Missouri developer jailed for violating Clean Water Act

Wentzille developer sentenced to 15 months for violating Clean Water Act St. Louis Business Journal Eric Johnson was sentenced to 15 months in prison and ordered to pay $100,000 in restitution for violating the Clean Water Act in association with his Wentzville subdivision development, U.S. Attorney Catherine Hanaway said Tuesday. Johnson, 43, of Springfield, Ill.,pleaded guilty in December to one count of violating the Clean Water Act and one felony count of bank fraud. He admitted with his plea that he failed to maintain runoff controls at his building site, resulting in storm water run-off into Dry Branch Creek, and used his building escrow money to pay other obligations, resulting in the foreclosure and losses to his partner and the lender. Johnson was the owner and operator of a construction site known as Providence on Peine and Providence Meadows developments in Wentzville. He obtained construction storm water permits from the Missouri Department of Natural Resources. In August 2004, inspectors with the Environmental Protection Agency observed numerous permit violations at both Providence sites, including lack of inspections and failure to evaluate, maintain, and implement runoff controls, resulting in off-site migration of a significant amount of sediment and accumulation of sediment in Dry Branch Creek, according to a release from Hanaway's office. Johnson was in the business of developing and building residential subdivisions in both St. Charles and Lincoln counties from 2003 to 2006. He had a loan with First Service Bank for $2.6 million to develop a residential subdivision known as Woodsmill Estates. An escrow account was set up at Commonwealth Land Title Insurance Co. to pay subcontractors of the development. However, during the time of this loan, Johnson used the escrow money to pay subcontractors and other bills for other projects, according to the release. The bank ultimately discovered this practice and foreclosed on the loan, which resulted in a loss to the bank in excess of $100,000. Additionally, Johnson's business partner, who co-signed on the loan, saw a loss between $400,000 and $500,000.