Citizens for Energizing Michigan’s Economy is a Consumers Energy-funded 501(c)(4) organization that spends hundreds of thousands of dollars on television and radio issue advertisements that praises state candidates ahead of primary and general elections.
According to the Michigan Campaign Finance Network, Citizens for Energizing Michigan’s Economy (CEME) spent an estimated $830,000 on TV ads in 2018 alone. CEME promoted candidates who ran against lawmakers that supported restoring old net metering rates or favored utility deregulation – energy policies that would create competition with the investor-owned utility companies.
Consumers Energy is an investor-owned monopoly utility company that provides electricity and natural gas to 6.7 million residents in Michigan.
The 2018 annual report filed in December with the Michigan Department of Licensing and Regulatory Affairs reveals that CEME’s board of directors now includes Consumers Energy’s Brandon Hofmeister, senior vice president of governmental, regulatory and public affairs.
Earlier filings with the State of Michigan did not include Hofmeister.
Ronn Rasmussen was Consumer Energy’s vice president of strategy and research. Howard Edelson managed the utility-funded campaign that defeated a 2012 ballot initiative that would have increased the state’s renewable energy standard to 25% by 2025. Consumers Energy contributed over $12 million to the campaign that year. Edelson is currently president of the Edelson Group.
CEME’s IRS 990s for the years 2014, 2015, and 2016 list David Mengebier as the vice president. Mengebier retired in October 2017 as Consumers Energy’s senior vice president of governmental, regulatory, and public affairs, and was the president of the Consumers Energy Foundation.
The latest tax documents filed with the IRS by CEME reveals that the organization received $15 million in dues in 2017.
The $15 million in reported dues matches the $15 million Consumer Energy reported providing CEME in a filing with the Michigan Public Service Commission (PSC).
The 2017 IRS 990 also reveals that CEME contributed $25,000 to the D.C.-based Electric Markets Research Foundation and $100,00 to the Michigan Chamber of Commerce.
The Electric Markets Research Foundation is a front group for electric utilities. It has commissioned papers supporting utilities’ positions on issues like net metering and the need to extend the lifetimes of non-competitive coal and nuclear plants, and has distributed them to state utility commissioners at NARUC events.
The 2017 annual report filed with the PSC details that Consumers Energy increased their contribution to CEME to $20 million – up from $15 million – which suggests that CEME’s 2018 IRS Form 990 should reveal at least $20 million in revenue from members.
From 2014 through 2017, Consumers Energy has made over $43.5 million in political contributions to the organization. The $43.5 million that Consumers Energy has contributed to CEME is far more than the utility has reported in other political spending. It’s over 40 times greater than the total amount of money the utility’s PAC has contributed to Michigan candidates, their total state lobbying expenditures, and is nearly 10 times larger than its federal government lobbying over the same four year period.
IRS Complaint Filed Against Citizens for Energizing Michigan’s Economy
On July 31, 2018, Patrick Anderson of Anderson Economic Group, filed a complaint with the IRS over CEME’s tax status.
Anderson writes that CEME is “operating in direct violation of its claimed purpose to ‘receive and administer funds for social welfare purposes’ … The primary purpose of CEME, as evidenced by its activities and expenditures, is to conduct political campaigns that support or oppose specific candidates for state offices in the State of Michigan.”