This Florida utility’s secret cash helped GOP win Gainesville state Senate seat

“This is pretty much the nightmare scenario,” an expert on campaign finance says.
Florida Power & Light secretly financed a spoiler candidate in a 2018 race for a Gainesville-area state Senate, according to internal documents from its political consulting firm. The utility’s cash allowed the Republican incumbent to beat off a strong challenge from a Democratic opponent.
Florida Power & Light secretly financed a spoiler candidate in a 2018 race for a Gainesville-area state Senate, according to internal documents from its political consulting firm. The utility’s cash allowed the Republican incumbent to beat off a strong challenge from a Democratic opponent. [ Miami Herald ]
Published Aug. 8, 2022

Florida Power & Light had a problem.

A strong Democratic challenger was threatening to unseat a friendly Republican incumbent in a Gainesville-area state Senate race in 2018. Florida Power & Light, one of the country’s largest utilities, needed to make sure the GOP held onto the seat.

So Florida Power & Light used a shadowy nonprofit group to secretly bankroll a spoiler candidate, a longtime Democrat named Charles Goston, according to new documents obtained by the Times/Herald Tallahassee Bureau. Running as a no-party candidate in the general election, Goston split the liberal vote, siphoning off enough votes from the Democratic challenger to swing the race to the GOP incumbent.

The documents show that the utility sent $200,000 to the nonprofit, a Washington D.C.-based group called Broken Promises, in the fall of 2018. Within five weeks, Broken Promises had donated $20,000 to Goston’s political committee and spent roughly $115,000 on mailers and advertising supporting him. Best of all for Florida Power & Light: Because of its nonprofit status, Broken Promises didn’t have to disclose its donors — meaning the cash was untraceable. No one would know that the utility had paid to secretly manipulate a state election in favor of Republicans. Voters were in the dark about who funded Goston and why.

The records tying the utility to Broken Promises — which come from inside its political consulting firm — mark the first time that Florida Power & Light cash has been directly linked to a series of election scandals rocking Florida politics. They raise questions about whether the utility “subverted” a free and fair election in Gainesville, said Saurav Ghosh, director of federal campaign finance reform at the nonpartisan Campaign Legal Center in Washington, D.C.

“This is pretty much the nightmare scenario,” Ghosh said. “You have a powerful corporate player in Florida politics using its financial resources to defeat a candidate without any disclosure to the public. … This is election rigging.”

As a corporation, Florida Power & Light is allowed to contribute to political campaigns. But under state and federal law, it’s not permitted to hide contributions through “straw” donors. And tax-exempt nonprofits like Broken Promises, which the utility used as a pass-through, are supposed to engage primarily in charitable activities, not politics.

The utility, a multibillion-dollar behemoth, is one of Florida’s most powerful political forces, accustomed to getting its way from a pliant Legislature and the state regulatory board. But over the past year, reporting has revealed its efforts to manipulate state politics, secretly craft legislation to maintain its grip on the solar energy market, snap up a public utility in Jacksonville, push for rate increases on residential customers, tail a journalist it disliked using private investigators and weaponize a supposedly independent news website to attack critics.

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Florida Power & Light is feeling some impact: one investment firm has downgraded its stock and a Democratic congresswoman from Tampa has asked the Department of Justice to investigate its political activities.

In an email, its spokesperson Christopher McGrath said the utility has done nothing wrong, citing an internal investigation — which the utility refuses to share — that said as much. He did not deny that the utility funded Broken Promises.

“(Florida Power & Light) requires that its 501(c)(4) contributions are done in compliance with all applicable laws,” said McGrath, referring to the formal name for tax-exempt groups like Broken Promises. “We do not control any 501(c)(4)s and when we donate money to an organization, regardless of tax status, we no longer control how that money is spent. We believe any assertion to the contrary is unfounded.”

The documents shedding light on the scandals come from an internal server at the utility’s former political consulting firm, Alabama-based Matrix, and were anonymously leaked to the Miami Herald and other news outlets. They include emails, letters, text messages, bank statements, wire transfers, and financial ledgers.

Neither the utility nor Matrix employees have been formally accused of wrongdoing. But prosecutors have so far charged five other people, including a former state senator, over a series of strikingly similar election scandals in 2020 with ties to Florida Power & Light. Those races featured so-called “ghost” candidates who appealed to progressive voters and helped the GOP hold onto three crucial state Senate seats. Utility officials have denied being involved.

‘This text is self-destructing’

Broken Promises was run by an Alabama political consultant named Sean Jason Anderson, who appointed his mother to join him on the nonprofit’s board.

Although Broken Promises appeared to be independent from Florida Power & Light and Matrix, that was just an illusion, text messages between the utility and Matrix executives show.

In one 2016 text exchange, Matrix’s then-CEO, Jeff Pitts, assured Florida Power & Light Vice President Daniel Martell that they had full control over two other nonprofit groups run by Anderson and another ally — and the nonprofits would have no public ties to the utility because they didn’t have to disclose their donors.

Not to mention, Pitts said, Anderson was an old friend. (A “Jason Anderson” is listed as a former Matrix lobbyist in Alabama public records.)

“Bottom line is we are the ones with the check books and in control 100 percent,” Pitts told Martell.

Channeling Mission Impossible, the FPL vice president responded: “This text is self-destructing in 30 seconds.”

“Yep that’s why I like face to face,” Pitts replied.

The text messages would appear to contradict Florida Power & Light’s assertion that it had no control over the nonprofits set up by its political consultants.

Pitts left Matrix in late 2020 to start his own consulting company. He and Matrix founder Joe Perkins are now suing each other. Perkins said Pitts and other former employees had gone rogue on behalf of Florida Power & Light.

“This is more of Joe Perkins leaking select documents and pushing a false narrative in his desperate and continual effort to blackmail and defame Mr. Pitts,” Jesse Dreicer, an attorney for Pitts, said in a statement. “These accusations are false, tiresome and a continuation of his slander and libelous attacks.”

Perkins has denied being the source of the documents sent to the news media.

Anderson could not be reached.

A test run

Florida Power & Light’s role in the Gainesville scheme stayed hidden for years.

But now the ghost candidate scandals from 2020 have spilled into public view, thanks to extensive criminal investigations and rancorous civil lawsuits.

The fallout has revealed the innards of an operation designed by Matrix to swing elections to Republicans in both 2018 and 2020, using secretive nonprofits like Broken Promises.

Kayser Enneking, the Democrat who lost the Gainesville election in state Senate District 8, said what happened to her in 2018 felt like a test run for the ghost candidate scheme that two years later would take down Miami Democrat José Javier Rodríguez, whose criticism of Florida Power & Light had infuriated Eric Silagy, the utility’s chairman and CEO. (Ghost candidates ran in two other 2020 state Senate races but their vote totals were not decisive in leading to the GOP candidate’s victory. Rodríguez, on the other hand, lost to Republican Ileana Garcia by just 32 votes.)

“I think they saw how successful it was in my race and how it was a relatively cheap way to siphon votes off,” said Enneking, who lost to GOP incumbent Keith Perry by roughly 2,000 votes while spoiler Goston received 4,300.

Enneking, Perry and their political committees spent more than $2.6 million combined on their races. Goston’s campaign cost less than $145,000.

Enneking said she didn’t see any policy reason why Florida Power & Light would back Goston, a former Gainesville city commissioner, other than to preserve a business-friendly majority in the state Senate, which confirms the appointment of members to the state’s utility regulator, the Public Service Commission.

“In policy debates with him, there was not one iota of difference between what he was advocating for and what I was advocating for,” Enneking said.

Perry, the Republican, said he did not know about Florida Power & Light’s and Broken Promises’ activities during the 2018 election.

Sen. Keith Perry, R-Gainesville
Sen. Keith Perry, R-Gainesville [ Florida Channel ]

“I don’t coordinate, have knowledge, or plan with any of these groups,” he told the Times/Herald.

He also noted that companies, just like individuals, have the right to donate to campaigns in order to influence the outcome, but said he is open to re-examining policies that enable campaign money to be funneled through opaque nonprofits like the ones created by Florida Power & Light’s political consultants.

“It’s a question of whether there should be more transparency in the process and how to do that, without stifling freedom of expression,’’ Perry said.

Efforts to reach Goston were unsuccessful. Unlike the candidates who ran in three state Senate districts in 2020, Goston wasn’t a “ghost” candidate because he actually campaigned, rather than relying solely on direct mailers to voters.

While Gov. Ron DeSantis has created a new Office of Election Crimes and Security to go after election fraud, he has refused to comment on the scandals linked to Florida Power & Light, which were first broadly outlined in the Orlando Sentinel. The office’s new head, Pete Antonacci, would not answer whether potential campaign finance violations will be among the alleged crimes his agency will investigate.

Records leak

Matrix employees kept detailed records of their activities, including a ledger of the utility’s political spending in the 2018 election cycle.

Entries on the ledger show that Florida Power & Light sent $100,000 to Broken Promises on Sept. 26, 2018, and another $100,000 on Oct. 16, 2018. Those infusions accounted for all of Broken Promises’ revenue that year, federal tax filings show.

Three days after receiving its first round of Florida Power & Light money, Broken Promises gave a $20,000 check to a political committee called Friends of Charles Goston, according to state campaign finance records. Within two weeks, Broken Promises spent another $52,000 on mailers supporting Goston’s campaign. Then, after receiving its next round of Florida Power & Light cash, Broken Promises spent an additional $63,000 on advertising for Goston.

In tax filings, Broken Promises claimed none of its spending qualified as “direct or indirect political spending.”

“That presentation does not seem accurate at all,” said Ellen Aprill, a professor emerita of tax law at Loyola Marymount University who reviewed Broken Promises’ filings for the Herald. “This is political activity.”

It’s not clear from the Matrix records to what extent Florida Power & Light funded Broken Promises directly and to what extent it used other groups as pass-throughs for the money. Federal tax records show another Matrix-controlled nonprofit called the Alliance for Consumer Protection donated $100,000 to Broken Promises in 2018.

The director of the Alliance for Consumer Protection is listed as David Calvert — a construction manager and Pitts’ former college roommate, according to a text between Pitts and Martell.

Calvert could not be reached.

Philip Hackney, an expert on tax law at the University of Pittsburgh Law School, said powerful people are using nonprofits to secretly influence elections around the country.

“This is primarily used by wealthy players and those who run corporations,” Hackney said. “It is an opportunity for them to have their fingers on the scale of elections … without the public having any insight. To run a free and fair democracy, you really need people operating in the light, truthfully and forthrightly.”

He pointed out that Florida Power & Light could simply have funded Goston’s campaign openly — as the utility did when it contributed $20,000 to Perry’s political committee in its own name — without funneling “dark” money through a nonprofit.

“You have to wonder why they didn’t just do that,” he said. “It tells you they have concerns about disclosing their support of this candidate to voters and they had some intention to hide it.”

Mothers for Moderation

Broken Promises wasn’t the only way Florida Power & Light went after Enneking.

The utility also funded a similar nonprofit group called Mothers for Moderation that attacked Enneking in the Democratic primary.

Mothers for Moderation paid $100,000 for direct mail and television advertising in support of a Florida political committee, Liberation Ocala African American Council, that backed Enneking’s 2018 primary opponent, Olysha Magruder. It also paid $75,000 to Anderson’s Alabama-based political consulting firm, according to a copy of a check in the Matrix records.

Almost all of Mothers for Moderation’s funding came from Florida Power & Light. Records show the utility contributed $13.9 million to Mothers for Moderation in 2018. (The nonprofit’s director, Stephanie Egan, is the sister of a former Matrix employee and an elementary school teacher in Alabama. She did not respond to requests for comment.)

Whitfield Jenkins, chairman of the Liberation Ocala political committee, said he did not recall Mothers for Moderation — even though it provided the only funds his group received.

Magruder, Enneking’s primary opponent, told the Herald she had nothing to do with Liberation Ocala’s messaging.

“My campaign had zero control over what happened outside of our campaign,” said Magruder, who is now running for Florida House District 22. “We were the more progressive, underdog campaign at the time so we didn’t have any sort of way to battle what was happening and they used my image and my name without any permission on my part.”

Despite the blitz of advertising, Enneking handily beat Magruder in the primary on Aug. 28, 2018.

The next day, Broken Promises was formed by the friend of Matrix’s CEO, apparently to try again to take down Enneking, this time in the general election. This time the effort succeeded.

In the two years that followed Perry’s victory over Enneking, the Republican-led Senate and the Public Service Commission gave Florida Power & Light what it asked for.

In 2019, for example, legislators passed Senate Bill 796, which created a new process for utilities to pass along costs to customers for storm protection projects, such as installing underground power lines. In 2020, the Public Service Commission approved Florida Power & Light’s proposal to recover the capital costs of building solar by building the expense into its rate base and passing along the charges to its customers, plus a profit.

‘Straw donors’

In 2020, a watchdog group filed a complaint to the IRS about Broken Promises.

In the complaint, Citizens for Ethics and Responsibility (CREW) alleged that Broken Promises had violated federal law “by failing to properly disclose its political contributions” and “was being used as a pass-through for political contributions.”

CREW pointed out that almost all of Broken Promises’ spending went to political causes, mainly the Goston campaign — even though under IRS rules the tax-exempt 501(c)(4) group’s primary activity is supposed to be supporting “social welfare” activities, not politics.

In federal tax filings, Broken Promises listed its 501(c)(4) social welfare purpose as “developing and advocating for legislation, regulations and government programs to improve social environmental [sic], economy and social environment [sic].”

The group, which was registered at a UPS store in Washington, D.C., filed for dissolution two weeks after the complaint, according to local business records.

501(c)(4)s like Broken Promises are often criticized as “dark money” groups because they can be used to mask the true identity of political contributors. Under federal and state law, political spending must be disclosed, and it is illegal to use straw donors and shell companies to hide the true sources of election spending.

FPL’s activities could run afoul of Florida’s straw donor ban, said Ghosh, of the Campaign Legal Center.

“It does appear that these C4 groups were organized as a deliberate mechanism for obscuring the true source of the funds being used for election purposes,” he said. “In that case, what you have is that (Florida Power & Light) is the true contributor and they are using [501(c)(4)s] as straw donors.”

Matthew Corley, CREW’s chief investigator, said Florida Power & Light had a reason for trying to hide its political contributions.

“Transparency helps fight against potential corruption — that’s one of the prime purposes for campaign finance disclosure,” he said. “When people go around it, the obvious question is: Is there something illicit going on?”

Miami Herald staff writer Sarah Blaskey contributed to this report. Miami Herald writer Julia Coin contributed from Gainesville.