How Should Springfield Clean Up After The ComEd Scandal? Lawmakers’ Reform Plans Are Hazy

ComEd
Illinois lawmakers are still debating what type of ethics reforms to pass following the long-running Commonwealth Edison Springfield bribery scandal. Manuel Martinez / WBEZ
ComEd
Illinois lawmakers are still debating what type of ethics reforms to pass following the long-running Commonwealth Edison Springfield bribery scandal. Manuel Martinez / WBEZ

How Should Springfield Clean Up After The ComEd Scandal? Lawmakers’ Reform Plans Are Hazy

With less than seven weeks left in their spring session, Illinois lawmakers have yet to put up new ethical guardrails in response to the historic Commonwealth Edison bribery scandal that toppled ex-House Speaker Michael Madigan and led to a series of federal indictments.

Given the nature of Madigan’s dramatic and forced departure, meting out some kind of meaningful, legislative consequences for the powerful utility company’s misconduct would be a logical response for Illinois lawmakers this spring.

A pair of potential rewrites to state utility law give some prominence to ethics reforms related to the revelations in the ComEd probe, but nothing under consideration would seriously curb the outsized political influence ComEd has enjoyed for decades in Illinois.

Last summer, ComEd admitted to a long-running bribery scheme aimed at influencing Madigan by awarding his political allies with lucrative no-work jobs and contracts. Federal prosecutors say ComEd’s goal was to secure favorable legislation in Springfield, including electricity rate hikes.

Apart from the criminal case against ComEd, the utility put relatives of politicians on its payroll and filtered money through a foundation to a top utility watchdog that later backed some of its priorities and has been a reliably prolific campaign donor, doling out more than $3.1 million in contributions during the nearly decade-long run of corruption.

Despite the scope of the scandal and its fallout — Madigan was long the most powerful politician in Illinois — the prospects for ethics reform this year are now hazy.

The two Democratic legislative leaders aren’t saying yet exactly what reforms, if any, they’re willing to push to passage. And a May 31 adjournment deadline looms with the ever-present danger that the pandemic could send lawmakers home from Springfield with little notice.

Still, a top aide to Gov. JB Pritzker says accountability and reform must be marquee elements of any package if it’s going to be signed into law by the governor this spring or summer. The Chicago Democrat intends to present his own, new outline to lawmakers as early as next week.

“Any energy legislation he is going to find worthy of support is going to need to lead with ethics reform,” said Deputy Gov. Christian Mitchell, Pritzker’s point person on a possible utility omnibus.

ComEd continues to operate with a scaled-back lobbying presence, a clear after-effect of the company’s stunning ethical nosedive last summer as spelled out in an agreement with U.S. Attorney John Lausch to defer a criminal probe into the company. ComEd agreed to pay $200 million to the government as part of that deal.

Madigan has denied wrongdoing and knowledge of the scheme. The former speaker and state Democraty Party chair has not been charged.

Even if ComEd is a weakened brand, the company’s corporate sister, Exelon Generation, has kept up pressure on lawmakers for a new bailout for its struggling Illinois nuclear business. It announced late last summer that it would prematurely shut down its Dresden and Byron nuclear plants in northern Illinois. The move would cost 1,500 full-time jobs — many held by Democrat-aligned union electricians — and threaten to undermine the Pritzker administration’s aim to wean Illinois from fossil fuel.

The governor’s office has commissioned its own study to determine what kind of subsidies would be necessary to keep the two nuclear plants in operation. A report released Wednesday justified roughly $350 million in ratepayer subsidies to Exelon over five years.

And on a separate front, ComEd filed paperwork with the Illinois Commerce Commission on Friday to seek a $51 million rate increase, effective in January, its first such request in four years.

Lawmaker: “It’s really a shame that we have to babysit” ComEd

There are competing bills in the General Assembly directed at ComEd for its ethical lapses.

In the House, state Rep. Ann Williams, D-Chicago, is carrying legislation to establish a path for ratepayers to win restitution if a utility company engages in criminal wrongdoing. In its deferred prosecution agreement, ComEd said its corrupt lobbying yielded legislative victories valued at more than $150 million for the company.

Her legislation also would do away with automatic rate increases for ComEd customers based on a preset formula. It would bar utilities like ComEd from billing ratepayers for charitable contributions or for legal fees tied to criminal investigations.

And Williams’ measure would establish a czar to oversee utility ethics compliance at the Illinois Commerce Commission, which regulates utilities.

That czar would have access to a database that ComEd and other utilities would be required to log, showing “requests for anything of value” sought by public officials or their staffs. But those records of potential job or contract asks wouldn’t be directly accessible to the public under current language in Williams’ bill — something she said she’s willing to reconsider.

Her legislation also would prevent ComEd-hired lobbyists from subcontracting, which the company acknowledged in its deferred prosecution agreement as a way political friends of Madigan’s were funneled rewards. That practice, which evaded state lobbying disclosure rules, enabled ComEd lobbyists to hire Madigan associates as consultants, who did little to no work.

“It’s really a shame that we have to babysit the utilities in this way,” Williams told WBEZ. “But unfortunately, ComEd has shown us that they were really willing to make a mockery of the legislative process.”

Williams, chairwoman of the House Energy and Environment Committee, said she intends to ask Democratic House Speaker Emanuel “Chris” Welch’s office for permission to hold a hearing in her committee to delve more deeply into ethics and accountability measures in response to the ComEd scandal.

Her legislation counts Welch, of Hillside, as a co-sponsor, but he hasn’t signaled if her template is the one he’ll seek to pass this spring.

In a statement, a Welch spokesman said the speaker “hasn’t been involved” with Williams’ legislation or another one pushed by organized labor.

“His goal is to restore confidence in government and address shortfalls identified following the ComEd issue,” Welch spokesman Sean Anderson said in the statement.

Last summer, Welch presided over legislative hearings that delved into Madigan’s conduct involving ComEd. But Welch signed off on efforts to shut down the inquiry without any sanctions against the former speaker.

In January, with Madigan’s blessing, Welch took over as speaker when Madigan couldn’t get enough votes to be reelected largely due to fallout from the still-active federal probe into ComEd’s dealings in Springfield.

In the Senate, state Sen. Michael Hastings, D-Frankfort, has sponsored legislation aimed at making ComEd refund $200 million to ratepayers — the same amount the company paid to settle its federal bribery case with the federal government last summer. It also would establish a utility ethics monitor at the ICC and prohibit ComEd from billing ratepayers for costs associated with a criminal investigation into its conduct and for benefits for any employees convicted of crimes associated with the misconduct.

“I think it’s essential,” Hastings said of utility-oriented ethics reforms, “and the reason I say that is the public needs to be able to trust their public utility system and their government when it comes down to what I consider essential needs.”

Hastings, who is chair of the Senate Energy and Public Utilities Committee and a declared candidate for secretary of state, said he could foresee a final ethics package that would encompass the provisions contained in both his and Williams’ measures.

Senate President Don Harmon, D-Oak Park, would not say if he was satisfied with any of the ComEd-driven ethics reforms on the table so far or outline specific ideas of his own related to the lobbying scandal.

“We are reviewing proposals,” Harmon spokesman John Patterson said.

A spokeswoman for ComEd said company executives embrace a retooling of ethics requirements.

“We expect that a variety of proposals will be considered and look forward to discussions with lawmakers and other stakeholders about how best to incorporate ethics requirements into legislation that ensures clean, reliable, and affordable energy for all Illinois residents,” ComEd spokeswoman Shannon Breymaier said in a statement.

“ComEd’s newly implemented ethics policies already prohibit subcontracting of both third-party lobbyists and political consultants and require tracking of all requests, referrals and recommendations from public officials,” she said.

Those internal procedures have been in place since July 2020, she said, shortly before the announcement of the company’s deferred prosecution with the U.S. attorney’s office.

The ethics reforms lawmakers aren’t discussing

The ethics reforms directed at ComEd introduced so far are a move in the right direction but need to carry more bite, some consumer advocates say.

“Do I think this is good? I would say it’s a start,” said Robert Gallo, state director of Illinois AARP, which represents 1.7 million seniors in the state and is a major consumer advocate on utility issues. “I don’t think it really answers or addresses the problem and how it started.”

A recent meeting with the speaker has left Gallo feeling encouraged that some ethics measures will advance this session.

“He emphasized his top priority is for the citizens of Illinois to regain trust in government,” Gallo said. “I felt he was sincere about that.”

For example, no policies under consideration would bar utility campaign contributions. Nor would they impose any kind of lifetime lobbying ban on any utility lobbyists who may be convicted as part of the ComEd investigation or any future corruption probes. Nor are logs of legislative favors publicly accessible.

Additionally, there presently are no reforms directed at the Citizens Utility Board, which was created as a utility watchdog by the legislature in 1983 and barred from accepting “gifts, loans and other aid” from utility companies. Despite that law, a WBEZ investigation last September documented at least $11.55 million in funding for CUB that came from a pair of utility-funded foundations during the past two decades.

The practice drew condemnation from consumer groups nationally and in Illinois, with Gallo saying last fall that the group had “fed at the utility trough just like the rest of them.”

CUB, which has signed on as a supporter to Williams’ legislation, has said the money it has accepted over the years from utility-funded foundations has not compromised its independence and that it frequently is at odds with the utility.

More recently, Illinois AARP, Illinois PIRG and the Environmental Law & Policy Center put together a laundry list of reform demands driven by the ComEd scandal, including ratepayer restitution and an end to utility company political contributions. CUB was noticeably absent from the effort.

“Utilities just can’t amass the same level of political power in the future as they’ve had in the past,” said Illinois PIRG Director Abe Scarr.

Another aspect of the state’s campaign finance law that merits scrutiny in light of the ComEd scandal is the time-honored practice of public officials who run afoul of the law turning to their campaign funds to pay criminal defense lawyers, said state Rep. Deanne Mazzochi, R-Elmhurst.

Since October, Madigan’s personal campaign fund, Friends of Michael J. Madigan, spent more than $3.7 million for work by a Chicago law firm specializing in white collar criminal cases. A Madigan spokesman attributed part of that expense to costs associated with complying with subpoenas from U.S. Attorney John Lausch’s office.

A member of the House panel that investigated Madigan last year, Mazzochi has sponsored legislation to bar campaign expenditures for mounting a criminal defense or for civil cases “pertaining to misconduct by a person in his or her capacity as a public official, sexual harassment claims or discrimination claims.”

Her bill has remained bottled up in the Democratic-led House. Its prospects appear dim.

“This just shows there’s so much power that is put in the speaker’s office,” Mazzochi said. “Even when it came to the ways in which [Madigan] was using those campaign funds, people still didn’t believe they had any choice but to donate.”

The contours of a legislative response to the ComEd scandal remain murky, but Illinois lawmakers should be duty-bound to reel in a powerful utility accustomed to steamrolling its way through Springfield, says one leading national watchdog.

“These types of legislative scandals should be easy to stop as long as you’ve got the right kind of comprehensive ethics and lobbying reforms in place,” said Tyson Slocum, who directs the energy program for Washington, D.C.-based Public Citizen, which was founded by consumer activist Ralph Nader. “It doesn’t appear as though states are doing enough to establish those standards in the wake of these scandals.”

Dave McKinney and Tony Arnold cover Illinois politics and government for WBEZ. Follow them on Twitter @davemckinney and @tonyjarnold.