Planning Board is prepared to recommend operating permit for Frontier Avenue cryptocurrency mining facility

Rick Pfeiffer -, Niagara Gazette, Niagara Falls, N.Y.
Updated ·3 min read

Apr. 13—The Niagara Falls Planning Board heard no dissent Wednesday night to the application of Northeast Data, doing business as BlockFusion, a cryptocurrency mining operator, to receive the first high-energy use operating permit in the city.

The only speakers during a 5-minute public hearing were attorneys for BlockFusion, who urged the Planning Board members to recommend that their application be approved by the Falls City Council. The board scheduled a special meeting for April 25 to consider the recommendation request.

None of the board members raised any questions about or objections to BlockFusion's application. Planning Board Chairman Tony Palmer noted the company's 233-page application submission was "exhaustive" in outlining how the company would comply with the city's recently revised Zoning Code which places new restrictions on high energy use industries such as crypto-mining, data centers and cannabis cultivation.

BlockFusion attorneys told the board that their application meets "all the qualifications" for a high-energy use operating permit. They said the board should "take our voluminous submission as a wish to comply with the new regulations."

The BlockFusion application has also been referred, by the City Council, to the Falls Zoning Board of Appeals for review. After receiving the recommendations of the two advisory boards, the council will make a final determination on the request for an operating permit.

BlockFusion had been operating a crypto-mining facility on Frontier Avenue, but shutdown operations in November after the city notified the company that it was in violation of the new high-energy use industry Zoning Code amendments. Officials said BlockFusion immediately filed its application for an operating permit and made changes to comply with the new regulations.

The city also sought a preliminary injunction to block the continued operation of two other cryptocurrency mining facilities in the Falls.

The Planning Board also unanimously recommended that the City Council give final approval to a proposed new ordinance that will amend the Falls Zoning Code by adding new requirements that will govern the location and hours of operation for stores that sell marijuana and regulate where cannabis can be legally cultivated in the city.

City Planner Kevin Forma had previously told the board that the Zoning Code changes were made at the direction of the state's Office of Cannabis Management and that the director of the office had made clear that local municipalities could only adopt the rules and regulations put forward by the state.

"At our last meeting, we were told this is pretty cut and dried," Palmer said. "There's not much we can do."

Under the new ordinance, cannabis dispensaries that engage in sales only can operate between the hours of 8 a.m. and 2 a.m. and may not operate for more than 70 hours a week. Dispensaries that allow on-site consumption may operate from 8 a.m. to 4 a.m. with the same 70-hour weekly restriction.

Retail dispensaries may not be located within 500 feet of a "community facility" and on-site consumption dispensaries can not be located within 1,000 feet of similar operations, within 500 feet of a school, within 200 feet of a house of worship or 500 feet of a "community facility."

Dispensaries are subject to yearly inspections by the city's department of code enforcement. Forma noted that dispensaries are limited to retail zones, while cultivation is only permitted in industrial zones.

In January, the Niagara County Planning Board failed to recommend the new ordinance. The county board members raised a host of objections that ranged from the ordinance not being specific on locations for sale or cultivation, to a sense that the city will see "little financial benefit" from the cannabis industry.

The zoning code changes do not effect a dispensary opened Wednesday morning by the Seneca Nation of Indians adjacent to the Seneca Niagara Casino. Because that dispensary is located on sovereign Native American land, it is not subject to state or local laws.