Nan’s Plan to Combat Corruption & Restore Ethics in Ohio

Ohio is at a crossroads. Decades of Republican control of state government has led to scandal after scandal. More often than not, the same politicians, lobbyists, and GOP consultants re-appear in each new abuse of power, but never face repercussions. Each scandal seems worse than the last, but the basic formula stays the same: Republican elected officials enriching themselves and their allies while the rest of us foot the bill. This culture of corruption has culminated in the most egregious scandal in Ohio’s history, and the biggest statehouse scandal in the country: the $61 million HB 6 bribery and racketeering scheme that reaches the highest levels of Ohio government.

These scandals — from Coingate, to ECOT, to HB 6 — are devastating for our state. Not only do they undermine confidence in our government as a force for good, but they literally cost Ohioans money through misdirected funds and increased costs.

Republican politicians like Governor Mike DeWine have looked the other way while Ohio has become the worst state in the country for public corruption. They have personally and politically benefited from this broken, pay-to-play culture and are too weak to stand up to it. If Gov. DeWine or other Republicans had the power or the will to fix these problems, we would have seen action by now.

Enough is enough. Nan Whaley is running for Governor to clean up this mess and restore public trust. As Governor, she would:

1. Create a new Public Accountability Commission to investigate corruption and shed light on political wrongdoing, taking the power to investigate politicians out of the hands of politicians and giving it back to the people;
2. Bolster funding to the agencies tasked with upholding ethics in Ohio, while aggressively seeking to collect penalties owed to taxpayers;
3. Hold her administration and all its appointees accountable to the highest ethical standards from Day One of her term;
4. Work with the legislature to close dark money loopholes and bring real transparency to political spending.

This robust plan, details of which can be found below, would allow for a real, nonpartisan investigation by the state into public officials and entities like the PUCO and Sam Randazzo, limit the power and influence of lobbyists, and stop the flood of “dark money” spent by super PACs to influence our elections. The policies laid out below can be accomplished through Executive Order and the governor’s executive budget.

As Mayor of Dayton, Nan has taken on corruption head-first. When confronted with the public trust being broken, she took action. This is the leadership we need in Ohio.

Ohio deserves better. Ohio deserves a government, and a Governor, who is looking out for all of us, not donors and special interests. Big, bold changes like these are what Ohio needs to restore public trust, and Nan Whaley is the only candidate strong enough to put them in place.

The Problem

In the past few decades, Ohioans have witnessed scandal after scandal from its Republican leaders. The latest public corruption case in Ohio involves $61 million in bribes in exchange for a taxpayer-funded billion dollar bailout of an energy company — the largest open corruption case in the entire country. While the specifics of this scandal are jaw-dropping, the story isn’t anything new. Two former Speakers of the House, Larry Householder and Cliff Rosenberger, are currently under federal investigation. Lobbyists move freely from lobbying on behalf of companies to holding regulatory roles over those same companies. Thanks to inaction from Gov. DeWine and previous Republican administrations, Ohio now holds the dishonor of being ranked Number One in public corruption. With Ohio’s leaders more focused on how to enrich themselves and their political allies, it’s no wonder Ohio has fallen further behind.

The recent cost of corruption to Ohio and Ohioans is well known:

• Electronic Classroom Of Ohio (ECOT), which drained hard-fought funding from Ohio’s students and schools by falsifying attendance records for their students and used the proceeds to enrich its for-profit owners. Over a 17-year period, more than $1 billion in taxpayer funds was funneled to the charter school, Electronic Classroom of Tomorrow, whose founders donated heavily to Ohio Republican politicians. All the while, state officials claimed they couldn’t find the resources to fully fund Ohio’s public schools. ECOT has since been under investigation for falsifying attendance records and test results.
• Payday lenders, who evaded regulation for years, charged Ohioans without bank accounts extremely high interest and fees for small personal loans. Former GOP Speaker Cliff Rosenberger resigned in 2018 following an FBI raid on his office where agents sought evidence of potential bribery and kickbacks linked to the payday industry.

The biggest scandal of the day remains around House Bill 6, which was passed under the influence of over $60 million in bribes to state lawmakers. This bill provided an outrageous taxpayer-funded subsidy to bail out several of Ohio’s nuclear and coal utilities.

• According to the FBI, FirstEnergy — and to a lesser extent AEP — paid $61 million in bribes to GOP Rep. Larry Householder and entities he and his allies controlled to build his personal political power and pass HB 6. The money was moved through a series of campaign accounts, 501(c)4s, and super PACs and used to elect enough Householder allies to make him Speaker, pressure lawmakers to pass HB 6, and then stop a ballot initiative to repeal the bill.
• Gov. DeWine also filled his administration with former FirstEnergy lobbyists with connections to the scandal, including appointing a FirstEnergy lobbyist, Sam Randazzo, to be the top utility regulator in the state as Chairman of the Public Utilities Commission of Ohio, ignoring warnings about the appointment. Randazzo is under scrutiny for failing to disclose a $4.3 million payment from top executives at FirstEnergy that he received shortly before being appointed to the regulator position. Randazzo has since resigned following an FBI raid on his home and has begun to sell off high-priced real estate holdings in Florida and Ohio.
• The kickbacks to Ohio Republicans are staggering: more than $60 million to help former GOP Speaker Larry Householder build and maintain power, at least $1 million to support Mike Dewine’s campaign for Governor, hundreds of thousands of dollars to a super PAC supporting DeWine’s daughter, and hundreds of thousands of dollars to other GOP entities and candidates.

Gaps in Ohio’s Watchdog Agencies

Ohio has several agencies devoted to regulating ethics among our public officials. However, there are huge gaps in investigation ability and enforcement. Ohio’s government has been letting down its people: years of a culture of corruption has led to a huge lack of trust in our citizens. These agencies have dropped the ball on HB 6, the largest corruption scandal in the history of Ohio; and none of them have effectively been able to address the culture of corruption in the statehouse and in state government.

The Joint Legislative Ethics Commission (JLEC) — This entity is the “ethics advisory office to Ohio’s legislative branch of government.” JLEC has not led public investigations into either the HB 6 scandal, where former GOP Speaker of the House Larry Householder was removed from leadership but still remains in office, or former GOP Speaker Cliff Rosenberger, who resigned under investigation for corruption related to payday lenders.

The Ohio Ethics Commission — This Commission oversees standards, offers education and training, provides ethics advice, and makes referrals for investigation to the Attorney General and the Inspector General. It does not investigate potential ethics complaints — that job is left to the Inspector General.

The Inspector General of Ohio — The Inspector General (IG), “investigates corruption, fraud, waste, and abuse within the executive branch of state government and has jurisdiction over the Governor, his [soon, her] staff members, state agencies, departments, boards, commissions, and any other entities appointed, employed, controlled, directed, or subject to the authority of the Governor.”

Although the IG is meant to complete a “report of investigation” for credible allegations to provide “recommendations for the agency to consider in addressing and avoiding the recurrence of fraud, waste, abuse, or corruption uncovered by the investigation,” public documents don’t show that the IG has ever investigated the Public Utilities Commission, its leadership, the Governor’s Office, or numerous gubernatorial appointments with links to FirstEnergy or the HB 6 scandal.

A New Way Forward: Sunlight, Participation, and A Strong Ethics Mechanism

As Governor, Nan will take concrete steps to battle corruption in Columbus by shining a light on corruption and fully investing in ways to eliminate it, so that every Ohioan can be assured their government is working for them — not for their political donors or special interests.

Nan proposes a four-point plan to battle corruption in state government:

1. Create a Public Accountability Commission to oversee executive branch ethics complaints — taking the power to investigate politicians out of the hands of politicians and giving it back to the people. Corruption dies when air and light bring transparency — we have so many loopholes in Ohio ethics law that HB 6 has been allowed to fester for over four years. The first assignment of the Public Accountability Commission will be to review all ethics exemptions given to all three branches of government and recommend where to remove those exemptions.
2. Invest in ethics in Ohio. Nan will stop disinvesting in ethics in Ohio. Even as requests for Ohio Ethics Commission advice, policy, and rulings have increased by 26% since 2013, the agency’s budget has been eroded by inflation, with only two staff attorneys and several staff to manage training, rulings, research and rulings for the entire state’s executive branch, as well as all local officials, other than the judiciary. By ignoring the growth in ethics questions that the agency has received, Republicans like Gov. DeWine have shown us that they don’t value an open and transparent government. Nan’s administration will aggressively collect fines and penalties owed to the taxpayers from corrupt officials. Investing more in ethics will save taxpayer dollars, not cost them.
3. Govern and live with ethics at the core. Nan’s first executive order will address ethics in her administration. Everyone that Nan appoints will be held to the highest ethical standards, including a prohibition on lobbying on any issue on which they have made decisions for two years after they leave public office. Restoring the state government’s ethical standards starts at the top and requires the Governor to lead by example.
4. Pass The Ohio Anti-Corruption Act (HB306). Nan will press the legislature to pass The Ohio Anti-Corruption Act, Reps. Sweeney and Russo’s bill to stop the culture of corruption in Ohio’s Statehouse. We need to close dark money loopholes that foster the culture of corruption currently engulfing the Statehouse and bring real transparency to political spending.

Policy #1: Create a Public Accountability Commission to Oversee Ethics Complaints.

It’s clear that the status quo isn’t working anymore. We can’t have good government when the people who are being judged are also in charge of the judging. That’s why, as Governor, Nan will create a bipartisan Public Accountability Commission (PAC), that sits atop the Inspector General and can refer cases to the Attorney General or other law enforcement agencies. The commission will make public valid complaints of ethics violations on a regular basis and publicize whether actions are being taken to investigate and/or eliminate the corruption. Having sunshine on the process ensures that those who are doing the investigation are held to account and that politics stays out.

Light, air, and transparency are the best medicine for corruption. Ohio’s people need to bring some common sense and ethics to the way the people’s business is done in Columbus. The Republican hammerlock on our legislature, our Governor’s office, and our courts have proved ineffective at addressing deep corruption and influence-peddling in the corridors of our government.

How will it work?

• The Public Accountability Commission will be a “robust referral” agency, taking inquiries from the public and whistleblowers inside state government and routing them to the appropriate agencies for investigation and follow up.
• Will oversee the Inspector General, monitoring how ethics charges are being followed up, investigated, or referred to others.
• Use the Inspector General to investigate allegations of corruption.

The chart below depicts the way this board will function:

The Public Accountability Commission will bring transparency and enforceability to ethics concerns in Ohio.

Ohioans can report their suspicions, even anonymously, to an Ethics Hotline that would be sponsored by the Public Accountability Commission and staffed by the Inspector General’s Office. The PAC will develop guidelines for the IGO to use in determining whether tips are substantial and merit investigation. Once the IGO has completed an investigation, they will forward the results to the Public Accountability Commission with a recommendation for their disposition. If the matter merits further investigation and action, the Commission would refer it, if necessary, for further investigation by the Attorney General or the judiciary. Once the case has been referred, this disposition will be made public with the general rationale.

The Public Accountability Commission will meet monthly and will review the portfolio being handled by the Inspector General, matters being raised, and disposition, including matters under investigation and status of those investigations.

The Public Accountability Commission will be made up of a total of 11 members. The Governor will appoint the Chair and will have the responsibility of ensuring there are no more than 6 members from the same political party. One seat will be nominated by the Attorney General and one seat will be nominated by the Auditor. Two other seats will be nominated by the Supreme Court, one seat will be nominated by the Civil Rights Commission, and one seat will be nominated by the Ethics Commission. Additionally, Commission members in aggregate will have at least one CPA, one lawyer, one representative from an Ethics discipline in Higher Education, and have backgrounds in both private sector and public sector ethics. For example, many companies have begun to appoint Chief Ethics Officers. Such a person would be an ideal appointment to this Public Accountability Commission. Members shall serve a four-year term, coincident with the Governor’s term.

The first assignment of the Public Accountability Commission will be to carefully review all exemptions to ethics and conflict of interest requirements provided in current law to the Supreme Court, members of the legislature, and the executive branch. The Public Accountability Commission will produce a report detailing the risks to Ohio’s taxpayers if those loopholes are not closed. As Governor, Nan will use this report as a blueprint for comprehensive legislation designed to address Ohio’s culture of corruption beyond the issues covered in HB306.

Policy #2: Invest in Ethics.

Gov. Dewine and Republican lawmakers have not funded the Ethics Commission or Inspector General appropriately, even as their workload has increased. The Ethics Commission and the Office of the Inspector General protects Ohioans from bad behavior of the executive branch of government. As a result, concerns about scandals, whistleblowers, and citizen suspicions may not get the attention they need.

As corruption has grown, lawmakers have not invested in expanded ethics and investigatory functions to meet new challenges. While payday lenders, ECOT, and FirstEnergy poured money into international trips, political campaigns, and home improvements for Ohio’s legislature, funding for the Ohio Ethics Commission has not kept up, falling by an inflation-adjusted 4% since 2008.

Demand for Inspector General and Ethics Commission services rose while funding remained flat or declined

(Thousands of dollars, adjusted for inflation)

Source: Ohio Inspector General, Legislative Service Commission, Budget in Detail, HB 166 (as appropriated and current actual expenditures for 2020 and estimated for 2021

As Governor, Nan Whaley will restore funding to the ethics function, restoring trust to our government, and enabling the Public Accountability Commission, Ohio Ethics Commission, and the Inspector General to do their jobs as the watchdogs for Ohio’s citizens.

Policy #3: Govern and Live with Ethics at the Core.

As Governor, Nan’s first Executive Order will be to apply the highest ethical standards from the top down throughout Ohio’s government. Nan will apply these standards to her own Cabinet and high-level administration posts. Every executive official that Nan appoints in Ohio will be required to sign a pledge to abide by the Governor’s first Executive Order, which will focus on Ethics in Government. Violation of this Executive Order will be cause for immediate dismissal. The Executive Order will include:

1. Limits on Gifts.
2. Ethics Training and Compliance required for all state employees.
3. Ethics Officer appointed in every Agency, and managed by a Chief Ethics Officer, lodged in the Governor’s Office.
4. All state officials and employees are directed to report any wrongdoing or apparent wrongdoing by a State official or employee to the Public Accountability Commission, Ethics Commission, or the Inspector General or through the Ohio Ethics Hotline.
5. No person serving on a board or commission may try to influence any decision by that board or commission on behalf of a client while a member of the board or commission or within two years of leaving that board or commission.
6. Vendor and Grantees who have contracts with the State or who get grants from the State will certify, before they can receive any money from the State, that they know and understand Ohio’s ethics and conflict of interest laws, are aware of this order, and that they will not do anything inconsistent with those laws or this order.
7. Whenever any Cabinet agency or State of Ohio board or commission awards any contract without a competitive bid for the products or services provided by that contract, the reason the contract was awarded without bids must be stated in writing by the agency, board or commission in a document that is available to the public.

Policy #4: Address Corruption in the Legislature and Get Dark Money Out of Politics.

Nan believes the legislature must pass The Ohio Anti-Corruption Act, HB306, which would do the following:

1. Close Dark Money Loopholes — 501(c)4 political nonprofits and limited liability companies have become commonplace in political campaigns as special interests seek to influence elections without disclosing their donors. This is the legal gray area where FirstEnergy moved $61 million to secretly support Larry Householder and HB 6. HB306 would close loopholes and require these entities to disclose contributions they use for political campaigns.
2. Increase Transparency — Right now, legal loopholes allow corporations set up to influence campaigns to hide who is behind them. This legislation will force corporations to reveal their true owners and the real sources of funds going to political spending.
3. Strengthen Foreign Money Ban — HB306 will also ban domestic corporations with foreign owners from spending in Ohio’s elections.

In addition, Nan will propose comprehensive ethics legislation when the Public Accountability Commission completes its initial review that will aim to close Ohio’s ethics loopholes.

Nan’s Record of Taking on Corruption

The problem is not a one-party problem, nor is it limited to state government. Local corruption scandals across Ohio have ensnared both Democrats and Republicans. Nan experienced this firsthand in Dayton in 2019 when a now-former City Commissioner and city employee were charged with corruption. But rather than taking the “wait and see” approach we have witnessed from Gov. DeWine and other Republicans in Columbus, Nan took action. In addition to an independent audit, Dayton changed its procurement and reporting structures to ensure such illegal activity could not happen again.

Corruption is corruption. It is inexcusable and those committing crimes and abusing the public’s trust for their own personal gain will be held accountable.