Ohio politicians reacted with anger and calls for further investigation as news spread Tuesday about what authorities are describing as a $60 million corruption scheme surrounding Ohio’s nuclear industry bailout, a financial lifeline meant to save the Davis-Besse nuclear plant east of Toledo and the Perry nuclear plant east of Cleveland.
Both power stations, now owned and operated by Energy Harbor, a company which emerged from the FirstEnergy Solutions bankruptcy proceedings, are along Lake Erie.
Ohio House Speaker Larry Householder (R., Glenford), former Ohio Republican Party Chairman Matt Borges, high-profile Columbus lobbyist Neil Clark, Columbus political consultant and Householder adviser Jeff Longstreth, and Columbus lobbyist Juan Cespedes were arrested on Tuesday. The arrests come amid a federal investigation into a purported $60 million corruption and racketeering scheme following Ohio’s 2019 passage of a law bailing out nuclear power plants by attaching a surcharge onto Ohio residents’ utility bills.
Among those who expressed outrage Tuesday were former state Rep. Steve Arndt, a Port Clinton Republican whose district included Davis-Besse, and Ohio Senate President Larry Obhof (R., Medina).
Mr. Arndt told The Blade that he had been working on other legislation to try to help save Davis Besse before House Bill 6 -—the bailout measure passed in July, 2019 — got off the ground. But he put his own proposal on hold when it became clear that he shouldn't bother introducing his bill. Mr. Arndt then resigned in the middle of 2019.
“There was an awful lot of pressure on members,” Mr. Arndt said. “I had a sense this was not coming out as normal good policy... It was no secret that Larry Householder and I saw things differently. Quite frankly, that was one of the reasons I left. It was not an environment in which I could survive.”
It was no secret that Mr. Obhof and Mr. Householder were often at odds on legislative issues, including the final version of the bailout bill. Mr. Obhof on Tuesday weighed in on the events surrounding the corruption probe.
“The seriousness and gravity of the allegations cast a dark shadow over the people's house. It is clear that he cannot continue to lead the Ohio House of Representatives. He should resign,” Mr. Obhof said of Mr. Householder.
Federal lawmakers also weighed in on Tuesday’s events.
U.S. Rep. Marcy Kaptur (D., Toledo) wrote an op-ed in the Columbus Dispatch speaking out against the bailout days before state lawmakers passed the measure, and on Tuesday she said the situation now unfolding in Columbus “bodes poorly for Ohio.”
“There is much to be learned in the coming days about the latest apparent pay-to-play scheme in the Ohio Statehouse,” she said. “Ohioans deserve honest and visionary leadership. The arrest of the Republican Speaker of the Ohio House and the former Chairman of the Ohio Republican Party undermines public confidence and underscores the corrosive impact money has on our politics. While these matters are adjudicated, Ohioans should demand a top-to-bottom reform of Ohio’s ethics and campaign finance system to put an end to pay-to-play in the Buckeye State.”
U.S. Rep. Bob Latta (R., Bowling Green) said these “are very serious accusations that should be fully investigated.”
“As of now, details are still emerging, and we will learn more as the investigation continues,” Mr. Latta said. “There is no room for corruption in the legislature, and there should be accountability for any wrongdoing that has taken place.”
One of Ohio’s two United States senators, Republican Rob Portman, called the case against Mr. Householder and the other four “troubling.”
“Rob saw the news story this morning and finds it troubling,” Meghan Dugan, a spokesman for Mr. Portman, said, adding he is eager to learn more.
The Washington-based Nuclear Energy Institute, the nuclear industry's chief lobbying group on Capitol Hill, has promoted bailouts for nuclear plants in Ohio and other states. It declined to comment Tuesday.
“NEI has no knowledge of the situation and has no comment,” said Jon Wenztel, the lobbyists’ vice president of communications.
Also declining comment was the U.S. Nuclear Regulatory Commission, which in the late 1990s embraced hopes for a nuclear renaissance. It has streamlined its oversight process and taken other steps to help America’s struggling nuclear industry become more viable.
The Washington-based American Wind Energy Association, which competes against nuclear energy, was appalled by the arrests.
“The legislative push to bail out legacy generation and roll back Ohio’s renewable energy commitments was always against the will of Ohioans, who overwhelmingly support renewable energy,” Andrew Gohn, AWEA Eastern State Affairs director, said.
It now appears that the passage of this bill was not just against the will of the people, but also may have involved serious and possibly criminal impropriety. We call for a full examination of the circumstances surrounding this attack on clean energy and for [Gov. Mike DeWine] and the legislature to pause implementation of HB 6 and ultimately repeal this harmful and regressive legislation," Mr. Gohn said.
One of Ohio’s largest environmental groups, the Ohio Environmental Council, likewise called for a repeal of the bailout legislation, as have several individuals.
“House Bill 6 has always been a bad deal for Ohioans, sticking us with dirtier air and higher utility bills while gutting our clean energy future,” Heather Taylor-Miesle, Ohio Environmental Council Action Fund president, said. “As we’ve suspected all along, the billion-dollar bailout, strong-armed through the General Assembly by Speaker Householder, appears to have been fueled by corrupt pay-to-play dealings with corporate utilities.”
She called the nuclear bailout and its accompanying repeal of Ohio’s renewable energy law “disastrous legislation” passed by the Ohio General Assembly, ensuring “that First Energy and its corporate investors benefited on the backs of Ohio taxpayers.”
State Rep. D.J. Swearingen (R., Huron) was appointed to the House after House Bill 6's passage, but he said he would donate campaign contributions he received from FirstEnergy to charity. He said the allegations were “shocking” with no previous rumbling of what might be coming.
He said he is not on board with the idea of repealing the law now that this information has come forward.
But he said Mr. Householder's resignation is probably a good idea.
“I will not stand for the way House Bill 6 was done, but Davis-Besse is very important to the livelihood of workers and the school districts. To call for a unilateral repeal of the law is something I wouldn't support. But I [don’t] condone the actions taken to get that legislation through.”
Ohio Rep. Mike Sheehy (D., Oregon) voted for the law, and he said he won't change his position now.
“I watched the FBI press conference today,” he said. “I was shocked at the numbers and the allegations.”
State Sen. Theresa Gavarone (R., Bowling Green), whose district includes the Davis-Besse plant, said she “was stunned” by the allegations but “doesn’t really know enough” about them to have an opinion on whether House Bill 6 should be repealed as a result.
“Government can’t operate effectively without the trust of the public. It’s really deeply concerning,” the senator said.
She said she wholeheartedly supported the legislation because of Davis-Besse’s significance as an employer and taxpayer in the district, and was never offered anything by anyone in exchange for her vote.
First Published July 21, 2020, 6:53 p.m.