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Questions about the transparency of FirstEnergy, Energy Harbor and others are central to proceedings in multiple cases.

By Kathiann M. Kowalski

This article is provided by Eye on Ohio, the nonprofit, nonpartisan Ohio Center for Journalism in partnership with the nonprofit Energy News Network. Please join our free mailing list or the mailing list for the Energy New Network as this helps us provide more public service reporting.

Environmental groups have filed a motion asking a federal appeals court to tell FirstEnergy Solutions’ bankruptcy court judge to take action in light of the alleged corruption cases in federal and state court.

The Environmental Law & Policy Center, Environmental Defense Fund, Ohio Citizen Action, and the Ohio Environmental Council want the judge to consider suspending execution of the reorganization plan that was confirmed earlier this year. The groups also hope the bankruptcy court will consider if it should revise that confirmation order and conduct additional hearings. The groups filed the motion on Oct. 5.

“We’re asking the 6th Circuit to deal with these truly extraordinary circumstances,” in which federal and state corruption charges relate directly to assets involved in the bankruptcy case, said Howard Learner, executive director at the Environmental Law & Policy Center. Among other things, Ohio House Bill 6 authorizes roughly $1 billion in subsidies over the next six years for two nuclear plants owned by Energy Harbor, formerly known as FirstEnergy Solutions.

The federal and state cases allege that an unlawful conspiracy used dark money organizations to hide the source of spending from FirstEnergy (known as “Company A” in some documents), its current and former affiliates, and others in order to secure passage of HB 6 and to prevent a referendum on the law.

“The remedy that we’re asking in the 6th Circuit complements what the Ohio attorney general has already asked for it its lawsuit,” Learner said. As he sees it, that case effectively asks the state court to “rescramble the eggs” and undo the reorganization.

Among other things, the state’s complaint asks that “each Defendant business entity and nonprofit [in the case] be dissolved or reorganized such that no agent, officer or representative found to have engaged in acts in furtherance of [the alleged wrongful conduct] retains a position within the defendant business or nonprofit entity.” The state case also seeks to prevent FirstEnergy Solutions, Energy Harbor, FirstEnergy or other defendants “from receiving any monetary benefit, supplement, credit or offset created by or through” HB 6.

Energy Harbor, FirstEnergy and certain current and former subsidiaries have denied any illegal activity. They were not named as parties in the federal case but are defendants in the state case. Likewise, former House Speaker Larry Householder and other defendants have pled not guilty, and no allegations in either case have yet been proven. Nonetheless, the environmental groups say the requested relief is within the court’s authority.

“We have framed it very carefully within the 6th Circuit’s equitable power to ask the bankruptcy court to consider whether it should reassess its confirmation order approving the reorganization, in light of the extraordinary revelations that have occurred since the court approved the order,” Learner said.

The bankruptcy court has already delayed payment of final fees in the case, and a hearing is scheduled for Nov. 17. If the appeals court grants the groups’ motion, it could open the door to a complete reexamination of the case by the bankruptcy court.

The timing on the appeals court’s response is unclear. Energy Harbor, the successor to FirstEnergy Solutions, did not respond to requests for comment. 

“I think transparency is always good, and I think more information about what their actual financial situation is would be helpful,” said Gov. Mike DeWine during an Oct. 1 press conference, noting that questions had been raised from the beginning about the nuclear plants’ need for subsidies.

But, DeWine quickly added, HB 6 “needs to be repealed because the process was so flawed that it has cast a light on this bill that it can never recover from. We’ve got to repeal it and figure out where we’re going from there.”

Bills to repeal HB 6 remain pending in the Ohio House, although further hearings have not been scheduled. Additional charges are currently slated to kick in starting in January.

“We opposed HB 6 last year and are seeking its repeal this year,” said Ohio Consumers’ Counsel Bruce Weston. “Ohioans should not have to pay a penny to subsidize coal and nuclear power plants. But the problem of undue influence from FirstEnergy and other utilities runs much deeper against the public interest than just HB 6. What consumers need is an overhaul of utility regulation in Ohio.”

FirstEnergy CEO Chuck Jones said in the company’s second quarter earnings call that a repeal of HB 6 would not affect obligations in the settlement agreement between the company and its former subsidiary in the bankruptcy case. Energy Harbor is now considered to be separate from FirstEnergy.

“The plan of reorganization was not contingent on House Bill 6 or any other support for the nuclear plants,” Jones said.

Questions of transparency

The environmental groups’ motion before the federal appeals court goes beyond a possible HB 6 repeal, said Environmental Law & Policy Center attorney Margrethe Kearney. Instead, the focus is on the alleged “improper expenditures of these … companies in bankruptcy to lobby for this bill.”

A reorganization in bankruptcy lets a company restructure its debts so it can move forward as a viable business with a mostly clean slate. But full disclosure is generally a condition for the bankruptcy court’s confirmation of any reorganization plan.

“The question really is what kinds of expenditures were being made here and not being disclosed to the court and not disclosed to parties that reached settlement agreements,” Kearney said. “This is something that really goes to the essence of bankruptcy.”

There have been numerous cases of companies using bankruptcy “as a tool for polluters to escape their liability,” Kearney added. As she sees it, the bankruptcy court should care whether companies might have engaged in illegal activity, and not just focus on whether a company can come out of the proceedings and keep operating.

“That can’t be what our bankruptcy system was designed to do,” Kearney said.

Full disclosure is also at the heart of the Ohio Consumers’ Counsel recent move to appeal a September decision from the Public Utilities Commission of Ohio that fell short of the consumer advocate’s earlier request for a full independent audit.

That decision told FirstEnergy’s utilities to file information, and commission spokesperson Matt Schilling said stakeholders would have “an opportunity to be involved and weigh in on the case through a formal comment period. … It is a first step.”

Nonetheless, the Ohio Consumers’ Counsel filed a motion for an early appeal on Sept. 21. The consumer advocate said regulators erred “by not ordering the hiring of an independent auditor.” 

FirstEnergy’s Sept. 30 filing basically just told the utilities commission that any costs for political or charitable spending for HB 6 “would not have been recorded in accounts that are used to calculate the Companies’ riders and charges. Therefore, the Companies’ ratepayers have not paid riders or charges that include HB 6 costs.”

FirstEnergy also opposed the Environmental Law & Policy Center’s motion to intervene in that case, claiming that the utilities commission review “involves only the filing of initial and reply comments by interested parties.”

Commission Chair Sam Randazzo had suggested to lawmakers on Sept. 16 that other parties could well intervene in the proceedings and implied that those parties might conduct discovery. He declined to answer a lawmaker’s question about possible remedies because “discussions like this can have implications for publicly traded companies.”

However, a detailed and independent investigation into whether utilities used ratepayer money improperly is “exactly the PUCO’s domain,” said former commission member Ashley Brown, who now heads the Harvard Electricity Policy Group. Arguably, not doing that could hurt a company’s stock price, he added.

Basically, if an independent audit investigation confirmed that a company caught up in a scandal did nothing wrong, that should help prevent a further fall in stock prices. Alternatively, if an investigation did reveal wrongdoing, the company could then strengthen its internal governance — thus theoretically shoring up the value of its shares.

‘A lot more yet to go’

Meanwhile, an investigation by the U.S. Securities and Exchange Commission of FirstEnergy’s actions has reportedly begun. Several shareholder lawsuits or investigations are also underway. 

And although Franklin County Judge Chris Brown ruled against the Ohio attorney general’s opening move to stop Energy Harbor, FirstEnergy and others from lobbying against the repeal of HB 6, Yost’s statement afterward said that was just the start.

“There’s a lot more yet to go,” Yost said. He also advised policymakers to use caution.

“It would be foolish for anyone to accept campaign contributions from these defendants — or, I might add, to engage in private discussions with these defendants or their lobbyists,” his statement said. “Anything they have to say — and there is much for them to say — should be said in public, where the people’s business ought to be conducted.”

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Chef Jason Quinlan will take over all of the culinary efforts at Der Braumeister, marking the first time in the restaurant’s 35-year history that a non-family member will be leading the kitchen.  A graduate of the Scottsdale Culinary Institute, Quinlan has over 15 years of experience, including working at some of Cleveland’s most notable establishments such as the former One Walnut, Spice (restaurant & catering) and most recently, Marigold Catering.

Classically trained in French technique, Quinlan aims to incorporate as much of that technique as possible to any dish he is creating, while adding his own personal twist. He has extensive experience creating menus and dishes for all types of styles and cultures including Mexican, Italian, New American – and now German.

“I’m beyond excited to get to work at Der Braumeister,” said Quinlan. “This family has a long history in the community, so being chosen as the first non-family chef to lead the kitchen is an honor. I can’t wait to work alongside Linda and Jenn, learning the family secrets and recipes that have made this restaurant such a beloved staple for so many years, while also adding my own spin and helping Der Brau take their next steps into the future.”

Quinlan will take over the kitchen operations from Linda Hoertz, mother of Jenn Wirtz, Der Brau’s current, third-generation owner. His first order of business will be to review – and edit – the restaurant’s current menu, incorporating some new creations while enhancing the dishes that have long been favorites of their customers.

“After thirty-five years working in this kitchen, I look forward to taking a much needed step back from the business and spending more time with my family,” said Hoertz. “I have the utmost trust and respect for Chef Jason, and I feel more than comfortable handing him the torch.”

“I’m beyond excited to have Chef Jason join our team,” said Wirtz. “We’ve been so fortunate to have served our community – together, as a family – for as long as we have, and now it’s time to take our next steps as a business. Jason isn’t going to be changing who we are – but instead, he’s helping us evolve. He respects our history, and he’s enthusiastic about learning our recipes and styles, so I know he will help preserve that part of our family moving forward.”

Quinlan’s first official day will be Thursday, October 15th and a new menu is slated for the coming weeks, just in time for the holidays. 

From the newsletter, Straight from City Hall:

The City of Cleveland strongly encourages residents not to participate in trick-or-treating this year as a result of the coronavirus pandemic. However, if residents choose to trick-or-treat or pass out candy, the permitted hours in the City of Cleveland are from 6-8 p.m. They are asked to adhere to the regulations outlined in the Ohio Department of Health’s “Celebrating Halloween” guidelines which include the following:

o   Always wear a face covering and stay 6 feet away from people who are not from your household, whether trick-or-treating, passing out treats or attending attractions or events.

o   A costume mask is not a substitute for a cloth mask. A costume mask should not be used unless it is made of two or more layers of breathable fabric that covers the mouth and nose and doesn’t leave gaps around the face.

o   Do not wear a costume mask over a protective cloth mask because it can be dangerous if the costume mask makes it hard to breathe. Instead, consider using a Halloween-themed cloth mask.

o   If you may have COVID-19 or may have been exposed to someone with COVID-19, you should not participate in in-person Halloween festivities and should not give out candy to trick-or-treaters.

o   Carry hand sanitizer and use it often, especially after coming into contact with frequently touched surfaces and before eating candy.

o   If taking your children trick-or-treating, limit the number of houses you visit and ask your children to stay as far from treat-givers as possible. For small children, consider holding the bag for them.

o   Wipe off candy wrappers with sanitizing wipes when you arrive home. (NOTE: Never wipe unpackaged food with wipes.)

In an effort to provide children in Cleveland’s neighborhoods with an alternative to traditional trick-or-treating, the City will be offering grab-and-go candy bags. This is in lieu of our annual Big City Boo event, which we must regretfully cancel this year. Participants seeking candy bags will be required to wear masks, maintain six feet of social distancing and follow posted guidelines and directional signage.

The candy bags will be at the 18 open City of Cleveland Neighborhood Resource and Recreation Centers (NRRCs) on October 30 from 6-7 p.m. or until all bags are given out. All of the NRRCs will supply candy bags with the exception of the following: Halloran, Stella Walsh, Sterling, Hamilton, Kovacic and Camp Forbes. Please note: candy bags will be given out on a first-come, first-serve basis.

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Ohioans have made substantial contributions to mitigating the effects of the Opioid crisis throughout the state. From state initiatives to community support, we have been able to save many lives. In fact, since its inception, 15,000 people have sought help from the RecoveryOhio Crisis Text Line. Despite these significant efforts, there was a disconnect in the education surrounding the life-saving antidote, naloxone.

In Ohio, a 2015 law allowed pharmacists to dispense this medication to customers without a prescription, the only problem was, many pharmacists were unaware of this change. According to a survey completed by the Cleveland Plain Dealer of 275 Northeast Ohio pharmacies, a large number of pharmacies did not know that naloxone can be dispensed without a prescription.  In fact, 20 percent of the pharmacies surveyed incorrectly stated that customers would need a prescription for naloxone. Consequently, many pharmacies did not even have naloxone in stock.

That is why I introduced Senate Bill 59, the Naloxone without Prescription Training Bill, to require all pharmacists, technicians and pharmacy interns be trained to become knowledgeable that naloxone can be dispensed without a prescription and would also require those professionals that dispense the drug to maintain an adequate supply of it. This legislation passed unanimously out of the Senate earlier this year. It then moved over to the House where it passed out of the House Health Committee unanimously.

I am proud to announce that in September, during National Recovery Month, Governor DeWine signed House Bill 341 into law, which contained S.B. 59 as an amendment. With this law in effect, we will be able to save more lives and work towards overcoming the opioid epidemic in Ohio. The passage of this legislation is even more significant given the increased loss of life due to opioid usage this year. In August alone, Cuyahoga County witnessed at least 47 fatal cases due to heroin/fentanyl/analogs, and at least 293 victims over the course of this year. We must continue to raise awareness and pass meaningful legislation to better help our families, friends, and neighbors who are silently battling addiction. 

PHOTO CAPTION: Senator Antonio provides Sponsor Testimony on S.B. 59 in the Ohio House Health Committee

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The COVID-19 pandemic has changed many aspects of our daily lives: what we wear, where we go, and who we can visit- but it does not change your vital role in our democracy.

With the 2020 General Election right around the corner, it is important to be aware of upcoming deadlines and processes to make your vote count and your voice heard. 

Before heading to the polls on Nov. 3, 2020, you must be registered to vote. The deadline to register to vote for this election is Oct. 5, 2020.

To register, you will need your Ohio driver’s license or Ohio identification card number, name, date of birth, address, and the last four digits of your social security number. If you have recently moved, you will need to update your voting address. Last year, the Ohio Secretary of State’s office purged thousands of citizens from voter rolls. Some of these names were removed in error, so even if you have not moved and you have previously voted, you should verify your voter registration out of an abundance of caution. 

The unpredictable nature of a global pandemic makes the possibility of in-person voting unclear for many. To be safe, you can vote by mail. To do so, you will need to complete and mail an absentee ballot application to the Cuyahoga County Board of Elections at 2925 Euclid Ave Cleveland, OH 44115. The deadline to request an absentee ballot is three days before the election, but it is highly recommended that requests are submitted as soon as possible. Once you receive your ballot in the mail, you will need to return it to the board of elections, which can be done by mail or in person. When mailing the completed ballot, it must be postmarked no later than the day before the election (Nov. 2, 2020) and received no later than 10 days after the election. You can also deliver your ballot in person prior to 7:30 p.m. on Election Day. 

Election Day 2020 will look different, but you too can help the process run smoothly by signing up to be a poll worker if you are less vulnerable to the virus. Many of our older Election Day volunteers will be unable to help in November due to COVID-19 related risks, so it is a great time for young people to sign up as paid poll workers through the Cuyahoga County Board of Elections. 

While this election will present new challenges, we must remember that our foremothers and fathers fought for our right to vote and make our voice heard. This is an important time to participate in our democracy. 

PHOTOS BY ELIZABETH HALKO

Featured top photo caption: Senator Antonio at the Cuyahoga County BOE drop box at E. 30^th and Euclid Avenue.