CLEVELAND, Ohio — The nonprofit at the heart of the state’s largest corruption scandal pleaded guilty Friday to a federal racketeering charge involving House Bill 6.
Generation Now helped receive more than $60 million in bribes that FirstEnergy Corp. and its affiliates gave former Ohio House Speaker Larry Householder and his allies in exchange for the passage of a $1.3 billion bailout for two aging nuclear power plants that a FirstEnergy subsidiary once owned, according to federal court filings.
The plea before U.S. District Judge Timothy Black in Cincinnati called for the forfeiture of nearly $1.5 million. The plea agreement in the case and other documents show the purpose of Generation Now was to take in undisclosed donations from FirstEnergy and its affiliates to benefit Householder.
Black declined to set a sentencing date. The nonprofit, which was indicted along with Householder and his allies, faces a term of probation for five years.
The plea comes a week after Cleveland City Council President Kevin Kelley subpoenaed documents from Generation Now to determine whether it had a role in undermining Cleveland Public Power in the past few years. FirstEnergy is CPP’s longtime competitor in Cleveland.
Because Generation Now was a nonprofit, it did not need to disclose who provided it money. Contributions to nonprofits for political issues are called dark money, as the sources are unknown.
The plea agreement shows the nonprofit, set up by Householder’s allies, “was to be used as a mechanism to receive undisclosed donations to benefit Householder and advance Householder’s efforts to become speaker of the Ohio House of Representatives.”
It was designed to “conceal the nature, source ownership and control of the payments made by Company A,” the plea agreement says. The document does not identify FirstEnergy or its affiliates, but records, tax filings and civil lawsuits make it clear that the utility is the focus of the investigation.
The document says Householder’s political strategist, Jeffrey Longstreth, served as the president and secretary of Generation Now. He and Householder, as well as lobbyists Neil Clark, Juan Cespedes and Matthew Borges, were charged with federal racketeering in July.
Longstreth and Cespedes pleaded guilty in October to the federal charges. A date for their sentencing has not been set. Householder, Clark and Borges have denied the charges. No one from FirstEnergy or its affiliates is charged, and the company said it is cooperating in the investigation.
Longstreth signed the plea agreement involving Generation Now as its representative. He answered Black’s questions Friday and entered the guilty plea on behalf of the nonprofit. His attorney, Robert Krapenc, could not be reached after the video hearing.
It is unclear whether Kelley’s subpoenas to Generation Now will determine whether additional funds flowed to undercut CPP. Records show that Consumers Against Deceptive Fees, a group that blasted CPP in mailers over its rates, received $200,000 in 2019 from a nonprofit called Partners for Progress.
An FBI affidavit and tax filings show Partners for Progress obtained $20 million from FirstEnergy and its affiliates. Partners for Progress gave $13 million to Generation Now and much smaller amounts to Consumers Against Deceptive Fees and other groups.
Michael VanBuren, the treasurer of Partners for Progress and an attorney at Calfee, Halter and Griswold in Cleveland, did not return a phone message seeking comment.
This week, Cleveland Mayor Frank Jackson said the city plans to sue FirstEnergy over its actions involving CPP. Jennifer Young, a spokeswoman for the Akron utility, said in a statement: “We support the city’s operation of Cleveland Public Power and are committed to fostering mutual respect for each other’s ability to serve customers.”
Kelley and Council are interested in finding out whether Generation Now contributed funds to attack CPP. Besides the $200,000 from Partners for Progress, Consumers Against Deceptive Fees also obtained $351,000, and Kelley is seeking to determine the source of that money.
Householder’s attorney, Mark Marein, did not return a message seeking comment on Friday’s plea. Young, of FirstEnergy, declined to discuss the hearing, citing the ongoing investigation.