HOOD COUNTY, Texas — Throwing a barbecue at Danny Lakey’s house in Hood County, Texas, isn’t any fun. The problem isn’t his grill master skills. Lakey told Straight Arrow News he’s a three-time finalist for the Texas Steak Cookoff, and he used to enjoy inviting people over for ribeye steaks, grilled chicken, corn and vegetables. The problem is the low-frequency hum emanating from a nearby Bitcoin mine that has stopped Lakey and his neighbors from fully enjoying their properties.
“Invite your friends over for a barbecue and set your table up next to your AC unit. And then go in the house and turn it down to 50 so it never goes off,” Lakey said. “That’s what it’s like in my backyard.”
Lakey is determined to fix the issue. His plan of action: Circulating a petition throughout his rural unincorporated part of Hood County, about 50 miles southwest of Fort Worth, to form an official town.
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He and his neighbors need 50 signatures to put their incorporation effort on the Nov. 4 ballot to form the municipality of Mitchell Bend, Texas. About 575 of Hood County’s 70,000 residents reside inside the prospective town’s borders.
Lakey thought he had collected enough of those signatures until the Bitcoin company’s lawyers got involved in early August.
In recent years, Texas has become a hub for Bitcoin mining, the energy-intensive process in which companies run computers to guess a correct series of numbers, keeping the cryptocurrency secure and earning a reward. Thousands of fans keep the computers from overheating, but the noise they generate has become a headache for locals. In Hood County, residents’ efforts to form their own municipality have brought them into conflict with corporate power.
Neighborhood noise
MARA Holdings, sometimes called Marathon, owns the Bitcoin mine in the area that could become Mitchell Bend, Texas. The company rents space from Constellation Energy, next to Constellation’s gas-fired power plant, which provides power to the Bitcoin mine. The Bitcoin mine can draw 300 megawatts of power from the gas plant — enough to power 187,000 homes in Texas.
Marathon, a Florida-based company that currently holds more than $5 billion in Bitcoin, has been sharply criticized by its Hood County neighbors. Noise pollution from fans has triggered lawsuits, as residents believe the pervasive hum is causing various health issues.
Creating a municipality would enable these neighbors to pass a noise ordinance, create new fees and have more power to stop expansion of industry. In addition to the Bitcoin mine, a new gas power plant and a grid-scale battery are proposed in the area.
“We have to do something,” said Cheryl Shadden, a Hood County resident who recently suffered hearing damage and lives across a two-lane highway from the power plant and Bitcoin mine.
The petition drive
Neighbors began gathering signatures in March. By the end of April, the group believed the petition had garnered enough valid names, and they submitted it to county officials to verify compliance with applicable state law.
Lakey said he reworked some of the petition language with the county attorney’s office to ensure compliance. Then he went to the county elections administrator, whom he said confirmed 50 valid signatures — just enough to send the issue to voters in November. On May 2, Hood County Judge Ron Massingill approved placing incorporation on the ballot.
But the process wasn’t over; lawyers representing MARA Holdings soon became involved.
In an Aug. 5 letter to Massingill, Paula Pendley, an attorney with the firm Nelson Mullins, wrote, “there appear to be defects on the face of the Petition submitted, including signature deficiencies, inclusion of ineligible territory, and irregularities in the map’s configuration.”
Pendley’s letter stated that lawyers conferred with the Hood County attorney and election administrator and “both confirmed that neither of them participated in verifying the accuracy of the information in the Petition.”
By the lawyer’s own count, the petition contained at most 42 valid names.
County Commission
During a County Commissioners’ meeting on Aug. 12, Massingill said he had vacated the first petition after initially signing his name to approve the petition and put incorporation on the ballot.
Massingill said the Hood County elections administrator, Stephanie Cooper, “informed me that the requisite number of registered voters for this petition was not met, which is why I signed an order vacating what I had signed for Mr. Lakey initially.”
Some residents argued during the meeting’s public comment session that Marathon had no standing to interfere in the local matter because the Florida company cannot vote and owns no property in the Mitchell Bend area.
“There has been no harm to MARA Holdings, and they cannot claim harm for something that might happen,” resident Thomas Weeks told county officials. “They are attempting to deny the vote.”
Lakey highlighted a portion of MARA Holdings’ letter to Massingill, which asked the judge to notify the company’s lawyers “of any future filings or proceedings concerning the incorporation effort.”
“There are some ethical issues with what [MARA] asked our Judge to do, and I’m not real happy about it,” Lakey told the commissioners.
At the end of a back-and-forth exchange with Lakey, Massingill raised his voice, thrust his head forward in the direction of Lakey and said, “I just don’t want anybody to think I’m not doing my job.”
Massingill did not respond to SAN’s repeated attempts to contact him for comment.
The second petition
Although Lakey believes there is no legal reason to disqualify the first petition, he spent a weekend gathering 88 signatures for a second petition.
In an email to SAN, elections administrator Cooper confirmed that 59 of those signatures met the county’s qualifications. She did not respond to questions about the first petition.
A lawyer in the county attorney’s office confirmed that Massingill signed his approval on the second petition. The approval still needs to be entered into the official record by the county commissioners’ meeting — a formality in which no voting occurs.
For now, Lakey is relieved his efforts are paying off.
Nevertheless, the community remains wary of additional challenges from MARA’s lawyers. Some neighbors have begun receiving flyers from an Iowa-based political action fund urging them to “just say no!” to incorporation.
“The people of Mitchell Bend want this election. We’re tired of being bulldozed,” Lakey said. “And we’re getting really good at fighting Goliath.”
