Dominion Wields Influence with Contributions

By Jacob Geiger, Richmond Times

As proposed changes to the rules that govern Dominion Virginia Power raced through the General Assembly this month, the company’s ample political power was on full display.

Through its political action committee, the company has donated $1.6 million to statewide and legislative candidates since the start of 2013, according to the Virginia Public Access Project.

But political contributions aren’t the only way Dominion wins friends and allies. The Dominion Foundation gives away about $15 million per year — in donations ranging from $1,000 to $250,000 — to a huge array of charitable causes in the states where Dominion operates. Many of the biggest gifts are made here in Richmond, where the company is headquartered.

“No single company even comes close to Dominion in terms of its wide-ranging influence and impact on Virginia politics and government,” said Larry Sabato, a University of Virginia professor and political analyst. “It is the first corporate entity most people think about in the Old Dominion. The company doesn’t win all its battles, but they prevail in the lion’s share.”

The bill, which would freeze base rates into the next decade for customers, orders state regulators to temporarily halt the reviews they conduct on Dominion’s profits. The company and its supporters say the rate freeze gives Dominion time to prepare for proposed Environmental Protection Agency rules that seek to reduce carbon dioxide emissions.

Under the proposed law, if Dominion closes any power plants in the next five years or has to clean up after a big storm, it will cover those costs rather than passing them on to customers. The bill also applies to Appalachian Power Co., which serves customers in the western part of Virginia.

The measure passed the Senate 32-6 and the House of Delegates 72-24. Gov. Terry McAuliffe must sign, veto or recommend changes to the bill this week.

McAuliffe, a Democrat, met recently with Thomas F. Farrell II, CEO of Dominion Resources Inc., to discuss the bill. One day after that meeting, Dominion announced plans to spend $700 million building solar power facilities in Virginia. The project was already planned, but the announcement was moved up to bolster support for the bill.

***

Dominion’s political donations were almost evenly split between Republicans and Democrats over the past two years. Statewide candidates and senior legislators from both parties received the bulk of the donations.

Sabato said that strategy of spreading out donations is typical for large corporations.

“Dominion is a corporation that is regulated by the state, has to work closely with government and wants to get its agenda approved,” he said. “You are best off contributing to senior members who can actually make things happen. Dominion also gives to up-and-comers in both parties; they have a long-range perspective.”

The biggest donations to individual campaigns in the past two years went to McAuliffe and to Ken Cuccinelli, his Republican opponent for governor in 2013.

The Virginia Senate Republican Caucus received $126,000. The leaders of both parties in the Senate received five-figure donations: $45,000 for Minority Leader Richard L. Saslaw, D-Fairfax; and $20,250 for Majority Leader Thomas K. Norment Jr., R-James City. Sen. Frank W. Wagner, R-Virginia Beach, who sponsored the legislation, Senate Bill 1349, received $8,000.

***

The impact of Dominion’s charitable contributions was easy to track as Wagner’s bill wound through Senate and House committees.

Representatives from Senior Connections, the American Red Cross and the Better Housing Coalition all came to speak in favor of the bill. Each of those groups also received donations from Dominion in 2013, according to the Dominion Foundation’s filings with the Internal Revenue Service.

Reginald E. Gordon, regional chief executive officer of the Red Cross, spoke in favor of the bill when it was discussed by the Senate Commerce and Labor Committee. Gordon said then — and in a subsequent interview — that the freeze in base rates will help people on fixed incomes and those who struggle to pay their bills.

Gordon also said the Red Cross and Dominion stay in close touch because both respond to natural disasters. And he said Dominion and its employees have been faithful supporters of the Red Cross.

“They are financial supporters, but even more important, whenever we need help, their people volunteer time for us,” Gordon said. “Dominion has always been a good corporate friend.”

Some of the company’s gifts are high profile, such as a $200,000 commitment in 2015 to support the Dominion Riverrock outdoor festival, and a $250,000 gift to support the UCI Road World Championships being held in Richmond later this year. Farrell is one of four chairmen of the board for the bicycling race, joining McAuliffe, Richmond Mayor Dwight C. Jones and Sen. Mark R. Warner, D-Va.

Others are more modest gifts to scholarship programs, classroom projects and environmental endeavors at hundreds of schools around Virginia.

“The foundation donates to nonprofit organizations and matches giving by our employees,” Hunter Applewhite, president of the Dominion Foundation, said in a statement. “Through it, we support a wide variety of nonprofit organizations in the communities we serve. Some specific focus areas include education, the environment and basic human needs.”

Ivan Tolbert, a community relations specialist with Senior Connections, a local nonprofit that works to help seniors stay in their homes as long as possible, said many of the group’s clients struggle with utility bills.

“What we’re interested in is anything that stabilizes rates in a volatile environment,” Tolbert said.

Tolbert said his focus is on community affairs, not fundraising, and that he isn’t in a position to comment on Dominion’s contributions to the nonprofit.

***

Dominion has been generating political power for as long as it’s generated electrical power.

Christopher J. Spanos, a retired lobbyist and former political aide to populist politician Henry E. Howell Jr., has been following Virginia politics since the late 1960s. Howell, who vowed to “keep the big boys honest,” served as lieutenant governor from December 1971 to January 1974. He unsuccessfully ran for governor as a Democrat in 1969, as an independent in 1973 and again as a Democrat in 1977.

Spanos was an aide to Howell when he was lieutenant governor, and then served as Howell’s campaign coordinator in the 1973 election for governor. Republican Mills. E. Godwin Jr. won by about 15,000 votes out of more than 1 million cast.

Spanos said Dominion — then operating as Virginia Electric and Power Co., or VEPCO — used to count charitable and political contributions as expenses that could be covered under base rates. Howell challenged that move, and won.

Howell fought against many big businesses, but he reserved special disdain for VEPCO, which his campaign ads called the “very expensive power company.”

“They’ve always gotten what they wanted,” Spanos said. “On the other hand, in recent years (state regulators) have taken a very independent stance. They’re not owned and operated by Dominion anymore.”

Spanos said Dominion deftly navigated the 1960s end of the Byrd Machine — a Democratic organization that hand-picked Virginia’s elected leaders for decades — and the switch to competitive, two-party politics.

“When the Byrd Machine went down, VEPCO started planning,” Spanos said. “They hire good lawyers and good public relations people, and they hire people with contacts and knowledge from state government.”

As long as Dominion remains the state’s largest supplier of electricity, it’s likely to remain a political and charitable power as well.

“Dominion is going to be here in some form for as long as Virginia is,” Sabato said.

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