Generation Now pleads guilty in $60.8M bribery case

Credit: DaytonDailyNews

Caption
Former Speaker of the House Larry Householder makes an appearance in the Ohio Statehouse on Tuesday, Sept. 1, 2020.

Credit: DaytonDailyNews

Generation Now, the nonprofit involved in a massive bribery scheme, pleaded guilty on Friday to one count of participating in a racketeering conspiracy and said it would forfeit $1.57 million under a plea agreement outlined in U.S. District Court.

Jeffrey Longstreth, the corporate representative of the organization, entered the plea on behalf of Generation Now. Longstreth agreed to forfeiture of the assets, which have already been seized by the U.S. government, and a five year term of probation if those are imposed by U.S. District Court Judge Timothy S. Black at sentencing.

Black accepted the plea and found Generation Now guilty. He said he would delay a presentence investigation and his sentencing until the cases of everyone indicted with Generation Now have been resolved.

“The company has taken full responsibility for its criminal conduct. It’s a credit to the company,” Black said. “Its conduct, of course, was not.”

Former Ohio House Speaker Larry Householder R-Glenford, as well as lobbyists Neil Clark and Matt Borges have pleaded not guilty to federal racketeering charges in the case. Last year lobbyist Juan Cespedes and Longstreth, who was Householder’s political strategist, pleaded guilty to racketeering.

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Generation Now, a 501(c)4 organization not required to disclose its donors, was established in March 2017. It was controlled by Householder and acted as the conduit for nearly $61 million in bribe money paid out over three years, according to federal prosecutors.

Between 2016 and 2020 Generation Now and the other defendants conspired with each other to engage in racketeering and “multiple acts involving bribery,” according to a statement of facts Longstreth on Friday acknowledged in court was true.

He agreed that Generation Now was allegedly organized at Householder’s direction to receive undisclosed donations to benefit Householder and advance his efforts to become Speaker of the Ohio House.

“As part of the conspiracy, Generation Now received money from Company A (as defined in the indictment) for the benefit of the defendants and others 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,” according to the statement of facts.

“Generation Now engaged in financial transactions that were designed to conceal the nature, source, ownership, and control of the payments made by Company A to Generation Now,” the statement said.

An 81-page criminal complaint in the case uses pseudonyms for utility companies that funded Generation Now but descriptions identify them as Akron-based FirstEnergy Corp. and its former subsidiary FirstEnergy Solutions, which emerged from bankruptcy under the new name Energy Harbor.

Both companies have said they are cooperating with federal investigators.

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According to prosecutors, the companies funneled nearly $61 million to Generation Now, which used the cash to elect pro-Householder lawmakers so he could return as House speaker, and in turn Householder helped pass House Bill 6 that provided a $1.3 billion bailout to FirstEnergy Solutions and other financial benefits to FirstEnergy. A chunk of the money was spent on a countercampaign that blocked opponents of House Bill 6 from collecting enough voter signatures to put the legislation up for a statewide referendum vote, according to court documents.

Ohio House Speaker Bob Cupp, R-Lima, generally wears a mask when in close proximity to others but removes it when publicly speaking from a distance.
Caption
Ohio House Speaker Bob Cupp, R-Lima, generally wears a mask when in close proximity to others but removes it when publicly speaking from a distance.

After Householder’s July 21 arrest, his colleagues stripped him of the speaker post but did not vote to expel him from the House. At the time, newly selected House Speaker Bob Cupp, R-Lima, said expulsion could only be done once and Householder was running unopposed for re-election, so waiting until 2021 would be best.

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The Ohio House met this week but did not take a vote on expelling Householder. Cupp said he is still “taking the temperature” of Republican members of the House.

“We have 64 members. It takes a long time,” he said. Cupp declined to discuss whether there are the required 66 votes to expel Householder.

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