[Congressional Record Volume 169, Number 201 (Wednesday, December 6, 2023)]
[House]
[Pages H6152-H6154]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
OHIO'S NUCLEAR ENERGY PROBLEMS
The SPEAKER pro tempore. The Chair recognizes the gentlewoman from
Ohio (Ms. Kaptur) for 5 minutes.
Ms. KAPTUR. Mr. Speaker, the production of nuclear power in our
country is an awesome responsibility. Put in the hands of the wrong
people, it can be deadly.
Those who operate nuclear facilities must be highly trained and
honorable. Recall Three Mile Island, Chernobyl, and Fukushima? They all
teach us nuclear power in the hands of careless and, indeed, corrupt
people can be deadly to thousands of innocent people.
This morning, let us turn to Ohio's two financially strapped nuclear
plants, both located in northern Ohio, adjacent to our people's
freshwater kingdom, Lake Erie.
In Ohio, the largest corruption crimes in America's commercial plant
nuclear history are being litigated. These crimes are also the largest
public corruption trials in Ohio's history.
Last week, a Federal grand jury in Cincinnati indicted former chair
of Ohio's Public Utilities Commission, Sam Randazzo, on bribery and
embezzlement for his role in receiving $4.3 million in kickbacks for
what has been labeled the biggest political bribery scandal in Ohio's
history.
The nuclear power company, FirstEnergy, ultimately paid more than $60
million in 2018 and 2019 to bribe public officials like the Speaker of
the Ohio House, who has now been sentenced to 20 years in prison.
Mr. Speaker, I include in the Record an article entitled ``Sam
Randazzo, Ohio's former top utilities regulator, charged with bribery,
embezzlement crimes.''
[[Page H6153]]
[From the Plain Dealer Cleveland, Dec. 5, 2023]
Sam Randazzo, Ohio's Former Top Utilities Regulator, Charged With
Bribery, Embezzlement Crimes
(By Jeremy Pelzer, Andrew J. Tobias, and Jake Zuckerman, Zuckerman)
Columbus, OH.--A federal grand jury has indicted Sam Randazzo, the
former chair of the Public Utilities Commission of Ohio, on 11 counts
related to bribery and embezzlement, U.S. Attorney Kenneth Parker's
office announced Monday.
The indictment states that Randazzo accepted a $4.3 million
bribe in exchange for helping FirstEnergy, an Akron-based
electric utility, secure its policy priorities, including
helping with House Bill 6, the 2019 energy law at the center
of a federal bribery probe. FirstEnergy admitted to bribing
Randazzo in 2021, but he wasn't charged until now.
If convicted, Randazzo could face up to 20 years in prison.
The 74-year-old Columbus resident self-surrendered on
Monday morning at U.S. District Court in Cincinnati,
according to a release. He appeared in federal court that
afternoon, cuffed at the wrists and ankles, before Chief
Magistrate Judge Karen Litkovitz at Cincinnati's federal
courthouse. He pleaded not guilty and was released on a bond
of his own recognizance.
The 11 counts against Randazzo include: one count of
conspiring to commit travel act bribery and honest services
wire fraud, two counts of travel act bribery, two counts of
honest services wire fraud, one count of wire fraud and five
counts of making illegal monetary transactions, according to
the release.
As chairman of the PUCO from April 2019 until he resigned
in November 2020, Randazzo reviewed requests from gas and
electric companies seeking to levy new costs on customers. He
accepted $4.3 million soon after meeting with then-
FirstEnergy executives Chuck Jones and Mike Dowling in
December 2018, as Randazzo was applying to become PUCO chair.
In November 2019, Randazzo pushed to cancel a 2024 rate
review case that the company believed would hurt its bottom
line by forcing it to reduce the rates it charged customers,
as well as open its books to regulators, which they saw as
problematic.
Randazzo also played a key role in getting lawmakers,
including Ohio Senate Finance Committee Chair Matt Dolan, to
include language in the 2019 state budget that loosened state
limits on FirstEnergy, and other utilities' ability to make
``significantly excessive'' profits, according to the
indictment.
Dolan, a Chagrin Falls Republican now running for the U.S.
Senate, previously acknowledged speaking to Dowling, who
convinced him of the need to place the amendment in the state
budget. The Plain Dealer/cleveland.com reached out to Dolan
on Monday for comment.
The indictment states that Randazzo routed the bribe money
through his consulting business, Sustainability Funding
Alliance of Ohio. He also used that business to funnel to
himself at least $1 million meant for Industrial Energy
Users-Ohio, a consortium of large-scale energy buyers who he
represented in PUCO cases as an attorney.
``Public officials--whether elected or appointed--are
tasked with upholding the highest level of integrity in their
duties and responsibilities. Such service to the public must
be selfless, not selfish,'' the U.S. Attorney said in a
statement. ``Through the indictment unsealed today, we seek
to hold Randazzo accountable for his alleged illegal
activities.''
Roger Sugarman, an attorney representing Randazzo in
criminal and civil lawsuits, declined to comment Monday.
Randazzo did not respond to questions posed by reporters.
Randazzo's arraignment on Monday advanced a stunning fall
from grace from a once respected utility lawyer and lobbyist
with notorious influence at the Statehouse. He is often
credited with pushing for what would become state laws
constricting the growth of wind, solar, and energy efficiency
programs in Ohio. State lobbying records reflect years of
lobbying work on behalf of the Ohio Gas Company, Vectren
Energy and IEU. Now-state Sen. Shane Wilkin once told
Randazzo in an email that ``we already know you run the
energy world.'' He was a mainstay at IEU's regular ``Ohio
Energy Management Conference.''
Gov. Mike DeWine, who appointed Randazzo, had dinner with
Jones and Dowling the same night as the latter pair's meeting
with Randazzo. DeWine spokesman Dan Tierney said Monday that
while the governor's office wasn't privy to the indictment
and was still reviewing it, ``the indictment alleges very
serious acts. Our office has full faith in the criminal
justice system to adjudicate these serious allegations in an
appropriate manner.''
Many of the emails and text messages referenced in the
indictment to and from the former FirstEnergy executives and
Randazzo have previously been made public. However, the
indictment's details about his embezzlement charge are new,
according to Dave DeVillers, Parker's predecessor as U.S.
attorney.
Randazzo resigned as PUCO chair in November 2020, days
after the FBI raided his Columbus townhouse. In the years
that followed, prosecutors were silent about Randazzo,
leading to questions about why they were taking so long to
decide whether to file charges.
Ashley Brown, a former PUCO commissioner, said the delay
has cost the state's electricity customers, given that the
PUCO has paused its own investigations into the HB6 scandal
at Parker's request to wait for the federal corruption
investigation to wrap up.
In the meantime, electricity customers have continued to
pay a fee contained in HB6 that subsidizes a pair of coal
plants owned by FirstEnergy and several other utilities.
``It's hard to imagine why he wasn't indicted earlier,''
said Brown, who also questioned why no current or former
FirstEnergy officials have been charged so far.
Asked about the length of time it took for charges to be
brought, DeVillers said, ``They could have been negotiating
with the defense attorney, they could have been talking to
him and it fell apart. And then it could be they dug into
this count [the embezzlement charge], which seems to be
completely different, and needed to ferret that out to find
out what that was all about.''
Randazzo is already a defendant in a civil lawsuit filed in
2021 by Ohio Attorney General Dave Yost. As part of that
case, a Franklin County judge ordered the seizure of up to $8
million worth of Randazzo's assets, though that decision is
still being appealed.
Randazzo's indictment comes several months after ex-Ohio
House Speaker Larry Householder was sentenced to 20 years in
prison for leading a $60 million bribery scheme using
FirstEnergy money to help pass House Bill 6, which included a
$1 billion-plus ratepayer bailout for two nuclear power
plants then owned by a FirstEnergy subsidiary. Former Ohio
Republican Party Chair Matt Borges received 5 years in prison
for his role in the scandal; two others connected to the
bribery scheme have pleaded guilty and are awaiting
sentencing.
FirstEnergy officials previously admitted that Randazzo
helped them to develop strategy and legal language for HB6.
After HB6 passed, emails made public last year showed
Randazzo, as PUCO chair, worked behind the scenes to hinder
attempts to fully repeal the law, and he only grudgingly
called for state regulators to take limited action--asking
FirstEnergy to investigate itself over whether it misspent
any customer money--in response to negative press.
To date, no current or former FirstEnergy officials, have
been charged in connection with the HB6 scandal or any of
Randazzo's alleged crimes.
Ms. KAPTUR. Mr. Speaker, FirstEnergy's plot was to foist its billion-
dollar-plus corporate losses on the consumers of Ohio due to its
pitiful management of its two nuclear power plants in northern Ohio.
These are crimes.
While Randazzo was being indicted, the Federal Government moved to
claim an additional $6.5 million from FirstEnergy for this crime. We
should all be deeply disturbed that inherently dangerous nuclear assets
have been in the hands of criminals.
Mr. Speaker, I include in the Record an editorial titled: ``Finally,
11 counts against ex-PUCO chief Sam Randazzo but why still none against
then-FirstEnergy officials whose fingerprints are all over the case?''
[From The Plain Dealer Cleveland, Dec. 6, 2023]
Finally, 11 Counts Against Ex-PUCO Chief Sam Randazzo But Why Still
None Against Then-FirstEnergy Officials Whose Fingerprints Are All Over
the Case?
(By Editorial Board)
Monday's unsealing of an 11-count federal conspiracy,
bribery, wire fraud and embezzlement indictment against
former Public Utilities Commission of Ohio chief Samuel
Randazzo was a welcome sign of prosecutorial progress in the
FirstEnergy/House Bill 6 corruption case--but it's like the
first footfall in a long-delayed reckoning with some of the
key officials at the heart of the asserted conspiracy.
Our editorial board had repeatedly urged the U.S. Attorney
for Southern Ohio, Ken Parker, to explain publicly why such a
long delay in a case whose first arrests--of five Statehouse
figures, including now-convicted former House Speaker Larry
Householder and former Ohio Republican Party chair Matt
Borges--came more than three years ago.
And where is the second footfall--charges against any of
the FirstEnergy Corp. executives whose roles in paying out
the bribes and soliciting the corrupt actions by Randazzo and
others have been detailed in this and prior indictments?
The Randazzo indictment refers to now-departed Executives 1
and 2 at Akron-based FirstEnergy--former CEO Chuck Jones and
former Senior Vice President for External Affairs Michael
Dowling--as those with the primary contacts with Randazzo
over the $4,333,333 bribe FirstEnergy Corp. previously
admitted paying Randazzo in a 2021 deferred prosecution
agreement.
But they're clearly not the only FirstEnergy officials
privy to the laundry list of regulatory and legislative
favors Randazzo was helping the company secure, including a
lucrative decoupling accounting provision that PUCO staff
opposed, modifications to the state's ``significantly
excessive earnings test'' (SEET) that were added to the two-
year state budget, and ``burning'' of
[[Page H6154]]
a critical PUCO audit about FirstEnergy's distribution
modernization rider (DMR).
According to the Randazzo indictment, ``On or about March
4, 2020, Executive 1 messaged another Company A executive:
``He [Randazzo] will get it done for us but cannot just
jettison all process. Says the combination of over ruling
Staff and other Commissioners on decoupling, getting rid of
SEET and burning the DMR final report has a lot of talk going
on in the halls of PUCO about does he work there or for us?
He'll move it as fast as he can. Better come up with a short
term work around.''
An indictment to shed light on the full scope of corruption
entailed in FirstEnergy's actions is needed.
It's possible Parker's delay in indicting Randazzo over
bribes long since acknowledged by FirstEnergy and favors that
have come into clearer light in civil cases was because he
hoped to turn others into cooperating witnesses--or Randazzo
into one himself.
Then there's the unexpected embezzlement charge against
Randazzo in the indictment, accusing him of defrauding
another client, the Industrial Energy Users-Ohio, a group of
big energy customers, of $1,104,598.
David DeVillers, the former U.S. Attorney for Southern Ohio
under whose leadership the corruption case was first
investigated and prosecuted, told cleveland.com's Jeremy
Pelzer, Andrew J. Tobias and Jake Zuckerman that the
embezzlement charge might have been the whammy in the mix,
taking time to sort out. ``It could be they dug into this
count, which seems to be completely different, and needed to
ferret that out to find out what that was all about,''
DeVillers told the reporters.
Either way, it is to be hoped that the indictment of
Randazzo will finally cause Parker to lift his effective hold
on important PUCO and other state-level investigations into
how both the PUCO and its processes, and the legislative
process separately, were so distorted and corrupted, so
reforms can be made. That's especially urgent given that
unrepealed parts of fatally tainted House Bill 6 right now
require electricity customers in Ohio to subsidize--to the
tune of more than $200 million so far, according to the Ohio
Office of Consumers' Counsel--two money-losing coal plants,
one in Indiana. Shining the full disinfectant of transparent
investigations on how all this came to be is a critical first
step to reform.
Ms. KAPTUR. Mr. Speaker, since the Davis-Besse plant came online in
1977, its corporate leadership has never understood nuclear power or
its dangers. It is only the unionized workers that have saved our
lives. The plant shares an old Babcock-and-Wilcox design with the Three
Mile Island reactor that partially melted down in 1979. Another plant
with the design, the Rancho Seco plant in Sacramento, California,
permanently closed in 1989.
Davis-Besse itself is now nearly 50 years old and has a dismal
reputation within the industry and a history of too many close calls.
In 1985, the plant suffered a loss of the main and backup supplies of
cooling water because of a series of system failures, and this should
have been a wake-up call, but it went unheeded.
In 2002, we faced the worst nuclear safety incident since Three Mile
Island when a major hole was discovered in Davis-Besse's reactor head,
endangering the lives of millions of Ohioans and the purity of Lake
Erie. The plant's unionized workers again saved us all.
The Davis-Besse nuclear power plant, with its history of safety
violations and close calls, is a clear example of how corporate culture
can influence safety culture for the worst, and the industry around our
country never held them accountable.
The fines and penalties imposed on FirstEnergy have done little to
deter misconduct. It is time for us to take bold action and provide our
region with safe, advanced, modern power in a platform akin to the
Tennessee Valley Authority.
So much more needs to be done to make our communities safe and whole
from FirstEnergy's fraud, starting with making sure that the Benton-
Carroll-Salem school system where Davis-Besse is located can be made
whole. The value of property in the region has gone down 90 percent,
which means the school system is going to be nearly $6 million short on
what it needs to teach the next generation.
I urge judges in the case to take the grid under FirstEnergy's
ownership under safe public conservatorship until a reliable operator
can be stood up.
May we find the wisdom and courage to confront these nuclear
challenges head-on to usher in a new era of clean and responsible
energy for the consumers and people of northern Ohio who have been
bilked so royally over the last nearly half century.
____________________