Lawmakers Want to Divert Columbia Gas Fine to Disaster Victims

BOSTON — Elected officials from the Merrimack Valley are angling for a piece of the record fine assessed Columbia Gas for its role in the 2018 gas disaster to be diverted back to the region.

On Wednesday, the U.S. Attorney's Office said it reached a settlement in a criminal case against the embattled gas company that included a $53 million fine and a requirement that Columbia Gas be sold in exchange for a guilty plea. Prosecutors said Columbia Gas' parent company, NiSource, one of the largest utilities in the country, would also have to forfeit any profits from the sale.

Hours later, Columbia Gas announced that it would be bought by Eversource Energy for $1.1 billion in a deal that appears to have quietly taken shape amid the federal investigation.

State lawmakers and other elected officials from the region are calling for the fine to be steered to victims of the Sept. 13, 2018, disaster, which killed a teenager, injured dozens and damaged more than 130 homes in Andover, North Andover and south Lawrence.

Most, if not all, of the money now appears destined for the Justice Department's Crime Victim Fund, which supports victim services nationwide.

State Sen. Diana DiZoglio, D-Methuen, is among those who want the money, as well as any proceeds of the sale of Columbia Gas, spent on victims of the gas disaster.

"It is imperative that these funds be utilized to help make our community whole again — starting with the victims," she said.

So too does state Rep. Tram Nguyen, D-Andover, who said the money could be used to set up a local fund for renewable energy to move the region away from a reliance on fossil fuels. "We want that money to come back to the community in some shape or form," she said.

State Sen. Barry Finegold, D-Andover, said he has reached out to the state's congressional delegation to see if they can intervene.

"We cannot forget the people who are at the heart of this tragedy, and sending the funds to the communities affected instead of national, general funds will ensure that we make everyone whole," he said.

Helping victims

Untangling the money is complicated.

For one, a sizable amount of money from the federal crime victims fund already comes back to the state to help victims of murder, rape, sex trafficking and other violent crimes. In 2019, Massachusetts received more than $46 million for victim service programs and direct compensation to victims, according to Justice Department data.

Another issue is that the fund, supported by criminal fines, penalties and forfeited bonds, is dwindling. Its balance of more than $12 billion in 2014 has dwindled to about $3 billion.

Declining deposits could deplete it almost entirely in the next several years, according to Daisy Pagan, executive director of the National Association of VOCA Assistance Administrators.

One reason the fund is in trouble is a drop in federal prosecutions of corporations and white-collar crimes, which tend to result in larger fines, Pagan said.

Another is that Congress also has made dipped into the fund for other purposes. In 2015, lawmakers shifted $1.5 billion from the fund to cover federal debt obligations as part of a budget agreement with then-President Barack Obama.

Pagan said Congress would likely have to change the 1984 law that created the fund in order to divert money to a purpose other than helping crime victims.

"It would be an unprecedented move," she said. "It would probably take some kind of statutory change because that isn't something that the Crime Victims Act allows."

Liam Lowney, executive director of the Massachusetts Office for Victim Assistance, said the fund now supports more than 130 programs in the state that provide services such as counseling for victims of domestic violence, child abuse, sex trafficking and other crime victims. He said the state has also seen a drop in allocations in recent years.

"We're supporting people in Massachusetts who are working to help crime victims," he said. "If there's less money going into the fund than is going out, it's obviously going to shrink."

Direct benefit

To be sure, Columbia Gas has already agreed to pay more than $80 million to the communities directly affected by the gas disaster, for reimbursement of costs. It also reached an undisclosed settlement with the family of 18-year-old Leonel Rondon, the Lawrence teen who was killed in the disaster.

The company also reached a $143 million settlement with residents in a class action lawsuit, which went before a Essex County Superior Court judge on Thursday.

U.S. Rep. Lori Trahan, D-Westford, said her office is working with the state's congressional delegation on ways to divert money from the settlement and pending sale back to the region.

"Communities across the Merrimack Valley that are continuing to recover from 2018’s devastating gas explosions need all of the help they can get," she said. "We're in touch with the Department of Justice on how to proceed with getting victim compensation funds back to our communities, or whether legislation is the best path forward."

U.S. Rep. Seth Moulton, D-Salem, agrees that the money should go toward victims of the gas disaster. He said he's on board with the effort.

"People in Massachusetts should feel a right to benefit directly from those funds," he said. "So we're exploring ways to make that happen."