BY JEFF CHUDZINSKINorth Country This Week

MASSENA -- A Massena resident is threatening to file a class action lawsuit against the town of Massena and Massena Town Board if a planned expansion by Bitcoin miner NYDIG moves forward. 

NYDIG is currently in the planning stages of a 1.5 million square foot expansion project at the former Alcoa East site, but hyperscale data centers are on hold after Governor Kathy Hochul issued a moratorium this June. 

That one-year pause will also allow the state Department of Environmental Conservation to also review all previously issued permits. 

NYDIG officials maintain they can proceed with the project without further state approval, saying there was no need to obtain new permits from the DEC. 

But resident David Fenton, who has been an outspoken critic of the operation and its practices, said work continues at the site outside the purview of permits. 

He said land clearing is well underway at the Superfund location, which is still an active cleanup site on the areas still owned by Alcoa. 

“The NCCS at this point has no permits to be able to do the work that they have started...I don’t see anything that is in here for the significant legal fees that are going to have to be paid to be able to work toward destroying a Superfund site that’s in Massena, New York," he told board members during an Oct. 5 special meeting. 

He said tree clearing and land redevelopment is underway, “well outside the scope of what is allowed.” 

Fenton and attendees were told to keep comments strictly to the budget that was presented, however that didn't stop Fenton from taking matters a step further and threatening legal action if the board did not intercede. 

“There are no permits done by the DEC. No permits have been issued by the DEC for NCCS to go forward. So I think we’re going to need a big legal fight. I think you need to do something to put it back in your budget,” Fenton said.

Fenton suggested the town allocate up to $250,000 for legal fees, saying a class action lawsuit awaited the town and board if they did not take action. 

“If something happens and you go ahead with this operation, myself, and I will have a lot of other people that will join me, we will perform a class action suit against the town of Massena and everybody sitting at this board,” he said. 

Fenton said it was crucial the site not be disturbed as it still partially remains a Superfund cleanup location on the parcel that remains under Alcoa's ownership and legal responsibility. 

Fenton wasn't alone in questioning the board about their budgeting and handling of data centers as well.

Former Department of Public Works Superintendent Hassan Fayad asked the board if funds were held in an escrow account for legal fees and contractual reviews. 

Though he had yet to see the town's budget, Fayad said he "suspected that its (legal fees) are probably in there." 

"That I don’t know. But, if it is, how is that planned to be spent and distributed, and who are the companies or the beneficiaries awarded the contracts, if anybody, for engineering costs and also for legal? Are the companies and beneficiaries versed in data center language?" he asked the board. 

Fayad said he was concerned about the possibility of lingering liabilities that the town could incur, pointing to language in the agreement that saw the town sell Massena Memorial Hospital to Rochester Regional Health in 2020. 

That sale came with more than $5 million in trailing liabilities for the town, despite the hospital serving the surrounding municipalities and communities as well. 

Around $1.7 million was repaid to the county for outstanding Worker's Compensation liabilities in 2021, largely eliminating the town's fund balance. 

A lawsuit settlement between the town of BOCES in 2023 led the town to secure roughly $1.6 million after a seven year legal battle regarding reimbursement rates for payments made to MMH. 

Town officials at the time said the plan between the town and BOCES called for a 92% reimbursement rate, though some former town officials suggested it was "likely closer to 62%." 

Those funds sat un-utilized after town board members shot down a resolution to use the funds to pay down the hospital debt owed to New York State. 

Deputy Town Supervisor Sam Carbone said the board remains committed to working with state officials to find a solution, whether it be full forgiveness of the debt or special bonding terms that would allow for a significantly reduced interest rate. 

Currently, the town is paying a little over $383,000 each year at 7% interest. The debt will be fully repaid in 2054 under the current plan.