House Bill 6 dissenters knew something was up
When anti-tax activists tried to repeal a $1 billion bailout of two Ohio nuclear plants last year by collecting signatures to put the issue on the ballot, they were met with roadblocks at every turn.
Signature collectors were paid off with $2,500 bribes and plane tickets.
A fake petition drive was created to confuse people.
Petition-gathering companies were paid to stay away and not help the antitax groups.
People were paid to physically keep citizens away from signature collectors.
And the television commercials against the effort involved ominous threats of how repealing the law would lead to a Chinese takeover of Ohio’s electrical grid.
It was rough-and-tumble politics, for sure, but for many pushing to repeal the bailout, it felt like something more nefarious — and possibly illegal — was going on.
They noted many of the problems in a lawsuit brought last year against Ohio Secretary of State Frank Larose that was designed to tamp down what they saw as unfair tactics. But they didn’t know how right they were.
On Tuesday, they learned federal prosecutors agree with them: Ohio House Speaker Larry Householder and four others were charged in a vast, $60 million racketeering conspiracy to get House Bill 6 passed, stymie the repeal campaign and protect the bailout.
“None of this was a surprise,” said Brandon Lynaugh, founder and owner of Battleground Strategies, who on behalf of Ohioans Against Corporate Bailouts brought the lawsuit. “Literally every day in that effort we woke up to a new revelation of how low our opponents would go.”
’Our system is broken’
Cincinnati attorney Chris Finney, who was hired by Ohioans Against Corporate Bailouts, filed a lawsuit seeking relief from the dirty tactics during the repeal effort. He said he’s never seen such aggressive efforts against a ballot initiative.
“Citizens didn’t have a chance to have a say because of Householder,” Finney said. “I have never seen tactics this aggressive, well-funded and this dirty.”
After reading the criminal complaint against Householder and the others, Finney said he felt “sick to my stomach.”
The evidence gathered by the FBI and U.S. Attorney Dave Devillers office was a reminder of how vulnerable the democratic system is to corruption, Finney said.
“At some point as a young man, you’re idealistic and you’re involved and think you can make a difference,” he said. “And then you see there are politicians on the take. Unless you have millions and millions of dollars to throw at a problem, you’re not even on the radar. Devillers can do what he wants, people will go to jail, but our system is broken.”
According to federal prosecutors, Householder and his associates did have millions and millions of dollars to throw at the problem, most of it funneled to Generation Now, a corporate entity registered as a “social welfare” agency controlled by Householder. Generation Now didn’t have to disclose its donors because of its status as a social welfare organization.
Devillers said a firm identified as Company A funneled $60 million to Generation Now to secure the nuclear plant bailout and block the campaign to repeal it. Though Company A is not named in court documents, the description of the company throughout the criminal complaint makes clear it is Firstenergy Solutions, the owner of the two nuclear plants.
The complaint states that at least $20 million from Generation Now was poured into TV commercials and “petition signature services” aimed at derailing the repeal effort. Rank-and-file signature gatherers hired by the anti-tax activists were offered $2,500 to “sign on with our team” and abandon their work, the criminal complaint states.
It also says a confidential informant was paid $15,000 to provide inside information about the repeal campaign and was told by one operative, former Ohio Republican Party chairman Matt Borges, that the effort to undermine the repeal was an “unholy alliance.”
The “Householder Enterprise,” as prosecutors described it, talked tough, too. During a dinner conversation in September 2019, which the FBI said it recorded, lobbyist Neil Clark explains how they would upend the repeal campaign.
“We have to go out on the corners and buy out their people every day,” Clark said, according to the complaint. “We started doing that today and everybody’s having a (expletive) fit.”
Later, prosecutors said, Householder weighed in. “It is so important, it is so important, that they are not successful,” he is quoted as saying about the repeal advocates in the complaint. “When the legislature votes on something it needs to stay law.”
‘Riddled with red flags’
Finney said he recognized the other side wasn’t playing fair, so he filed a lawsuit asking a judge to give the repeal campaign more than the typical 90 days to gather the signatures needed to put the issue on the ballot. He also asked the court to allow signature gatherers to keep some of their work secret so they wouldn’t be targeted by Generation Now.
The lawsuit includes a declaration from William Rogers, president of Advanced Micro Targeting, the prime petition contractor for Ohioans Against Corporate Bailouts. He wrote that two petition gatherers had been attacked and that others had been sent text messages offering them cash and plane tickets home.
The tactics worked, he said. The number of petition gatherers dwindled.
“I believe that the increased attrition rate and the decrease in productivity in the past days is a direct result of the text messages and other inducements to our circulators,” Rogers wrote.
Finney said none of the pro-bailout group’s work would have been possible without massive amounts of money.
“We were shocked at the amount of money that they were throwing at this between phony petitions, the blockers they were paying and the payoffs of people,” Finney said. “It had to have been millions of dollars in the closing days of the campaign.”
The lawsuit didn’t stop the dirty tactics, Finney said, and Ohioans Against Corporate Bailouts failed to get enough signatures by the Oct. 10, 2019, deadline to get the repeal on the ballot.
A federal judge refused to give opponents of the fee more time to collect signatures.
Anti-tax groups weren’t the only ones frustrated by the unsuccessful campaign. The Sierra Club, along with other environmental advocacy groups, resisted House Bill 6 because it forced electricity customers to pay more each month to prop up aging coal and nuclear power plants, instead of investing in newer and cheaper clean-energy projects.
They, like Finney and the anti-tax activists, think House Bill 6 is now tainted and should be repealed. They say the activities of Householder and his associates mean the bailout was obtained illegally and must be overturned.
“The whole process around HB 6 – from its passage through the legislature, to the attempted referendum campaign – was riddled with red flags,” said Neil Waggoner, senior campaign representative for Sierra Club’s Beyond Coal Campaign in Ohio.
“The Ohio legislature must take steps to rebuild public trust,” he said. “And an immediate necessary first step is to repeal HB 6.”