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State Capitol Week in Review


LITTLE ROCK – The Arkansas Senate passed two bills that will tighten state and local regulations of data centers and the newly emerging crypto mining industry.
Senate Bill 78 passed with 26 votes in the 35-member Senate. SB 79 passed with 32 votes. Next, they will be considered by the House of Representatives.
The measures represent legislators’ attempts to balance competing demands. One is to protect the quality of life near the centers. Another is to ensure that their energy consumption doesn’t cause power failures. At the same time, lawmakers don’t want to cripple the growth of a new industry that few people understand.
The legislature is in a fiscal session that is expected to end on May 2. Routinely, during fiscal sessions only budget bills can be introduced, but the state Constitution allows for consideration of non-budget bills if both the Senate and House agree by an extraordinary majority of two-thirds. That happened with SB 78 and SB 79.
Since the first fiscal session took place in 2010, only a few non-budget bills have been brought up and they were relatively non-controversial. SB 78 and 79 address issues of enormous importance to people who live near crypto mines, and to local governments that want more authority to regulate them.
Crypto mines have popped up in rural areas only recently and more are being planned. They consume a lot of electricity and some use large quantities of water. Nearby residents have been especially vocal about the noise they generate every day, all day.
The Senate bills require crypto mines to install equipment or build coverings that will reduce noise levels.
Neighbors who live within 2,000 feet of a digital asset mining business will have standing to file lawsuits in circuit court. The state Oil and Gas Commission will issue permits to data centers and local governments can pass ordinances to regulate them.

A major concern about some crypto mines is that their ownership cannot be verified, and they may be a threat to our cybersecurity. Ownership by Chinese military agencies is a particular concern.
The Senate bills prohibit ownership of data centers by organizations or foreign countries that sponsor terrorism and that traffic in weapons in violation of international law.
State Employee Pay Plan
The Joint Budget Committee approved the governor’s proposal to raise salaries of state employees.
Beginning on July 1, which is the start of Fiscal Year 2025, state employees may get raises of up to three percent. Also, they will be eligible for lump sum bonuses of up to $5,000 or 40 hours of leave.
Agencies looking to hire new employees may offer the bonuses as a recruitment incentive. The head of the Arkansas State Employees Association said the pay raises were much needed and well deserved.
The plan allows for higher salaries for employees at the top of the pay scale. The minimum salary for employees at the bottom of the pay scale is raised significantly, from $22,880 to $32,405 a year.
The governor’s office said it was important for state government to recruit and retain its best employees.