Wednesday, October 28, 2020

Ohio sues FirstEnergy over $60 million bribery scandal involving former Speaker Larry Householder

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Ohio Attorney General Dave Yost wants to prevent the owner of two nuclear plants from receiving fees connected to what’s being called the largest bribery scheme in Ohio history.

Yost, a Republican, asked a Franklin County judge to block payments to Energy Harbor, which owns two nuclear plants in northern Ohio, from fees slated to hit Ohioans’ electric bills in January.

Unless lawmakers redirect the money, fees would go to the Ohio treasury rather than Energy Harbor, previously called FirstEnergy Solutions.

These fees are at the center of a federal investigation that has implicated former GOP Speaker Larry Householder, former Ohio Republican Party chairman Matt Borges and three others.

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They are accused of taking nearly $61 million in bribes to help Householder win his leadership spot, pass a $1.3 billion bailout for nuclear plants and then defend that law against a ballot effort to block it. All have pleaded not guilty, and no one from former parent company FirstEnergy Corp. or its affiliated businesses has been charged.

But Yost says the criminal complaint alone won’t make Ohioans whole. He wants penalties for businesses and individuals involved in the alleged scheme.

“The criminal indictment handed up by the federal grand jury may provide a certain degree of justice and recompense, but they cannot address the harm Ohio utility ratepayers still face as they pay into a corporate bailout fund that was secured through fraud, deceit and intimidation,” the complaint reads.

Yost asked for certain changes immediately:

  • Block FirstEnergy, Energy Harbor and those under federal investigation from lobbying or making public statements about keeping or modifying House Bill 6 through the end of 2020.
  • Block those companies and individuals from contributing to a House or Senate campaign this year.
  • Limit Householder’s campaign fund to expenditures of $250 without court approval.
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In the long term, Yost asked that companies remove anyone involved in the alleged scheme from their ranks and ban individuals involved in the scheme from lobbying or participating in a campaign, political action committee or dark money group for eight years.

FirstEnergy Corp. declined to comment on the pending lawsuit, but said in a statement that “ethical behavior and upholding the highest standards of conduct are foundational values for the entire FirstEnergy family. We strive to apply these standards in all business dealings, including our participation in the political process.”

Liberal think tank ProgressOhio questioned whether Yost, who received money from FirstEnergy’s political action committee and used Borges as an advisor, could be unbiased in this case. Yost initially rejected language on a referendum effort to block House Bill 6.

Yost pointed out that he was suing FirstEnergy and its affiliated companies. “This is a job I was elected to. I’ve proven my independence over the last 10 years.”

A legislative solution?

Yost previously promised to block sending money from these fees to the nuclear companies if Ohio’s GOP-controlled Legislature didn’t act.

So far, lawmakers haven’t. Proposals to repeal the bailout have received hearings in two committees but none have received a vote.

Legislators and Yost face a ticking clock: if lawmakers don’t repeal the subsidies for nuclear plants by Oct. 1, Ohioans will pay the new fee starting Jan. 1. Legislation could be passed later with an emergency clause, but that would require more votes.

“This complaint does nothing to get Ohioans their money back, and it does nothing to bring back the 100,000-plus green energy jobs House Bill 6 kills,” said Rep. Dave Leland, D-Columbus, about Wednesday’s action. “We need to show that Ohio is not for sale… We need to Repeal HB 6 now!”

Opponents of the subsidies detailed three reasons House Bill 6 needs to go:

  • the federal investigation alleged House Bill 6 became law through a nearly $61 million bribery scheme;
  • Energy Harbor’s board approved a $800 million dollar stock buyback after House Bill 6 passed, indicating the company didn’t need the subsidies;
  • A last-minute change allowed the plants’ owner to collect another $355 million.

“Some will argue that the process, not the legislation, was corrupt,” testified Rep. Laura Lanese, R-Grove City, who sponsored a bill to repeal the subsidies. “Even if true, the legislation is so intimately tied to the process that it would take the precision of splitting atoms to separate the two.”

Proponents of House Bill 6 say it saves ratepayers money by slashing subsidies for energy efficiency and renewable energy. The true cost of the law has been debated for months.

A recent poll showed 49% of Ohioans supported nuclear energy but only 14% wanted to keep House Bill 6 subsidies in place because of its links to “corruption and bribery.” The poll was released by the anti-House Bill 6 Coalition to Restore Public Trust and had a margin of error of plus or minus 3.99 percentage points.

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