Did PUCO play a corrupt role in HB 6? Utility regulator asked to investigate itself

Photo from Getty Images.

Two environmental groups last week formally asked Ohio’s utility regulator to take a number of steps in relation to a massive bribery scandal. One of them would require the agency to investigate itself.

The Environmental Law & Policy Center and the Ohio Environmental Council last week filed a motion with the Public Utility Commission of Ohio asking that its multiple investigations related to the House Bill 6 scandal be consolidated into one. It also asked that the scope be expanded to determine whether Akron-based FirstEnergy involved the PUCO chairman in what federal prosecutors have called the biggest bribery scandal in the history of Ohio.

Former House Speaker Larry Householder, R-Glenford, and four others were arrested last summer in connection with $1.3 billion House Bill 6. The legislation bailed out nuclear plants formerly owned by FirstEnergy, provided revenue guarantees to FirstEnergy and propped up aging coal plants owned by a consortium of utilities of which FirstEnergy is a part.

A federal affidavit says that FirstEnergy and associated interests funneled $61 million through 501(c)(4) “dark money” groups and into the effort to make Householder speaker and to pass HB 6. Two of Householder’s associates have since pleaded guilty, a judge has stopped collection of the nuclear bailout and FirstEnergy on Monday agreed to stop collecting from its revenue guarantee. 

The latter move came after Ohio Attorney General Dave Yost asked a state judge to enjoin the payments. On Monday, he praised the company for changing leadership and making the move.

FirstEnergy spokeswoman Jennifer Young on Wednesday said she couldn’t comment on the environmental groups’ motion due to ongoing investigations.

The PUCO has three ongoing proceedings related to the HB 6 investigation. But in their latest filing, the environmental groups say they don’t go far enough.

One issue they want investigated is the role former PUCO Chairman Sam Randazzo played in the passage of House Bill 6 and whether he corrupted the regulatory process. Randazzo resigned in November after the FBI raided his Columbus home.

A month earlier, FirstEnergy fired CEO Chuck Jones after an internal investigation revealed that the company in early 2019 paid $4 million to someone who had just taken a full-time job with the state regulator.

Randazzo, a former FirstEnergy lobbyist, seemed to fit that description. In December, Gov. Mike DeWine confirmed it, saying, “We certainly did not know the huge payment that was made to him. We certainly did not know that when he was picked.”

As DeWine looks for Randazzo’s replacement on the PUCO, there have been further revelations about the former chairman’s involvement in HB 6. In their motion to the PUCO, the environmental groups outlined them.

“More recently, public records requests have revealed emails showing that Chair Randazzo participated in drafting HB 6 while acting as commission chair,” it said. “These reports raise questions about whether, and how, FirstEnergy entities influenced Chair Randazzo during his time as commissioner. The current limits on the investigation ignore this critical relationship between FirstEnergy Corporation and Chair Randazzo.” 

As further context, the environmental groups noted that between 2017 and July 2019, there were 84 contacts between Jones, then the FirstEnergy CEO, and Householder, the House speaker who pushed House Bill 6. Thirty of those contacts took place during the first half of 2019 — a period during which FirstEnergy made a huge payment to Randazzo, DeWine made him PUCO chair and Randazzo was helping to shape the legislation. DeWine signed HB 6 on July 23, 2019.

“Given the seriousness of the allegations, the Commission must go beyond merely requiring the FirstEnergy Utilities to self-report on financial aspects of their connections to the scandal and calling for comments,” the environmental groups’ motions said.

In addition to asking that the PUCO investigate whether anyone with that agency had improper involvement with HB 6, the groups are also asking that the agency consolidate its investigation into a single case.

“The environmental advocates urge the commission to carve a new path,” the motion said. “Up to this point the commission has divided reviews of the FirstEnergy Utilities’ actions across multiple unconnected dockets, all of which have narrower focuses than needed for uncovering the truth about the allegedly years-long scandal.”

PUCO spokesman Matt Schilling said that other interested parties will now be allowed to respond to the environmental groups’ motion, responses will be made to them and then the commission will decide how to proceed.

In answer to the environmental groups’ request to investigate whether the PUCO itself acted improperly, he said, “The commission speaks through its opinion and orders, so it would be inappropriate to comment on the merits outside of the case.”

THE MORNING NEWSLETTER
Subscribe now.
HELP US GROW
Make a tax-deductible donation.