Plus: Mike DeWine’s calendars reveal meetings with leaders from AEP and an AEP-backed dark money groupduring the final weeks of DeWine’s 2018 campaign for governor
American Electric Power disclosed yesterday that it received a subpoena from the U.S. Securities and Exchange Commission seeking documents related to House Bill 6, the 2019 Ohio law at the center of a major corruption scandal that’s already engulfed FirstEnergy, another Ohio utility company.
AEP also faces litigation related to HB 6 by shareholders who allege the electric utility company violated federal securities laws, as the company disclosed in a quarterly report to the SEC in April. The shareholders allege that AEP made materially false or misleading statements to investors, including about the company’s actions on clean energy and climate change, by misrepresenting or not disclosing the company’s role in what federal prosecutors have described as the largest case of public corruption in Ohio’s history.
Under HB 6, Ohio ratepayers will pay millions of dollars more in subsidies to bail out two coal-fired power plants operated by the Ohio Valley Electric Corporation, which counts AEP as its largest shareholder.
How AEP is involved in the corruption scandal surrounding Ohio’s House Bill 6
American Electric Power admitted last summer that since 2015, it contributed $8.7 million to Empowering Ohio’s Economy, a 501(c)(4) dark-money group that counted AEP as its only funder.
Tammy Ridout, a spokesperson for AEP, defended those contributions yesterday as “appropriate and lawful” in response to an email inquiry from the Energy and Policy Institute.
Empowering Ohio’s Economy contributed $700,000 to Generation Now Inc., the 501(c)(4) that pleaded guilty earlier this year to participating in a $60 million racketeering conspiracy that resulted in HB 6, which included a $1 billion ratepayer-funded bailout of two nuclear power plants owned by a bankrupt subsidiary of FirstEnergy. Generation Now, Inc.’s guilty plea is one of three that federal prosecutors have secured in their case against former Ohio House Speaker Larry Householder and five others indicted last summer in connection with the nuclear bailout.
Last month, AEP’s lawyers included a copy of a 2017 grant agreement between Empowering Ohio’s Economy and Generation Now in a motion to dismiss a shareholder lawsuit related to HB 6. The grant agreement was signed by J.B. Hadden, president of Empowering Ohio’s Economy, and Jeff Longstreth, the executive director of Generation Now. Longstreth pleaded guilty last fall to racketeering in connection with HB 6.
Hadden is a lawyer at the law firm Murray, Murphy, Moul, + Basil who has worked as an outside attorney for AEP.
Tom Froehle, a vice president of governor affairs for AEP, also served on the board of directors for Empowering Ohio’s Economy. Froehle actively lobbied in support of HB 6 for AEP in 2019.
Mike DeWine’s calendars reveal previously unreported meetings with AEP and Empowering Ohio Economy’s leadership
Mike DeWine met with leaders from AEP and Empowering Ohio’s Economy during the final weeks of his successful 2018 campaign for governor, according to copies of his meeting calendars obtained by the Energy and Policy Institute.
EPI obtained the calendars through a records request filed with the Ohio Attorney General’s Office, where DeWine served as state attorney general prior to his inauguration as Ohio’s governor in January of 2019.
DeWine’s calendar for October 15, 2018 included time to “prep for AEP meeting with JB” and listed DeWine’s director of campaign finance Mary Sabin and “Michael” as points of contact for the meeting. AEP’s political action committee reported making a $12,500 contribution to DeWine’s campaign on the next day.
When DeWine signed HB 6 into law in July of 2019, it included the nuclear and coal plant bailouts long sought by AEP and FirstEnergy.
AEP’s Ridout did not dispute that a meeting between AEP and DeWine took place in October 2018, but said she could not track down any details about the meeting, including who from the company might have attended.
“If DeWine’s schedule said we had a meeting, we likely did as it would be typical for us to have discussions with prominent elected officials who are actively engaged in public policy matters in Ohio,” Ridout said. “We were fully aware of his candidacy for governor at that time, so that could have been a subject discussed.”
The Energy and Policy Institute had asked Ridout to comment on who from AEP met with DeWine, and whether any meeting that occurred included discussion of how AEP could support DeWine’s campaign, either directly or through an outside organization like Empowering Ohio’s Economy, State Solutions Inc., or the Republican Governors Association.
Ridout did not respond to a question about whether Hadden was on contract with AEP in 2018, and sought to distance AEP from how Empowering Ohio’s Economy used the money it received from the electric utility.
“Empowering Ohio’s Economy is a separate organization and you should direct any questions regarding their contribution process to them,” Ridout said.
A spokesperson for DeWine did not respond to an email from the Energy & Policy Institute seeking comment, nor did Hadden.
Money for gifts, food, drinks, and entertainment for DeWine’s policy meetings
DeWine’s calendars also included a meeting with AEP’s CEO Nick Akin on January 3, 2019, not long before DeWine’s inauguration as Ohio’s new governor.
DeWine, Lt. Governor Jon Husted, and key members of their staff, later disclosed receiving gifts and/or food and beverages from the Ohio Governor’s Residence and Office Foundation on their annual financial disclosure statements for 2019 and 2020.
Ohio lawmakers repealed HB 6’s $1 billion nuclear bailout earlier this year, but have left in place the law’s OVEC coal subsidies.
Top photo is a public domain image of the SEC seal from WikiMedia Commons