NEOMG vs. Kevin Kelley: Combatants Trade Blows over CPP Allegations

On Wednesday afternoon, Cleveland City Council will convene for a special Public Utilities committee meeting to “get to the bottom of” all this Cleveland Public Power brouhaha you’ve been reading about.

If you haven’t, here’s the abstract:

Former CPP director Paul Bender, who now runs a “highly respected” consulting firm with expertise in utility billing systems, reached out to Leila Atassi at the NEOMG to blow an enormous whistle on the utility he used to run. CPP had been charging an illegal “ecological adjustment fee,” Bender alleged, to the tune of $128 million over the course of 16 years.

Bender said that when he was in charge, back in 2013, he brought this to the attention of Mayor Jackson and his staff, but that his objections were ignored. The theory is that, in order to compete with private-sector behemoth FirstEnergy, CPP wanted to keep its base rate low and continue using money from the ecological adjustment fee for operational expenses with a loose environmental connection — things like tree-trimming and snow removal.

“At the time, I received no feedback [from the Mayor] at all,” Bender told Scene when we spoke with him by phone last week.

Council President Kevin Kelley was upset by Bender’s decision to alert the media — “If this was really bothering his conscience, there were plenty of other ways to do it,” he told the NEOMG. 

Kelley was quoted saying that he took the NEOMG’s initial story “with a grain of salt,” because so much of it came from a former director who now serves as a pricey consultant for Landskroner, Grieco, Merriman, LLC, the firm that filed a Class Action Lawsuit against the Cleveland utility shortly after Atassi’s first story ran. Bender is also consulting for the firm’s overbilling case against the Los Angeles Department of Water and Power. (Correction: Bender is actually functioning as a monitor for the city of Los Angeles. He was appointed as a condition of the court-ordered settlement and has "already begun [his] detailed work to ensure that the settlement terms are implemented and the LADWP data is accurate.")

In a letter to the editor, Kelley gently called Bender’s relationship with that firm a “curious” one.

Kelley wrote in his letter, and told Scene by phone, that a “bad taste” left in his mouth was specifically in reference to Bender’s professional situation, not (as the NEOMG implied) that the information had been made public in the first place. He told Scene he didn’t know whether or not the adjustment charge was appropriate — that’s what the committee meeting will seek to investigate — but regardless, Bender never once brought up the fee to him when they worked together. Kelley was chair of the Public Utilities committee at the time, and both men agreed that their working relationship had been good. Bender even called it “outstanding,” moments before saying that “what Kevin Kelley believes is irrelevant.”

But Kelley said he must’ve hurt the NEOMG’s feelings or something with his “grain of salt” comment because he’s now on the receiving end of what feels like a personal vendetta. 

“They bought Bender’s story hook, line and sinker,” Kelley told Scene. “They’re making it seem like CPP has had some diabolical agenda... They took my comments out of context.”

The Plain Dealer published an editorial in its Sunday Forum section which knocked Kelley and his actions in the wake of Atassi’s reporting:

“The fact that Kelley's first reaction was to lash out at Bender, and his subsequent comment that he was taking the accusations "with a grain of salt," makes one wonder how aggressive council's look into the fee is likely to be,” the Editorial Board opined. “Anything other than a comprehensive, fully public inquiry would ill serve the residents of Cleveland and the customers of Cleveland Public Power. If Bender's allegations are correct — and they appear to be — Kelley and City Council may have little choice but to follow Bender's advice, and either cut costs or enact a rate increase. So far, Kelley's public statements suggest that he would have preferred that Bender's concerns about the hidden fee not come up in a public forum. That is unfortunate. It appears that city officials already have operated quite enough out of the public eye with the people's dollars.”

My my my.

On Friday afternoon, Kelley tried to explain to Scene why the issue is complicated for him. Some of it has to do with the narrative being crafted at the NEOMG, the idea of Bender as a gallant whistle blower out to save the public from a devious public utility.

A whistle blower often blows a whistle at tremendous personal risk — have a look at Edward Snowden, or even at Abdul-Malik Ali, the Cleveland Hopkins Airport employee who came to the NEOMG with information about the airport’s staffing levels even after he’d alerted his superiors last year and been demoted in retaliation.

But Kevin Kelley invited us to consider what sort of personal risk Paul Bender was taking by “blowing the whistle” on Cleveland Public Power. None, was the answer he was shooting for. In fact, as a consultant for the attorneys filing suit, he stands to make a great deal of money.

The Plain Dealer, in its Sunday editorial, said that Kelley “suggested that Bender had a curious relationship with the law firm” that filed suit against CPP, but didn’t elaborate on that relationship or concede that Kelley’s suggestion was grounded in fact.

Nor did they mention that, as a self-sustaining public utility — like Hopkins, CPP has to pay for itself — if CPP lost a major lawsuit, the ratepayer would be on the hook: for a subsequent rate increase, sure, but also for costly legal fees and the beaucoup man hours for a consultant, who, much like the handsomely compensated monitor in a consent decree, would work to ensure that the terms of any potential settlement is implemented accurately.