Maybe privatization deserves another look....

Sewer plant owner guilty

Many homes affected by actions

By JOE GYAN JR. New Orleans bureau

NEW ORLEANS -- The founder and general manager of an embattled Mississippi-based utility company that owns roughly 175 sewage treatment plants in Louisiana pleaded guilty Friday to federal conspiracy and obstruction of justice charges in exchange for a three-year prison term.

Glenn Kelly Johnson, 58, of Vicksburg, Miss., told U.S. District Judge Morey Sear of New Orleans that he intentionally failed to properly operate and maintain six wastewater treatment plants in Thibodaux and Houma.

"When I would fix the sewer plants, they wouldnt be fixed properly. Im not sure why, but I did it on purpose," Johnson, who acknowledged having only a ninth-grade education, told the judge.

Johnson and his family own numerous water and sewer systems in the Lafayette area under the umbrella of Acadiana Treatment Systems, in addition to systems in Livingston, Ascension, Pointe Coupee, Iberia, Rapides, St. Tammany and Lafourche parishes. Many residents served by the company in the Lafayette area have complained about poor service.

One of Johnsons associates, Carol Rowell of Denham Springs, also pleaded guilty in the case Friday, but to a misdemeanor for violating a federal Clean Water Act permit. Rowell, 41, was director of Enviro-Tech Treatment & Labs Inc., which provided laboratory services to Johnson Properties. She faces up to one year in prison and a $100,000 fine.

U.S. Justice Department lawyers also made public Friday the Sept. 29 guilty plea by Montell Watkins of Baton Rouge, who was president of Johnson Properties. Her conspiracy to violate the Clean Water Act guilty plea and plea bargain agreement had been placed under seal. Watkins agreed to testify against her co-defendants. She faces up to five years in prison and a $250,000 fine.

Under the terms of his plea agreement, Johnson will have to pay a $500,000 fine and pay $250,000 in restitution to homeowners in addition to serving three years in prison. Johnson was scheduled to stand trial Monday in federal District Court in New Orleans. Sear will formally sentence Johnson on May 3. He remains free on bond. The judge will sentence Rowell the same day. Watkins sentencing date has not been set.

Johnsons company -- Johnson Properties Inc. -- and six of its subsidiaries pleaded guilty last month to conspiracy to violate the Clean Water Act. The companies admitted failing to properly operate and maintain the six sewage treatment plants in Houma and Thibodaux. Sear fined Johnson Properties and the six subsidiaries more than $4.3 million last week and put each on probation for five years for failing to provide the homeowners with basic sewage treatment.

Johnson Properties owns 200-plus sewage treatment and drinking water plants in Louisiana and five other states -- Mississippi, South Carolina, North Carolina, Tennessee and Pennsylvania.

Johnson Properties filed for bankruptcy in March in Baton Rouge, where its key operating subsidiary -- Utility Management Services Inc. -- is based. A civil lawsuit also was filed against Johnson Properties in federal court in Lafayette, where the company was put into receivership by a federal judge in March.

Federal regulators have cited Johnson Properties for widespread failure to comply with environmental law s, finding 600 violations in a four-day inspection of the companys Louisiana plants.

U.S. Justice Department lawyer Ruth McQuade told Sear that Johnson was aware there were "severe problems" with the operation and maintenance of the sewage treatment facilities in Thibodaux and Houma from 1991 to 1998.

"These problems included breaks in the levees surrounding the treatment lagoons, resulting in overflows of sewage from the lagoons ..." she said. "Mr. Johnson was aware that the homeowners were experiencing numerous problems as a result of the poor operation and maintenance of the facilities. These included raw sewage seeping out of manholes and into the streets, and sewage backing up into the toilets and bathtubs of homeowners."

McQuade also told the judge that Johnson used for "personal expenses" sewer fees collected from the homeowners for the operation and maintenance of the sewage treatment facilities in Thibodaux and Houma.

When regulators began inquiring about the condition of the plants, McQuade said, Johnson and Watkins tried to conceal the problems by submitting false monitoring information. Rowell submitted reports to regulators without verifying their accuracy, McQuade said.

In addition to conspiring to violate the Clean Water Act, Johnson told Sear he attempted to impede the federal governments criminal probe by offering money to a former employee in exchange for the ex-worker withholding information about criminal violations. Johnson said he offered in 1995 to loan the woman "any money she wanted."

Last week, Sear fined Johnson Properties $680,000. The judge fined six of the companys subsidiaries the following amounts: Thoroughbred Park Service Corp., $1,180,000; Utility Management Services, Johnson Utility Co. Inc., Seashore Utilities Inc., Seashore Utilities of Louisiana Inc., and Tara Development Corp., $500,000 apiece. The judge also ordered Thoroughbred Park Service to pay $165,000 in restitution to more than 500 homeowners in six subdivisions in Thibodaux and Houma.

A federal grand jury in New Orleans indicted Johnson, Johnson Properties itself, the six subsidiaries, Watkins and Rowell, and C.J. Cox Construction Co. Inc. of Brookhaven, Miss., in 1998. C.J. Cox, owned by Johnsons sister, operated and maintained Johnson Properties subsidiaries wastewater treatment facilities. C.J. Cox is the only remaining defendant in the case.

link

http://www.theadvocate.com/news/story.asp?StoryID=10719

-- Carl Jenkins (Somewherepress@aol.com), February 05, 2000

Answers

Thanks Carl, for posting this. Jerks like this make me sick. And yes, I'm an environmentalist and proud of it. This is the only earth we have, and I want it to be as safe and clean as possible.

-- gilda (jess@listbot.com), February 05, 2000.