What you need to know about Ohio's corruption scandal, Larry Householder conviction
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In mid-2020, the FBI arrested one of Ohio's most powerful politicians, revealing an extensive investigation into a sweeping pay-to-play scandal.
On Thursday, a jury found ex-Ohio House Speaker Larry Householder and ex-Ohio Republican Party chairman Matt Borges guilty of racketeering conspiracy. The verdict came after seven weeks of the trial and about nine hours of deliberation.
Federal prosecutors made the case that Householder traded legislation − a $1.3 billion bailout for two nuclear plants on Ohioans' electric bills − for nearly $61 million in campaign cash. Householder says he did nothing wrong and took the stand in his own defense.
What happened?:Selling out in the Statehouse
Borges was accused of bribing a GOP operative for information about a ballot initiative to block the nuclear bailout and pleaded not guilty.
Who is Larry Householder?
Householder, 63, is the former leader of the Ohio House of Representatives. He represented Coshocton and Perry counties and a portion of Licking County, east of Columbus.
Householder led the House from 2001 to 2004. He left Columbus under the cloud of an investigation into irregular campaign practices but was never charged with any crime.
He returned to the Ohio House in 2017 with the goal of once again leading it. Federal investigators say Householder used money funneled through dark money groups to bankroll his return to power, helping to elect candidates who would be loyal to him.
In-depth preview:Corrupt scheme or politics as usual? Trial of ex-Ohio House Speaker Larry Householder begins
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He narrowly won control of the House, cobbling together votes from 26 Republicans and 26 Democrats. Once in charge, Householder championed a sweeping energy bill that would have charged Ohioans a fee on their electric bills for two nuclear plants in northern Ohio, then-owned by FirstEnergy Solutions.
Householder defended the law even as a ballot initiative tried to block it.
Federal investigators also accused Householder of using campaign money to repair his Florida home, pay off credit card debt and cover legal fees from a defamation lawsuit settlement.
Who is Matt Borges?
Matt Borges, 50, is a Republican political operative and former chairman of the Ohio Republican Party.
Borges worked on campaigns for former Ohio Treasurer Joe Deters, presidential candidate John McCain, Ohio Attorney General Dave Yost and Gov. John Kasich's presidential bid. Shortly before his arrest, Borges launched an effort to get Republicans to vote for Democrat Joe Biden instead of then-President Donald Trump in the 2020 election.
Borges was accused of giving $15,000 to GOP strategist Tyler Fehrman in exchange for insider information about the ballot initiative to block the nuclear bailout. Borges says he gave the money to help a mentee in need and wasn't a part of any larger scheme.
More:One year later, ex-Ohio GOP leader accused in House Bill 6 scandal fights case against him
Who else has been arrested in connection with House Bill 6?
Three other people were arrested with Householder and Borges. They are:
Jeff Longstreth who served as Householder's political strategist. Longstreth also held the purse strings of Generation Now, a dark money group backing Householder and his chosen candidates. Longstreth pleaded guilty to participating in a racketeering conspiracy and testified against Householder at trial.
Juan Cespedes, who worked as a lobbyist for nuclear plants owner FirstEnergy Solutions. Cespedes also pleaded guilty and testified in the trial.
Neil Clark, a prominent Republican lobbyist who described himself as Householder's "proxy." Clark died by suicide in March 2021.
What is racketeering?
Householder and Borges were charged with conspiracy to participate, directly or indirectly, in the conduct of an enterprise's affairs through a pattern of racketeering activity. The offense is punishable by up to 20 years in prison, a $25,000 fine and forfeiting any ill-gotten gains.
The charge has been used for FIFA corruption, crime families and the Latin Kings, a street and prison gang. The law was intended to punish mob bosses who didn't commit the lower-level crimes themselves but rather orchestrated the enterprise.
Prosecutors must prove there was a pattern of two or more crimes, such as bribery, extortion and fraud, within 10 years.
What is FirstEnergy?
Akron-based FirstEnergy is an electric utility that serves 6 million customers in Ohio, Pennsylvania, West Virginia, Virginia, Maryland, New Jersey and New York. The company's generation subsidiary, FirstEnergy Solutions, entered into bankruptcy in 2018 and emerged as Energy Harbor.
In 2018, FirstEnergy announced plans to close its two nuclear power plants − Davis-Besse in Ottawa County and Perry in Lake County. Meanwhile, company officials were working on solutions at the state and federal level to keep the plants open.
As part of that push, FirstEnergy and its allies used nonprofits known as dark money groups to funnel contributions to Householder to conceal the scope of their donations.
FirstEnergy would later admit it bribed Householder and Gov. Mike DeWine appointee Sam Randazzo, who led the Public Utilities Commission of Ohio. The company agreed to a $230 million fine and to cooperate with a larger federal investigation. Randazzo has not been charged with any crime and Householder has pleaded not guilty.
What is House Bill 6?
House Bill 6 is the law that Householder championed to charge Ohio ratepayers for nuclear plants in northern Ohio. It also included fees for Ohio Valley Electric Corp., which owns coal plants in Ohio and Indiana, and certain solar projects.
Podcast:Winks, nods, texts and more can prove bribery in Ohio corruption case
The bill gutted renewable energy standards and energy efficiency benchmarks. DeWine signed House Bill 6 in July 2019.
An effort to put House Bill 6 before the voters ultimately failed to collect the needed signatures, in part because of unprecedented opposition funded by FirstEnergy and its allies. Following the arrest of Householder and others, lawmakers repealed the nuclear subsidies.
What is dark money?
Dark money is a sweeping term for nonprofit and for-profit organizations that can accept unlimited political contributions without disclosing their donors. The most common type is a 501(c)(4) nonprofit.
Podcast:How do the feds investigate public corruption? It's complicated
This case involves a complex web of dark money groups that concealed the scope of the political donations flowing at the Ohio Statehouse.
What was the case against Householder?
Householder led a criminal enterprise to sell legislation for political power and nearly $61 million, a federal prosecutor said in closing arguments. Householder and his co-conspirators used a web of dark money groups to conceal their actions, which prosecutors said shows "corrupt intent."
Closing arguments: Prosecutor says Householder led pay-to-play scheme, defense calls it 'nothing burger'
“Mr. Householder did not act alone but he was at the top,” Assistant U.S. Attorney Matt Singer said. “He benefited the most because the enterprise was set up to benefit his political machine.”
What was Householder's defense?
Householder defense attorney Steven Bradley said Householder backed the nuclear bailout because "he believed it was good policy and was consistent with his long-held political views regarding the importance of energy generation in Ohio." In short, he wasn't bribed.
"It's not bribe money. It's political contributions," Bradley said.
Borges' attorney Karl Schneider said Borges wasn't a member of Team Householder or Householder's alleged criminal enterprise.
When will Larry Householder, Matt Borges be sentenced?
U.S. District Court Judge Timothy S. Black will sentence Householder and Borges in the coming months. Black allowed both men to remain out on bond. Householder promised to appeal his conviction.
"This is just step one. ... Stay tuned," Householder told reporters after the verdict.
USA TODAY Network Ohio bureau reporters Jessie Balmert and Laura Bischoff have been following the House Bill 6 scandal since the story broke. They will continue to follow developments and the trial. Follow them on Twitter at @lbischoff and @jbalmert for updates.
Get more political analysis by listening to the Ohio Politics Explained podcast
This article originally appeared on Cincinnati Enquirer: Larry Householder convicted in Ohio corruption trial: What to know
