Crypto mine debate returns to Hawkins commission next week

BULLS GAP — When the Hawkins County Board of Commissioners banned cryptocurrency mines and data centers, Mayor Mark DeWitte knew it could lead to a legal challenge. Attorneys from the County Technical Assistance Service told him as much. County Attorney Allen Coup expressed these concerns at the Sept. 22 commission meeting where the ban passed with little opposition. While the county can ban nuisances, DeWitte said, it can't deem an entire industry a nuisance; it amounts to zoning, which Hawkins does not have. Now, to avoid possible litigation, the commission will consider allowing ExoticRidge Crypto Company to operate at its Bulls Gap site, under noise restrictions. The proposed settlement agreement dictates that ExoticRidge will not exceed 80 decibels at its property line for more than 30 minutes during any four-hour period. ExoticRidge would also have to record its sound output for county review. If the company breaks the noise limit, it would have to take corrective measures and potentially reduce or stop its operations. "They want to play fair," DeWitte said of ExoticRidge. "They want to have the community OK with what they're doing, and that was the purpose of the agreement." However, the residents of Bulls Gap and beyond continue to oppose the crypto mine. Legal issues The resolution to approve the settlement agreement states that ExoticRidge has considerable legal rights and would likely win a lawsuit against Hawkins. DeWitte does not want that to happen. He described the agreement as "an attempt to not spend money on a lawsuit." ExoticRidge CEO Will Daugherty, in a written statement to the Kingsport Times News, described it as a constructive path forward. Daugherty said his company has a legal right to operate, as ExoticRidge made a "substantial investment and took material steps toward development" before the county's "hastily adopted" ban. In addition to the single-industry ban, Daugherty criticized the commission's use of the County Powers Act, since they previously promised not to seek those powers. The act enables Hawkins to — among other things — prohibit businesses deemed detrimental to public welfare. However, this new resolution states that the County Powers Act is limited in its application. Commissioner Robbie Palmer — who represents Bulls Gap and sponsored the ban — said the commission acted within its power. "Even the state legal team has said, while [the ban] could be challenged, they did not say it was illegal," he said. "What we did was legal. We need to stand on that until told otherwise." Transparency concerns Legal discussions surrounding the settlement agreement began around the New Year between the attorneys, DeWitte and Daugherty. The agreement was written by Daugherty's attorney and edited by Coup, according to DeWitte. "I didn't have anything to do with writing it," DeWitte said. "It was just my job to present it." DeWitte didn't tell commissioners that an agreement may have been on the horizon, he said, because it wasn't certain yet. "[But I did tell] everybody who talked to me about it, commissioners and all, that [ExoticRidge] has a significant case," he said. DeWitte said he and Coup received the final version of the agreement on Jan. 20, a Tuesday. He called an executive session for the commission Wednesday morning; it was held Thursday evening in anticipation for a commissioner meeting the following Monday. Six out of 14 commissioners attended the session, DeWitte said, which was purely informational. The regular Monday meeting was canceled for wintry weather, moving the resolution to February's agenda. Participants of an executive session — not the public, as pending litigation is private — must be given a reasonable notice given the circumstances, DeWitte said. "People think I've tried to rush this through and that wasn't the case at all," he said. "I wanted [commissioners] to be aware and consider it before ExoticRidge took legal action. It was time sensitive." Palmer said he wishes things were done differently. He hasn't spoken with the mayor's office or Daugherty about the agreement, he said, and only learned of it when the executive session was called. Palmer was unable to attend that meeting. "It's always wise to involve the county commissioners in decisions like this, especially county commissioners in the district it affects most," he said. "I've not had any communication about it." Additionally, Daugherty criticized the commission's use of an out-of-order resolution for something they had prior knowledge of when they banned crypto mines. He said this excluded the crypto ban from the Sept. 22 meeting's agenda, violating the Tennessee Open Meetings Act. DeWitte denied that it violated that act, also known as the Sunshine Law. The commission regularly votes on out-of-order resolutions at their meetings, if a resolution missed the normal filing deadline but is considered time sensitive. Out-of-order resolutions are posted to the county clerk's website, alongside but separate from the normal resolutions, but they are not on agendas. The commission must suspend its rules to consider them. According to the Tennessee Comptroller, an agenda must "reasonably" describe the contents of a meeting; a legislative body can discuss something not on the agenda if it takes the correct steps. DeWitte said he hates doing out-of-order resolutions, but they're sometimes necessary. The mayor and commissioners did not know about ExoticRidge's intent to operate in Bulls Gap until after the September resolution deadline. Looking ahead Palmer said he and his constituents still support the ban. They're worried about the mine's noise, even with regulations. "People have contacted me throughout the county, from every district, telling me to stand firm in our decision," Palmer said. "The commission, regardless of what people may think, does listen to their citizens. And the citizens are making their voices loud and clear." He also expressed concern at the settlement setting a precedent for other crypto mines to come to Hawkins. "If we let one company come in, why wouldn't we allow another?" Palmer said. "I think that is more discriminatory than what Will Daugherty is trying to argue." DeWitte said the county can still enact a noise ordinance, if the need arises to curb crypto mines in the future. Daugherty encouraged the commission to approve the agreement, "[avoiding] unnecessary and costly litigation." "The legal framework is clear," he said. "Obstructing our operations is not in the best interest of Hawkins County taxpayers, nor would it change the underlying rights at issue." The commission will vote on the proposed settlement agreement at its meeting Monday, Feb. 23, at 6 p.m. in the Hawkins County Courthouse.