The Niagara Falls Planning Board heard from just one city resident during a public hearing Wednesday evening on a long-delayed request for an operating permit from a Frontier Avenue bitcoin miner.
The board was seeking input from the public on a request from North East Data, LLC, doing business as BlockFusion, to create a high energy use overlay district at its property at 5380 Frontier Ave. That would allow BlockFusion to obtain a high-energy use industry operating permit from the city and resume its bitcoin mining operations.
In a brief presentation to the board at the beginning of the public hearing, Lauren Adornetto, an attorney representing BlockFusion, said the bitcoin miner’s four-acre site is a “former manufacturing facility that has been refurbished for an industry of the future.” She said the company has already invested $35 million in its operations here and anticipates paying about $3 million a year in property and sales taxes.
Almost two years after its future was left in limbo by inaction from the Niagara Falls City Council, city lawmakers in February agreed to accept a draft environmental impact statement (DEIS) from BlockFusion which declares that any noise coming from its bitcoin mining operation is within the limits outlined in a series of city zoning ordinances regulating so-called high-energy use industries.
Adornetto said a noise study by an independent sound consultant shows that operation of the bitcoin mining facility “doesn’t impact the noise (level) in the neighborhood.” She also told the planning board that the consultant’s study shows the noise from BlockFusion’s operations appears to be “lower than the ambient noise” in an area stretching 800 feet away from the bitcoin mining facility.
Sarah Zelensky, the only resident to speak at the public hearing, told the board that noise in her neighborhood, which she described as “a horrible, mechanical, grinding noise,” sometimes causes the windows and walls of her home to vibrate.
“I think the residents of the Falls deserve to enjoy some peace and quiet,” Zelensky said.
The February action by the current city council triggered the start of a public review process, required for the approval of a high-energy use operating permit for BlockFusion. Adopting the DEIS resolution opened a 31-day window for the public to submit comments on BlockFusion’s permit request.
It also re-started a process that stalled in July 2023 when the then-city council members split on approving an operating permit for BlockFusion in a dispute over the amount of noise its bitcoin mining was generating.
Complaints about the noise created by bitcoin mining facilities that had set up shop in the Falls led the city, in September 2022, to adopt a series of Zoning Code amendments that imposed strict new regulations on the operation of high-energy use industries. At a public hearing on the then-proposed amendments, one Falls resident described the noise coming from a nearby bitcoin mining facility as equivalent to “a 747 revving up on Buffalo Avenue.”
The Zoning Code amendments restrict high-energy use facilities like data centers and bitcoin mining operations to locations that are zoned only for industrial uses. The amendments also created an “overlay” to the city’s current industrial zone requirements, adding restrictions that require larger setbacks from residential areas and imposing strict limits on noise.
When the new requirements went into effect in November 2022, BlockFusion ceased operations and applied for an operating permit for its Frontier Avenue facility. The company submitted an application to the city in December 2022 that its attorneys said brought it “into compliance” with the requirements.
However, the application languished in a continuing dispute with city officials over the amount of noise coming from the facility and the measures BlockFusion had taken to reduce it.
The Zoning Code overlay caps the noise from a high-energy use facility at 65 decibels, measured at the property line of the residence closest to the operation. But Adornetto told the planning board that the sound consultant’s study showed the background noise alone, near its facility, was higher than the zoning code limits.
City Planning Director Kevin Forma told the board another independent noise study, by a city consultant, would be available for its review by next week. The planning board is expected to take action on BlockFusion’s operating permit request at its April 30 meeting.
BlockFusion’s general counsel, Rob Scott, said, “It’s important to us that we are a part of this community. We enjoy being a good corporate citizen.”
In response to a question from Planning Board Chair John Spanbauer, Scott said his company has been looking at potential expansion if it’s successful with its operating permit application.
“Yes, there is room for expansion. We have absolutely been looking at that,” Scott said. “And as our technology improves and we can get it in there, the sound will also go down.”