Editor’s Note: Portions of the following article are reprinted with permission from the Trenton Republican Times
TRENTON — The former executive director of Green Hills Regional Planning Commission has filed a lawsuit against Green Hills Rural Development, Inc., several employees and former employees of the two organizations and the city of Chillicothe with the main focus of the suit being the sale of the shortline railroad from RDI to the city of Chillicothe.
Michael Johns, who served as director of RPC from 1980 to 2002, filed the suit Tuesday in Grundy County Circuit Court. Count I is a taxpayer suit and Count II is identified as civil conspiracy.
In addition to the RDI and the city of Chillicothe, those listed as defendants in the suit include Randy Railsback, the current RPC executive director; employee Jackie Soptic; and former employees Jerry Ann Robbins and Elaine Loghry.
Johns’ tenure at the RPC ended in December 2002 when the board of the nine-county organization voted to not renew his contract. He was later indicted by a federal grand jury on charges of public corruption after pleading guilty to federal program fraud in relation to the use of unauthorized loans. He was sentenced to serve two years in federal prison without parole and pay restitution of $479,556 to the RDI. A co-defendant, Denise Stottlemyre, also pleaded guilty to using falsified employment contracts in order to justify salary increases paid to herself and Johns. She was placed on probation for three years and was ordered to pay a $5,000 fine.
Chillicothe City Administrator Dean Brookshier told the Constitution-Tribune today (Wednesday) that he was unaware of the lawsuit until this morning and that, as of 10:30 a.m., the city had not received legal papers in reference to this matter. Brookshier declined to make further comment, citing its legal nature.
The city of Chillicothe purchased the railroad from Green Hills Rural Development, Inc., on Dec. 31, 2003, for $32,500. The city, then between late 2006 and mid-2007, sold 27 miles of the railroad to a salvage company (Montoff Transportation) for $976,000. The city retained the portion of railroad in and near Chillicothe.
In the lawsuit, Johns alleges that the city received assets from the RDI by illegal purchase, without the benefit of bidding as is required by Missouri law, and after having been advised of the illegality of the purchase, that the assets being purchased were the subject of a prior lien. He alleges that the city participated in a conspiracy to waste assets, convert loan collateral in an illegal manner to their own uses and participate in a fraudulent real estate transfer.
