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State Rep. Terri Hodge pleaded guilty Wednesday and agreed to resign from office for participating in a bribery scheme involving Dallas city officials and a developer of apartment complexes.

Hodge pleaded guilty to a federal charge of fraud and false statements on an income tax return. She faces up to three years in prison, a $100,000 fine and restitution to the IRS. A sentencing date has not been set.

Hodge, who was running for re-election, has agreed to never again hold public office. The Democrat from Dallas has been a state representative since 1996.

In a written statement, Hodge, 69, acknowledged violating federal income tax laws.

“I want to take this opportunity to express my remorse to my colleagues in the Legislature, my friends, and my family for my actions,” she said. “Most of all, I want to apologize to all the citizens of District 100 for letting them down.”

Her guilty plea is the latest conviction for federal officials in what they say is the largest corruption case in Dallas history. The investigation became public in 2005 when the FBI raided the City Hall offices of former Mayor Pro Tem Don Hill, who was convicted last year on seven counts that included bribery, conspiracy to commit bribery and extortion.

Federal prosecutors alleged Hill, his wife and other former officials sought hundreds of thousands of dollars from contractors in exchange for the city councilman’s approval of the construction of apartment complexes.

Hodge acknowledged writing letters of support for affordable housing projects built by Southwest Housing Development Company, Inc. The company was owned by Brian Potashnik and his wife, Cheryl, who have pleaded guilty to bribing officials in exchange for their support. The Potashniks await sentencing.

In 2002, according to court documents, Hodge told the Potashniks she was having financial problems and asked for help. They provided her with a housing unit at the rental rate of $200 a month, when its market rate was nearly $900 a month. The couple also paid her utility bills and bought her new carpeting.

The total value of the free rent, utilities and carpet was more than $32,000, which Hodge did not include as income on her tax returns, according to the U.S. Attorney’s Office. She also failed to report additional income of more than $73,000 from 2001-05.

According to the plea documents, Hodge also did not report income of $41,465 from 2001-05, money that came in part from campaign contributions that she used for personal expenses.