Chairman of panel nominating regulator’s replacement also has ties to FirstEnergy, nuclear bailout

By: - December 7, 2020 12:40 am

Electrical pylons. Photo from Getty Images.

The connections between a power company at the center of a massive scandal involving a nuclear bailout and the Ohio agency that’s supposed to regulate it increasingly appear to be deep. Consider:

On Jan. 31, 2019, Michael Koren chaired a meeting of the Public Utility Commission of Ohio’s Nominating Council, which recommends people for posts on the utility commission. Koren voted for Sam Randazzo, who with 11 votes from the 12-member council easily became one of four names the council recommended to incoming Gov. Mike DeWine. 

DeWine not only chose Randazzo to be a member of the commission, which has power over billions of dollars that Ohio ratepayers have to pay utilities, DeWine made Randazzo the chairman.

At the same time that he was recommending Randazzo, Koren was registered as a lobbyist for a large Ohio utility, Akron-based FirstEnergy, a firm Randazzo previously had consulting deals with. Specifically, in the first quarter of 2019, Koren had registered to lobby on behalf of House Bill 6, a $1.3 billion nuclear bailout that FirstEnergy was pushing, according to documents he filed with state regulators.

After an ugly fight, HB 6 passed in July 2019 and after an even uglier fight, its supporters turned back a voter initiative to repeal it. 

In the summer of 2020, everything blew up, with federal prosecutors calling a press conference and deeming the $61 million scheme to pass HB 6 the biggest bribery scandal in state history. Then-House Speaker Larry Householder, R-Glenford, and four associates were charged with racketeering and two of those associates later pleaded guilty. 

FirstEnergy at first defended the conduct of its corporate leadership in the HB 6 affair, but then it fired CEO Chuck Jones and other top execs in October. That came after Ohio Attorney General Dave Yost in September filed a civil suit threatening to dissolve the company if it didn’t get rid of officers who might have been involved in the scheme.

On Nov. 16, journalists spotted FBI agents carrying boxes out of Randazzo’s German Village condo

Then on Nov. 20, FirstEnergy made a disclosure to the U.S. Securities and Exchange Commission explaining part of the reason for terminating Jones and other top executives. It was “related to a payment of approximately $4 million made in early 2019”  to “an entity associated with an individual who subsequently was appointed to a full-time role as an Ohio government official directly involved in regulating the Ohio companies,” the company said.

“Early 2019” was the same time that the Koren-led committee was recommending Randazzo for the PUCO and DeWine was making him its chairman. Randazzo, who has not been charged, resigned his post a day after the FirstEnergy disclosure.

Now Koren’s committee is poised on Dec. 21 to follow Ohio law and recommend a slate of four more candidates to fill Randazzo’s vacancy. DeWine — who wants to replace the as-yet unrepealed HB 6 with another bailout — can either pick one of those names or ask Koren’s committee for four more.

Koren, one of the governor’s appointees to the nominating committee, denies ever lobbying on HB 6, despite filing documents with the Ohio Legislative Inspector General saying he did.

“I didn’t lobby directly on it. I may have said something to somebody. I don’t know,” Koren said in an interview Friday. “I can’t remember. See, you put that down on your (lobby-disclosure) form to protect yourself.”

Despite being part of FirstEnergy’s lobby team and filing papers saying he worked on HB 6, Koren said he had no direct knowledge of the strategy for what surely was the company’s top priority for the legislative session. Indeed, FirstEnergy CEO Jones had been saying since 2016 that the company was “advocating for Ohio’s support for its two nuclear plants… “

Koren said he was unaware how FirstEnergy planned to do that.

“It didn’t know what their strategy was,” he said. “They never explained their strategy. So I don’t know. But as a lobbyist, you put it down… just to protect yourself, you put stuff down.”

Despite his desire to cover himself in case he’d made an offhand comment to someone about HB 6, Koren only told the legislative inspector general he was lobbying on the bill during the first quarter of 2019. Through the rest of the year, when the issue became the subject of heavy press coverage and endless gossip around Capitol Square, he merely told the agency he was representing FirstEnergy. He didn’t list any legislation he was working on for the company.

And despite saying he “may have said something to somebody” about HB 6, Koren is sure none of those people was an official.

“I never talked to a single legislator or a government official about it,” he said.

When it comes to Randazzo’s appointment, there appears to be some confusion about who was ultimately responsible for it.

“The nominating committee does not pick them, the governor picks them,” Koren said.

A few days earlier, DeWine Press Secretary Dan Tierney was asked whether the Randazzo appointment illustrated that the PUCO was too cozy with the industry it’s supposed to be regulating.

“The PUCO already had a nominating committee that sends names to the Governor,” Tierney said in an email. “The Governor must choose from the names submitted.” 

Koren said media scrutiny of his roles with FirstEnergy and in Randazzo’s appointment is unfair.

“I feel like I’m in the crosshairs of somebody else’s battle,” he said. “I’m just trying to do my job.”



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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.