Dark Money In The Spotlight In Heated Nuclear Bailout Referendum Campaign

Sep 30, 2019

The controversial U.S. Supreme Court decision Citizens United v FEC almost a decade ago helped bring in hundreds of millions of dollars into political campaigns – and the groups that get some of it don’t have to disclose where it came from.

Dark money gets a lot of attention at the federal level, but it’s hard at work in Ohio right now.

The proposal to overturn the state’s new nuclear power plant bailout isn’t even on the ballot. But the group that’s gathering signatures to put it there has launched its first ad.

“If someone approaches you with a petition to allow you to vote on corporate bailouts, sign it,” the ad copy reads.

This comes in response to a campaign working against the potential ballot issue. It’s estimated to have spent $3.5 million on its own petition supporting the bailout, though it does nothing beyond that, along with mailers featuring vivid images invoking the Chinese flag, and ads including a new one, featuring the line: “They’re bringing in outsiders into our state to roam our neighborhoods with petitions, and they’re asking for your personal information.”

Bradley Smith is a professor at Capital University Law School near Columbus and a former chair of the Federal Elections Commission. And he’s fascinated.

“To me, what's really interesting is that they're doing this all this just to keep the petition from even qualifying for the ballot and that's what I don't recall saying before. Is somebody coming forward and trying to spending a large amount of money just to get the issue from even being placed on the ballot,” Smith said.

Smith uses that word “somebody” because nobody knows exactly who is Ohioans For Energy Security, the group behind those commercials and fliers. And spokesman Carlo LoParo says that’s the way it will stay.

“It's not that we won't disclose our donors. It's that we're following the law, and the law allows us free speech. And we're exercising that free speech right,” LoParo said.

To be fair, the group trying to overturn the bailout law, Ohioans Against Corporate Bailouts, is also not revealing its donors. But the law requires that group as a ballot issue PAC, to file financial disclosure forms within 30 days of filing its petitions to put the law before voters next year – which they have to do by October 21.

But its spokesman Gene Pierce said his group is made up of those who opposed the bailout law when it was House Bill 6. “You're talking about consumer groups, business groups, renewable energy advocates and people who want to offer more competitive pricing and the electricity marketplace in Ohio.”

LoParo said that group also includes natural gas companies, and that a Chinese government-owned bank has invested in those companies. Pierce says it’s ridiculous to tie the referendum group to the Chinese. And he pointed to FirstEnergy Solutions, the owner of the state’s two nuclear power plants, and its former parent company FirstEnergy as likely donors to the bailout opposition.

There is little known about that opposition. Ohioans For Energy Security is a limited liability corporation, and there’s little information in its filing with the Secretary of State’s office. Carlo LoParo is a longtime Statehouse PR figure, having worked for, among others, Republican former Secretary of State and candidate for governor Ken Blackwell – who also employed Gene Pierce.

LoParo also spoke for the Ohio Clean Energy Jobs Alliance, which advocated for passing the bailout law, along with Generation Now, another dark money group. That group is sending people it’s calling monitors out to share the pro-bailout side with people being asked to sign petitions to get the bailout to the ballot. And there have been clashes between circulators and monitors.

Groups including the League of Women Voters and Common Cause Ohio have called for more financial disclosure of the groups involved in this referendum. Ohio State University Moritz College of Law professor Dan Tokaji said it’s simple.

“It's fundamentally an issue of transparency. We should know we the people should know who's funding campaigns whether they're for ballot measures or for candidates,” Tokaji said.

Those who oppose that say corporate and high profile donors sometimes want to be shielded to avoid protests and boycotts, and that they support dark money groups for reasons beyond political activity. And former FEC chair Bradley Smith said there’s often plenty of information about dark money groups anyway.

“I think anybody would be, would not be shocked to discover that there's a fair amount of energy company money behind this, the people who in fact would benefit from this directly. So I don't know how much voters would benefit,” said Smith.

Smith is the founder of the Institute for Free Speech, which opposes campaign finance reform. It’s a 501(c)3 organization – those are religious, charitable, scientific or educational groups. And it doesn’t have to disclose its donors. But on its website, it does provide IRS forms required for nonprofit organizations. So do the League of Women Voters and Common Cause Ohio. They are 501(c)4 or social welfare organizations, and are calling for more disclosure.