Ex-Poplar Bluff city manager offered work to financial firm

POPLAR BLUFF, Mo. -- Emails provided to the Daily American Republic appear to show that former city manager Heath Kaplan offered work to a financial advisory group in Poplar Bluff several days before he officially signed on with the city.

Kaplan later advocated for city council members to give First Southwest of Greenville, Texas, two significant contracts without taking competitive bids. The council agreed to one in October but declined another in April. Seeking bids for the second project saved taxpayers more than $125,000.

In a series of emails that began at 12:50 p.m. July 31, Kaplan wrote to First Southwest managing director Jim Sabonis: "I am moving to Missouri! I gave my 2 weeks notice yesterday to become the next City Manager in Poplar Bluff, Missouri. Ready to help me there?"

Sabonis responded about 10 minutes with, "Congratulations!" and a request for Kaplan to call him.

Kaplan signed a contract Aug. 5 to work for Poplar Bluff.

First Southwest later was hired in November by the city when Kaplan cited time constraints as a reason to act quickly.

The company served as financial advisers in the issuance of more than $6.4 million in bonds by a special taxing district to make payments to Eight Points developers, according to city council minutes from November. Council documents from November show the proposed fee was to include a $25,000 nonrefundable retainer and 1 percent of the gross proceeds of the bonds -- an estimated $64,400. No bids were taken for the project.

Kaplan requested that First Southwest be hired again in April, telling council members there were few firms in the country capable of offering the same kind of service. This time, the financial adviser would have assisted with the issuance of $14 million in bonds related to the Eight Points development.

First Southwest would have charged $140,000, while a St. Louis firm, WM Financial Strategies, bid the project for less than $15,000.

The newspaper was provided with several thousand emails from Kaplan's mailbox in Muskegon County, Michigan. The source who provided the documents has asked not to be identified for fear of retaliation.

The documents also revealed conversations between Kaplan and Information Systems Intelligence owner Ryan Leestma. The Daily American Republic previously reported on these emails, which contained flight information for Leestma to travel to Poplar Bluff within days of Kaplan's official start of work for the city Aug. 18. Documents obtained from the city of Poplar Bluff showed the city paid for other ISI employees to travel to Poplar Bluff the same date as the ticket secured by Leestma.

Officials also did not seek bids before giving ISI more than $3 million in city technology contracts.

Kaplan was fired by the city May 12. The sheriff's department has begun an investigation into illegal purchasing and bidding practices through the city manager's office.