Two Ohio Republicans Plead Guilty in Alleged $60 Million Bribery Scandal for Coal and Nuclear Bailout
By Alyse Stanley
November 2, 2020 - Two of the five Republicans arrested on corruption charges involving former Ohio House Speaker Larry Householder pleaded guilty on Thursday to racketeering. They’re the first to be convicted in the alleged $60 million federal corruption scandal, which federal prosecutors are already calling one of the largest pay-to-play scandals in the state’s history, regarding a nuclear and coal bailout bill that Ohio legislators passed last year.
Per the Columbus Dispatch, one of Householder’s aides, Jeffrey Longstreth, and a lobbyist for FirstEnergy Solutions Juan Cespedes entered their plea deals in U.S. District Court for the Southern District of Ohio. The two can now testify against the remaining defendants—Householder, former Ohio GOP Chairman Matt Borges, and lobbyist Neil Clark—concerning allegations that the men accepted millions in bribes from FirstEnergy and its subsidiaries over the course of three years in a bid to fast-track nuclear bailout legislation.
Known as House Bill 6, this legislation focused on subsidizing nuclear and coal power plants with millions of dollars on the taxpayer’s dime while simultaneously gutting the state’s mandates for energy efficiency and renewable energy. The bill would hit every Ohio electricity customer, from homeowners to industrial plants, with extra surcharges set to bring in an extra $170 million a year. Legislators earmarked $150 million of that total to bail out two nuclear plants owned by FirstEnergy Solutions (now called Energy Harbor). State lawmakers on both sides of the aisle and Governor Mike DeWine have since called for the bill to be repealed.
The five men were arrested in July on felony racketeering charges. FBI documents related to the charges noted that the “combination of phone records, bank records, and text messages paint a clear picture of the partnership” between the company and the five arrested Republicans trying to get HB 6 passed.
Both Longstreth and Cespedes both planned to plea guilty to single counts of racketeer-influenced and corrupt organizations conspiracies, the Dispatch reports. These felonies carry up to 2o-year prison sentences and fines of $250,000.
As part of his plea agreement, Longstreth admitted that he helped organize and manage the bank accounts of Generation Now, a nonprofit group set up “to receive undisclosed donations to benefit Householder and to advance Householder’s efforts to become speaker of the Ohio House of Representatives.” An FBI affidavit said Longstreth funneled more than $5 million in bribes through the organization. Meanwhile, Cespedes admitted in a separate statement of facts to organizing the organization’s payments “in return for specific official action by Householder relating to the passage and preservation of legislation that would go into effect and save the operation of two nuclear power plants in Ohio.” The payments also reportedly went toward fighting off a ballot initiative trying to overturn the $1.3 billion bailout of the plants outlined in HB 6.
“Today’s guilty pleas by Longstreth & Cespedes move the HB6 racketeering scandal from allegation to admitted fact,” Ohio Attorney General Dave Yost posted on Twitter. “The only remaining question: ‘who else?’ My team, including a forensic accountant, is going through the first batch of documents in our civil racketeering lawsuit.”
U.S. District Judge Timothy Black, who is presiding over the case, declined to set a date for sentencing, saying that he wanted to hold off until after the proceedings for the other defendants wrap up. The other three men have denied the allegations. FirstEnergy has not been charged so far, though the U.S. Securities and Exchange Commission reportedly launched an investigation into the company shortly after Householder and his allies were indicted in the scandal.