaper and said he was going to bid all the way up to between $30,000 or $40,000 for it. We wondered, even at that purchase price, if it was worth it. The building is old and needs work, and it’s huge. Just heating and cooling it is significant, if the old AC units are even working.
The man quickly folded his tent and exited the auction, which produced a sale of the building for more than $600,000, which was a rather shocking amount of money. But OK, we thought, let’s see what’s in store for the place. Never underestimate the inventiveness of the entrepreneur.
Independent reporting for Pine Bluff & Jefferson County since 1879.
There was no activity at the building until this spring when it sorta came to life. A handful of people were seen moving in and out of it, and the question was posed to them: Hey, what’s up? To which one of the workers said it was going to be a crypto mining operation.
We had heard of such a thing, but didn’t know much about it other than the reports of them being noisy and very energy-inefficient.
The person who bought the place was a real estate company owner from California who said he planned to invest significantly in the operation and employ scores of individuals.
Then along came the Planning Commission doing their own due diligence.
As it turns out, a crypto operation, such as was planned for the building, doesn’t fit within the zoning criteria for that area, according to Larry Reynolds, executive director of Southeast Arkansas Regional Planning. Reynolds doesn’t work for the city, but because his fast ball is planning, his analysis of what is and isn’t allowed in an area is used by the planning staff and the commission in making crucial decisions.
Sometimes even non-conforming uses will be given a green light through a “use permitted on review” process, but the applicant has to show that what they want to do with the property doesn’t change the character of the neighborhood. Reynolds said he got very little information about the proposed project from the new owner of the building so he had to rely on his own investigation of what a crypto mining operation would look — and sound — like. What he found was ugly. They are noisy and not just train-going-by noisy, as the owner suggested, but 24-7 noisy. There are also stories of such operations sucking so much electricity from the grid that additional problems are created.
A recent investigative report done by The Washington Post seemed to confirm what Reynolds had found from his own investigation. Mainly, people complain about the loud din of noise that makes life something less than it was for those living in the vicinity. Many people, the newspaper reported, had to move away or soundproof their homes, which had been situated in quiet glens in the mountains. One man said it was like standing near a jet airplane getting ready to take off except the plane never leaves.
As much as Pine Bluff could use the jobs and economic shot in the arm, we see this turn-down as a win for the city. The Washington Post story said many of these operations are put in rural areas where electricity is cheap. Once the fans are turned on — huge fans that keep cool the many computers that are needed for the operation — and the nonstop noise is suddenly there, local communities and rural areas are largely unable to do anything about it.
There was a lot of social media talk about how the city should not have turned down the application for this project, but we see Reynolds and the Planning Commission as the heroes here. Reynolds said he doesn’t hate the idea of a crypto operation in the area but said it needs to be in the industrial park and not in a neighborhood where there are people living and where there is also a church and a school.
We also blame the real estate company’s Joe Delmendo for the mess. He dismissed the snub as “politics,” but someone in his business surely has to understand the ins and outs of planning and zoning. To have purchased the building and to have dumped what was said to be $1.5 million total into the enterprise before making sure he could do what he wanted to do strikes us as a foolish way to spend money.
Perhaps not all is lost. Some have suggested that Delmendo could install noise-abatement devices to reduce the sounds coming from the building. But that would require him to work with the planning folks in a way that he has not done to date.
The whole affair also makes us think the state should take a hand in the matter, not for the benefit of Pine Bluff, which handled the potential problem on its own, but for smaller communities and rural areas out in the countryside that an investor might see as easy pickin’s and set up shop before anyone knew what was going on. We in the Natural State do not need to be known as a safe haven for such operations, but the expertise to combat these nuisances is probably beyond the scope that some city and county officials have.