SUNDAY, OCT. 9, 2011 FOLLOW-UP: Sun-Times Editorial: Campaign donations raise power bill questions

In the months leading up to the Illinois General Assembly’s approval of a controversial energy bill that would raise electric rates statewide and revamp an aging power grid, utility giants ComEd and Ameren, and their executives and affiliates, donated more than $1.3 million to campaign funds benefitting state lawmakers, according to an analysis by the Better Government Association.

The bill—approved May 31—was vetoed Sept. 12 by Gov. Pat Quinn but is expected to reappear, with some revision, in the General Assembly’s veto session starting this month as backers attempt to garner enough votes to override Quinn’s enthusiastic rejection of the legislation. Quinn branded the bill a “nightmare for consumers.”

If history is any indication, utility interests will open their pocketbooks and give generously to lawmakers in advance of any legislative showdown.

In the three months following the voting, ComEd and Ameren interests have donated more than $170,000 to state legislators and their party organizations, according to Illinois State Board of Elections records.

Ever since the bill passed, the utilities have reached out with contributions to legislators who voted “no” and “present” in the last balloting, while also making significant contributions to legislators who voted “yes.”

All told, records show that members of the General Assembly and their political organizations have—since Jan. 1, 2010—reaped more than $1.5 million from the ComEd and Ameren camps.

While the need to improve the electrical infrastructure has been apparent for a while—and especially acute given the brutal outages in Illinois in recent years—the bill’s roots extend to spring 2010, when a variation of the current measure was presented to legislative leaders and then withdrawn for lack of support.

Including both legislative chambers, 98 legislators voted in May 2011 to approve the revised measure—the so-called “Smart Grid” bill—while 71 voted against it, and eight voted present or were listed as absent during the roll call.

Representatives of the two utilities insisted that donations had no impact on the voting, with Ameren spokesman Leigh Morris saying his company donates to legislators “who will keep an open mind and who are willing to listen to all sides before they make up their minds.”

Legislators interviewed by the BGA insisted that donations played no role in their decision-making.

However, the BGA found:

• House members supporting the bill received six times more campaign money from energy interests between Jan. 1, 2010, and June 30, 2011, than opponents. On the Senate side, supporters received three times more.
• Of the 177 legislators in both chambers, 157 received direct donations from ComEd, a subsidiary of Chicago-based Exelon, and Ameren interests during that 18-month period.
• Of the 98 legislators who voted in favor of the bill, 90 reported ComEd/Ameren donations, which ranged from $500 to $93,750, with the highest amount going to House GOP leader Tom Cross. Democratic House Speaker Michael Madigan was second with $55,000 in direct donations—although the Democratic Party of Illinois, which Madigan runs, also reaped $62,500. On the Senate side, Republican leader Christine Radogno ranked first in contributions, with $52,500. Democratic Senate President John Cullerton received $21,300, making him the leading recipient among members of his party in that chamber.
• The 60 legislators who received donations and voted “no” on the bill received contributions ranging from $250 to $19,500. State Sen. Kyle McCarter (R-Decatur), for example, received $6,000 in donations from the two groups, and voted against the bill. He also allegedly received a punch in the chest from state Sen. Mike Jacobs (D-Moline), one of the sponsors of the legislation, after giving a speech noting that Jacobs’s father is a lobbyist for ComEd.
• Although most donations went to individual lawmakers, the energy companies, their employees and affiliates donated roughly $470,000 to the state Democratic and Republican parties and related campaign funds that benefit legislators.
• In the three months after balloting, the two utilities contributed $15,540 to 10 of the 24 senators who voted against the bill. Proponents need to pick up five votes in the Senate to override the veto.
• Twelve of the “no” voters in the House received a combined total of $12,750 in the same three-month period, and one “present” voter received $1,000. In the House, the utilities need four votes to override Quinn’s veto.

To provide some perspective, the total donated by the energy interests appears to dwarf contributions made by the money-heavy gambling industry, which has been fighting for the statewide expansion of slots and casinos. Gaming is considered by many to be one of the top legislative issues of the upcoming veto session.

A recent Chicago Tribune investigation, for instance, found that gaming interests contributed $812,000 to the Legislature, the governor and Chicago Mayor Rahm Emanuel between Jan. 1, 2010, and June 30, 2011, the same period the BGA examined. The non-profit good-government group Common Cause, also examining state documents, found gambling industry contributions to all Illinois politicians amounted to $1.1 million during the same 18-month time frame.

ComEd and Ameren interests were among the biggest private-sector donors to state political figures in 2009 and 2010, according to an analysis by Kent Redfield, an emeritus professor of political studies at the University of Illinois Springfield. The utilities collectively gave around $1.9 million those two years and ranked, respectively, 17th and 19th, behind a number of unions—including the Service Employees International Union, which gave more than $5.7 million—and various trade groups.

(The U of I analysis excluded some types of contributions that the BGA included in its review, including donations from individuals. While the BGA looked solely at lawmakers, Redfield looked at political figures at all levels of state government, including the Illinois Supreme Court.)

Redfield also determined that the ComEd and Ameren camps donated roughly $1.2 million to state legislators and their affiliated campaign committees in an earlier 18-month period, Jan. 1, 2008, through June 30, 2009, although that analysis included a larger universe of lawmakers than the BGA’s examination. The BGA only focused on legislators who voted on the energy bill, not those who served during that 18-month stretch but left before the measure passed.

>> How the  Senate  voted + donation levels from Ameren & ComEd interests

>> How the  House  voted + donation levels from Ameren & ComEd interests

ComEd and Ameren stand much to gain if the “Smart Grid” bill becomes law.

Ameren distributes electricity to 1.2 million electricity customers in southern, middle and western Illinois, a geographic area representing about three-fourths of the state. ComEd delivers to 3.8 million customers, about 70 percent of the state population, all in northern Illinois.

The legislation would allow the utilities to raise rates on businesses and households to help pay for billions of dollars in new infrastructure work that, the companies claim, will mean fewer and shorter power outages, more energy efficiency, union job creation and new business growth. The bill would also significantly diminish the oversight procedures now imposed by the Illinois Commerce Commission, the government regulator of utilities, by changing the methods by which the utilities report costs.

At a Sept. 12 press conference, Quinn denounced the bill as “a dream come true for ComEd and a nightmare for consumers.” Illinois Attorney General Lisa Madigan argued that it amounts to “legalized pick-pocketing.”  Lisa Madigan, Michael Madigan’s daughter, has campaigned against passage, saying the legislation would guarantee ComEd and Ameren a yearly profit of 10 percent or more, that consumers would bear all the risk, that the proposed technology was “expensive and unproven,” and that utility lobbyists had been able to “muscle a bill through the Legislature that will mean a decade of higher prices for consumers.”

ComEd contends that a typical residential consumer would see a $3-a-month increase on electric bills.

Both Quinn and Lisa Madigan have cited the off-the-cuff response Exelon CEO John Rowe gave during questioning after a speech in Washington, D.C., on March 8. “Smart grid we are reluctant to embrace because it costs too much and we’re not sure what good it will do,” Rowe said in response to a question from the audience. “The real issue is, are we doing the customers more good by putting money into more advanced electronics, or would we do them more good by putting the same money into replacing more old cable? To me, that’s an unknown answer. If I had to choose, I’d bet on the cable.”

The Illinois Commerce Commission, Citizens Utility Board, the AARP, the Environmental Law & Policy Center, and Citizen Action/Illinois also denounced the bill for putting too high a burden on taxpayers and for lessening the oversight by the Illinois Commerce Commission.

Some environmentalists, however, including the Sierra Club, the National Resources Defense Council and Environment Illinois ultimately urged passage, won over by environment-friendly provisions inserted in the legislation. In their analysis, the bill would dramatically increase the use of wind and solar energy, establish a market-based mechanism to reduce energy use, and encourage consumers to shift energy consumption to off-peak hours.

This article was reported and written by BGA Senior Investigator John Conroy, who can be reached at (312) 453-0632 or at jconroy@bettergov.org. BGA Intern Michael Sandler also contributed to this article.