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Tag: Gov. Mike DeWine

  • Ohio Lt. Gov. Husted won’t say if he knew about $1M dark-money contribution

    Ohio Lt. Gov. Husted won’t say if he knew about $1M dark-money contribution

    Donation came from utility behind massive bribery scandal

    BY:  – Ohio Capital Journal

    Ohio Lt. Gov. Jon Husted is refusing to say whether he was aware of a $1 million contribution in 2017 to a political group that was supporting his bid for governor. Instead, his office is only reiterating that the group wasn’t affiliated with the Husted campaign.

    The massive donation came from Akron-based FirstEnergy, which over the next two years ponied up more than $60 million in bribes in exchange for a $1.3 billion ratepayer bailout — a law that Gov. Mike DeWine signed just hours after it passed.

    The donation was discovered among a trove of documents that a group of news organizations including the Capital Journal requested from the Office of Ohio Consumers’ Counsel.

    As reported last week by the Energy News Network and Floodlight, the documents also contained emails indicating that Husted was lobbying DeWine to support the bailout. The lobbying came just 11 days after Husted abandoned his gubernatorial bid and joined DeWine’s ticket on Dec. 1, 2017.

    “Jon Husted called me to say he was meeting with DeWine on our issue to try and get him aligned to help keep the plants open,” a Dec. 12, 2017 email by FirstEnergy lobbyist Joel Bailey said.

    The plants were money-losing nuclear and coal plants that FirstEnergy wanted to prop up with the bailout and then spin off.

    FirstEnergy in 2021 signed a deferred prosecution agreement in which it admitted to paying bribes to elect a friendly Republican majority to the state House, which would elect a friendly speaker who would pass and protect the corrupt bailout.

    The company also admitted to paying a $4.3 million bribe to Sam Randazzo, DeWine’s pick to chair the Public Utilities Commission of Ohio, who died by suicide last week. A state indictment said that FirstEnergy executives arranged the bribe with Randazzo the same night they discussed his suitability as a regulator at a dinner meeting with Gov.-elect DeWine and Lt. Gov.-elect Husted on Dec. 18, 2018.

    The ensuing scandal has landed former House Speaker Larry Householder, R-Glenford, in federal prison for 20 years, and former Ohio GOP Chair Matt Borges for five. Two others have pleaded guilty and await sentencing. Another defendant, lobbyist Neil Clark, also died by suicide — clad in a “DeWine for Governor” T-shirt.

    DeWine and Husted haven’t been charged in case, and they adamantly deny wrongdoing.

    However, they haven’t publicly discussed just what they knew about Randazzo’s long-standing relationship with FirstEnergy, or what they knew about the torrent of dark money flooding from FirstEnergy into Capitol Square to pass and protect the bailout. They also haven’t discussed what senior administration officials with close ties to FirstEnergy might have known.

    Among the documents turned over once FirstEnergy made its agreement with federal prosecutors was a spreadsheet listing 501(c)(4) political contributions the company made in 2017.

    Such donations are called “dark money” because recipients don’t have to disclose their sources. By law, dark-money contributions can’t go directly to candidates, but they can go to groups that support them, but aren’t supposed to directly coordinate with them.

    The FirstEnergy spreadsheet is only now becoming public because the FBI investigated the scandal and the U.S. Department of Justice brought a prosecution. During the battle over the bailout law in 2019, there were suspicions that FirstEnergy was bankrolling the effort, but the press and public couldn’t know because the money was being funneled through dark-money groups — without which U.S. Attorney David DeVillers said the conspiracy would have been impossible.

    Now that FirstEnergy’s 2017 donation to a Husted-aligned group is known, it raises new questions.

    Special interests sometimes piously claim that they spend millions on politics solely in the interests of “good government.” But as was shown in Householder’s lengthy trial last year, corporate political donations are often — if not usually — intended to buy influence with people in government.

    In order for that to happen, a government official would have to know that a special interest had contributed on his or her behalf. But Husted — who is eyeing a 2026 gubernatorial run — won’t say whether he knew that FirstEnergy in 2017 gave a million bucks to a group supporting his earlier bid.

    His spokeswoman, Hayley Carducci, was asked if Husted knew of the contribution and if he did, when he learned of it. She was also asked if Husted persuaded DeWine to support the FirstEnergy bailout; what Husted knew about Randazzo’s links to FirstEnergy when he was picked to regulate the company; and whether he knew that FirstEnergy was flooding Cap Square with dark money in its effort to pass and preserve the bailout.

    In an email, Carducci repeated her earlier statement: “The Husted campaign never received this donation and is not affiliated with any of these groups.”

    She added, “As for your other questions, we will not be commenting.”

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

    Ohio Capital Journal is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.

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  • COMMENTARY: Ohio’s true state of the state: Relentless misrepresentation, extremism and corruption

    COMMENTARY: Ohio’s true state of the state: Relentless misrepresentation, extremism and corruption

    David DeWitt

    Meanwhile, Ohio ranks in the bottom half of all states on education, economy, environment, infrastructure, and health care.

    by David DeWitt

    You wouldn’t know it from Gov. Mike DeWine’s State of the State Wednesday, but Ohioans are currently suffering under a state government captured by corruption and yoked to extremist lawmakers racked with dysfunction and intent on little more than imposing radical ideology from the safety of unconstitutionally gerrymandered districts.

    Sweetheart Republican special interests often get everything they ask for in Ohio, while community advocates fighting every day to obtain proven policy solutions that improve the lives of Ohioans get largely ignored. Wealthy families and corporations continue to do phenomenally in the Buckeye State while millions get left behind, or outright attacked.

    Back in 2010, Ohio was ranked by Education Week as having the 5th best public school system in the nation. Education Week’s last ranking was in 2021 and put Ohio at No. 20. A recent ranking from U.S. News & World Report puts Ohio education at No. 29. If you break those numbers down, Ohio sits at No. 21 for Pre-K to 12 education, and No. 37 for higher education.

    State disinvestment from higher education is one of the primary drivers of our country’s vastly over-inflated higher education costs and subsequent record student loan debt.

    The National Center for Science and Engineering Statistics calculated state support for higher education per full-time student in 2021. Ohio ranked No. 40 in the amount of money we provide to fund higher education, giving about $5,600 per student compared to a national average of nearly $8,000.

    So are gerrymandered Ohio lawmakers thinking of how they can help better support our storied and cherished institutions of higher learning as they grapple with enrollment declines and right-sizing? No. They are attacking them. They are attacking freedom of speech and expression in the classroom, and any efforts toward diversity on campuses.

    They’ve proposed and then walked back their ultimate desire to attack tenure and collective bargaining, and in accordance with their own weird preoccupations, they also want to force transgender people on campus to use restrooms that do not match their gender identity and appearance.

    The Ohio Attorney General’s Office has meanwhile put the fear into Ohio colleges over awarding any diversity scholarships. Our student loan debt at college graduation is higher than the national average, and our high school graduation rate is below the national average.

    Regarding K-12, Ohio was giving out $69 million worth of private school vouchers in 2008. In 2023, gerrymandered Ohio lawmakers imposed near-universal private school voucher eligibility. This year, Ohio public funding of private school vouchers is on track to be more than $1 billion by June.

    Who is all the new voucher money going to? Mostly to families whose children were already attending private school. As for the 90% of Ohio K-12 students who attend public school, many are in cash-strapped districts facing budget cuts.

    Ohio doesn’t fare much better in any of the other rankings by U.S. News & World Report. Overall, it puts us at No. 34.

    Ohio ranks No. 31 in crime and corrections; No. 37 in economy; No. 42 in natural environment; No. 32 in infrastructure; and No. 29 in health care.

    Take heart though, Ohio is sitting on $3.5 billion in the state’s rainy day fund and ranks No. 14 in fiscal responsibility. But don’t go counting those chickens just yet. Gerrymandered Ohio lawmakers want to end state income taxes, which would leave a $13 billion state budget deficit.

    They say they could make up the money by raising the sales tax, cutting spending, and letting the economy allegedly “fix itself.” In other words, the rich get richer while everybody else pays a higher percentage of our income for other taxes and fees to make up the difference, and low-income families get their support services cut. This, in a state where 1 in 5 children already suffer food insecurity.

    But wait, what’s this? Ohio ranks No. 11 in “opportunity”? What’s that mean? Well, it’s not economic opportunity. For that we rank No. 35. But it is affordable to live in Ohio, so we grabbed a No. 16 ranking for that.

    Nevertheless, our median household income is below the national average and our poverty rate is above the national average. Ohio also has one of the worst infant mortality rates in the country, and ranks No. 29 in income inequality, with the top 1% of Ohioans taking home nearly 16% of all of the income in the state.

    We often hear from our leaders about what a great place Ohio is to do business. Surely we have a top-notch ranking there then, right? No. We rank No. 29 in business environment, No. 34 in growth, and No. 42 in employment.

    We crack the top half of states on health care when it comes to access (No. 24) and quality (No. 23), but our public health is abysmal, coming in at No. 42. Our pollution ranking is also abysmal, at No. 45. Columbus even recently won the crown for most-polluted city in America. And even though gerrymandered lawmakers have now opened our beautiful state parks and lands to fracking, we still rank No. 35 on energy.

    The national average for renewable energy usage is 12.3%, and Ohio’s is 4.4%. We once had one of the robust commitments to alternative energy in the nation, but, if you’ll recall, that corrupt Ohio House Bill 6 law that DeWine signed same-day that was the product of a $60 million political bribery and money laundering scheme that awarded a $1.3 billion bailout to FirstEnergy and a couple of failing coal-fired plants? It also gutted the state’s renewable energy portfolio.

    Insult to injury, gerrymandered Ohio lawmakers and DeWine also stripped Ohio communities of home rule when it comes to fossil fuel rigs, but made sure local solar projects could be astroturfed and attacked into oblivion.

    This may all sound pretty bleak, because it is.

    But hey, buck up, Ohio. We may not be No. 1 in anything. (In fact, we don’t even crack the Top Ten in anything good.) But at the end of the day, at least we can pick up our kids from one of our under-funded public schools or colleges, gather with our over-worked and under-paid family and friends, and get out in the sun to enjoy some pollution.

    We could picnic at one of our favorite state parks, and take in the soothing views of a fracking operation.

    “We’re No. 34! We’re No. 34!”

    _________________

    David DeWitt
    DAVID DEWITT

    Ohio Capital Journal Editor-in-Chief and Opinion Columnist David DeWitt has been covering government, politics, and policy in Ohio since 2007, including education, health care, crime and the courts, poverty, state and local government, business, labor, energy, the environment, and social issues. He has worked for the National Journal, The New York Observer, and The Athens NEWS. He holds a bachelor’s degree from Ohio University’s E.W. Scripps School of Journalism and is a board member of the E.W. Scripps Society of Alumni and Friends. He can be found on X @DC_DeWitt

    Ohio Capital Journal is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.

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  • FirstEnergy gave $1 million to boost Ohio Lt Gov Husted’s campaign before scandal, document shows

    FirstEnergy gave $1 million to boost Ohio Lt Gov Husted’s campaign before scandal, document shows

    Records show Jon Husted worked behind the scenes to bail out the company’s nuclear power plants. The million dollar donation was secret — until now.

    BY:  AND 

    Versions of this story were published by Floodlight, Energy News Network and the Ohio Capital Journal.

    A surge in FirstEnergy political spending ahead of the utility’s push to secure a legislative bailout for its nuclear power plants included a $1 million dark money contribution to support the campaign of Ohio Gov. Mike DeWine’s eventual running mate.

    The previously unreported gift linked to Lt. Gov. Jon Husted’s 2017 primary bid was revealed as part of a raft of documents obtained under Ohio’s public records law by a coalition of news organizations, including Floodlight, Energy News Network, and the Ohio Capital Journal.

    Among the documents are company emails describing behind-the-scenes efforts by Husted to persuade DeWine to support House Bill 6, the utility-backed legislation at the heart of the state’s ongoing $60 million public bribery scandal.

    Neither Husted nor DeWine, whose campaign also benefited from a previously reported $1 million in dark money from the utility, has been implicated in the scheme in which eight people, including the state’s former House Speaker Larry Householder, have been indicted.

    Two of those charged in the multi-million-dollar scandal surrounding the passage of HB 6 may have taken their own lives, including Sam Randazzo, the former chairman of the Public Utilities Commission of Ohio, who was found dead earlier this week of an apparent suicide.

    ‘Confidential’ email details campaign gift

    One of the documents from the Office of the Ohio Consumers’ Counsel Office is a spreadsheet attached to a January 2020 message labeled “confidential.” It shows $1 million went from FirstEnergy to the conservative group Freedom Frontier in 2017, with “Husted campaign” noted as the reason.

    That group backed Husted during his 2017 primary campaign for governor. The group then supported DeWine after Husted dropped out of the race to become his running mate.

    Husted is considered among possible front runners for the Republican nomination for governor in 2026. A January report by the Jon Husted for Ohio campaign committee shows it got roughly $1.7 million last year.

    Husted was also dubbed the “‘Golden Boy’ for FirstEnergy” by lobbyist Neil Clark, a co-defendant with Householder and others in the federal government’s criminal corruption case. Clark died by suicide in 2021.

    In several of the recently released records, Husted is mentioned in the same breath as Householder, the convicted House speaker, and Randazzo, the former PUCO commissioner, by FirstEnergy leadership as they sought to pass and then defend HB 6, the nuclear and coal bailout law at the heart of Ohio’s ongoing corruption scandal.

     FirstEnergy records released via public records request show how executives at the power company relied on Ohio Lt. Gov John Husted and convicted former House Speaker Larry Householder to help them pass a $1.3 billion nuclear bailout bill. 

    Husted has maintained that his support for the 2019 law stemmed from his belief that nuclear energy is an important part of Ohio’s energy portfolio. Parties in HB 6-related shareholder litigation have subpoenaed Husted to answer questions under oath, although a new date needs to be set.

     FirstEnergy records released via public records request show how executives at the power company relied on Ohio Lt. Gov John Husted and convicted former House Speaker Larry Householder to help them pass a $1.3 billion nuclear bailout bill. 

    “The Husted campaign never received this donation and is not affiliated with any of these groups,” said spokesperson Hayley Carducci. By law, candidate campaigns are not supposed to coordinate with groups like Freedom Frontier, which can spend unlimited amounts to support or attack them.

    The document and others reflect a major commitment by FirstEnergy to Husted’s political future. Before 2017, the company’s reported political spending to support Husted was less than $25,000 per campaign, according to data from OpenSecrets.

    Dark money spending rises sharply

    More broadly, the document also indicates a major increase in FirstEnergy’s political spending through nonprofit groups exempt from taxes under Section 501(c)(4) of the Internal Revenue Code. Those, along with privately held corporations, are common structures for dark money organizations — groups that aren’t required by law to disclose the ultimate source of their funding.

    The company’s giving to such groups jumped to more than $12 million in 2017, after much lower levels of $200,000 in 2016 and $100,000 in 2015, according to the spreadsheet.

    Starting in 2014, FirstEnergy had sought bailouts for noncompetitive coal and nuclear plants. And in late 2016, regulators approved a $456 million consumer surcharge that ultimately was held unlawful. Yet the company claimed it needed more.

    The document details once-secret contributions to groups supporting “everyone from the mayor of Akron to President Trump that FirstEnergy made to secure bailouts for its soon-to-be bankrupt coal and nuclear plants and to gain influence on other key issues,” said Dave Anderson, policy and communications manager for the Energy and Policy Institute.

     A spreadsheet details dark money expenditures by northeastern power company FirstEnergy as it sought to secure a $1.3 billion bailout for its struggling nuclear power plants. The sheet reveals a previously unreported $1 million donation to benefit the candidacy of Ohio Lt. Gov. Jon Husted. 

    Anderson added that the spreadsheet also “provides some key new evidence for utility regulators and consumer advocates to use to ensure that every dollar of ratepayer money that FirstEnergy misused to fund its secret political spending is publicly disclosed and refunded, with interest and ideally serious financial penalties.”

    At the time, the author of the document that details the donations, Kristina Housley, was executive assistant to FirstEnergy’s Mike Dowling, who is now a defendant in a state criminal case along with former CEO Chuck Jones.

    Finding out all the details about the dark money spending behind HB 6 is like peeling back the layers of an onion, said Catherine Turcer, executive director of Common Cause Ohio.

    “The reason that transparency matters so much is that money that is spent in the shadows influences elections, and it influences really important policy decisions that impact us every day,” Turcer said. “And we have the right to know what is going on in government and how decisions are being made and who’s attempting to influence those decisions.”

    The ‘Golden Boy’ for FirstEnergy

    A December 2017 email from former FirstEnergy lobbyist Joel Bailey said Husted was working to get DeWine on board with FirstEnergy’s “issues.” FirstEnergy also supported other pro-DeWine/Husted efforts during the election cycle.

     Former FirstEnergy CEO Chuck Jones (top left), former FirstEnergy VP Michael Dowling (top right), former PUCO Chair Sam Randazzo (bottom middle). Graphic by WEWS. 

    After the election, Husted and DeWine dined with Jones and Dowling on December 18, 2018. Later that night, FirstEnergy agreed to pay $4.3 million to energy lawyer Randazzo, who went on to become DeWine’s first pick for chair of the Public Utilities Commission of Ohio. FirstEnergy later identified Jones and Dowling as the two people responsible for paying alleged bribes.

    Husted’s office has been evasive about his recollections, despite Jones noting in texts to Randazzo that the PUCO chair position was discussed in at least general terms. Another text by Jones in 2019 said the DeWine/Husted team was forced “to perform battlefield triage” to secure Randazzo’s nomination after a 198-page dossier provided to DeWine’s staff threatened to derail it.

    Evidence from last year’s criminal trial of Householder, the former Ohio House speaker, and lobbyist Matt Borges also included messages between former FirstEnergy executives Jones and Dowling about Husted working behind the scenes to build support for the bill. Among the actions were efforts to extend the bailout period for the company’s former nuclear power plants in Ohio.

    Husted long a friend of utilities

    Husted had been Ohio’s secretary of state immediately before becoming lieutenant governor. Before that, he served as House speaker in the General Assembly. In that role, he played a pivotal part in securing passage of another major energy bill, Senate Bill 221.

    At the time, Husted supported the law’s clean energy standards that were ultimately gutted by HB 6. However, SB 221 set the stage for so-called electric security plans. Those have let FirstEnergy and other utilities avoid full rate cases for more than a decade, while allowing cross-subsidies and adding multiple additional charges to consumers’ bills.

    “That bill upset the balance” of energy regulation in Ohio, said Ashley Brown, a former PUCO commissioner. “It was a humongous gift for the utilities.”

    Lawmakers repealed HB 6’s $1 billion-plus in subsidies for FirstEnergy’s former nuclear power plants and its recession-proofing provisions in 2021, eight months after the arrests of Householder and others.

    Earlier this year, Husted told NBC4 in Columbus the rest of HB 6 “needs to be completely removed.” He did not respond to Energy News Network questions this week about whether that includes both the law’s subsidies for two 1950s-era coal plants and its gutting of Ohio’s renewable energy and energy efficiency standards.

    FirstEnergy spokesperson Jennifer Young declined to comment on the company’s 2017 donation to Freedom Frontier due to ongoing litigation. However, she added, “FirstEnergy will post information regarding its support of 501(c)(4) social welfare organizations on the company’s website on a quarterly basis.”

    Those disclosures are currently required under the company’s July 2021 deferred prosecution agreement. That agreement expires later this year.

    Meanwhile, FirstEnergy still has not disclosed its dark money spending for the years 2018 through 2020. And proposals for reforms that would require such disclosures from all electric utilities remain stalled in the General Assembly.

    “It’s incredibly frustrating that Ohioans can be aware that dark money impacted decision-making at the statehouse,” Turcer said, “and yet we still haven’t gotten the legislators to create greater transparency.”

    The Energy News Network is a nonprofit news site dedicated to keeping influencers, policymakers and citizens informed of the important changes taking place in the transition to a clean energy system. Floodlight is a nonprofit newsroom that investigates the powerful interests stalling climate action. 

    This article first appeared on Energy News Network and is republished here under a Creative Commons license.

    _____________

    Mario Alejandro Ariza, Floodlight
    MARIO ALEJANDRO ARIZA, FLOODLIGHT

    Mario Alejandro Ariza is an investigative reporter and a Dominican immigrant. His byline has appeared in publications like the South Florida Sun Sentinel, The New Republic, and The Atlantic. Mario wrote a book called “Disposable City: Miami’s Future on the Shores of Climate Catastrophe,” which was published by Bold Type Books. His essays have been featured in The Believer and selected for Best American Essays. He lives in South Florida with a cat, a dog, and a sturdy pair of waterproof boots.

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    Kathiann M. Kowalski, Energy News Network
    KATHIANN M. KOWALSKI, ENERGY NEWS NETWORK

    Kathi is the author of 25 books and more than 600 articles, and writes often on science and policy issues. In addition to her journalism career, Kathi is an alumna of Harvard Law School and has spent 15 years practicing law. She is a member of the Society of Environmental Journalists and the National Association of Science Writers. Kathi covers the state of Ohio.

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  • Indicted former Ohio utility chair Sam Randazzo reported dead by suicide

    Indicted former Ohio utility chair Sam Randazzo reported dead by suicide

     Former Public Utilities of Ohio Chair Sam Randazzo at court. (Photo by WEWS.)

    BY:  – Ohio Capital Journal

    Sam Randazzo, Gov. Mike DeWine’s first pick to chair the Public Utilities Commission of Ohio, has died by suicide, the Columbus Dispatch is reporting.

    Randazzo’s body was found Tuesday in a Franklin County warehouse he owned, the paper reported. A spokesman for Franklin County Coroner Nathaniel Overmire couldn’t immediately be reached.

    Randazzo — a 74-year-old energy consultant turned regulator — was charged both in state and federal court over his role in a massive utility scandal that broke in July 2020, along with other alleged misdeeds. In the bribery scandal, Akron-based FirstEnergy paid more than $60 million in bribes between 2017 and 2020 in exchange for a $1.3 billion ratepayer bailout.

    DeWine picked Randazzo to be the state’s top regulator after a decade of shady dealings between Randazzo and FirstEnergy, his state indictment says. They include secretly being a paid consultant for FirstEnergy while also serving as general counsel to industrial energy users who were trying to get a better deal from FirstEnergy, the document says.

    Randazzo also secretly skimmed millions from settlements FirstEnergy paid the big users to get them to go along with rate hikes for everybody else, the indictment says.

    Just before DeWine nominated Randazzo to chair the PUCO in early 2019, FirstEnergy’s top executives paid him $4.3 million — a payment that FirstEnergy later conceded was a bribe.

    DeWine’s chief of staff reportedly knew about the payment before Randazzo was nominated, but it’s unclear how much she, DeWine, and others in the administration knew about the more than $10 million Randazzo was paid by FirstEnergy over the years. She was slated to testify at the former regulator’s state trial.

    As PUCO chairman, Randazzo helped draft the bailout legislation and did a number of other lucrative favors for FirstEnergy, court documents and testimony have shown.

    After a lengthy federal trial last year, former House Speaker Larry Householder, R-Glenford, was sentenced to 20 years in prison for his role in the scandal. Former Ohio GOP Chairman Matt Borges was sentenced to five years for his.

    Two others pleaded guilty and await sentencing. Another defendant, lobbyist Neil Clark, died by suicide.

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

    Ohio Capital Journal is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.

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  • Digging into the latest indictment of former Ohio House Speaker Larry Householder

    Digging into the latest indictment of former Ohio House Speaker Larry Householder

    Former Ohio House speaker Larry Householder arrives for day two of his racketeering trial. (Photo by Morgan Trau, WEWS.)

    Some allegations address Householder’s actions after the feds arrested him in 2020

    BY:  – Ohio Capital Journal

    Former House Speaker Larry Householder has again been indicted on charges related to his actions in a massive bribery and money laundering scandal.

    The Glenford Republican is already serving a 20-year sentence in federal prison after being convicted last March of racketeering in a scheme in which Akron-based FirstEnergy paid more than $60 million to purchase a $1.3 billion, ratepayer-financed bailout.

    The state charges concern some conduct Householder engaged in after he was arrested in July 2020. They also concern debts and other items that Householder admitted during his federal trial that he didn’t report to the Joint Legislative Ethics Commission as required.

    The former speaker faces maximum sentences of from three to eight years on each of the 10 state charges from the Cuyahoga grand jury. And importantly, if he’s convicted of one of the counts — theft in office — he’s permanently disqualified from holding public office.

    In a video accompanying the announcement of the indictment, Ohio Attorney General Dave Yost noted that Householder has served two different stints as speaker, and that if he’s successful in appealing his federal conviction, “he might well try for a third bite at the apple.”

    Five of the 10 state counts Householder faces stem from his use of campaign funds to pay lawyers after his July 2020 arrest. In the video in which Yost appeared, Deputy Attorney General Carol O’Brien said Householder knew that was illegal when he did it.

    Several other counts relate to Householder “not reporting significant credit card debts going back to at least 2016, as well as gifts from lobbyists and significant loans from individuals.”

    Among gifts Householder received from FirstEnergy were flights to and from the 2017 inaugural of Donald Trump.

    Householder is due in Cuyahoga Common Pleas Court to be arraigned on April 12.

    The new state charges follow the announcement last month of state charges against former FirstEnergy CEO Chuck Jones and Vice President Michael Dowling. The executives are accused of financing the $60 million scheme to bail out two unprofitable nuclear plants owned by the utility so they could spin them off.

    Also indicted was Sam Randazzo, Gov. Mike DeWine’s pick to be Ohio’s top utility regulator. Jones and Dowling paid Randazzo $4.3 million mere weeks before DeWine nominated him to the commission in February 2019.

    DeWine’s chief of staff, Laurel Dawson, knew of the payment, but an administration spokesman said she didn’t tell the governor until after the FBI searched Randazzo’s Columbus condo in 2020.

    The governor stands behind Dawson because it wasn’t until 2021 that the payment was alleged to be a bribe, the spokesman said.

    Randazzo was charged by federal authorities in relation to his role in the scandal in December.

    Despite all the prosecutions and allegations of wrongdoing, the bailout law, House Bill 6, is still on the books. As a result, ratepayers have ponied up nearly a quarter-billion dollars to prop up two aging coal plants.

    Despite the fact that Ohio ratepayers are shouldering that burden, one of the plants isn’t even in Ohio, but in Indiana instead.

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

    Ohio Capital Journal is part of States Newsroom, the nation’s largest state-focused nonprofit news organization.

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  • Ohio indictments provide a better picture of squalid relationships that spurred massive scandal

    Ohio indictments provide a better picture of squalid relationships that spurred massive scandal

    Former Public Utilities of Ohio Chair Sam Randazzo at court. (Photo by WEWS.)

    BY:  – Ohio Capital Journal

    An Ohio grand jury has handed up a 44-count indictment against three players in what is likely the biggest bribery scandal in state history. And when the 50-page indictment was unveiled Monday, it provided new details about a decade of payoffs and conflicts as one of them — who became the state’s top regulator — allegedly did a huge electric utility’s bidding.

    The indictment concerns a $1.3 billion dollar bailout that Akron-based FirstEnergy has already admitted to the federal government that it paid more than $60 million in bribes to purchase.

    Former Ohio House Speaker Larry Householder, R-Glenford, and former state GOP Chairman Matt Borges are serving federal prison sentences for their roles in the 2019 passage of the bailout and the dirty-but-succesful fight to thwart a voter-led repeal.

    When federal prosecutors in 2021 charged those two and three others, they said their investigation continued. But it wasn’t until December that they charged another in the case — Sam Randazzo, a lawyer and longtime energy consultant whom Gov. Mike DeWine nominated to chair the state’s top regulator, the Public Utilities Commission of Ohio.

    That left the people who paid the alleged bribes — FirstEnergy’s top executives — uncharged in a scheme that took place more than four years ago.

    Double dealing

    All that changed Monday when Ohio Attorney General Dave Yost announced state charges against Randazzo and former First Energy CEO Chuck Jones and former Vice President Michael Dowling for their alleged roles in the criminal conspiracy. The three were arraigned in Akron on Tuesday and each pleaded not guilty.

    They were charged in an indictment that alleged shady dealings between the them stretching back 13 years.

    “It all began with a well-lawyered theft in 2010,” the indictment said.

    It went on to describe how Randazzo was general counsel for a group of large FirstEnergy customers — the Industrial Energy Users of Ohio — while also working as a FirstEnergy consultant. Only, the Industrial Energy Users didn’t know that Randazzo was also being paid by the company they were paying him to fight, the indictment said.

    It accuses Randazzo of settling the industries’ claims against FirstEnergy on terms acceptable to FirstEnergy and running the settlements through Randazzo-controlled shell companies where he took a skim — again, unknown to the industrial energy users.

    “His clients, the industrial members of IEU-Ohio, did not know he was a consultant for FirstEnergy,” the indictment said. “Randazzo did not tell them. Years later, some of the money would make its way to IEU-Ohio. Some of it would end up in Randazzo’s pocket.”

    The Industrial Energy Users appear to have engaged in some cynical conduct of their own, however. The indictment describes a 2015 agreement in which FirstEnergy was to pay Randazzo’s company $8.5 million for “consulting services.”

    It was really a cash “side deal” in which FirstEnergy paid the industrial users to drop their objections to a rate hike FirstEnergy wanted, supposedly in the name of “energy security,” the indictment said. In other words, prosecutors said that with Randazzo’s facilitation, FirstEnergy paid off a wealthy, powerful group of electricity users in order to raise rates on everybody else.

    Such arrangements proved quite profitable for Randazzo.

    “Between 2016 and 2019, FirstEnergy paid… $13,152,639.94 to Randazzo’s two shell companies,” the indictment said. “Of that total, Randazzo gave $7,756.903.84 to his IEU-Ohio Client and kept $5,395,736.10 for himself.”

    Cozy relationships

    This is the guy the incoming DeWine-Husted administration thought would be a good candidate to regulate utilities — companies to which Ohioans have little choice in paying their billions.

    The state indictment describes how, on Dec. 18, 2018, FirstEnergy execs Jones and Dowling met with Gov.-elect DeWine and Lt. Gov.-elect Jon Husted at the Columbus Athletic Club and discussed whether the executives wanted Randazzo to regulate their massive electric utility.

    The notion that a governor would ask a huge utility who might be acceptable as a regulator might itself seem startling. But after the dinner, according to the indictment, Jones and Dowling did something even more brazen.

    They went to Randazzo’s German Village condo and pursuant to that, Randazzo solicited a $4.3 million payment from Jones and Dowling, the indictment said. FirstEnergy paid the money “without ever having received an invoice for the payment and without any work or consulting services being performed,” the indictment said. It added that the executives made the payment over the objections of a company lawyer.

    Randazzo told Laurel Dawson, DeWine’s chief of staff, about the payment, calling it a “consulting agreement.” But he didn’t tell her of the other millions he’d gotten from the utility he was seeking to regulate, the indictment said. Randazzo also never told the Ohio Ethics Commission about any of the money he’d gotten from FirstEnergy, the indictment said.

    In Dawson, Randazzo might have had a sympathetic audience. Her husband, Michael Dawson, was a “paid FirstEnergy lobbyist” in 2016, when he’d gotten a $10,000 loan from Randazzo, the indictment said.

    But if his chief of staff told DeWine about the huge payoff Randazzo got from FirstEnergy, it must not have fazed the new governor. DeWine nominated Randazzo to be chairman of the Public Utilities Commission — the ratepayers’ supposed protector — on Feb. 4, 2019.

    Versatile player

    During Householder’s six-week trial in Cincinnati last year, federal prosecutors put on exhaustive evidence of how the FirstEnergy executives financed Householder’s bid to become speaker and to pass the notorious bailout known as House Bill 6.

    “Together, Jones, Dowling, Randazzo and his shell companies worked in concert to steal the power of government and bend it to the will of FirstEnergy,” was the way the state indictment unveiled on Monday put it.

    Most of the details of Randazzo’s involvement in the creation and passage of HB 6 are already known from the federal trial. They show him acting in multiple, conflicting, often-undisclosed capacities — similar to those the state indictment alleges he had already played with FirstEnergy and the industrial energy users.

    Even though he was supposed to be a regulator, Randazzo drafted portions of the bailout legislation and passed them between FirstEnergy officials and a Householder employee who had recently worked for the PUCO. They sometimes only shared printed copies of the huge bill, out of an apparent apprehension about leaving electronic fingerprints.

    According to text messages between Jones and Dowling, Randazzo went so far as to actively lobby for passage of the bailout — which would seem a big departure from the traditional duties of a disinterested regulator.

    Jones and Dowling discussed a meeting about HB 6 that Randazzo had with Sen. Steve Wilson, R-Maineville, and the Senate’s counsel. “We have a good plan to help,” Dowling told his boss.

    Other officials

    Despite the fact that DeWine had reason to know Randazzo was connected to FirstEnergy, the governor made him the state’s top utility regulator and he signed the billion-dollar bailout that benefitted the company the day it passed. And on July 21, 2021 — the day Householder was arrested — DeWine said he wasn’t in favor of repealing the measure.

    The governor subsequently walked that back, but HB 6 is still on the books and Ohio utilities are still getting hundreds of millions in ratepayer subsidies as a result.

    DeWine wasn’t the only state official to act at least peripherally in the scandal.

    Secretary of State Frank LaRose has refused to explain the “private” updates that FirstEnergy CEO Jones said the state’s chief elections official was providing during an attempt to gather signatures to put an HB 6 repeal on the ballot.

    And Yost himself dealt a mortal blow to the signature gathering when he initially rejected the ballot language — cutting nearly in half the time HB 6 opponents had to gather a quarter-million valid signatures. And in text messages presented in the federal trial, Borges told a co-conspirator that Yost thought HB 6 was a bad law, but wouldn’t speak up because of help he’d gotten from FirstEnergy in the past.

    Beyond the bailout

    Randazzo’s alleged help to FirstEnergy wasn’t limited to HB 6. He also thwarted a PUCO look into the company’s books that was likely to force a cut in electricity bills. That would have caused falling stock prices and a hit to Jones’ and Dowling’s portfolios, the indictment said.

    The erstwhile regulator was apparently so helpful that Jones at one point told a FirstEnergy subordinate to back off for fear of being too obvious. In a text message included in the indictment, Jones told Dennis Chack that Randazzo’s pro-FirstEnergy conduct “has a lot of talk going on in the halls of PUCO about does he work there or for us?”

    Even so, Randazzo’s behavior at the PUCO continued to be shameless, urging fellow regulators to join him in lobbying for the corrupt bailout, the indictment said.

    Randazzo “began internally lobbying PUCO staff members between July 2020 and September 2020 to generate strategies to save HB 6, despite facing internal objections about the inappropriateness of the effort to save HB 6,” it said.

    The indictment included a Sept. 15, 2020 email in which Randazzo told subordinates, “One option (and I really think we need to get other commissioners and staff into a proactive mode): We could, on our own initiative, issue a show-cause order to (FirstEnergy) directing (FirstEnergy) to show that no costs associated with HB 6 have been included in any riders or base rates.”

    Had such an order been issued, the result would have been misleading. While the bill didn’t raise consumer costs through riders or base rates, it included a provision that ensured FirstEnergy would collect at least as much as it did in one of its best years and it created a massive subsidy for money-losing coal plants.

    Randazzo’s efforts seemed finally to end two months later, when the FBI searched his condo.

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

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  • Ohio transgender adults speak against proposed administrative rules that would change health care

    Ohio transgender adults speak against proposed administrative rules that would change health care

     Getty Images

    The rules would collect data on transgender medical care and modify the treatment of those with gender dysphoria, requiring medical consent from a psychiatrist, an endocrinologist and a bioethicist before moving forward with treatment.

    BY:  –  

    Ohio transgender adults are deeply concerned Gov. Mike DeWine’s proposed administrative rules would make it harder for them to access gender-affirming care.

    DeWine announced two proposed rules earlier this month that would collect data on transgender medical care and modify the treatment of those with gender dysphoria, including requiring patients under 21 undergo six months of counseling before receiving more treatment.

    “Anytime the government is telling its citizens what they can and cannot do with their own bodies, it sets a very, very, very dangerous precedent,” said Vincent-Natasha Gay, a transgender adult who lives in central Ohio.

    The rules are just proposals at this point and have not gone into effect. Ohioans still have time to submit comments regarding the proposed rules.

    “They need to not be implemented,” said Lis Regula, a transgender man living in Columbus. “It would make us the worst state in the entire nation for adults and children who want to obtain gender-affirming care.”

    A major issue Terry Brown has with the administrative rules is that they deal with adults.

    “You’re talking about restricting people who are classified as adults in the eyes of the law,” Brown, a trans man, said.

    The Ohio Senate Democratic Caucus recently sent a letter to DeWine expressing their concerns about how the proposed rules could get in the way of adults accessing gender-affirming care.

    “While these rules may have been drafted with the intention of taking a more pragmatic approach than the legislature, in reality, this proposal could make it more difficult for trans Ohioans to receive the life-saving medical care that they need,” the letter said. “The proposed rules go even further than House Bill 68 by interfering with the lives and medical care of both trans children and trans adults.”

    House Bill 68 would ban gender-affirming care for trans youth. DeWine vetoed HB 68, but the House voted to override his veto last week. The Senate will vote to override the veto on Wednesday next week.

    One of the proposed administrative rules would require obtaining medical consent from a psychiatrist, an endocrinologist, and a bioethicist before moving forward with treatment.

    DeWine’s spokesperson Dan Tierney said this rule would only apply to people who start receiving treatment after the rule takes effect.

    “It’s the Department of Health’s intention that it applies to treatment that starts moving forward after the enactment of the rule,” Tierney said. “That’s the way House Bill 68 was written. We intend this to be consistent with that.”

    Lawmakers added a grandfather clause to HB 86 that would allow doctors who already started treatment on patients to continue.

    But transgender adults argue the language of the proposed rules is vague and ambiguous.

    Silhouette of doctor in white coat with stethoscope and LGBT badge on pocket
     Getty Images. 

    “I feel like that was not very clear at all,” Brown said. “Because of that vagueness, we really still don’t know how it’s going to be applied.”

    This just leaves Regula with more questions about continuing care.

    “That doesn’t address if someone has to put a pause on things for some reason if they’re going to be able to get back to their treatment,” Regula said.

    Vincent-Natasha Gay is currently receiving gender-affirming care and would be considered grandfathered in under the proposed administrative rules.

    “But that shouldn’t matter,” Gay said. “There are so many people out there who are trans and just don’t know they’re trans yet, or are in the closet and hiding because they’re afraid for their life. And my goodness, with these proposed rule changes, that’s just going to make that even worse.”

    Health experts say it would be harmful if someone who’s already receiving treatment abruptly stopped, Tierney said.

    “That could have some negative health consequences,” he said. “That’s certainly not the intent for anything along those lines.”

    Instead, Tierney said these rules are meant to prohibit health care providers from giving treatment without consultation.

    “Most of the providers are doing this in the comprehensive, multidisciplinary way, anyways, so they would likely be in compliance with the rule,” he said.

    The proposed rule doesn’t mean people have to sit down with a psychiatrist, an endocrinologist, and a bioethicist, Tierney said

    “The bioethicist helps develop how each facility is going to deal with cases of how the treatments occur at that particular facility,” he said. “At the very least, mental health care is generally provided by the psychiatrist, not the endocrinologist, and endocrinology is generally provided by the endocrinologist, not by the psychiatrist.”

    But Ares Page is concerned about adding people to the medical team that might not have proper training in treating transgender patients.

    “I don’t see where that’s going to be safe, and where that’s going to help us improve our safety,” said Page, a transgender adult living in Akron.

    Page is also worried how much extra it will cost to add these specialists to a person’s medical team.

    “Some people’s insurance companies may not allow them, or approve them for these specialists,” Page said.

    Ohioans have until 5 p.m. Friday to give feedback on the proposed transition care rule by emailing out to MH-SOT-rules@mha.ohio.gov with the subject line, “Comments on Gender Transition Care Rules.”

    Data Collection

    The second proposed administrative rule would require data collection around gender-affirming care, including requiring a health care provider to report non-identifying treatment for “gender-reassignment surgery, gender-transition services, genital gender reassignment surgery,” according to the proposed administrative rules.

    Under the proposed administrative rules, the Ohio Department of Health would share the aggregate data collected with Ohio lawmakers starting Jan. 31, 2025.

    But many transgender adults question why the data collection is necessary.

    “You can assign a code …  But there always has to be a place where my name goes back to the code,” Brown said.  “That is a problem.”

    Having a common data set on medical treatment will help people make an informed decision, Tierney said, who explained ODH collects data on things like pediatric flu deaths, food poisoning and abortion.

    “It’s all de-identified, it’s all aggregate,” Tierney said. “There’s really no way you could identify any patient from the data.”

    But people are concerned it would be hard to have the data be completely anonymous, especially for folks who live in a small community.

    “If it’s a matter of three (trans) people in a community and a doctor’s office or hospital system is treating all three of those people, how do you really anonymize three folks?” Regula said.

    Feedback for the data collection proposal must be sent to ODHrules@odh.ohio.gov by Feb. 5.

    Despite these proposed rules and ongoing legislation targeting trans youth, most people interviewed for this story say they would like to stay in Ohio if they can.

    “This is my home,” Regula said. “I’m an Ohio boy born and bred. I was raised here, my family is here. … I can’t imagine leaving home …  I also want to be able to make sure that my daughter and I have the medical care that we need.”

    But Page has contemplated leaving the country altogether.

    “(The government) has no right to tell me what to do with my body,” Page said.

    Follow OCJ Reporter Megan Henry on X.

    Megan Henry
    MEGAN HENRY

    Megan Henry is a reporter for the Ohio Capital Journal and has spent the past five years reporting in Ohio on various topics including education, healthcare, business and crime. She previously worked at The Columbus Dispatch, part of the USA Today Network.

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  • Money paid, favors done. Messages detail relationship between Ohio regulator and energy executives

    Money paid, favors done. Messages detail relationship between Ohio regulator and energy executives

    FBI agents remove boxes of materials from PUCO Chairman Sam Randazzo’s condo in Columbus Nov. 17, 2020. Photo courtesy of Daniel Konik/Statehouse News Bureau.
    BY:  – Ohio Capital Journal

    In early 2019, news of financial ties between Akron-based FirstEnergy and the man incoming-Gov. Mike DeWine had named to lead the Public Utilities Commission of Ohio began to spread. And as it did, FirstEnergy’s top executives feared they wouldn’t have a regulator they could control, according to documents filed in federal court late last week.

    “Great. Now we have none on the list” of nominees, then-CEO Chuck Jones texted Vice President Michael Dowling. Jones later added, ruefully, “Always need a backup plan.”

    As it happened, the nominee, Sam Randazzo, ended up being appointed to the commission after being paid $4.3 million by FirstEnergy. He proceeded to help draft a law providing the utility with a $1.3 billion bailout. The company spent another $60 million to pass and then to protect it from a citizen-initiated repeal in what law-enforcement officials have called one of the biggest bribery and money-laundering scandals in state history.

    Randazzo, Jones and Dowling haven’t been charged in the scandal, but after a jury trial that convicted two others, two guilty pleas, and a suicide, the three men could be the next targets as federal authorities continue their probe.

    If authentic, the communications filed on Friday indicate that the three met in Randazzo’s Columbus condo in December 2018. And they appear to show that the FirstEnergy executives agreed to pay Randazzo a large sum in exchange for favors when Randazzo became the state’s chief regulator.

    Another communication 23 months later — just after the FBI searched the condo in November 2020 — shows Randazzo providing a friend “the number for my home which the FBI does not have.”

    Demanding records

    Lawyers for Randazzo, Jones and Dowling didn’t immediately respond to requests for comment Monday, but attorneys for the former executives have said in separate court filings that they believe the feds are investigating their clients.

    The documents filed in federal court on Friday are part of a huge class-action suit against FirstEnergy, Jones, Dowling and a number of other defendants.

    In a deferred prosecution agreement, FirstEnergy in 2021 agreed to pay $230 million and admitted wrongdoing, including by bribing Randazzo. But the class-action plaintiffs — large pension and investment funds — are arguing that the company violated securities law by not disclosing its corrupt conduct. And, they argue, the company lost much of its value when that conduct came to light, leaving investors holding the bag.

    Randazzo has denied wrongdoing and he isn’t a defendant in the case, but the class-action plaintiffs want him to produce all communications relating to how he spent the $4.3 million he got from FirstEnergy just as he was poised to become its most powerful regulator.

    The plaintiffs have been accusing Randazzo since April of foot-dragging. They obtained the messages they filed Friday from a third party and are pointing to them as examples of Randazzo’s lack of cooperation.

    Early arrangements

    The earliest of the messages was on Dec. 18, 2018, and it appears that the three men had recently met in the residence that the FBI later searched.

    “Got it, Sam,” Dowling, then the FirstEnergy vice president, texted Randazzo. “Good seeing you as well. Thanks for the hospitality. Cool condo.”

    The “got it” was in response to a column of numbers Randazzo sent that appear to indicate that he was expecting payments from FirstEnergy through 2024:

    • 2019 — 1,633,333
    • 2020 — 600,000
    • 2021 — 600,000
    • 2022 — 600,000
    • 2023 — 600,000
    • 2024 — 300,000

    A seventh entry said “Total 4,333,333” — an amount equal to what FirstEnergy said was a bribe.

    The following day, Jones, the CEO, told Randazzo that he wouldn’t have to wait that long for the money, according to the filings. Jones also made it clear that he expected access to Randazzo.

    “We’re going to get this handled this year, paid in full, no discount,” the message says. “Don’t forget about us or Hurricane Chuck may show up on your doorstep! Of course, no guarantee he won’t show up sometime anyway.”

    Randazzo’s response seemed to be meant to reassure — and he linked the money to favors.

    “Made me laugh — you guys are welcome anytime and anywhere I can open the door,” he said. “Let me know how you want me to structure the invoices. Thanks.”

    Connections

    But on Jan. 30, 2019, problems popped up with Randazzo’s nomination.

    FirstEnergy’s nuclear-owning subsidiary, FirstEnergy Solutions, was going through bankruptcy and it had listed the Sustainability Funding Alliance of Ohio on one of its disclosures. Randazzo controlled the group and FirstEnergy had paid him millions through it in the past. Now the press was on to the matter.

    “Chuck — Sam Randazzo is going to pull out of the PUCO process ASAP and it’s related to a disclosure on a (FirstEnergy Solutions) bankruptcy filing,” Dowling texted Jones, according to the documents filed Friday. “Reporters called (FirstEnergy) today inquiring about the relationship between (FirstEnergy Solutions) and a group called the Sustainability Funding Alliance of Ohio. You can guess the rest.”

    That’s when Jones lamented not having a “backup plan” in the event that Randazzo was not seated on the utility commission. Dowling agreed.

    “This is awful,” he wrote. “The FirstEnergy Solutions bankruptcy filing names that group and Sam names the same group on a financial disclosure statement. Unreal. I don’t know why it was listed in the (FirstEnergy Solutions) bankruptcy filing. The payments we made year-end ’18 came from (FirstEnergy) Corp. Services.”

    Dowling was ready to throw Randazzo under the bus if the connection proved to be an embarrassment to the incoming DeWine administration.

    “They’re going to be mad at Sam (and hopefully not us) for not disclosing the financial relationship,” Dowling wrote. “That’s Sam’s responsibility.”

    A day later, however, the financial connection between FirstEnergy and Randazzo apparently wasn’t sufficiently embarrassing and he was picked to head up the PUCO.

    “A bullet grazed the temple,” Dowling told Jones, according to one of the texts filed last week.

    “Forced DeWine/Husted to perform battlefield triage,” Jones responded, referring to Lt. Gov. Jon Husted. “It’s a rough game.”

    A still rougher game

    In a trial held in Cincinnati from late January to mid-March, prosecutors put on witnesses and displayed communications describing Randazzo’s 2019 role in drafting House Bill 6, the bailout bill. Not only did it provide $1 billion to prop up two failing nuclear plants FirstEnergy was spinning off, it charged ratepayers about $100 million a year to insulate the company from an economic downturn. For FirstEnergy, it was easy money, in other words.

    In June, U.S. District Judge Timothy Black sentenced former Ohio House Speaker Larry Householder, R-Glenford, to 20 years in prison for orchestrating the racketeering scandal. Former state GOP Chairman Matt Borges got five years for his role.

    By November of 2019, HB 6 was on the books after FirstEnergy and a subsidiary plowed $36 million into a brutal, dishonest effort to turn back a citizen-initiated repeal. But the FirstEnergy executives weren’t done with Randazzo.

    On Nov. 10, 2019, Jones texted a coal executive that another cloud loomed for FirstEnergy.

    “And the (FirstEnergy) rescue project is not over,” Jones said, according to documents filed as part of the class-action suit. “At (Edison Electric Institute) financial conference. Stock is gonna get hit with Ohio 2024. Need Sam to get rid of the ‘Ohio 2024’ hole.”

    That was an apparent reference to a requirement that FirstEnergy file a “rate case” with the PUCO in 2024. In such a proceeding, regulators assess a utility’s operations and make a judgment about whether its rates and revenues are reasonable.

    FirstEnergy was apparently afraid they wouldn’t be. On Nov. 21, 2019, just 11 days after Jones expressed his concerns, the PUCO under Randazzo’s leadership issued an order saying it was “no longer necessary or appropriate” to require FirstEnergy to file a rate case.

    The next day, Jones wanted to express his appreciation to Randazzo. He did so by sending the erstwhile regulator a list of prices for six energy stocks that day. FirstEnergy stocks were up 1.5%. The next highest was Avangrid, which was up 0.86%.

    “Thank you!!” Jones wrote.

    Randazzo replied, “Ha — as you know, what comes up may come down… Thanks for the note. Spoke to Mike (Dowling) last night.”

    Then Jones said, “My Mom taught me to say Thank you.”

    Flying high

    By the start of 2020, things seemed to be going well for those who orchestrated the bailout.

    FirstEnergy Solutions would emerge from bankruptcy in February as a separate company, Energy Harbor. The class-action plaintiffs argue that one of FirstEnergy’s major goals in the scheme was to prop up the nuclear plants, get them off their books and shed the liability of having to pay for a decades-long process to close and clean up after them.

    At the same time, FirstEnergy was funneling millions more dark-money dollars into an effort to get the state’s legislature to put a constitutional amendment on the ballot. It would change the state’s term-limits so Householder could stay speaker for another 16 years — and presumably continue to do the utilities’ bidding.

    But then in July 2020, it all crashed down.

    On July 21, the FBI arrested Householder, Borges and other conspirators. By the next day, FirstEnergy stock had lost 34% of its value, the class-action plaintiffs contend.

    FirstEnergy fired Jones and Dowling the following October. And then in November, 2020, Randazzo was forced to resign from the PUCO after the FBI searched his condo.

    “Pretty stressful few days which started Monday at 6:00 when 10-12 FBI agents with their guns drawn announced their arrival at our home,” Randazzo emailed a friend on Nov. 21, according to the documents filed by the class-action plaintiffs. “But, Carol and I are handling it and doing better each day. Neighbors, friends (like you) family, PUCO staff and people I have worked for over the years have been great. Roger Sugarman (his attorney) is my new hero. So onward!”

    Then Randazzo encouraged the friend to call him on the number he believed that the FBI didn’t have.

    _________________________

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

    MORE FROM AUTHOR

  • Federal judge blasts disgraced Ohio House speaker as a “bully,” sends him straight to jail

    Federal judge blasts disgraced Ohio House speaker as a “bully,” sends him straight to jail

    Former House Speaker Larry Householder, R-Glenford. Source: Ohio General Assembly.

    BY:  – Ohio Capital Journal

    CINCINNATI — Former Ohio House Speaker Larry Householder spent possibly his last moments as a free man around 2:30 p.m. Thursday and they couldn’t have been pleasant.

    U.S. District Judge Timothy Black gave the Glenford Republican the maximum possible sentence of 20 years and then ordered blue-shirted U.S. Marshals to immediately take him into custody. He rose, put his hands behind his back, the marshals cuffed him and led the once-powerful pol away.

    But before that humiliation, the judge blistered Householder for being the ringleader of a racketeering scandal in which Akron-based FirstEnergy paid him more than $59 million in bribes in exchange for a $1.3 billion bailout, most of which was intended to save two failing nuclear plants in Northern Ohio.

    Ratepayers could have used that money for things like education, health care or to start businesses, the judge said.

    “You handed that money to suits in private jets,” Black said.

    The judge made the speech and imposed the sentence after saying Householder clearly perjured himself during his criminal trial, which lasted from late January until mid-March.

    In it, Householder claimed to barely know FirstEnergy executives as federal prosecutors put on a mountain of evidence that Householder flew on their corporate jets, sat in their luxury boxes and dined in fancy restaurants as they plowed tens of millions of the corporation’s dollars into dark-money accounts.

    “You conned the people of Ohio and you tried to con the jury, too,” Black said in his gravely voice as Householder, clad in a gray suit and red tie, slumped his bulk back in his chair.

    The money from FirstEnergy and one of its subsidiaries was used to elect fellow Republicans in 2018 who would vote to make Householder speaker in early 2019. More than $500,000 of it was used to pay off Householder’s credit card bills, settle a lawsuit and to repair a house he owned in Florida.

    Tens of millions more went to pass the corrupt bailout — House Bill 6 — and to fund a thuggish campaign to thwart a citizen-initiated repeal.

    Earlier in the hearing, Assistant U.S. Attorney Emily Glatfelter said Householder used FirstEnergy’s dark money to crush a “citizen veto” and “because of this House Bill 6 remains in effect today.”

    That’s also because Republican supermajorities in Ohio’s gerrymandered legislature have refused to repeal the corrupt law even after arrests were made, and as they try to make it virtually impossible for citizens to initiate amendments to the Ohio Constitution.

    Also arrested in the scandal were lobbyists Juan Cespedes and Jeffrey Longstreth — who cooperated with prosecutors within days of their arrests — and Neil Clark, who died by suicide. Former Ohio GOP Chairman Matt Borges is slated for sentencing at 11 a.m. today, Friday.

    Steven Bradley, Householder’s attorney, sought leniency for his client. Referring to the possibility of a 20-year sentence, he said “That is effectively a life sentence for Larry Householder given his age and health situation.”

    Householder is 64 and overweight.

    Bradley argued that his client was around 60 when the racketeering conspiracy began in late 2016 and that prior to that, Householder did “innumerable” good deeds “for decades.” A 20-year sentence would “effectively give no consideration” to those good deeds, Bradley said.

    But when he spoke on his own behalf, Householder appeared to do more to harm his case than to help it, just as he did at trial.

    “My greatest commitment is to my creator… My next commitment is to my family,” he read from a prepared statement as he stood at the podium.

    Householder said that in the course of 38 years of marriage, “I can count on one hand” the number of nights he spent away from his wife, Taundra. Householder also described the crushing pain they suffered when they lost a four-year-old daughter.

    But then he pushed his claims past the point of plausibility.

    He said Taundra was planning to retire from her teaching position and next year, when he turns 65, he wanted to retire as well, saying he planned to “hang up my suit and tie.”

    Householder made that statement in the same courtroom where, only three months earlier, prosecutors put on testimony and displayed bank records and written messages from early 2020 that showed FirstEnergy and AEP putting money into dark money groups intended to fund an effort to change the state’s term limits so Householder could stay in office for as long as 16 more years.

    The former House speaker also implied that he wanted a lenient sentence not for himself, but for his family. Taundra, he said, would be alone while “I’ll be in a cold cell hours away.”

    But what might really have set Judge Black off was Householder’s profession of selfless public service.

    “My life has been a total and full dedication to making life better for those I serve,” he said.

    Black described voters who put out Householder yard signs, donated their hard-earned money to his campaigns, and pushed a button for him in the voting booth.

    “I’m not talking about some corporation or the (former FirstEnergy CEO) Chuck Joneses of the world,” Black said. Householder’s constituents who supported him “were saying, ‘I’m choosing to trust you,’ and you betrayed that trust,” the judge said.

    Black used Householder’s own words to give the lie to his claims. He quoted several recordings of Householder that were surreptitiously made during the conspiracy and played at trial.

    “If you’re going to fk with me, I’m going to fk with your kids,” Householder said in one of them.

    “Bottom line, you were a bully,” the judge said.

    If the federal racketeering statute didn’t cap sentences for a single count at 20 years, sentencing guidelines would have recommended life for the former House speaker, Black said. One reason for that is because Householder’s use of a mountain of hidden corporate money to elect a legislature, pass an exponentially bigger bailout for the company, and to crush a citizen repeal is “an assault on democracy,” the judge said.

    Black explained the special harm done by public corruption like that committed by Householder and his co-conspirators. To do so, he quoted former President Theodore Roosevelt, who ironically advocated the citizen-initiated amendment process in Ohio that Householder’s former Republican colleagues in state government are now trying to gut.

    “There can be no crime more serious than bribery,” Roosevelt said in a 1903 message. “Other offenses violate one law while corruption strikes at the foundation of all law.”

    When Borges, the former GOP chair, is sentenced today, it’s unclear what he’ll face. His involvement in the conspiracy was considerably less than Householder’s, but Judge Black showed that he’s not much in the mood for leniency when it comes to Ohio’s corrupt political culture.

    Also uncertain is when — or if — others might be charged.

    Former FirstEnergy CEO Chuck Jones and Vice President Micheal Dowling — as well as former FirstEnergy Solutions President John Kiani — directed the flood of corporate dollars into the Householder-controlled dark money groups, according to prosecutors.

    And FirstEnergy admitted in a deferred prosecution agreement that it paid  a $4.3 million bribe to Sam Randazzo just as Gov. Mike DeWine was appointing him to chair the Public Utilities Commission. Randazzo the helped draft the corrupt bailout law, according to trial testimony.

    On the steps of the Potter Stewart U.S. Courthouse just after the sentencing, U.S. Attorney Kenneth Parker was asked when or whether those men or others might be charged.

    “We continue to look through evidence and we continue to listen to recordings and speak to individuals, so if something’s there we’re going to go there, too, and address it,” he said.

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

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  • As Borges delay is denied, former FirstEnergy execs say “no doubt” the feds are after them

    As Borges delay is denied, former FirstEnergy execs say “no doubt” the feds are after them

    Litigation, prosecutions in massive corruption scandal move forward

    BY:  – Ohio Capital Journal

    Judges denied two delays in recent days that would have been key to a bribery and money laundering scandal that took place in Ohio between 2017 to 2020. Lawyers in one suit called it “one of the largest corruption and bribery schemes in U.S. history.”

    Denial of a delay in one court case means that a player will still be sentenced late next month.

    In denying the other, the judge in that case agreed with two former FirstEnergy executives who said federal law enforcement has them in its crosshairs. But she ordered that they be questioned under oath anyway.

    One of those denied was former Ohio Republican Party Chairman Matt Borges, who on March 9 was convicted of racketeering along with former Ohio House Speaker Larry Householder, R-Glenford. Two others who were also charged in 2020 pleaded guilty and a third died by suicide.

    Borges and Householder played very different roles in a scheme to use more than $60 million from Akron-based FirstEnergy to make Householder speaker at the start of 2019 so Householder could pass and protect a $1.3 billion ratepayer bailout that mostly benefited FirstEnergy. But both made heavy use of funds that were passed through 501(c)(4) “dark money” accounts that enabled them to disguise its FirstEnergy source.

    Householder directed the effort in 2018 to elect friendly representatives who would make him speaker. He led the 2019 legislative fight to pass the bailout. And he engineered the nasty, dishonest battle to beat back an attempted repeal.

    Borges’ role was much more limited. He acted as a go-between with statewide officials such as Attorney General Dave Yost and Secretary of State Frank LaRose — and he paid a worker on the repeal campaign $15,000 as the worker shared inside information about its likelihood of success.

    Even though Householder’s role in the scandal was much bigger than that of Borges, each faces a sentence of up to 20 years in prison on the one count of racketeering of which he was convicted. Householder is scheduled to be sentenced in the Potter Stewart U.S. Courthouse in Cincinnati on June 29. Borges was scheduled for sentencing the next day.

    But after his conviction, Borges asked the court for extra time to file post-trial motions asking that his conviction be thrown out. U.S. District Judge Timothy Black agreed, giving him until April 24.

    Borges didn’t file anything by that deadline. But on May 15, Borges again asked permission to file post-trial motions. He argued that his conviction was on much shakier ground in light of two decisions handed down on May 11 by the U.S. Supreme Court: Ciminelli vs. United States and Percoco vs. United States.

    Judge Black, however, on Monday agreed with Assistant U.S. Attorney Emily Glatfelter that the legal theories those decisions dealt with were “neither charged, nor argued, nor instructed” in Borges’ case. Black added that it’s important to keep the case moving.

    “Finally, this case has been litigated, tried, and a verdict returned. Defendant Borges is now scheduled for sentencing on June 30, 2023. Disrupting the schedule would needlessly undermine the interests in judicial efficiency and finality,” the judge wrote.

     Former FirstEnergy CEO Charles “Chuck” Jones. Source: FirstEnergy, via Flickr 

    Similarly, a separate federal judge declined to postpone sworn depositions of the two former FirstEnergy executives who directed more than $60 million in corporate cash to Householder-controlled dark money groups that fueled the scandal. She did so even as she acknowledged that former CEO Chuck Jones and former Vice President Michael Dowling “fear they are next in line for indictment” and don’t want to incriminate themselves in their depositions.

    U.S. Magistrate Judge Kimberly Jolson is helping to manage the administration of a massive class-action suit against FirstEnergy, Jones and Dowling over the Householder scandal. Investors say the recklessness of the scheme cost them big — especially when it came to light and stock values plummeted.

    Alleging federal securities fraud, lawyers for pension funds and other investors have said in court filings, “FirstEnergy and its most senior executives bankrolled one of the largest corruption and bribery schemes in U.S. history.”

    Judge Jolson already slapped Sam Randazzo — Gov. Mike DeWine’s chairman of the Public Utilities Commission of Ohio — for not producing documents related to the $4.3 million FirstEnergy paid him just as DeWine was nominating Randazzo. Even though he was supposed to be regulating the utility, Randazzo, who has not been charged, helped draft the corrupt bailout law.

    Last Friday, Jolson also rejected attempts by Jones and Dowling — the former FirstEnergy executives — to delay sworn depositions to September or even later. The depositions had been scheduled for this week and next, but plaintiffs and defendants agreed to a short delay while Jolson considered the request.

    In asking to hold off until Sept. 8, Jones and Dowling said that having to give a deposition under oath put them in a position in which they were damned if they did, and damned if they didn’t.

    Answering questions could put them in criminal jeopardy, but if they took the Fifth, the jury in the class-action case is free to conclude they have something bad to hide, Jones and Dowling argued. They added that it’s certain that the feds are coming after them.

    “Although the defendants in (the Householder trial) have been found guilty (but are yet to be sentenced) and charges have not yet been brought against Jones or Dowling, there can be no doubt that the government’s investigation into Jones and Dowling remains ongoing,” their motion said.

    Judge Jolson replied that she had to weigh those concerns against those of FirstEnergy investors, who already have been fighting the case for nearly three years.

    Jones and Dowling “say the stay is temporary, (but) their grounds supporting the stay could extend for months or even years,” Jolson wrote. “Presently, they request that the depositions be delayed until at least September 8, 2023. (Jones and Dowling) have chosen this date because it is the first date on which investigations and proceedings conducted by PUCO might resume—after a third six-month stay of those proceedings was recently granted at the request of” federal prosecutors.

    The judge added it didn’t help the former executives’ argument that they haven’t been indicted yet because waiting until that question is resolved is a recipe for further delay.

    Jolson said she understood the executives’ dilemma.

    “In sum, there is substantial overlap between the issues in this case and the criminal investigation surrounding the Householder case,” she wrote. “And (Jones and Dowling) are faced with legitimate concerns regarding the invocation of their Fifth Amendment rights.”

    Jolson added, however, that granting a delay would privilege the former executives who funded the corrupt bailout scheme over the aggrieved investors and the public.

    “A stay of these key depositions at this moment — with no clear end in sight — would throw a wrench into the works of discovery and impede or even halt the litigation,” she wrote. “It would privilege the interests of (Jones and Dowling) above those of Plaintiffs, the public (whose interests are particularly implicated given that this is a class action), and the Court.”

    Marty Schladen
    MARTY SCHLADEN

    Marty Schladen has been a reporter for decades, working in Indiana, Texas and other places before returning to his native Ohio to work at The Columbus Dispatch in 2017. He’s won state and national journalism awards for investigations into utility regulation, public corruption, the environment, prescription drug spending and other matters.

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