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Tuesday, July 21, 2020

House Speaker Larry Householder Engaged in Racketeering Around Nuclear Energy Bailout HB6, Federal Charges Allege

Posted By on Tue, Jul 21, 2020 at 4:25 PM

CHRIS DILTS / CREATIVE COMMONS
  • CHRIS DILTS / CREATIVE COMMONS

The U.S. Attorneys Office in Columbus today released criminal charges against Ohio House Speaker Larry Householder, his aide Jeff Longstreth, lobbyist and former Ohio Republican Party Chair Matt Borges and others. Those racketeering charges concern almost $61 million in payments related to a controversial energy bailout the Ohio General Assembly passed last year.

Earlier today, FBI officers arrested Householder, Borges, Longstreth, FirstEnergy Solutions lobbyist Juan Cespedes and lobbyist Neil Clark on the charges, which stem from lobbying activity around HB6. That law funnels millions of taxpayer dollars to two faltering nuclear power plants and two coal-powered plants.



The law is controversial. An unusual combination of fiscal conservatives, oil and gas companies, environmental groups and others decried the $150 million per year between 2021 and 2027 ratepayers would provide to FirstEnergy Solutions, a bankrupt subsidiary holding two nuclear power plants — Perry Nuclear Power Plant outside of Cleveland and Davis-Besse Nuclear Power Station outside of Toledo — owned by Akron-based parent company FirstEnergy Corp. That monthly surcharge would cost users between 85 cents for some residential customers and $2,400 for the state's largest industrial users.

The filing details the complex system by which Householder and others received money from the nuclear plants' owners and its subsidiaries, called "Company A" in the filing, for supporting HB6. That system involved an organization called Generation Now, which investigators allege Householder controlled.

"To summarize, from March 2017 to March 2020, Householder's Enterprise received roughly $60 million from Company A's entities," the charges read. "An exchange for payments from Company A, Householder's Enterprise helped pass House Bill 6, legislation described by an Enterprise member as a billion-dollar 'bailout' that saved from closure two failing nuclear power plants in Ohio affiliated with Company A. The Enterprise then worked corruptly to ensure that HB6 went into effect by defeating a ballot initiative."

That ballot initiative sought the recall of HB6. It was met with millions in ads and counter-petition efforts from pro-HB6 groups — some with alleged ties to Householder.

As an effort by anti-HB6 group Ohioans Against Corporate Bailouts to get the 265,744 valid signatures necessary to land a referendum on the state ballot kicked off last year, a group called Ohioans for Energy Security fired a salvo back at the law's critics in the form of a 60-second commercial that began running in late August on broadcast and cable TV and radio. That ad accused natural gas interests of being behind the opposition to HB6 and further asserted that those interests represented an attempt by the Chinese government to take over Ohio's energy grid — a claim many media outlets deemed misleading.

Neither Ohioans Against Corporate Bailouts nor Ohioans for Energy Security, which are both LLCs, disclosed who funded their campaigns.

Following today's revelations, Ohio Gov. Mike DeWine called for Householder's resignation. Environmental groups and some Democrats have called for HB6 to be repealed.

"Those of us who stood up to the culture of corruption in Columbus and opposed the HB6 billion-dollar bailout knew it was terrible for Ohio, but didn't realize how deep the corruption was," Cincinnati Mayor John Cranley said in a statement. "Not only did HB6 impose one of the largest tax hikes ever on Ohioans, it repealed Ohio's renewable clean energy standards — notoriously becoming the only state to ever do so — at a time when renewable energy jobs are the future and a path to better jobs for Ohioans. Of course, the corrupt Columbus politicians put their pocketbooks ahead of our kid's interests in having a cleaner environment. In light of the indictments coming out today, I call on the Ohio General Assembly and Governor DeWine to immediately repeal the most crony corrupt bailout bill in the history of our state."

Cranley also called for Ohio to re-adopt clean energy standards that HB6 rolled back.

Householder and the other defendants had preliminary appearances before a federal magistrate in Cincinnati via video today.

You can read federal prosecutors' full criminal filing against Householder and others here.

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