Columbus, Ohio – The 133rd Ohio General Assembly wrapped up its term with a flurry of lame-duck activity last week, closing out a challenging year of legislating amid a global pandemic.
Lawmakers hurried to get priority bills passed and sent to Gov. Mike DeWine’s desk for a signature before the two-year term ended. There were, however, a number of major legislative projects that did not get passed.
Here are some of the priorities falling to the 134th General Assembly, which starts in January:
What to do with House Bill 6?
After months of deliberation about House Bill 6, lawmakers have decided to punt any repeal or replacement effort to 2021.
HB 6 is the $1.3 billion nuclear bailout bill at the center of what has been called the largest corruption scheme in state history.
In the days after Speaker Larry Householder and four other political operatives were arrested in July, one thing was clear: Ohio lawmakers needed to do something about the tainted bill.
DeWine, who signed the bill into law in 2019, called for its repeal. Householder was removed as House Speaker. His replacement, Rep. Robert Cupp, R-Lima, said one of the first priorities of his speakership would be addressing HB 6.
Davis Bees Nuclear Power Station with electricity pylons, Ohio. Getty images.
Cupp did create a new “House Select Committee on Energy Policy and Oversight,” which met nine times between September and December to hear testimony on various attempts to repeal HB 6.
Members could not come to an agreement on how to best approach HB 6; some wanted a full repeal, others wanted only certain portions replaced and a few defended the whole bill as being good public policy, even if it did come about through sordid means.
Two of those involved have already pleaded guilty in federal court; the cases against Householder and two others are ongoing.
Householder was reelected to another term and it remains to be seen if the chamber will take a vote in 2021 to expel him. When Cupp was elected as speaker in July, he indicated such a vote would wait until after the new term starts.
School spending reform will take more time
The Ohio Supreme Court ruled the state’s school funding model was unconstitutional back in 1997. Decades later, lawmakers are still working to figure out a constitutional and equitable substitute.
A bipartisan funding overhaul passed the House in early December, but did not make it through the Senate.
Sen. Matt Dolan, R-Chagrin Falls, who chairs the Senate Finance Committee, wrote in a December letter “there is not enough time in the legislative session for the Senate to have the in-depth hearings this bill deserves.” Dolan suggested the new formula could be passed as a piece of the next state budget, which will be decided in the first half of 2021.
Republicans still concerned about pandemic authority
For all the condemnation leveled against Ohio’s pandemic response by Republican lawmakers in 2020, the legislature achieved little this year in the way of curbing the government’s executive powers.
Between May and December, Republicans introduced numerous bills targeting the pandemic authority of the governor and the Ohio Department of Health (ODH). Only a few of them passed, and DeWine followed through on a pledge to veto any bill restricting ODH’s ability to issue health orders meant to stem the spread of COVID-19.
DeWine vetoed a bill over the summer which would have reduced the penalties for violating a public health order. Lawmakers did not seek a veto override.
Gov. Mike DeWine is pictured during his statewide address on Wednesday, Nov. 11. Photo courtesy Ohio Channel.
More recently, DeWine vetoed a bill to prevent ODH from issuing widespread quarantine orders (it also would’ve given lawmakers authority to vote down any public health orders). Despite protests and pressure from conservative lawmakers to override the veto, such a vote was not taken during the lame-duck session.
Late in the term, lawmakers debated efforts to make future health orders more fair to business owners, should they be necessary. At other points this year, legislators said they wanted to address the state’s pandemic authority for future crises beyond the coronavirus. Those efforts may come up again in 2021.
Campaign finance and election reform
These were two hotly-debated topics this year in large part because of the presidential election cycle and the House Bill 6 scandal.
As the Ohio Capital Journal has reported, lawmakers proposed a wide array of improvements to the state’s election system over the past term — from automated voter registration to online absentee ballot requests. Some legislators expressed worry about approving reforms during an election year, which may provide an opportunity for reforms to be heard during an “off year” like 2021.
The HB6 scandal involved allegations of bribery money being funneled through “dark money” groups in order to influence Ohio elections and public policy. These groups are registered nonprofits which are not required to disclose who funds them.
Ohio Secretary of State Frank LaRose, whose office oversees campaign finance in the state, came out in favor of improved transparency when it comes to “dark money groups.” He supported legislative efforts which followed Householder’s arrests to require such groups to publicly disclose their financial activity.
Secretary of State Frank LaRose is flanked by state Reps. Gayle Manning and Jessica Miranda during a press conference in support of HB 737.
A bipartisan bill proposing reforms to the state’s campaign finance system did not receive a hearing in 2020, but these efforts may carry over to the new term.
Split opinions on criminal justice reform
There was much attention paid to the legislature’s work to reform the Ohio criminal justice system, with plenty of disagreements leading to mixed results.
Lawmakers passed Senate Bill 1, which expands access to drug treatment programs in lieu of convictions and broadens the description for criminal records that may be sealed.
A separate bill to reclassify low-level drug offenses from felonies to misdemeanors passed the Senate last June, but was not taken up for a vote during the House’s lame-duck session. The bill sought to divert drug offenders into treatment rather than criminal punishment.
Despite bipartisan support in the Statehouse and among civil rights groups, the bill remained controversial among law enforcement groups and prosecutors. The Ohio State Bar Association came out against the bill, arguing in testimony that some drug offenders “must have serious consequences hanging over their heads like the threat of a felony and prison time” in order to commit to a treatment program.
Rep. Bill Seitz, R-Green Twp., a supporter of the bill who will serve as Majority Floor Leader next term, told The Cincinnati Enquirer that work will continue in 2021 on criminal justice reform.
The arrest of former Ohio House Speaker Larry Householder and others in July revealed how the use of dark money organizations enabled an alleged $60 million conspiracy to sway elections and provide costly bailouts to noncompetitive nuclear and coal plants.
As federal and state court cases move forward, questions remain about what can be done to restore confidence in the legislature and to prevent similar situations in the future.
“Dark money is really how special interests win right now,” said Jay Costa, executive director at Voters’ Right To Know. When corporations use shell groups to hide their political spending, they “gain a level of credibility they wouldn’t otherwise have,” he explained. “I like to think of it as the ‘Wizard of Oz’ effect.”
In other words, voters don’t get to see who’s behind the curtain.
Two months after the federal government’s criminal complaint and indictment in July, Ohio Attorney General David Yost has filed a state court lawsuit. The complaint alleges a “pattern of corrupt activity,” and seeks injunctive relief to prevent FirstEnergy, FirstEnergy Solutions, Energy Harbor and others from reaping benefits from the bailouts under House Bill 6. A hearing on a preliminary motion for that relief is currently scheduled for Friday, Oct. 2.
Meanwhile, it’s unclear whether Ohio lawmakers will actually repeal House Bill 6, the bailout law passed as a result of the alleged conspiracy. Both Democratic and Republican lawmakers called for a swift repeal in late July and early August. However, leadership in the Ohio House has so far refused to allow a full House vote on any pending repeal bills.
‘Dragging their feet’
Rep. David Leland, D-Columbus
“They’re just dragging their feet,” said Rep. David Leland, D-Columbus. “We have 58 members of the legislature who are willing to repeal HB 6 right now.”
Instead, Speaker Robert Cupp, R-Lima, has referred the bill to a House Select Committee on Energy Policy and Oversight. So far, those hearings have largely been a general review of the pros and cons of HB 6, rather than a focused oversight of the alleged corruption that led to its passage and whether it should be repealed in order to repair any claimed harm to public trust in the legislature’s integrity.
“The only way that we can prove that Ohio is not for sale is by repealing HB 6,” Leland said. “The polling we’ve seen shows that people by an overwhelming margin are going to punish those people who have voted for HB 6 and have done nothing to repeal it.” Early and absentee voting in Ohio begins on Oct. 6.
“Our legislators are supposed to act in the public interest,” said political scientist Leah Stokes at the University of California at Santa Barbara. Corporations’ interests may sometimes conflict. But, she adds, “it’s really politicians’ and regulators’ job not to be listening to those special interests. That basic responsibility of democracy has failed in Ohio with House Bill 6.”
A straight repeal would mostly restore Ohio energy law to before HB 6 became effective, subject to some follow-up regulatory matters before the Public Utilities Commission of Ohio. A quick replacement could potentially reenact all or much of the law, which also gutted the state’s clean energy standards.
Advocates say that rushing to ram through anything more than a simple repeal this year would either just repeat bad policy or create more problems, even aside the alleged conspiracy’s past influence on the current makeup of the Ohio House of Representatives. Even at that, a repeal bill would now need either an emergency clause or an injunction sought by the state attorney general in order to stop the nuclear subsidies slated to start in January. The committee adjourned on Sept. 30 and no additional meetings are currently scheduled.
HB 6 “is so questionable at this moment. The vehicle itself and the way it was sold is all just a pack of lies,” said Rachael Belz, executive director of Ohio Citizen Action. “We need them to repeal it, and then we need to go from there.” And that second step will take time, she said.
“It’s complicated and complex legislation and policy. And we have to get it right,” said Chris Neme, a principal and co-founder of Energy Futures Group. “Passing a bill in less than a couple of months like the way HB 6 was just leads us down the road of unintended consequences.”
Shining a light on dark money
The bigger question is how to prevent similar abuses in the future. Utilities and fossil fuel interests have given heavily to Ohio political campaigns since the state enacted a 1999 law calling for competition in electricity generation. And the level of giving went up dramatically once a competitive market actually began to develop in the state.
Utilities’ political spending has continued during this election season. FirstEnergy spokesperson Jennifer Young said that its political action committee has since canceled campaign donations it had originally reported as going out in July shortly before Householder’s arrest.
Campaign donations shown for August have in fact been sent out, Young said. FirstEnergy has denied any wrongdoing in connection with its political donations or the alleged Householder scandal.
Meanwhile, a 2010 Supreme Court case, Citizens United, “really opened up the floodgates of fossil fuel and electric utility influence over politics,” Stokes said. Utilities’ political spending is “particularly pernicious,” in her view, because customers “have to buy from these companies” to get electricity delivered to their homes.
At the same time, reporting requirements currently apply only to immediate spenders on political issues and campaigns. They don’t reach all the way up the chain to the original source of the money.
“It’s basically this Russian nesting doll scenario, where you have one donor giving to another donor, giving to another donor, to get to the person who finally spends the money to influence the voters,” Costa explained.
In the case of HB 6, money flowed into Generation Now from multiple sources, with a lion’s share allegedly originating with Company A — understood to be FirstEnergy — and its subsidiaries, according to the federal complaint.
Some of the money in turn then went to a political action committee. Or, it went to other organizations that directly funded pro-HB 6 ads. One such ad claimed a debunked Chinese conspiracy was behind last year’s failed effort to put a referendum on the law on the ballot this fall. A for-profit group called Ohioans for Energy Security paid for that ad. When asked last year, lawyers at the firm that set up the corporation, Isaac Wiles, would not answer questions about the source of its funding.
“The notion that dark money is something some people don’t like is not part of the elements of the crime,” Mark Weaver, an attorney at that firm, said at a Columbus Metropolitan Club forum after news broke about the Householder arrest.
Asked if there was too much money sloshing around at the statehouse, he said it’s “a lot of money, no doubt,” but it “pales in comparison” to the amount that Americans spend on Halloween candy and costumes every year. And he said that the First Amendment protects the right to conduct political speech anonymously.
“Of course, state and local governments may (depending on how they draft) pass additional 501(c)4 disclosure requirements that could meet constitutional scrutiny,” Weaver later added.
Ian Vandewalker, Ian PHOTO CREDIT: Courtesy of Brennan Center for Justice
“There is no absolute right to anonymous speech,” said attorney Ian Vandewalker at the Brennan Center for Justice at New York University School of Law. Elections are treated differently from general speech, because of the overriding interest in making sure elections function properly, he explained at a panel organized by the League of Women Voters of Ohio.
“That requires informed voters. And it requires policies to not be able to cheat the public,” Vandewalker said. “And so those interests require that there be a level of transparency.”
“No regulation, no law, no set of ethical rules substitutes for American voters paying attention to who’s running for office — pressing them hard on what they stand for, looking closely at the issues, and going into the ballot box having done your homework,” Weaver said.
“The reason that information is important and transparency is important is so that voters are educated,” said Catherine Turcer, executive director of Common Cause Ohio. “You can’t make the argument that voters need to be better educated but you shouldn’t give them actual education. It doesn’t make any sense.”
Moreover, disclosure needs to be timely, said Heather Taylor-Miesle, executive director for the Ohio Environmental Council. In the case of HB 6, Generation Now didn’t report its 2017 spending to the Internal Revenue Service until late 2019. By then, millions more had been spent to influence the 2018 elections, the passage of HB 6, and the failed referendum effort against it.
Pending bills
Several bills introduced by Democratic and Republican lawmakers could make a strong start toward improved disclosure, including HB 737, HB 739, and SB 347. Those bills should be broadened to include digital media, as well as more traditional campaign spending, Turcer said.
The bills should also call for disclosure not only of the name of an organization, but the identity of the top three original donors of funding, Turcer added in her Sept. 16 testimony in support of SB 347. “Otherwise, wealthy special interests will attempt to avoid disclosure by creating pop-up shell groups,” she said.
And while Ohio voters won’t know who’s behind all the groups funding attack ads or other political spending this election season, information is available about how lawmakers voted on HB 6. The Akron Beacon Journal has also compiled some information on how some funds were used in the 2018 Ohio House campaigns.
“People should contact their legislators about HB 6” if they want to speak out about the issue, Stokes said, noting that the law passed with support from a mix of both Republicans and Democrats.
“When the public is outraged about an issue and really shows up, these issues get reversed,” Stokes added. “There’s a lot of leverage right now.”
[Note: the original version of this story took additional comments made by Mr. Weaver and summarized them to help the story flow better and to highlight the most relevant points. Mr. Weaver contacted Eye on Ohio and the Energy News Network after publication expressing his concern that the summary was not an accurate representation of his public comments. While we do not share that view, we are happy to share the full text from which that summary was taken. We know our readers are smart and can draw their own conclusions regarding their meaning. Beneath this article is that text, as well as a link to the entire video.]
Mark Weaver: Blaming Citizens United for this I think is wrongheaded. The New York Times, it’s sort of been proven that their collusion story about Russia has fallen completely apart and yet I don’t blame the First Amendment for the right to print what they printed. I think they had a right to print all that. I think it was substantively wrong, but I wouldn’t go after their ability to print that stuff.
And so what the Supreme Court said in Citizens United was, if a few of us get together and want to form a group to communicate, we ought to have a right to do that under the First Amendment.
And a lot of donors are looking at what’s happening in America right now with the doxxing, or the releasing of personal information and targeting people for shame. So that’s why some donors don’t want to give. Now some may have less noble notions for wanting to keep their money and their name private. But we saw what happened to Amy Acton for example where her personal home was targeted by protesters– that’s just wrong.
The notion that- I disagree with you so I’m going to personally vilify you and show up at your house where your family or your children are- so many donors see that as part of 2020 current affairs and so many of them want to avoid that. And I know not everyone has that reason.
Mike Thompson: But the problem comes in not just that somebody gives $500 to a candidate or a cause they believe in. It’s that somebody gives– $61 million or $35 million, let’s be conservative, and we don’t know that’s happening. Is there a middle ground where we can say, okay I can protect your identity, your First Amendment rights, but you can’t have THAT much influence?
Weaver: Well, not Constitutionally, no. It’s not just Citizens United. There was a case out of Ohio called McIntyre vs. the Ohio Elections Commission. This is the 7-2 Supreme Court case that said it’s legal to keep yourself anonymous when spending politically, based out of Ohio, in Westerville, Mrs. McIntyre. I used to teach the case. This morning I looked at it again and I had forgotten about this quote. This is not a close call. 7-2. This is Supreme court on anonymous speech: “It’s not a pernicious, fraudulent practice but an honorable tradition of advocacy and of dissent.”
And they pointed to the Federalist Papers that were written anonymously, to avoid scrutiny of the authors and focus on the ideas. So this notion of anonymous speech is one that’s protected by Supreme Court precedent.
Thompson: Laura, there are efforts at the statehouse to make it more transparent. Is it just lip service or are they serious efforts?
Laura Bischoff: You know it’s interesting. I do think the conditions are probably better now for reform than they were six months ago. So, there’s a couple of different bills pending. One is House Bill 737, which is sponsored by Gayle Manning, a Republican from North Royalton, and Jessica Miranda, a Democrat from Cleveland. And it’s got the support of the Ohio Secretary of State, Frank LaRose. And it would require, if you’re going to have a 501c(4) that’s spending in Ohio on political matters then it would require reporting through the state. Louis Brandeis said that the best disinfectant is sunshine. And so, this kind of works on that premise– transparency and disclosure will help clean it up.
Thompson: Derrick, It comes down to the Supreme Court. And the courts have said money equals speech. How much money? We have unlimited amounts of Free Speech. We can stand on a street corner, 24 hours a day, 7 days a week, and as long as we don’t yell fire in a crowded theatre we can do all we want. Should that same apply to the amount of money someone can give to a campaign? Or to a political cause?
Derrick Clay: Well you know if you have the money to give it, that’s your discretion whether you want to give that money to a c(4). You know, right now we’re under the law from that Citizens United case where people can give unlimited amounts of money to a c(4) nonprofit. So until that court case is overturned or challenged, then that’s the law of the land that we all have to abide by unfortunately.
Thompson: Is it too much money sloshing around at the statehouse? And you guys [points at Weaver and Clay] have both advocated for groups, and helped raise money and spent money that’s been raised. I mean, you’re part of the system-
Weaver: It’s a lot of money, no doubt. But when you look at what America spends on Halloween candy and costumes every year it pales in comparison. There’s lots of money done for lots of things.
Halloween candy and costumes don’t have the protection of the First Amendment. Remember, the Supreme Court has been very clear: the speech that aggravates us the most gets the most protection. And when you’re laying out what’s protected, political speech is the highest. And so whatever laws get passed, and I’m interested to read the details, and I’m interested in whatever laws are being put out there, they will have to withstand First Amendment scrutiny just like the news organizations represented today.
This article first appeared on Eye on Ohio and is republished here under a Creative Commons license.
An Akron-based utility company that figures prominently in a massive nuclear bailout scandal is saying that state regulators don’t have the authority to investigate whether the company improperly financed the bailout effort.
Over the past week, FirstEnergy Corp. has filed two documents with the Public Utilities Commission of Ohio saying that the commission and the state’s consumer representative don’t have standing to investigate whether FirstEnergy and affiliated companies improperly used ratepayer money in what has been called the largest bribery scandal in state history.
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.
Federal prosecutors say $60 million in utility money was used to pass a $1.3 billion nuclear bailout into law. But FirstEnergy says the utility commission lacks the authority to investigate whether it improperly used ratepayer funds in the affair.
“The commission lacks any statutory basis to conduct an investigation of FirstEnergy Corp. with respect to the alleged expenditures or to order FirstEnergy Corp. to show cause that it has not violated Ohio utility law,” FirstEnegy said in a Sept. 23 filing.
It was in response to an order by the utility commission that it show “that the costs of any political or charitable spending in support of (the bailout bill), or the subsequent referendum effort, were not included, directly or indirectly, in any rates or charges paid by ratepayers in this state.”
Federal prosecutors in July charged then-House Speaker Larry Householder and four associates with using $60 million from FirstEnergy and related interests in a scheme to make Householder speaker and pass a $1.3 bailout of two failing nuclear plants owned by FirstEnergy Solutions, a successor company to FirstEnergy Corp.
The effort was successful, although there is an effort in the legislature to repeal it before the charge hits ratepayers’ bills on Jan. 1.
FirstEnergy and associated companies haven’t been charged, but in announcing criminal charges against Householder, U.S. Attorney David M. DeVillers stressed that the investigation was far from over. An affidavit supporting the criminal complaint also refers repeatedly to “Company A,” or FirstEnergy, and it makes reference to its CEO.
In addition, Ohio Attorney General Dave Yost last week filed a civil suit that names FirstEnergy, a subsidiary and its successors — as well as Householder and his associates — as defendants.
The Ohio Consumers’ Counsel, the state’s official consumer representative in utility matters, has asked for an independent investigation into whether FirstEnergy improperly used ratepayer funds in the dark-money scheme to pass House Bill 6, the bailout legislation. The agency was disappointed when the utilities commission only directed the company to show that it had not acted improperly.
But even that is too much for FirstEnergy.
In documents filed on Monday with the utility commission, it said it was legally entitled to a reasonable profit. The company also seemed to argue that what it did with much of its money was nobody’s business.
“Beyond the investment necessary to provide adequate service, a public utility may spend its funds in the best interests of the utility as determined by its management.,” the company argued, later adding, “To the extent the Companies use a portion of their revenues to make political or charitable contributions, this is not improper or illegal.”
Ohio’s official utility watchdog wants to know where Akron-based FirstEnergy got the $60 million that federal prosecutors say fueled the largest bribery scandal in Ohio history.
The Office of Ohio Consumers’ Counsel on Tuesday evening filed several motions with the Ohio Public Utilities Commission:
A request for an investigation and a management audit of FirstEnergy.
A requirement that the company show that it hadn’t misused consumer money to support the passage of a nuclear bailout.
And that the regulator reopen a probe into how FirstEnergy spent money intended to upgrade the electricity grid.
In July, the U.S. Attorney’s office charged then-House Speaker, Larry Householder, R-Glenford, in an alleged scheme to funnel FirstEnergy money through 509(c)(4) “dark money” groups in a corrupt effort to elect supportive lawmakers and make Householder speaker.
The feds say the goal was to pass House Bill 6, a $1.3 billion bailout that went primarily to two failing nuclear power plants, but also subsidized two failing coal-powered generators. In addition, the money was used to fund a xenophobic campaign to stop a voter repeal of HB 6 and to line the pockets of Householder and his alleged conspirators, federal officials said.
Also charged were Matt Borges, a lobbyist who was formerly chairman of the Ohio Republican Party, Neil Clark, a lobbyist who owns Grant Street Consulting, Juan Cespedes, also a lobbyist, and Householder’s aide, Jeffrey Longstreth.
In its filing, the consumers’ counsel said it was asking the utilities commission to do its job.
“The (Public Utilities Commission of Ohio) has the right and duty to regulate public utilities, for the protection of the public,” it said. “The PUCO should require FirstEnergy to show that money it collected from consumers, including the distribution modernization charge money, was not improperly used regarding House Bill 6 and that it did not violate any utility regulatory laws or PUCO orders regarding House Bill 6.”
A FirstEnergy spokeswoman said her company will comment through official channels.
“We are unable to comment on pending litigation, but we will respond to the motion by September 23 as required,” External Communications Manager Jennifer M. Young said in an email.
In its filings, the consumers’ counsel noted that “Long before the House Bill 6 subsidies, FirstEnergy was authorized to charge its consumers nearly $7 billion for these and other FirstEnergy power plants as part of the transition to power plant competition (and a supposed end to future power plant subsidies) under Ohio’s 1999 electric deregulation law.”
The documents also focused on $465 million FirstEnergy was allowed to collect from Ohio ratepayers in 2017 and 2018 as a “distribution modernization rider.” In other words, the charge was meant to fund improvements to the lines and poles and other equipment needed to efficiently deliver electricity in Ohio.
The consumers’ counsel pointed to an independent audit showing that at least some of the money was used for other purposes. For example, it was placed in FirstEnergy’s “Regulated Utility Money Pool,” where its out-of-state utilities could borrow from it.
The dividends FirstEnergy paid shareholders also took a big jump once the company started collecting more from ratepayers, supposedly to improve the power grid. The money for dividends from FirstEnergy’s Ohio utilities went from $141 million in 2016 to $350 million in 2017 — the first year of the subsidy — to $400 million in 2018.
The Ohio Supreme Court subsequently declared the charge to be unlawful, but the money wasn’t refunded to ratepayers.
After the court ruling, the utilities commission shut down an investigation into the extra charge and how the money was used. But now the consumers’ counsel says it “should be reopened in light of the new information alleged in the U.S. Criminal Complaint about FirstEnergy’s use of extraordinary amounts of money in its efforts for the passage of House Bill 6.”
After other interested parties have a chance to respond to the consumers’ counsel motions the utilities commission will decide whether to approve them.
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.
In reaction in Ohio’s Speaker of the House Larry Householder being arrested by the FBI as part of a $60 million pay-to-play scheme, Common Cause Ohio Executive Director Catherine Turcer released the following statement:
“This pay-to-play scandal would have been stopped in its tracks if Ohioans were able to see who was behind efforts to influence their opinions and votes — if they could “follow the money.” We shouldn’t need an FBI investigation to connect the dots. If we had strong campaign finance disclosure rules, Larry Householder would not have been able to pervert our political system the way that he did.
This scheme began with his quest for power — his election as Speaker of the Ohio House of Representatives — and revolves around the passage of the nuclear and coal bailout of a FirstEnergy subsidiary, House Bill 6.
Householder allegedly took millions of dollars at the same time he pushed legislation to bail out non-competitive coal and nuclear plants with more than $1 billion in public money, gut subsidies for renewable energy, and roll back clean energy standards.
Ohioans have a right to an accountable government and to know who is trying to influence lawmakers, their votes, and opinions. The federal investigation into Generation Now and today’s arrest of Speaker Householder are just the latest example of why the Ohio legislature needs to take immediate action to increase campaign finance disclosure.
It’s past time for the Ohio legislature to take action to increase transparency of political spending and stop allowing ‘dark money’ to distort the democratic process. The source of campaign funding information helps voters examine the motivation of ads they see on TV and the internet. Shining the light on ‘dark money’ will also encourage those funding these egregious ads to be more accountable.
Common Cause and its members will work with Republican and Democratic allies to find a path for strong money in politics transparency reform. Ohio voters deserve nothing less.”
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Common Cause Ohio is a non-profit, non-partisan advocacy organization that works to strengthen public participation in our democracy and ensure that public officials and public institutions are accountable and responsive to citizens. Through a powerful combination of coalition building, lobbying and litigation, grassroots organizing, policy development, research and public education, we spotlight local, state and national issues that affect every Ohioan.
Make no mistake – the $61 million came from Company A’s ratepayers and ultimately extorted from every residential and commercial electrical utility user in Ohio. The racketeering scheme of lies and deception corrupted Ohio citizen’s ability to overturn corrupt legislation at the ballot box. – David Miller, Loveland Magazine Publisher
By Marty Schladen The Ohio Capital Journal and David Miller/LovelandMagazine
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Cincinnati, Ohio – Ohio House Speaker Larry Householder, four political operatives and a dark-money group were charged Tuesday in a criminal complaint that an Ohio energy company paid them $61 million to get a $1.5 billion nuclear bailout from taxpayers.
Read the Press Release issued by the Department of Justice
Neil Clark, a lobbyist who owns Grant Street Consulting – Photo from Grant Street Consulting who exclaim, “Clark’s decades of experience and role in shaping Ohio’s political landscape makes him an indispensable resource to Ohio’s elected leaders, to whom he often serves as a trusted and highly sought after campaign advisor.”
All are charged with racketeering, which carries a prison sentence of up to 20 years.
David M. DeVillers, U.S. Attorney for the Southern District of Ohio
The alleged conspiracy, which revolved around the bailout of two failing nuclear plants in Northern Ohio, is “likely the largest bribery and money-laundering scheme ever in the state of Ohio,” David M. DeVillers, U.S. Attorney for the Southern District of Ohio, said at a Tuesday afternoon press conference.
Shortly after the press conference, Ohio Gov. Mike DeWine called on his fellow Republican to step down.
“I am deeply concerned about the allegations of wrongdoing in the criminal complaint issued today by the U.S. Attorney’s Office,” DeWine, who last year signed the bailout into law, said in a written statement. “Every American has the presumption of innocence until proven guilty. Because of the nature of these charges, it will be impossible for Speaker Householder to effectively lead the Ohio House of Representatives; therefore, I am calling on Speaker Householder to resign immediately. This is a sad day for Ohio.”
The criminal complaint says that “Company A,” the former FirstEnergy Solutions of Akron, worked to save its failing nuclear plants by funneling $61 million into Generation Now, a 501(c)(4) “dark money” group controlled by Householder.
On September 9, 2019, President Donald Trump nominated DeVillers for the United States Attorney in the Southern District of Ohio. The Senate confirmed the nomination in October, and DeVillers took his oath on November 1, 2019.
“Make no mistake, this is Larry Householder’s 501(c)(4),” the U.S. attorney said.
The money was used for three general purposes, the complaint said. First it was used to build “Team Householder” through campaign contributions and other measures that helped Householder win the speakership in 2019.
“In exchange for payment from Company A, Householder’s enterprise helped pass House Bill 6, legislation described by an enterprise member as a billion-dollar ‘bailout’ that saved from closure two failing nuclear power plants in Ohio affiliated with company A,” the complaint said
The money was also used for the personal benefit of Householder and the other conspirators, DeVillers said. Householder got about $500,000, he said.
Despite the companies claims of poverty, the interests behind the bailout spent millions — much of it in the form of hard-to-trace dark money on campaign contributions, a xenophobic ad campaign and then on an aggressive effort to stymie a petition drive to repeal the bailout DeWine signed into law a year ago.
And the money was used to fend off a petition effort to repeal HB6, going so far as to buy plane tickets for and pay $1,000 each to people circulating it to get out of town, DeVillers said.
The federal prosecutor said that it was crucial to keep the investigation secret until Tuesday. Now it begins a new phase that might be causing some lawmakers, energy executives and some others to lose sleep.
“We are not done with this case,” he said. “There were things we couldn’t do before. People we couldn’t interview. People we couldn’t subpoena. Documents and search warrants we couldn’t execute.
“As of this morning there are a lot of FBI agents knocking on a lot of doors asking a lot of questions, serving lots of subpoenas. That’s going to go on for days.”
“It takes courage for citizens to assist law enforcement in the ways detailed in the affidavit,” U.S. Attorney David M. DeVillers said. “We are grateful to those who felt a moral duty to work together with agents in bringing to light this alleged, significant public corruption.”
House Bill 6 is adding $1.5 billion in additional taxpayer bailouts to the $10.2 billion that Akron-based FirstEnergy Solutions and its former parent company, FirstEnergy Corp, have received from taxpayers since 1999. Most of the funds have gone to prop up the Davis-Besse and Perry nuclear power plants in Northern Ohio.
The company that owns the plants was renamed Energy Harbor after emerging from bankruptcy earlier this year.
Despite the companies claims of poverty, the interests behind the bailout spent millions — much of it in the form of hard-to-trace dark money on campaign contributions, a xenophobic ad campaign and then on an aggressive effort to stymie a petition drive to repeal the bailout DeWine signed into law a year ago.
The interests behind the nuclear bailout also contributed heavily to the effort at the beginning of 2019 to elect Householder speaker. He ended up winning the support of 26 Republicans and 26 Democrats, His opponent, Ryan Smith, R-Bidwell, got the votes of 34 Republicans and 12 Democrats.
The Ohio Republican Party didn’t respond Tuesday to requests for comment.
The Ohio Democratic Party didn’t respond when asked about the fact that Householder wouldn’t have worn the speakership without Democratic votes. However, the party chairman, David Pepper called on Householder to step down as speaker.
“As the U.S. attorney indicated, this investigation is ongoing, and we will wait to hear all the facts as they emerge. However, given what was revealed in today’s complaint and the taint of corruption over Ohio legislative activity, we believe Speaker Householder should step down from leadership immediately as he avails himself of his due process rights,” Pepper said in a written statement.
House Bill 6, which passed 51-38, was quickly signed into law by Gov. Mike DeWine. Under the bill, from 2021 until 2027, every Ohio electricity customer will have to pay a new monthly surcharge that ranges from 85 cents for residential customers to $2,400 for large industrial plants. Ratepayers around the state would also have to chip in up to $1.50 monthly (and up to $1,500 per month for commercial and industrial users) to subsidize coal plants in Ohio and Indiana run by the Ohio Valley Electric Corporation.- cleveland.com
Starting next January, ratepayers around the state would also have to chip in up to $1.50 monthly (and up to $1,500 per month for commercial and industrial users) to subsidize coal plants in Ohio and Indiana run by the Ohio Valley Electric Corporation.
This isn’t Householder’s first encounter with federal law enforcement.
In 2006, the Justice Department told the FBI that it wouldn’t pursue charges against Householder. The FBI had been told two years earlier that Householder had used his post as head of the House Republican Campaign Committee to overpay some vendors in exchange for kickbacks from them.
Nor is Householder, 61, of Glenford, the first Ohio House speaker to find himself in the FBI’s crosshairs. In 2018, Speaker Cliff Rosenberger, a Republican, resigned amid an FBI probe of his overseas travel. He has not been charged, but the investigation remains open.
Read about the local ramifications and : “ORIGINS OF REPULSIVE BILL”
Vindicator Editorial
July 19, 2019
The Ohio Senate’s passage Wednesday night of one of this state’s most odious anti-consumer bills in history toward almost certain passage in the state House deals a mean blow to Ohioans in their pocketbooks and sets the Buckeye State on a regressive path toward environmental irresponsibility.
