I hope everyone had a great Christmas and was able to enjoy it with family and friends. Christmas Eve church services are hard to beat. This year was no exception. I look forward to the new year and hope everyone has a safe and enjoyable New Year’s celebration.

The beginning of the 109th Legislative session is scheduled to begin on January 8. Bill introduction takes place during the first 10 legislative days. I have several bills ready for introduction, but perhaps one of the most significant bills I intend to introduce is a bill restricting the expansion of Bitcoin mining.

Bitcoin mining involves large desktop computers that solve equations to support the blockchain technology that supports Bitcoin creation. Unfortunately, these computers consume massive amounts of electricity. The most extreme example is the large Bit Coin installation located on the east edge of Kearney. The computers are housed in portable storage units and consume more electricity than the entire city of Kearney. In addition to this facility, there are smaller facilities popping up across rural Nebraska.

As many of you know, Julie and I own farmland where I grew up in Clay County. The family that does some custom work for me has their headquarters a couple of miles west of Sutton along Highway 6. There is an electrical substation operated by the South Central Public Power District diagonally across the intersection from their large bin site. A Texas-based Bitcoin miner leased 1.5 acres of pastureland next to the substation and placed two large portable storage units next to the substation. Note that they pay no property taxes on the land or the storage units (although they will pay personal property taxes for 5 years on the storage units and computers). They have someone drive by in a pickup truck to monitor the facility. So, no property taxes, no sales taxes, and no full-time employees. Since they get paid in Bitcoin, I don’t know if they are paying Nebraska income taxes. Yet, they are consuming massive amounts of electricity. The farmers next door have had several power surges since this facility was completed.

So why is a Texas-based company locating this Bitcoin facility in Nebraska? I would say the answer is abundant, low-cost electricity with limited to no restrictions.

My bill will add an excise tax to all Bitcoin mining facilities to replace the taxes that would have been collected if they were a manufacturer or other commercial business that employs people, builds buildings, and pays state and local taxes. I will want to target this new revenue to property tax relief. The tax would need to be high enough to cause new facilities to think twice about locating in Nebraska.

This revenue stream may be short-lived, but we cannot grow productive new businesses that employ workers who will help grow our state if we cannot keep up with the energy demands.

I will follow up next week with other bills of interest.

I look forward to continuing to hear from you about issues that are important to you. It is a privilege to serve as your State Senator, and I will continue to give my full effort to make a positive difference for the District and the State. You can reach me at mjacobson@leg.ne.gov or 402-471-2729.