The 3,085 pages of City Hall emails released Thursday by Mayor Rahm Emanuel’s administration begin with a short message dated Oct. 21, 2014, from the Chicago Public Schools:

“MACDONALD, Laquan M/17 yrs old . . . 10th grade student at YCCS-Sullivan House Alternative HS . . . shot and killed on October 20, 2014,” reads the rather unremarkable note about the teen’s death.

What would unfold over the next 14 months would be anything but unremarkable.

Eventually, Chicago police Officer Jason Van Dyke would be charged with killing McDonald, and a police video of the shooting would be viewed around the world.

As the situation evolved, Emanuel’s staff went from fact-gathering mode — and negotiating a $5 million settlement with McDonald’s family to avoid a wrongful-death lawsuit — to crisis management, monitoring everything from national news coverage of daily protests to comments that activist-priest Michael Pfleger and others said on TV and posted on Facebook, the emails show.

Over and over, mayoral aides were obsessed with how their boss was being portrayed — keeping tabs on who was seemingly in his corner — and worked to deliver a unified “message” that he was seeking justice in the case.

The records, obtained under the Illinois Freedom of Information Act, also reveal that Emanuel’s office communicated repeatedly about the McDonald case with the “independent” agency that decides whether police shootings are justified, the Chicago Sun-Times reported in its Friday editions. Aides to the mayor said those communications were routine and didn’t interfere with the Independent Police Review Authority’s investigation.

Other emails show just how quickly City Hall became aware the McDonald shooting was a heater case and the steps mayoral aides took as it intensified. Here’s a closer look at some of those developments:

After the shots

On Nov. 14, 2014, less than a month after McDonald’s death, City Hall’s law department began requesting video of the shooting from the police.

By the second week of December, city officials were fielding questions from journalists — including Chicago Sun-Times columnist Mary Mitchell — about a web posting by University of Chicago law professor Craig Futterman and journalist-activist Jamie Kalven that called on City Hall to release video footage of what had happened at the shooting scene near 41st and Pulaski. According to the Futterman-Kalven post, a witness saw the teen “shying away” from the police at the time a cop — later identified as Van Dyke — opened fire.

In a story posted on the website Slate on Feb. 10, 2015, Kalven disclosed that autopsy records showed McDonald had been shot 16 times. A link to the story was quickly shared among top mayoral aides, Emanuel’s press staff, police department general counsel Ralph Price and Stephen Patton, Emanuel’s chief City Hall lawyer.

Questions about the case intensified after City Hall reached the $5 million settlement with McDonald’s estate — a deal announced in April, shortly after Emanuel won re-election.

Reporters kept seeking the police video of the shooting. Eventually, a judge ordered the city to release it, despite City Hall’s objections.

“We lost,” city law department spokesman Bill McCaffrey emailed to his colleagues from court on Nov. 19. “Court ordered release by Nov 25.”

Damage control

With the video due out, Emanuel’s staff — particularly Kenneth Bennett, deputy chief of staff for public engagement — reached out to community leaders to attempt to prevent a firestorm.

Of particular concern was the Rev. Pfleger, pastor of the large African-American congregation at St. Sabina parish.

After Pfleger went on TV on Nov. 20 and said Van Dyke should be fired, mayoral spokesman Adam Collins emailed colleagues: “Not sure who has the best relationship, but it looks like there might be value in putting in a call to Pfleger about the process here.”

Bennett replied that he’d already spoken with him. “I can call Pfleger again but he stated to me Thursday that he would continue to call for the termination of this officer.”

The next day, Emanuel communications chief Kelley Quinn quoted a Facebook post from Pfleger in an email to Bennett and others. According to Quinn’s email, Pfleger wrote: “The officer who killed LaQuan McDonald . . . His lawyer said yesterday that the shooting was justified because the officer felt threatened. . . . How much of a threat was he after getting shot 3 times . . . that gave you permission to shoot 13 more times?????”

Later in the day, Bennett emailed, “I left Pfleger a message earlier. Waiting for his call back. He may require a call from [then-police Supt.] Garry [McCarthy] assuring him of our commitment to a transparent process. . . . I can also try to talk to him about a calmer tone in his comments and on social media.”

Assessing the fallout

Quinn kept the mayor and his staff regularly updated on news stories about Van Dyke and the video.

At 10:46 p.m. on Nov. 24 — the day charges against Van Dyke were announced and the video was released — Quinn emailed Emanuel directly, writing, “Mayor, the release of the video is the leading news item across the country on Tuesdays [sic] night. . . . With the release of the video, the coverage is highlighting the ferocity of the officer’s actions and the rawness of the footage.

“The coverage is highlighting YOUR efforts to urge calm before the video was released, but also notes how upset community members are about the developments surrounding the video. Furthermore, the coverage highlights the number of questions that protesters and commentators say still linger: Why did it take so long to press charges against the officer?; Why wasn’t the video released earlier?; Why is the police superintendent still in power?”

Emanuel fired McCarthy on Dec. 1.

As for the video’s release, the mayor had maintained he was waiting for criminal investigators to finish their work before making it public.

Aides repeatedly expressed frustration that the message didn’t always seem to be getting out.

One reporter, for example, said in a story that “Emanuel’s administration tried to keep the recording of McDonald’s death from becoming public.”

“I’d like to push back on this,” Collins wrote to Quinn on Nov. 26. It’s one of several references to the mayor’s press office doing a “push back” to media stories, columns or editorials.

Attorney general surprise . . . sort of

On Dec. 1, Illinois Attorney General Lisa Madigan sent — and publicly released — a letter to U.S. Attorney General Loretta Lynch requesting a federal inquiry into the police department.

“Trust in the Chicago Police Department is broken, especially in communities of color in the City of Chicago,” Madigan wrote. “Chicago cannot move ahead without an outside, independent investigation into its police department.”

The mayor’s office was taken by surprise. “We’re [sic] we given a heads up?” Quinn wrote a number of top mayoral aides, including Patton, mayoral adviser David Spielfogel and Melissa Green, who leads the city’s office in Washington, D.C.

“By who?” responded Green. “No.”

In fact, Madigan’s office had warned at least one Emanuel official the letter was coming. “Here it is,” Madigan chief of staff Ann Spillane emailed at 4:49 p.m. on Dec. 1.

The mayor’s office drew up a statement emphasizing Emanuel’s plan to form a commission to look at police reforms, and Spielfogel signed off on it. On Dec. 2, the mayor told reporters the idea of a federal probe was “misguided.”

The statement was met with another round of criticism. That evening Democratic presidential front-runner Hillary Clinton — who’s known Emanuel since he worked as a fund-raiser for Bill Clinton during his first presidential campaign and went with him to Washington as a  White House aide— called for a federal investigation into the police department. Mayoral aides emailed each other the news.

The next day, Emanuel reversed his position, saying he “welcomed” a Justice Department inquiry.

His aides prepared for the unfavorable news coverage.

“Still going through calls with beat reporters,” Collins wrote Spielfogel. “Expect the theme to be that he backtracked.”

It was.

Four days later, on Dec. 6, Lynch announced the Justice Department would indeed open an inquiry into the police department.

“Oh my”

On Dec. 1, the Sun-Times’ Lynn Sweet reported that U.S. Rep. Luis Gutierrez, D-Illinois, was withdrawing his support for the re-election of Cook County State’s Attorney Anita Alvarez. Gutierrez said the year-plus it took for Alvarez to bring charges against Van Dyke was “inexcusable.”

Clothilde Ewing, a mayoral aide who specializes in “strategic messaging,” forwarded the story to Spielfogel.

“Oh my,” she wrote, possibly worried that Gutierrez might tee off on the mayor, too.

Emanuel was soon in touch with Gutierrez, an important Latino ally who co-chaired the mayor’s re-election campaign, to make sure they were on the same page.

In an interview on MSNBC that afternoon, the congressman praised Emanuel’s plans to assemble a police reform commission.

Soon after, a Gutierrez aide emailed a clip of the interview to mayoral staffers. “He spoke personally with MRE about message this afternoon,” the congressional aide noted.

“They spoke for about 15 minutes,” replied Emanuel aide Adolfo Hernandez. “Good call and MRE was fine after.”

When the Chicago Teachers Union rallied at Grant Park one frigid night in November, protesters from Action Now were there. So were members of community groups from Brighton Park and Kenwood, showing support for the CTU in its long-running battle with Mayor Rahm Emanuel.

Activists from across Chicago long have stood together with the teachers union in its bitter feuds with Emanuel. But in only the last 1-1/2 years, financial connections have added to those ideological ties.

A newly wealthy charitable foundation formed by the CTU is funding the three groups at the November rally and many other organizations allied with the union, according to records obtained by the Chicago Sun-Times.

Fueled by the CTU’s $48.5 million sale of a Gold Coast apartment building in 2014, the Chicago Teachers Union Foundation Inc. has handed out millions of dollars in grants.

The foundation only had assets of about $80,000 and gave just $12,000 in scholarships a couple of years ago, before receiving a huge infusion of money from the apartment building.

In 2014, the CTU’s foundation doled out about $1 million in grants, according to its federal tax returns. And the foundation increased that giving to nearly $2 million last year, labor leaders say.

Some of those contributions went to purely charitable or educational groups, including the DuSable Museum and Mercy Home for Boys and Girls. Records show hundreds of thousands of dollars from the foundation also went to groups that are highly active in the pitched policy debates between Emanuel and the CTU, which is calling for Emanuel’s resignation.

In addition to Action Now, community groups that have received funding from the foundation include:

• Kenwood-Oakland Community Organization.
• Brighton Park Neighborhood Council.
• Albany Park Neighborhood Council, now known as Communities United for Quality Education.
• Logan Square Neighborhood Association.
• Pilsen Alliance.
• Enlace Chicago.
• Raise Your Hand Illinois.
• Crossroads Fund.
• Blocks Together.

Union leaders say members of Action Now and the Kenwood-Oakland and Brighton Park neighborhood groups joined CTU President Karen Lewis at a “solidarity rally” at Grant Park in November. The CTU members demonstrated ahead of a vote authorizing what could be their second strike in four years.

The Kenwood-Oakland organization, known as KOCO, got $30,000 from the teachers union in 2014 and $60,000 last year. The group receives another $60,000 a year from the American Federation of Teachers, whose affiliates include the CTU, according to U.S. Labor Department documents.

KOCO had the CTU’s backing when they waged a 34-day hunger strike last year to protest the Chicago Board of Education’s plans for Dyett High School. The group also had sued the Chicago Public Schools in 2013 over the closure of a record 50 schools — which the CTU also vehemently opposed.

Ald. Will Burns (4^th), an Emanuel ally and frequent target of KOCO, says he didn’t know the teachers union was funding the neighborhood group.

“It doesn’t surprise me in the least bit, given the ideological consistency between KOCO and the CTU,” says Burns, an Emanuel ally. “It does cause one to ask if they are representing the community or the CTU.”

But CTU vice president Jesse Sharkey says the union doesn’t dictate the policy positions of groups it chooses to benefit from foundation funds.

“We don’t want to be a group you have to be nice to or else you won’t get our money,” Sharkey says.

KOCO executive director J. Brian Malone says he felt no pressure from the union.

“It’s not like they say ‘We’re going to pull the money if you don’t show up to this thing,’” Malone says, referring to CTU rallies attended by his group’s members.

The wellspring of the foundation’s wealth is an apartment tower the CTU built at 55 W. Chestnut in the early 1960s. The building was meant to house retired teachers at discounted rents, but few union members lived there.

In 2014, months before the sale of the building, union leaders shifted more than $8 million from the tower’s accounts to the foundation. Some of the newfound riches went toward the first round of 22 contributions.

After the apartment tower sold in October 2014, the union budgeted about half of the proceeds from the $48.5 million deal to buy and renovate a building at 1901 W. Carroll, Sharkey says. The recently acquired building on Carroll is owned by the foundation, which will have its headquarters there and lease space in the building to the CTU and another office tenant.

The foundation has the rest of the apartment tower windfall at its disposal, CTU officials say.

“We want to be around for a while, so the money won’t all go out in the first year,” says the foundation’s newly hired executive director, Carmen Curet.

Although most of the foundation’s grants were doled out locally, one of the biggest recipients — getting a total of $200,000 — is the Arizona-based Network for Public Education. The network’s co-founder and board president is Diane Ravitch, a New York University professor and nationally prominent blogger who has supported CTU in its battles with City Hall.

Ravitch says the grant money from the foundation was used to pay for teachers, parents and students to attend her group’s annual conferences and to produce a “national report card” next month grading states on how much they support public education.

The Raise Your Hand parent group, based on the North Side, got $35,000 last year and $20,000 in 2014. Raise Your Hand’s total revenue was about $56,000 in the year it received the first gift from the CTU foundation.

“It was an unsolicited grant,” says the group’s director, Wendy Katten, who often speaks out against Chicago schools’ policies.

Katten says CTU official Jackson Potter offered the grant money and she replied that Raise Your Hand would accept — “as long as you know there’s no strings attached.”

“They don’t have a role or voice in anything we do,” Katten says.

The Brighton Park Neighborhood Council has used the $75,000 it received from the foundation over the last two years for a mentoring program at Kelly High School, says Patrick Brosnan, the group’s executive director.

“CPS used to fund programs like that but they don’t anymore,” he says.

Besides joining CTU at its Grant Park rally in November, the Brighton Park activists recently protested plans for new charter schools on the Southwest Side together with teachers union members. The Emanuel-appointed Board of Education has allowed the rapid expansion of charter networks, which often employ nonunion teachers, even as officials have shuttered traditional, unionized public schools.

Brosnan says the CTU foundation cash had no bearing on his group’s positions on the latest charter-school fight or other policy issues.

“We’ve been organizing on these issues long before CTU gave us resources,” he says.

The Crossroads Fund, a nonprofit group that has received $300,000 from the teachers union foundation, passes on the money to small community organizations in the city promoting public participation in education and other policy issues, says Jeanne Kracher, the group’s executive director.

The Crossroads Fund had presented CTU leader Lewis with an award for activism in 2013.

The emergence of the CTU’s foundation as a major contributor to local groups “is a great development,” Kracher says. “We are interested in racial, social and economic justice, and they are as well.”

The cash-strapped city of Chicago paid $74.7 million in fees last year to banks, law firms and other businesses that helped it borrow money — a record tab that will rise as more fees get tallied and one that comes as the city pays higher costs to dig itself out of its deep financial hole.

Altogether, City Hall borrowed $4.6 billion through the municipal bond market in 2015, with firms that worked on those deals netting $28.3 million in fees, a Chicago Sun-Times examination of city records found. On top of that, City Hall paid $46.4 million in other borrowing-related fees through the first three quarters of the year; fees for the fourth quarter have yet to be disclosed.

Most of the firms that help the city with borrowing and other financial transactions have long done business at City Hall. Some also have been political supporters of Mayor Rahm Emanuel, whose plan to fix the city’s finances relies in part on ending costly and risky financial deals from the past.

But, to do that, the city keeps borrowing. And many of the fees associated with borrowing have gone up, a consequence of the city’s credit rating dropping to “junk” status in May. The downgrade also is resulting in the city paying higher interest rates on long-term borrowing deals — costs that can add up over decades.

It’s a trend Chicago taxpayers might have to get used to: Emanuel is planning another $4.15 billion in bond sales in 2016, starting with a $500 million deal this month, according to documents he’s shared with aldermen.

Next up will be another $3.1 billion in bond sales that he’ll seek City Council authorization for this week, the Sun-Times reported Friday. The mayor also is planning two more bond deals totaling $600 million in the second half of the year.

Emanuel, who worked in investment banking for two and a half years before running for Congress in 2002, defended his borrowing strategies last week, saying, “It’s actually what the rating agencies wanted to see us do — to strengthen Chicago’s finances rather than leaving it vulnerable.”

The city’s need to borrow money, as well as the costs associated with borrowing it, has grown partly because Moody’s Investors Service and other financial ratings agencies have downgraded city debt ratings multiple times since 2013. In May, Moody’s — citing uncertainty over how the city will continue to pay for police, firefighter and other city worker pensions — lowered Chicago’s credit rating to its current level: junk bond status.

In the wake of that downgrade, City Hall used bond proceeds to refinance existing city debt and end financial transactions that had grown costlier because of it. The deals that have been eliminated include so-called interest rate swap agreements engineered under Emanuel’s predecessor, Richard M. Daley, as well as Daley’s 2002 decision to sell the land and tracks beneath the city-owned Orange Line.

Chicago’s Orange Line goes back and forth

The city also has borrowed about $2 billion to bankroll runway and other major construction projects at O’Hare Airport, as well as refinance some of the airport’s debt.

In October, Emanuel and aldermen took steps to shore up police and fire pensions by approving a record $543 million property-tax increase. But the city remains saddled with the junk bond label and the additional costs of borrowing that ensued.

“Moody’s downgraded us, and inside all of our lending documents and all of our swap documents are provisions that say we are in default or had to pay higher [interest] rates because we are below investment grade,” said Carole Brown, the city’s chief financial officer.

As a result, City Hall last year negotiated deals to end 18 different swaps, paying the financial institutions involved a total of $255 million, which came out of bond proceeds.

City Hall hired a consulting firm to assist in those negotiations, Brown said. The city paid the company, Swap Financial Group, $879,088 in fees through the end of July, records show.

The credit-rating nosedive has also resulted in the city paying more in so-called credit enhancement fees because banks consider Chicago a greater financial risk.

Through the first three quarters of 2015, those fees totaled $42.7 million. That’s more than all of 2014, when credit enhancement fees totaled $35.4 million. In 2013, credit enhancement fees totaled $29 million.

The city spent a total of $23 million in underwriting fees for its five big bond sales in 2015 — the highest yearly total by far in the 12 years the city has tracked such fees. Nearly three dozen financial institutions, led by Wall Street giants JPMorgan Chase and Morgan Stanley, were paid for such work.

Another $5.2 million went to law firms, financial advisers, credit-rating agencies, auditors and others who worked on those bond sales.

Many of the financial and law firms tapped by the Emanuel administration have been working on city bond deals for years. Some have been political supporters of the mayor or have executives who serve alongside him on the board of World Business Chicago, a city-funded economic development agency he chairs. Other firms have ties to Daley, Emanuel’s predecessor.

City Hall doesn’t have a formal competitive bidding process for bond business, though it does seek information on financial institutions’ qualifications and community involvement. Only a limited number of financial firms have the expertise to do such work, and the fees City Hall pays appear to be in line with those paid by other municipalities and government agencies.

Among the firms that do borrowing-related business with City Hall:

• JPMorgan Chase: The banking giant received the most borrowing-related fees of any firm, totaling more than $15 million. J.P. Morgan Securities, an affiliated firm, received another $3.8 million. Its current Midwest director — former U.S. Rep. Melissa Bean, a Democrat who served alongside Emanuel in Congress — now serves on the board of directors of World Business Chicago, the economic development organization chaired by the mayor. William Daley, former chief of staff to President Barack Obama and brother of the former mayor, previously served as a top JPMorgan Chase executive. “Yeah, I worked at JPMorgan,” William Daley said. “What does that have to do with bond deals the city’s done in 2015?”

• Morgan Stanley: The financial firm collected $4.7 million in borrowing-related fees from the city in 2015 and was the lead underwriter for a $1.1 billion bond issue in July. One of the firm’s officials is William Daley Jr., son of the former White House chief of staff. In addition to its bond work, Morgan Stanley has been involved in major city privatization deals, serving as the lead investor in the $563 million privatization of the parking garages under Millennium Park and Grant Park in 2006 and in the $1.15 billion privatization of the parking meter system in 2009. Company vice chairman Hugh Sullivan serves on the World Business Chicago board.

• Bank of Montreal: The bank was paid $2.9 million in borrowing-related fees, most of them for credit enhancements. Employees of its Chicago-based subsidiary, BMO Harris, contributed $5,700 to Emanuel’s campaign funds in the days before the mayoral runoff election in April and another $1,500 soon after. David Casper, the president and CEO of BMO Harris, also sits on the board of World Business Chicago.

• Katten Muchin Rosenman: The law firm was paid $726,000 for its work on city bond deals last year. Soon after leaving office as mayor, Richard M. Daley became “of counsel” to the firm, whose partners include his good friend Terry Newman. Newman has donated $12,100 to Emanuel’s campaign committees, including $6,800 last year. Other partners have donated $53,500 to Emanuel. As outside counsel for the city, Katten drafted the legal framework of the parking meter deal.

• William Blair: The investment banking and financial services firm got about $975,000 in bond-related fees from the city in 2015. The company has previously been an adviser to the city for some of its biggest privatization deals, collecting $2.1 million for its work on the sale of downtown parking garages in 2006 and $4.3 million for the parking meter deal.

The financial crisis facing the Chicago Public Schools also has prompted billions of dollars in borrowing over the years. The Sun-Times reported in July that CPS had paid $18.1 million in fees on bond deals since 2011.

Like their counterparts at City Hall, CPS officials are planning more long-term borrowing — more than $1 billion worth — for early this year. Moody’s last month downgraded CPS credit rating, already at junk status, even further, virtually assuring higher interest rates on future borrowing.

In 2002, then-Mayor Richard M. Daley sold the City Council on a plan “to generate millions of dollars of new revenue” by selling the land and tracks beneath the Orange Line and leasing them right back.

Fast-forward 13 years.

Mayor Rahm Emanuel’s administration last summer sold $1.1 billion worth of bonds, with much of that money being used to rid City Hall of the Orange Line deal and others that Emanuel aides say have become a financial drag.

Of the $1.1 billion, $181 million went toward buying back the Orange Line. “We collapsed that deal so now we can own it again,” said Carole Brown, the city’s chief financial officer.

Daley’s decision to sell the Orange Line — which, unlike the other train systems in Chicago, was owned by the city instead of the CTA — caused little stir at the time. The CTA had cut a similar deal for the Green Line four years earlier.

The agreements allowed the private investors who bought the train lines to get lucrative federal tax breaks on their depreciation. Cities and transit agencies around the country, including ones in New York and Washington, D.C., had done similar deals, eventually costing the federal government billions of dollars.

Congress eventually closed the tax loophole, but that didn’t affect deals already in place.

The Orange Line agreement was set to last until 2031, records show, but it had provisions to protect the buyers in the event the city might not be able to make lease payments. Those protections included costly penalties to the city should its credit rating plummet below investment grade.

That’s what happened last May, when Moody’s Investors Service downgraded the city’s credit rating to junk bond status. That led to the city negotiating to end the deal altogether.

It’s not the only Daley deal the city moved to end early using proceeds from the July bond sale. City Hall also used $2.4 million to buy back the city’s 911 computer and radio system from investors.

Bond proceeds also were used to pay $35 million in debt from Daley’s acquisition of the Michael Reese hospital site, which he hoped to use to house athletes for the 2016 Olympics; $62 million to settle a dispute with investors in four downtown parking garages the city privatized in 2006; $18.5 million to settle a dispute involving the parking-meter privatization deal of 2009; and $195 million to terminate interest-rate swap agreements on earlier borrowing.

A Russian immigrant was sentenced Thursday to a year in federal prison for his role in a scheme to falsify documents so he could illegally convert 112 salvaged cars into taxis, creating Chicago’s largest fleet of cabs for his boss, a close friend of former Mayor Richard M. Daley’s son.

Alexander Igolnikov was under pressure from Patrick Daley’s friend, Symon Garber, to buy more cars because Garber had gone on a binge buying city-issued taxi medallions and needed more vehicles for his fleet of maroon-colored cabs, according to Edward Genson, Igolnikov’s attorney.

“He did this to satisfy the cab company’s desire to put as many cabs on the street,” Genson told U.S. District Court Judge Edmond Chang.

Chang said Igolnikov’s scheme would have likely continued indefinitely if not for a crackdown by the Daley administration in response to a Chicago Sun-Times investigation in 2010.

The Sun-Times reported that Garber’s companies — Chicago Carriage Cab and Royal 3CCC, which form the city’s biggest fleet of taxis — had converted salvaged wrecks into cabs in violation of a city regulation enacted under Mayor Daley.

Igolnikov, a 68-year-old grandfather from Northbrook, had faced a possible sentence of as much as five years in prison after pleading guilty last year to a single count of securities fraud, admitting he laundered the title of a wrecked vehicle so it could illegally be used as a cab.

Assistant U.S. Attorney Steven Dollear argued that Igolnikov should have been sentenced to prison for two years because his scheme put the public at risk between 2007 and 2010.

“Thankfully nobody was hurt,” Dollear said. “Whatever his motive, he made a conscious decision to put 112 salvaged cabs on the streets of Chicago and sat back while the consumers bore the risk.”

Garber, a wealthy Russian immigrant who has a stable of polo ponies, had been operating fleets of taxis in Moscow and New York when he met Daley’s son in Moscow in August 2001. Two years later, the Daley administration gave Garber permission to operate cabs in Chicago. Igolnikov, who had been driving a cab in New York City, moved to Chicago, serving as president of Garber’s company.

Igolnikov became part of the title “laundering” scheme in 2007 along with two Indiana car dealers, who were granted immunity from prosecution. With phony affidavits signed by Indiana police officers, the Indiana car dealers would obtain titles from the Indiana Bureau of Motor Vehicles stating that the wrecked cars had been rebuilt. Then Igolnikov and his cohorts placed stickers over the word “rebuilt,” submitting the Indiana documents to the Illinois Secretary of State, which issued clean titles so the cars could be registered with City Hall as taxicabs.

After the Sun-Times discovered Garber’s fleet included salvaged titles, Chicago Inspector General Joseph Ferguson and the FBI opened an investigation, resulting in Igolnikov’s indictment in 2014.

City Hall found that other cab companies also had salvaged cars in their fleets, but Garber was the biggest offender with 183 salvaged cars. He and his companies paid $815,000 in fines, and agreed to update the fleet of 600 cars.

While a Russian translator assisted Igolnikov in court, he read a statement to the judge in English: “I am very sorry for all of my bad decisions. I make no excuse. . . I am embarrassed. I am ashamed.”

Two years after Mayor Rahm Emanuel closed a record 50 schools over low enrollment, officials say they don’t know where many of the computers, desks, books and other items from those buildings ended up.

After being pressed for more than six months on what happened to the classroom equipment, Chicago Public Schools officials now say they don’t have an answer.

They blame bad record-keeping under Barbara Byrd-Bennett, Emanuel’s disgraced former schools chief, who awaits sentencing after pleading guilty in October to steering millions of dollars in CPS contracts to her former employer in exchange for what prosecutors said were promises of kickbacks.

“Unfortunately, the previous CPS administration did not adequately manage or keep records on the day-to-day operations of the transition logistics,” CPS spokeswoman Emily Bittner says.

Former Chicago Public Schools chief Barbara Byrd-Bennett. | Ashlee Rezin / Sun-Times file photo

Byrd-Bennett couldn’t be reached for comment. Like her successor, Forrest Claypool, she reported to Emanuel.

The 50 schools were shuttered in a cost-cutting move that caused an uproar on the South Side and the West Side, which felt the brunt of the closings.

The principals of schools that received the 12,000 displaced children were able to go to warehouses and choose equipment that had been moved out of the closed schools, according to Bittner.

But CPS record keeping was lax in charting what was moved out of the closing buildings and where it ended up, according to interviews and CPS records that show:

• CPS says it has no records on what happened to any of the books from the closed schools.

• There are more than 9,400 desktop and laptop computers listed on inventories of schools that were closed. Of those, 3,724 were “redeployed” to other schools or to CPS headquarters, according to CPS, which says the rest were “disposed” of — though how or where isn’t clear.

• More than 33,000 chairs and roughly 12,000 desks and 6,000 tables were listed in good condition in the closed schools, CPS records show. About 9,500 of those chairs, 3,900 desks and 1,000 tables apparently were moved to other buildings. It’s unclear where the rest went.

“There are so many under-resourced schools that it is just a tragedy for stuff to go to waste,” says Jackie Leavy, the pro bono adviser for the Chicago Educational Facilities Task Force, a state task force.

Two people who were involved in the logistics of the school closings, speaking only on the condition they not be named, say they tried to get equipment to schools that were getting displaced students or to other buildings that could use the materials but that there was so much to move, poor inventories and not enough time.

“A handful of schools, we could have moved, no problem,” one of the sources says.

Only 60 percent of the students from the 50 closed schools ended up at the schools that had been designated for them. The rest ended up at schools throughout the city.

When fewer displaced students than expected ended up enrolling at the “welcoming schools,” the principals had movers come back and pick up items they had just dropped off, according to one of the sources. Other schools got more students from the closed schools than expected, then asked for extra equipment, according to that source.

CPS couldn’t provide a dollar value for the equipment from the 50 closed schools.

The school system originally awarded an $8.9 million contract to Ohio-based Global Workplace Solutions to move materials from the 50 schools and handle other logistics. But taxpayers ended up paying the company far more, records show — about $25 million. CPS officials have said the cost soared because there were more items than anticipated.

Protesters occupied a classroom on June 19, 2013, at Jean de Lafayette Elementary School, one of 50 schools closed as a cost-cutting and consolidation measure by the Chicago Board of Education. AP file photo

Robert Faillo, chief financial officer of Global Workplace Solutions, says he can’t discuss specifics because of a clause in the company’s contract barring it from disclosing such information.

The school closings were supposed to save $43 million a year in operating expenses and hundreds of millions of dollars more in future capital costs. CPS has yet to itemize the projected savings, though.

Frank Clark, the former Commonwealth Edison chief executive appointed by Emanuel last year as president of the Chicago Board of Education, chaired a mayoral commission in 2013 that found CPS could close as many as 80 schools. Clark did not respond to requests for comment.

This was written by Sarah Karp of the Better Government Association.

A co-founder of Cardinal Growth — the venture capital company that bankrolled City Hall projects involving former Mayor Richard M. Daley’s son — has agreed to pay $1.5 million to the federal government, which seized the company four years ago for failing to repay $21.4 million it borrowed from taxpayers.

Robert J. Bobb Jr., a former federal prosecutor who co-founded Cardinal Growth, agreed to pay the U.S. Small Business Administration by last Friday, avoiding a battle in federal court. Bobb also agreed to cooperate with regulators hoping to recover more of the tax dollars that he borrowed to invest in various companies.

Besides Bobb’s payments, federal regulators have collected more than $6.6 million after liquidating Cardinal Growth’s investments, according to a report the SBA filed in federal court two months ago.

The SBA hopes to collect from Bobb’s former partner, Joseph McInerney, who Bobb said was responsible for running the company’s daily operations, according to court records. McInerney, a close friend of the former mayor’s son, Patrick Daley, has failed to respond to the SBA’s demands for his “unpaid (financial) commitments,” the records show.

Bobb, 68, of Chicago, and McInerney, 48, of River Forest, could not be reached for comment.

Bobb and his then-wife Patricia Bobb were friends of Mayor Daley, who appointed Patricia Bobb, an attorney, to the police board in 1998. Two years later, Bobb and McInerney founded Cardinal Growth to invest in financially troubled companies with money from private investors, including Bruce Rauner, now the governor of Illinois, as well as loans from the SBA. The SBA had certified Cardinal Growth as a “small business investment company,” allowed Bobb and McInerney to borrow $2 from taxpayers for every dollar  raised from private investors. Altogether, they borrowed $51 million.

Cardinal Growth invested in companies across the United States. Among them: Municipal Sewer Services, a company they created to take over City Hall contracts for cleaning and inspection of sewers when the original contractor, Kenny Industrial Services, went bankrupt. They bought Kenny’s equipment with money from private investors and the SBA and got $4 million in no-bid contract extensions from the Daley administration.

In documents with the Daley administration, Municipal Sewer Services said it was owned by Bobb, McInerney and Anthony Duffy but failed to disclose two other investors — the mayor’s son and the mayor’s nephew Robert G. Vanecko — who had invested about $65,000 in the company in 2003, a deal  exposed by the Chicago Sun-Times four years later. MSS is now out of business. Duffy went to prison for lying to the FBI about the roles of Daley’s son and nephew.

Joseph McInerney (left) and Patrick Daley | File photos

Two years after the sewer deal, Cardinal Growth invested federal and private money in Concourse Communications, which got a 10-year contract from the Daley administration to install Wi-Fi service at O’Hare and Midway airports. The mayor’s son collected $708,999 for helping find investors, including Blair Hull, the wealthy commodities trader who was running for U.S. Senate, hoping for the mayor’s endorsement.

Patrick Daley made more than $1.2 million on deals with Cardinal Growth while his father was mayor, the Sun-Times has reported.

After the SBA seized Cardinal Growth in summer 2011, regulators forced Rauner and other investors to abide by their financial commitments, which were used to leverage the federal tax dollars. Rauner, who owed $50,000, and the other investors paid the regulators more than $6 million. SBA officials are suing to collect from a few others, including McInerney and Near North Insurance Co., which the government seized after the fraud and racketeering conviction of Michael Segal, Near North’s CEO.

Over the past four years, the SBA has spent more than $3 million, primarily hiring accountants and lawyers to recoup the money loaned to Cardinal Growth.

Over the past 10 years, more than two dozen officers with multiple citizen complaints have been assigned to train recruits at the Chicago Police Department Education and Training Academy, records obtained by the Chicago Sun-Times show.

Out of a total of 460 officers assigned to the academy between 2005 and 2015 — most for just a few days or weeks — 40 percent of them had at least one citizen abuse complaint, often before they were assigned to the academy, the Sun-Times found.

One of them supervised a team of cops who went to prison for ripping off drug dealers, two served in the notorious Special Operations Section, and some were hit with complaints from citizens while they were teaching at the academy.

Since the police department ends up dismissing most of the complaints against its officers — fewer than 4 percent of the cases are “sustained,” based on records the police gave to a group called the Invisible Institute — officials say there’s no reason to ban those officers from teaching at the academy.

“While we can’t speak for prior police administrations, the current process for applying to become a police academy instructor is that you must be highly qualified in a designated area and must undergo an internal screening process to ensure there are no open integrity investigations or disciplinary issues in your background,” police spokesman Anthony Guglielmi said. “This was implemented last year by current training director Deputy Chief Keith Calloway.”

Cops with sustained misconduct complaints no longer are “eligible to serve in an academy position,” Guglielmi said. “While the officers you mentioned do have allegations in their backgrounds, of which the majority were not sustained, they were appointed to positions during a prior administration.”

Attorney Jon Loevy. | Ashlee Rezin / Sun-Times file photo

Still, Jon Loevy, a Chicago lawyer who has won millions of dollars from lawsuits filed by clients who accused the police department of violating their rights, says he’s troubled to learn the background of some instructors at the academy.

“When you’re a Chicago police officer accused of serial misconduct, they put you in charge of teaching young police officers,” says Loevy, who sued the city following a raid on a basketball game by several officers, including one who ended up teaching at the academy. “It’s horrible.”

A lengthy “complaint registry,” or “CR,” history shouldn’t necessarily disqualify an officer from teaching at the academy, says Lori Lightfoot, a former federal prosecutor newly appointed by Mayor Rahm Emanuel as president of the Chicago Police Board, which disciplines cops.

Lori Lightfoot, president of the Chicago Police Board. | Rich Hein / Sun-Times file photo

“Just because you have a CR record doesn’t mean you can’t be an impactful instructor,” says Lightfoot, who is also a member of the five-member task force Emanuel has appointed to review police accountability, oversight and training in the aftermath of the release of a video in late November that showed Officer Jason Van Dyke firing 16 shots into Laquan McDonald.

The video has prompted an investigation of the police department by the U.S. Department of Justice.

The Sun-Times compared a roster of academy instructors, obtained from the police department, with a database maintained by the Invisible Institute of 56,631 abuse complaints involving 8,652 officers covering the periods 2001 to 2008 and 2011 to 2015. The Invisible Institute obtained those records from the police department.

The analysis found:

• Fourteen officers had at least 11 abuse complaints before being assigned to the academy.

• Tops among those was Sgt. Robert T. O’Neill with 27, including 11 accusing him of illegal searches. All but one of the complaints against O’Neill were dismissed. He got a 30-day suspension for that one, an official misconduct complaint accusing him of theft.

O’Neill was detailed to the academy in May 2009, under former Supt. Jody Weis. At the time, O’Neill and 10 other cops, including Officer Corey Flagg, were being sued in federal court, accused of breaking into homes to extort money and steal drugs from drug dealers. O’Neill had been the supervisor of Flagg and three other officers already convicted of federal crimes. In April 2012, the Emanuel administration paid $700,000 to settle the lawsuit. Four months later, O’Neill took a leave of absence from the police academy. He hasn’t returned to the police department.

• Two former members of the department’s notorious, now-disbanded Special Operations Section — Christopher Hoffman and Dustin Roscoe — ended up teaching at the academy. Hoffman, a firearms instructor, had 22 abuse complaints — all ultimately dismissed — that included multiple allegations of misconduct, illegal searches and improper use of force. All came before he was detailed to the academy in 2012, under former Supt. Garry McCarthy. Hoffman is no longer at the academy, according to Guglielmi.

Roscoe, who left the department in 2010, had 19 complaints during his career. Two were “sustained,” including one for an illegal search. The rest were dropped. It isn’t clear how many of the complaints were filed against him before he joined the academy. That’s because the police records incorrectly show his assignment at the academy began in 1900.

• Eighteen officers had at least one complaint filed against them during the time they were assigned to the academy.

• One of those officers had faced six citizen complaints before he was assigned there. He faced five additional complaints while working as an instructor there, including two over his “supervisor responsibilities.” Altogether, that officer has been the subject of 15 citizen complaints of abuse. All have been dismissed.

• Another of those officers — Sgt. Isaac Lee Jr. — was an instructor at the academy when he and 10 other officers raided the South Side apartment of a guitarist named Walter Lee, who sued for illegal search and seizure after a Cook County judge threw out the criminal case against him. City Hall paid him $20,000 to settle his lawsuit, plus $37,402 a federal judge ordered the city to pay his lawyer.

Walter Lee said he was at his sister’s home on Jan. 10, 2007, when the officers burst in, found a handgun on a bed and arrested him on a charge of unlawful use of a weapon. According to his lawsuit, he ended up spending three days in jail because the police mistakenly released another man who claimed to be him.

Isaac Lee has been the subject of 22 complaints, including 11 before he was detailed to the academy in June 2008, under former Supt. Weis. Two were sustained, including one for improper use of force. It’s unclear, though, whether the illegal raid resulted in a complaint because the database of complaints doesn’t include details of the incidents.

According to the data the police provided to the Invisible Institute, most instructors at the academy haven’t faced any complaints during the periods those records cover.

One set of those police records contains basic information on cases involving 662 officers with at least 10 complaints over a five-year period ending in May 2006. Another set of records has information on 185 officers with at least five abuse complaints between May 2002 and December 2008. The last set of those records includes all complaints filed between 2011 and 2015, involving thousands of officers.

But, given the time gaps, the records don’t include every complaint over the past decade.

There’s no complaint against Officer George Cancel, the police academy’s master Taser instructor. Yet Cancel, who has been detailed to the academy since 2008, said in sworn testimony in a court deposition on Dec. 13, 2012, that he has been the subject of “numerous” abuse complaints for excessive force.

George Cancel, the police academy’s master Taser instructor. Sun-Times file photo

According to the transcript, Cancel said none involved the use of a Taser, the stun device that Emanuel plans to issue to more officers as a result of criticism that equipping officers with a Taser might have prevented McDonald’s death.

During Cancel’s deposition, attorney Barry C. Owen asked him, “Have you ever been accused of using excessive force?”

Cancel replied, “Yes.”

“Do you know how many times?” Owen asked.

“Numerous,” Cancel answered. “Can’t give you a specific number.”

Guglielmi says Cancel has no sustained complaints in his record.

The police department has a complaint registry history on its officers dating to 1967.

The Sun-Times, the Chicago Tribune and Jamie Kalven of the Invisible Institute all have filed public records requests under the state’s Freedom of Information Act asking for summaries showing the number and type of complaints against each officer and the outcome since 1967.

In response, the city’s police unions sued to block the release of that information, citing provisions in their contracts that prohibit the department from keeping records on disciplinary cases more than four years old.

A Cook County judge has issued a preliminary order barring the release of those records.

Separately, an arbitrator, ruling on a contract grievance filed by the Fraternal Order of Police, said earlier this month that the city’s contract with its largest police union requires it to destroy records older than that.

As a result of the litigation, the police department has refused to make public even summaries of complaints more than four years old. Nor would it release older records it previously provided to the Invisible Institute.

For nearly two months, Mayor Rahm Emanuel’s administration has been sitting on a report urging punishment — including firing — of the police officers who failed to charge a nephew of former Mayor Richard M. Daley with killing David Koschman.

But the Chicago Sun-Times has learned that six cops have been singled out for discipline in the report that City Hall Inspector General Joseph Ferguson delivered to City Hall several weeks ago.

Pressed for weeks by the Sun-Times about the delay in disciplining cops, Emanuel’s acting police Supt. John Escalante said Friday he is “pursuing” punishments that “range from suspension without pay to job termination” for cops involved in the Koschman case.

But Escalante refused to identify any of the six cops Ferguson urged be sanctioned until formal disciplinary charges are filed with the Chicago Police Board — something that hasn’t been done yet.

Escalante’s statement comes two years after Daley nephew Richard J. “R.J.” Vanecko pleaded guilty to involuntary manslaughter, exposing what Koschman family lawyers labeled a coverup that had allowed him to escape criminal charges for years. Escalante is among several candidates seeking to become the city’s next top cop.

In the time since Ferguson sent his report recommending discipline for the six cops to the Chicago Police Department, the mayor’s office and Emanuel’s law department, three of the officers have retired, so they are no longer subject to disciplinary action.

Constantine G. “Dean” Andrews, left, with then-Supt.
Supt. Garry McCarthy in 2012. | Rich Hein / Sun-Times

Former Chief of Detectives Constantine G. “Dean” Andrews, 51, and former Cmdr. Joseph P. Salemme, 56, retired in early December. Andrews — whose retirement came just two months after he was promoted to chief of detectives by former Supt. Garry McCarthy — and Salemme are getting pensions that top $100,000 a year.

Detective James G. Gilger, 58, also has decided to retire. His last day is Sunday, he said on Facebook.

The other officers — Lt. Denis P. Walsh, Sgt. Sam J. Cirone and detective Nicholas J. Spanos — remain on the city payroll. But they also could avoid any punishment by retiring.

Dan K. Webb, the court-appointed special prosecutor who charged Vanecko, also considered charging the six cops with obstructing justice or official misconduct but decided he lacked the evidence to convict them.

Emanuel and McCarthy directed Ferguson to determine whether any officers should be disciplined after Vanecko’s guilty plea on Jan. 31, 2014.

The plea came nearly three years after the police, asserting that Vanecko acted in self-defense, closed the case as Daley was preparing to retire as mayor. Vanecko hadn’t made the self-defense claim himself. He had refused to speak to police or prosecutors.

Escalante’s decision to discipline the Koschman cops — a group that includes clout-heavy officers with long histories of complaints, including Walsh, who was once charged with sexual assault — comes amid a civil rights investigation of the police department by the U.S. Department of Justice in the wake of public outrage following the release of video showing 17-year-old Laquan McDonald being shot 16 times by a cop.

City Hall also has hired a law firm, Greenberg Traurig, to review Ferguson’s findings.

Emanuel’s office and his law department have refused to release Ferguson’s recommendations. On Christmas Eve, they rejected Sun-Times requests, made under the Illinois Freedom of Information Act, seeking Ferguson’s report.

City Hall maintained that the inspector general’s records are confidential, saying the report contains material from the grand jury impaneled by Webb. The grand jury records remain sealed by Cook County Circuit Judge Michael P. Toomin.

“Particularly in light of pressing questions about transparency and delays in disclosure, it is very distressing to learn that the inspector general’s report was completed months ago and has not been released to the public,” say attorneys Locke Bowman and G. Flint Taylor, who have been representing Koschman’s mother, Nanci Koschman. “The Emanuel administration can’t possibly think the public isn’t interested.”

Attorney Thomas Needham

Thomas Needham, an attorney representing Andrews and Salemme, called Ferguson’s recommendations “idiotic.”

“I am tempted to say the inspector general’s findings are a joke,” Needham said Saturday. “But this case has been no laughing matter to the law enforcement professionals whose reputations have been damaged by this farce of an investigation.

“All of the detectives and all of the supervisors involved in the Chicago Police Department’s reinvestigation of the Koschman/Vanecko case are fair and competent investigators,” Needham said. “None of them were political, none had any affiliation with Mayor Daley or his family, and certainly none of them had any reason to jeopardize their careers or good names to help Mr. Vanecko. In fact, in private, they were highly critical of Mayor Daley.”

Richard J. “R.J.” Vanecko leaving court in December 2012 . I Brian Jackson~Sun-Times

The city’s decision to finally discipline police officers is the latest twist in a saga that began on April 25, 2004, when Vanecko, then 29, punched Koschman, 21, during a drunken encounter on a sidewalk outside the late-night bars along Division Street. Vanecko and a friend ran away. Koschman died 11 days later of severe brain injuries.

The initial police investigation ended in less than a month after witnesses couldn’t identify the 6-foot-3, 230-pound Vanecko in a lineup that included five Chicago cops who were all bigger or taller. The case remained open and unsolved.

When the Sun-Times requested the case files in January 2011, the police reinvestigated, closing the case without charging Daley’s nephew.

A series of Sun-Times stories revealed holes and inconsistencies in the department’s 2004 and 2011 investigations, among them missing case files and statements having been attributed to witnesses that the witnesses said they’d never made.

Over the objection of Cook County State’s Attorney Anita Alvarez, Toomin granted a request from Koschman’s mother to appoint Webb, a former U.S. attorney, as special prosecutor to investigate Koschman’s death and the handling of the case by police and prosecutors.

Webb’s investigation led to the criminal charge against Vanecko. But Webb said he couldn’t charge anyone from the police department involved in the 2004 investigation because of the statute of limitations. And he said he lacked enough evidence to charge any cops who were involved in the 2011 investigation.

City Hall Inspector General Joseph Ferguson. Rich Hein / Sun-Times file photo

Ferguson’s investigation enraged two police unions representing sergeants and lieutenants.

The unions argued that their contracts dictate that disciplinary investigations be handled by the department’s internal affairs division — which previously investigated Walsh over the missing files. But since IAD had been involved in the case, McCarthy said Ferguson should weigh any disciplinary action against the cops — a decision the unions fought, which delayed any punishment for months. An arbitrator ruled against the unions last August.

Andrews, Salemme, Cirone, Gilger and Spanos all had been involved in authoring or approving the police report that closed the case, which said Koschman yelled “F— you! I’ll kick your ass!” before “breaking away from his group of friends and aggressively going after Vanecko.”

Webb found no evidence that Koschman ever said that. But the statement still ended up in the final police report after being discussed in a series of emails that Andrews and Cirone exchanged via personal email accounts the night before Gilger and Spanos submitted the report on Feb. 28, 2011.

Mug shot of Lt. Denis P. Walsh following his criminal sexual abuse arrest in Michigan in August 2004. Kalamazoo Township, Michigan, police

Walsh, a 29-year veteran of the department, was involved in four instances of missing files in the case, including some files he took home, Webb found.

Though Walsh had no official role in the 2004 or 2011 investigations, Webb also found evidence Walsh was communicating in 2011 with detectives from both investigations. Webb never explained why.

Court records show that, in 2013, Webb turned over the evidence he gathered in the Koschman case to the FBI, including Special Agent Vick Lombardo. Lombardo is involved in the Justice Department probe of the police department prompted by the release of the McDonald video.

Police Cmdr. Joseph Salemme, seen in April 2010. Sun-Times file photo

Four of the Koschman cops — Salemme, Walsh, Cirone and Spanos — have received “merit promotions” over the years, all moving into higher-paying positions based in part on recommendations from higher-ranking officers in the department. Spanos, for one, became a detective based on the recommendation of Andrews.

All six cops have had multiple complaints filed against them by citizens or members of the department, records show. Gilger has had 28 complaints, Spanos 25 complaints, Salemme 21, Andrews 18, Cirone 17 and Walsh 28. Nearly all of those complaints were dismissed.

Detective James Gilger, who recommended closing the Koschman case without any charges based upon a fabricated witness statement. | Facebook

Walsh has been disciplined five times — more than any of the other officers. His longest suspension came after he was arrested in Michigan in 2004 on a charge of criminal sexual assault, accused of groping and licking a clerk at a gas station in an incident caught on surveillance video. That felony arrest could have cost Walsh his job. But he ended up pleading guilty to misdemeanor assault and battery, after the victim stopped cooperating, and he was fined $600. Then-Police Supt. Phil Cline suspended Walsh for 30 days.

Walsh received a merit promotion to lieutenant in October 2004 — about two weeks before he pleaded guilty in the Michigan case. In 2010, he was promoted to oversee all North Side detectives.

Walsh comes from a police family. His late father was a commander in the old Rogers Park district when he got in hot water for refusing to press criminal charges against a son of ward boss Ed Kelly after Kelly’s son was arrested for carrying a gun in a restaurant.

Walsh’s brother was a high-ranking Chicago cop. Walsh’s nephew is a cop. Walsh’s wife was a cop. Her father is a retired detective, and her sister was a member of Daley’s police security detail. Walsh’s uncle was a high-ranking cop whose son, Walsh’s cousin, is a police captain.

Sgt. Sam Cirone, left, with Cook County State’s Attorney Anita Alvarez in January 2011. | Sun-Times file photo

Cirone also comes from a police family. His late father was a detective.

Dan Herbert, an attorney representing Walsh and Cirone, said, “I don’t know how the police department is going to find that my clients committed a rule violation, so I’m curious to see the findings” that Escalante presents to the police board.

After Vanecko pleaded guilty two years ago, Koschman’s mother filed a federal civil rights lawsuit against the Daley nephew, City Hall, the police department, 21 cops, Alvarez and other prosecutors. A judge threw out the suit, saying Nanci Koschman had waited too long to file it. After she appealed, the city settled with her for $250,000, and Alvarez settled for another $50,000.

Three of Alvarez’s top prosecutors involved in the Koschman case have gone on to be judges: U.S. District Judge John Robert Blakey, Cook County Circuit Judge John Mahoney and Associate Cook County Judge Shauna Boliker.

One of Vanecko’s attorneys, Marc Martin, has been appointed by the Illinois Supreme Court to fill a vacant Cook County judgeship. Martin is seeking election to that seat in the March primary.

David Koschman

Two years after former Mayor Richard M. Daley’s nephew admitted killing David Koschman, Mayor Rahm Emanuel’s interim police superintendent moved Wednesday to fire a high-ranking cop involved in the case and suspend two other officers for a year.

Acting Supt. John Escalante wants to fire Lt. Denis P. Walsh — a 29-year veteran who comes from a Chicago police family — over Koschman case files that disappeared and reappeared, including some that Walsh took home after the police closed the case in 2011 without charging Daley nephew Richard J. “R.J.” Vanecko.

Escalante is seeking a one-year, unpaid suspension for Sgt. Sam Cirone — a 23-year Chicago Police Department veteran whose father was a detective — over shoddy oversight of Detectives James Gilger and Nicholas Spanos, who closed the case without interviewing witnesses including Daley family members who were with Vanecko hours before he punched Koschman on April 25, 2004.

Spanos — with the department for 20 years — also has been handed a one-year suspension without pay.

All three cops have been stripped of their police powers.

Escalante’s moves came in response to recommendations he received Dec. 4 from City Hall Inspector General Joseph Ferguson that Walsh, Cirone, Spanos and three other cops be punished for their conduct during a 2011 reinvestigation prompted by inquiries from the Chicago Sun-Times.

During the weeks Escalante was reviewing Ferguson’s report, those other three officers retired and avoided departmental disciplinary action. They are Chief of Detectives Constantine “Dean” Andrews, Cmdr. Joseph Salemme and Gilger, who officials say had been planning his retirement for a year.

It’s unclear whether Escalante followed Ferguson’s recommendations on the severity of the punishments.

Escalante filed the internal disciplinary charges against Walsh and Cirone with the Chicago Police Board, which ultimately will decide whether to uphold the punishments. An initial hearing is set for Feb. 23.

Walsh has been suspended without pay pending police board action. Cirone and Spanos are on desk duty for now.

If Spanos fights his suspension, his case also could end up before the police board, a nine-member panel headed by attorney Lori Lightfoot, an Emanuel appointee.

“After a thorough investigation by the inspector general and subsequent legal reviews by outside counsel, interim Superintendent John Escalante concluded that Lt. Denis Walsh, Sgt. Sam Cirone and Detective Nicholas Spanos did not properly follow department policies when they investigated the death of David Koschman,” the police department said in a written statement.

Daniel Herbert, an attorney for Walsh and Cirone, called the disciplinary charges filed by Escalante “vague and baseless.

“Anyone from the police department who signed off on these charges should be embarrassed,” Herbert said. “My clients are two of the most decorated and esteemed members of this department who have ever served.”

Koschman died of severe brain injuries in May 2004, 11 days after he was punched in the face by Vanecko, who then ran away. Witnesses couldn’t pick Vanecko out of a lineup held nearly a month later, and the police left the case open until January 2011, when the Sun-Times made a public records request to see case files.

Walsh told department higher-ups he couldn’t find the original files. So Andrews ordered a reinvestigation of the case, assigning it to Gilger and Spanos, who reported to Cirone and Salemme. Walsh was supposed to have no role in the reinvestigation, which ended on March 1, 2011, when Andrews closed the case, asserting that Vanecko had punched Koschman in self-defense — even though Vanecko, who never spoke with the police, hadn’t made that claim himself.

Daley retired as mayor less than three months later.

A series of Sun-Times stories about the case led to the appointment of a special prosecutor, former U.S. Attorney Dan K. Webb, and to Vanecko pleading guilty to involuntary manslaughter on Jan. 31, 2014, and serving 60 days in jail.

Richard J. “R.J.” Vanecko leaving court in December 2012. I Brian Jackson~Sun-Times

Webb’s investigation found that Walsh had been communicating in 2011 with Ronald E. Yawger, the retired detective who failed to solve the case in 2004, and Gilger, the lead detective in the reinvestigation, who told Webb he’d been told not to talk to Yawger.

Escalante is accusing Walsh of violating eight department rules, including “incompetency or inefficiency in the performance of duty,” removing department records and making a false report. Walsh is accused of compromising the 2011 reinvestigation “by communicating with Detective James Gilger and/or retired Detective Ron Yawger and/or exchanging unprofessional emails with Cmdr. Gary Yamashiroya regarding the Koschman homicide investigation.”

A week after the Sun-Times asked to see the Koschman files, Walsh exchanged emails with his supervisor, Yamashiroya, in which he attached a 2004 Sun-Times story that quoted then-police Supt. Phil Cline saying there would be no charges in the Koschman case. “Looks like the case is over……can we get Cline to close it,” Walsh wrote in his email.

Walsh sent another “unprofessional” email six months after that, according to the charges, referring to the suicide of Michael Scott, Daley’s former school board chief.

Escalante is accusing Cirone of breaking five department rules stemming from his supervision of Gilger and Spanos, who failed to interview Officer Edwin Tremore, the beat cop who wrote the first report on Koschman’s injuries; to obtain telephone records from anyone involved in the case; to interview Vanecko’s friend, Craig Denham, regarding where they went after they ran from the scene; and to interview anyone who’d been with Vanecko at an engagement party for his cousin, Katherine Daley, hours before the deadly encounter with Koschman on a sidewalk near the late-night bars along Division Street.

Gilger and Spanos’ final report also included a fabricated statement attributed to Koschman to make it appear as if he was being aggressive toward Vanecko.

An attorney representing Gilger and Spanos couldn’t be reached for comment.

Thomas Needham, an attorney representing Salemme and Andrews, has described the disciplinary investigation of all six officers as “a joke.”

Lt. Denis Walsh has resigned from the Chicago Police Department one week after interim Supt. John Escalante moved to fire him over his role in the 2011 reinvestigation of David Koschman’s killing — a case that was closed without charges against a nephew of then-Mayor Richard M. Daley.

Walsh’s resignation ends the disciplinary case that Escalante filed against him with the Chicago Police Board, which decides punishments for cops.

Walsh, who had been suspended without pay, can now retire and begin collecting a pension of as much as $90,000 a year, records show.

Escalante had accused Walsh of violating eight departmental rules — including “making a false report,” “inattention to duty” and “incompetency or inefficiency” — regarding the Koschman case.

He was tied to case files that disappeared, then reappeared. Walsh also exchanged “unprofessional emails” joking with his boss about the case, according to Escalante.

Special prosecutor Dan K. Webb, whose investigation led to Daley nephew Richard J. “R.J.” Vanecko pleading guilty to killing Koschman, has said he considered filing criminal charges against Walsh and five other cops over their roles in the case.

Webb decided he didn’t have enough evidence to convict them. But City Hall Inspector General Joseph Ferguson recommended in December that Escalante fire or suspend them without pay.

Walsh, 52, becomes the fourth of those six cops to quit, avoiding firing or other disciplinary action. The others are Constantine G. “Dean” Andrews, who retired two months after he was named chief of detectives; Cmdr. Joseph Salemme; and Detective James Gilger.

Gilger’s detective partner, Nicholas Spanos, and their supervisor, Sgt. Sam Cirone, face one-year suspensions without pay. They aren’t yet 50 years old — the minimum retirement age for Chicago cops.

Walsh resigned this week, police spokesman Anthony Guglielmi said.

Walsh’s attorney, Daniel Herbert, put out this written statement Thursday: “This was a difficult decision for Denis because he was fully prepared to defend himself from these baseless allegations. We were confident that an impartial trier of fact would have fully exonerated Denis. However, in this case, that would have been the court system.

“Unfortunately, we would wait months or years for the court’s decision,” Herbert said. “For this reason, Denis Walsh has chosen to retire and begin collecting his pension. Economics was the deciding factor.”

Webb’s investigation found that Walsh — who was supposed to have no official role in the 2011 reinvestigation — had communicated that year with Gilger, the lead detective, and with retired detective Ronald E. Yawger, who failed to solve the case in 2004.

After the Chicago Sun-Times asked to see Koschman case files in 2011, Walsh told his bosses he couldn’t find the original files, leading to the reinvestigation. Webb reported that Walsh was involved in four different sets of missing files, including some that ended up at Walsh’s house.

Walsh — a 29-year department veteran who comes from a family of Chicago cops — was suspended for 30 days in 2004 after being arrested in Michigan on a criminal sexual conduct charge. While fighting that felony charge, he was promoted to lieutenant. He ended up pleading guilty to misdemeanor assault and battery.

The Chicago Transit Authority has spent nearly $94 million over 15 years on a retirement program that has allowed former CTA executives to start collecting lucrative pensions in their late 40s and early 50s while also getting paychecks from other government jobs, a Chicago Sun-Times and Better Government Association investigation has found.

Nearly 500 former transit executives or their survivors collected a total of more than $7 million from the “CTA supplemental retirement plan” in 2014, the most recent year for which records were available.

Originally intended to supplement CTA executives’ regular pensions with modest additional benefits, the CTA board — then chaired by Carole L. Brown, who’s now the chief financial officer in Mayor Rahm Emanuel’s administration — changed the supplemental plan in 2008 to allow dozens of those employees to retire early.

Seven of the supplemental-plan retirees collected pensions totaling more than $100,000 each in 2014, records show. One of them, David F. Simmons, retired the same month he turned 55 and now has a six-figure job with Metra. Another, Dennis Anosike, retired at 49 and now makes more than $200,000 a year working for the public bus and rail system in Washington, D.C.

Another 37 people received pension payments in 2014 of between $50,000 and $100,000 apiece. They include Lynn Sapyta, who retired at 53 and went on to work for five years for the College of DuPage before being fired from her $159,000-a-year job along with other school administrators over allegations of financial mismanagement.

Seventy percent of the supplemental retirees — 341 — were paid less than $10,000 each, in line with the plan’s original intent of providing them with modest payments on top of their regular CTA pensions. Most of their pension income came from the Retirement Plan for CTA Employees, the main pension fund for transit workers, into which the CTA has paid nearly $1.8 billion over 15 years.

To retire early under the changes made to the supplemental plan in 2008, CTA executives had to pay varying sums out of their own pockets to buy years of service and, in many cases, to “bridge” their years of service from other government jobs, records show.

But their contributions were small compared to what the publicly funded transit agency has paid toward their pensions and those of other senior-level staff. Between the start of 2000 and the end of 2014, CTA contributions to the supplemental plan totaled $93.8 million, according to the agency’s financial statements.

During that time, the cost of an L ride has risen from $1.50 to $2.25 and bus fare has gone up from $1.50 to $2.

The top-paid supplemental pensioners include:

David F. Simmons

• Simmons, a former CTA capital budget director, who paid a total of $27,652 to buy two additional years of CTA service and to have the five years he worked in state government included in his total service time.

Since his February 2010 retirement from the CTA as he was turning 55, Simmons has gotten pension payments totaling more than 20 times that amount — $562,543 as of last summer, records show.

Like other early CTA retirees, Simmons also is getting $25,000 of CTA-paid “supplemental executive life insurance,” records show.

After leaving the CTA, he went to work for Metra, where he makes $112,014 a year as the government-funded commuter rail agency’s director of grant administration.

“I had been eligible to retire from CTA with a full pension since 2004, upon achieving 25 years of service,” including state of Illinois bridge-of-service credit, says Simmons, who turns 61 this month and gets a yearly CTA pension of $103,854. “I chose to retire in 2010 because CTA offered the buyout and it made economic sense to take it. I feel that I have availed myself of benefits legitimately offered to a broad class of eligible CTA employees.”

• Anosike, a former CTA chief financial officer, who helped design the early-retirement program. After the CTA board approved it, he paid $96,853 to buy six years of service and to be allowed to include the nearly nine years he worked for the city of Chicago in his total CTA service time. That allowed him to retire in March 2009 at 49.

Dennis Anosike in a 2003 photo | Sun-Times file photo

Since then, Anosike has collected a total of $668,230 as of last summer — seven times the amount he paid into the supplemental plan. His yearly pension is $105,510.

He also elected to get CTA-subsidized health insurance coverage for life through the plan. In all, 41 supplemental retirees get that benefit.

Anosike is also paying for another benefit, which would see his spouse get two-thirds of his pension if he dies before she does. If she dies before he does, his pension would rise to $116,162 a year.

Now 56, Anosike makes $215,000 a year as the chief financial officer for the Washington Metropolitan Area Transit Authority, which also gives him a $3,000-a-month housing allowance. Attempts to reach him were unsuccessful.

Lynn Sapyta

• Sapyta, a former CTA comptroller, who paid $52,489 to buy six years of service, which allowed her to retire in July 2010 at 53 with an annual pension of $92,712. She’d collected $463,561 in pension benefits as of last summer — nearly nine times what she paid in.

After retiring, Sapyta, now 59, became assistant vice president and controller at the College of DuPage, a $159,032-a-year job she lost in September when college trustees fired her, alleging financial mismanagement by her, another top administrator and the college’s president. Sapyta denies the allegations and is suing the college for wrongful termination.

She says she “worked a little over 20 years with the CTA and opted to take advantage of the voluntary-termination program,” which she says she understood would “achieve cost savings” for the agency.

• Ruben E. Madrigal, the CTA’s former vice president of technology, who paid $34,080 to buy six years of CTA service. He retired in August 2010 at 51 with a yearly pension of $82,517.

He had collected $405,709 in pension payments as of last summer — nearly 12 times what he paid in.

Madrigal, 57, is now a $122,856-a-year deputy director of the city of Chicago’s Office of Emergency Management and Communications. He couldn’t be reached for comment.

Alison Perona. Brian Jackson / Sun-Times file photo

• Alison Perona, 57, who paid $135,572 to buy six years of service and include the nearly 18 years she spent working for the Cook County state’s attorney’s office in her total CTA service time.

Perona — who, as inspector general, served as the transit agency’s in-house watchdog against waste, corruption and fraud — retired in April 2009 at 50 with a  pension of $106,756 a year. As of last summer, she had been paid $667,223 by the supplemental plan.

Between March 2010 and January 2012, Perona worked for the Illinois Department of Financial and Professional Regulation, where her final salary was $102,372. In May 2012, she became inspector general of the Chicago Park District under a contract that paid her $140,000 a year. She left that job last May.

Like Sapyta, Perona says she was was told her early retirement would help the CTA save money in the long term.

• Patricia L. Taylor, the CTA’s former vice president of facilities, maintenance, capital construction and engineering, who paid $139,354 to buy six service years and to include the nearly 17 years she spent working for the city of Chicago’s budget and law departments in her total CTA service time.

Taylor retired in June 2009 with a yearly pension of $81,908. The same month, she became chief facilities officer for the Chicago Public Schools, a job that was paying her $165,000 a year when she left it last May.

“I did take early retirement, but I had put in many, many years in city government to earn my pension,” says Taylor, who had collected a total of $498,276 from her CTA pension as of last summer.

Created by state law in 1947, the supplemental plan was set up to reward long-serving senior-level retirees by giving them modest extra pensions, at no cost to them, in addition to their regular CTA pensions, into which they paid a portion of their salaries.

In January 2008, though, state legislators banned future CTA hires from getting the extra-pension perk as part of a massive transit bailout bill that stopped the then-financially failing CTA, Metra and Pace suburban bus system from imposing fare hikes and service cuts.

The law raised sales taxes by one-quarter of one percentage point in Cook County and half of one percentage point in the collar counties. It also increased real estate transfer taxes within Chicago by 40 percent to bankroll a borrowing deal that pumped nearly $2 billion into the Retirement Fund for CTA Employees and a newly created CTA retiree health-care trust.

Bus drivers, train operators and other CTA employees had to double their contributions into the pension fund from 3 percent to 6 percent under the new law. They’re now paying in about 10 percent of their salaries, according to the Illinois auditor general’s office — contributions that have put the fund in better shape than other city pension plans but still not at ideal levels with a funding ratio of 58 percent.

The supplemental plan, a separate pension fund, relies heavily on CTA contributions to make payouts to its retirees, records show.

“How this was ladled on top of the regular CTA pension is something that defies obvious public benefit,” says Laurence Msall, president of the Civic Federation, a non-partisan government research organization. “There is very little justification for why any government worker should be getting a supplement on top of what regular employees get. This comes at a very large cost.”

The CTA board added the “voluntary-termination employment program” to the supplemental plan in November 2008 — a move that then-CTA President Ron Huberman’s staff said would save the CTA an estimated $3.6 million a year by eliminating some senior-level jobs and filling others with lower-paid employees.

CTA board members unanimously approved the program on Nov. 13, 2008, after a brief discussion led by then-board chairman Brown, now Emanuel’s top financial official at City Hall, according to a transcript of the board’s meeting.

“I just want to be clear we are, by doing this voluntary termination, there could be a level of senior employees who elects to take an early [retirement] and that, those positions, we are expected, for those people who did that, would be replaced by lower-cost employees, and doing that would save us probably $3.6 million annually?” Brown asked.

“Or $90 million over 25 years, correct,” Anosike replied.

Steve Mayberry, a CTA spokesman, says the early-retirement program was “created seven years ago under a different CTA administration” and was “intended to cap pension amounts.”

But he also says no cost-savings analysis of the program has been done. So it’s unclear if any money has been saved. 

Brown declined to comment.

Ron Huberman. Sun-Times file photo

In all, 69 CTA execs agreed to participate in the early-retirement program. Not all are drawing benefits, though.

Huberman, for example, “has not yet met all of the requirements of the supplemental plan to initiate a pension payment,” according to the CTA’s legal department. Huberman has yet to make “the necessary payments to be eligible,” Mayberry says.

Theresa Mintle, a former Emanuel chief of staff who previously worked as the CTA board’s chief of staff and a CTA government-relations official, also hasn’t made the required payments, Mayberry says. According to CTA lawyers, “her right to receive a benefit has been terminated,” but they provided no details.

Both Huberman, a onetime chief of staff and schools CEO for former Mayor Richard M. Daley, and Mintle, a cousin of Daley, declined to discuss their payments into the plan.

Theresa Mintle. | Rich Hein / Sun-Times file photo

Other former CTA execs made all of their contributions but won’t be able to begin drawing benefits from the plan until they are in their 60s because they don’t have enough years of service.

Last June, the Sun-Times and the BGA reported that Dorval Carter Jr., then the newly named CTA president, was among the early retirees. Carter retired from the CTA in November 2009 at 52 and returned last May as the agency’s executive director.

In between, he worked in Washington for the U.S. Department of Transportation while getting $754,762 in pension payouts — more than triple the $244,853 he paid into the supplemental plan to buy six years of CTA service and to include the nearly 15 years he spent in other government jobs in his total service time.

Carter’s combined income reached as high as $283,679 a year — the sum of his $146,450 federal salary and $137,229-a-year CTA pension. Because he accepted Emanuel’s offer to return to the CTA as its $235,000-a-year boss, Carter has to temporarily forgo his pension because he is once again a CTA employee. He will be able to start collecting it again when he leaves the agency.

CTA President Dorval R. Carter Jr., right, with Mayor Rahm Emanuel last month at the Cermak-McCormick Place Green Line L station. | Ashlee Rezin / Sun-Times

Unlike many other retirees in the supplemental plan, Carter’s CTA retirement income will be paid out of the supplemental plan for the rest of his life, records show. He withdrew all of his contributions into the CTA’s regular pension fund, a total of $58,778, to help him make his upfront payment to the supplemental plan, records show.

Simmons, Anosike, Sapyta and others didn’t withdraw their contributions to the CTA’s regular pension fund. That means they’ll start drawing benefits from that fund when they turn 65 — the normal retirement age for CTA employees.

That won’t be a windfall for the employees, though. “When they reach the age of 65, they will begin to receive their regular benefit payments from the Retirement Plan for CTA Employees, and the supplemental benefit will be reduced by the same amount,” Mayberry says.

CTA officials say participants in the early-retirement program aren’t eligible for annual cost-of-living increases that are a staple of other government pension plans.

In 2014, the transit agency contributed $4.1 million to the supplemental plan and paid a total of nearly $7.3 million to 490 retirees.

Also in 2014, the CTA reported spending an additional $802,000 on health insurance-related costs for Anosike, the 40 other supplemental-plan retirees with health coverage and 15 CTA board retirees who also have CTA-subsidized coverage.

Mayberry says that figure is “not what the CTA actually” paid for their health care but is an actuarial estimate of expected spending that the agency “is required to include in our financial statements. . . . As a matter of policy, CTA does not disclose actual health-care costs.”

Chris Fusco is a Sun-Times reporter. Patrick Rehkamp is an investigator for the BGA.

A PENSION BOOST FOR CTA EXECS

Here’s a look at the money that four early retirees paid into the CTA’s supplemental retirement plan — and the payouts they’ve gotten:

DAVID F. SIMMONS

CTA post: former capital budget director

Retirement age: 55

Paid into plan: $27,652

Pension pay (as of June 30, 2015): $562,543

Yearly pension: $103,854

Current job: works for Metra

Current salary: $112,014

RUBEN E. MADRIGAL

CTA post: former vice president of technology

Retirement age: 51

Paid into plan: $34,080

Pension pay (as of June 30): $405,709

Yearly pension: $82,517

Current job: works for Chicago Office of Emergency Management and Communications

Current salary: $122,856

DENNIS ANOSIKE

CTA post: former chief financial officer

Retirement age: 49

Paid into plan: $96,853

Pension pay (as of June 30): $668,230

Yearly pension: $105,510

Current job: works for: Washington, D.C., Metropolitan Area Transit Authority

Current salary: $215,000

LYNN SAPYTA

CTA post: former comptroller

Retirement age: 53

Paid into plan: $52,489

Pension pay (as of June 30): $463,561

Yearly pension: $92,712

Most recent job: fired in September by the College of DuPage; has sued for wrongful termination

Salary: was making $159,032 when she lost her job

SOURCES: CTA, Metra, WMATA, College of DuPage

Valerie Jarrett was on the Chicago Transit Authority board for nearly eight years before becoming a top aide to President Barack Obama. Howard Medley was on the CTA board for a decade before he was convicted in a scheme involving a CTA fuel contract.

Despite their divergent paths, the time Jarrett and Medley spent there proved lucrative to both of them. They and other retired CTA board members — all of them political appointees who worked only part time — each came away with five-figure pensions that have cost the public transit agency a total of more than $3 million over 10 years, a Chicago Sun-Times and Better Government Association investigation has found.

In 2014, the most recent year for which records were available, the CTA paid $330,000 into its board pension fund and doled out $329,744 in pension payments to 19 board retirees or their survivors.

Fifteen board retirees also get CTA-subsidized health insurance — another perk that comes at the expense of riders and taxpayers. Citing federal health privacy law, CTA officials declined to identify those retirees.

Between the start of 2005 and the end of 2014, the CTA put $3.04 million into the board retirement fund, according to the transit agency’s financial statements. Board members contributed only a fraction of that amount to the fund in that time — $96,351 in all — through deductions from their part-time government paychecks.

The board pensions, established in 1947 under state law, are more lucrative than the pensions afforded to retirees who served on the Regional Transportation Authority, Metra commuter rail and Pace suburban bus boards, the Sun-Times and BGA found. Of the 40-plus RTA, Metra and Pace board retirees with pensions, the overwhelming majority get less than $5,000 a year.

RELATED: CTA execs riding pension express

Jarrett was appointed CTA board chairman in 1995 by then-Mayor Richard M. Daley. She left the $50,000-a-year part-time post in 2003 and began collecting her $35,660-a-year pension three years later, at 50 — the minimum age at which former board members can take their pensions.

Now 59, Jarrett had collected a total of $306,080 in pension payouts as of last summer, records show. That’s more than 27 times the $11,132 that she paid toward her board pension through payroll deductions from her CTA paychecks.

Besides her CTA pension, she makes $173,922 a year in her role as Obama’s senior adviser — a job she has held since his first term in the White House in 2009.

A White House spokeswoman declined to comment on Jarrett’s CTA pension, referring questions to the transit agency.

Howard Medley, in 2007. | Sun-Times file photo

Medley, 88, was appointed to the board in 1979 by then-Mayor Michael Bilandic. Medley now gets a yearly CTA pension of $15,361.

As of last summer, records show he has collected a total of $207,376 from his CTA pension over the past quarter-century — 331 times the $626 that was deducted from his checks during his board service. He retired from the board in 1989 at 62.

Most government officials and employees convicted of crimes related to their posts have to forfeit their pensions. But the CTA had no such rule in place at the time of Medley’s conviction in 1989 for “accepting a thing of value with the intent to be influenced or rewarded” in his duties as a CTA board member, according to court records. That changed the following year, when the CTA board began “requiring forfeiture of pension benefits following conviction for a felony relating to service on the board,” CTA spokesman Steve Mayberry said.

In 1988, federal authorities accused Medley of trying to stop a CTA investigation of inflated prices by a CTA fuel contractor because Medley had accepted a $22,500 fee on a real estate deal involving the contractor. Medley’s first case ended in a mistrial. He was convicted at his second trial and sentenced to 30 months in prison.

Medley, who was a top campaign fundraiser for the late Mayor Harold Washington, says he spent about 10 months behind bars and served the rest of his sentence on parole.

Since his release, he has fought to get his conviction overturned, arguing that his attorneys failed to introduce recordings that would have proved his innocence. His latest effort to win a new trial is now pending before the Seventh U.S. Circuit Court of Appeals.

During his time as a CTA board member, Medley says he turned down perks — including the free use of a CTA car and free phone service — while tightening CTA financial controls.

“I’m sure I saved the board millions of dollars,” says Medley, who headed the board’s operations committee. “They had no knowledge of how much money was coming in at all. There were no records of how much gas was being used. . . . I did my duties. . . . I earned my pension.”

Other CTA board pensioners include:

Susan Leonis, then the CTA board’s vice chairman, at a board meeting in 2009. | Brian Jackson/Sun-Times file photo

• Susan A. Leonis, who worked in state government under Republican governors Jim Thompson and Jim Edgar and was a close friend of Daley’s late wife, Maggie Daley. She had the highest pension of any board retiree: $41,596 a year. That’s the result of her fellow board members allowing her to make extra contributions to the board pension plan stemming from the 13 years she worked in state government.

Leonis, an Edgar appointee, was on the CTA board between 1996 and 2009, when she transferred $51,236 she’d withdrawn from her state retirement account to the CTA to bolster her board pension. After she retired, CTA officials determined “this transfer was not appropriate because the board-member plan is not a tax-qualified plan and therefore cannot receive a rollover of funds,” according to CTA meeting minutes.

Rather than diminish Leonis’ pension, the CTA board decided that Leonis had relied on advice from CTA employees and “acted in good faith.” So the board refunded the $51,236 and started deducting the equivalent of that contribution from her pension by withholding all payouts to her for more than two years.

Leonis, now 58, ended up contributing a total of $61,066 to the board retirement plan. Since getting her first pension check in February 2011, she has been paid more than $185,000. She declined to comment.

• Arthur F. Hill Jr., who replaced Medley on the board and now makes $181,220 a year as an associate Cook County judge. Hill, 62, is drawing a CTA board pension of $15,913 in addition to his judicial salary. A board member between 1989 and 1996, he began collecting his CTA pension in 2003 after turning 50. As of last summer, he’d received $186,982 in pension payments — 35 times the $5,230 that was deducted from his board paychecks. Hill declined to comment, except to say he isn’t getting CTA-subsidized health insurance.

Cynthia A. Panayotovich. | Sun-Times file photo

• Cynthia A. Panayotovich, who was appointed to the board by then-Gov. George Ryan and served between 2002 and 2009, when she began collecting a $17,788-a-year pension at age 59. She’s the wife of former state representative and Illinois Liquor Commission executive director Sam Panayotovich, who is partners in a lobbying business with Cook County Assessor Joseph Berrios, the Cook County Democratic Party chairman. She couldn’t be reached for comment.

Two and a half years ago, in the wake of outrage over a patronage hiring scandal at Metra, the Illinois Legislature put a stop to giving pensions and retiree health insurance to any future political appointees to the four transit boards.

State Rep. Jack Franks. | AP file photo

State Rep. Jack Franks, D-Marengo, who sponsored that legislation, was flabbergasted by the size of the pensions that Jarrett and other CTA board retirees receive.

“It’s terrible for the taxpayers; it’s great for those with clout,” Franks said. “At least, we ended that nonsense.”

But about two dozen CTA, RTA, Metra and Pace board members might still be eligible for pensions because they were appointed before July 2013, when the law went into effect.

CTA board members appointed before then will be eligible to draw pensions at 65 as long as they serve two years on the board.

Those who serve five years will become eligible for a pension after they turn 50. They include Terry Peterson, the current CTA board chairman, appointed to the board in late 2009. He’s paid $50,000 a year as part-time board chairman.

CTA board chairman Terry Peterson with Mayor Rahm Emanuel last May. | Brian Jackson/Sun-Times file photo

Peterson, 57, had paid a total of $21,485 into the board pension plan as of last summer. A onetime Daley campaign manager and CEO of the Chicago Housing Authority, he stands to make back more than that amount in the first year after he retires from the board. He’ll be entitled to an annual pension of $35,660 — the same as Jarrett’s pension.

Carole L. Brown, Mayor Rahm Emanuel’s chief financial officer, chaired the CTA board between 2003 and 2009 and is now eligible for a board pension because she has turned 50. But, according to the transit agency, Brown hasn’t begun to draw her pension. She declined to comment.

Carole Brown, who formerly headed the CTA board, now is Mayor Rahm Emanuel’s chief financial officer. | Rich Hein/Sun-Times file photo

Besides its contributions for board pensions, the CTA reported spending an additional $802,000 in 2014 on health insurance-related costs for the 15 CTA board retirees and 41 CTA supplemental-plan retirees with health coverage.

Mayberry says that figure is “not what the CTA actually” paid for their health care but is an actuarial estimate of expected spending that the agency “is required to include in our financial statements. . . . As a matter of policy, CTA does not disclose actual health-care costs.”

Chris Fusco is a Sun-Times reporter. Patrick Rehkamp is an investigator for the BGA.

By Chuck Neubauer and Sandy Bergo 

Two members of Congress from Illinois who have gotten thousands of dollars in campaign contributions from a union representing pipeline workers were instrumental in passing a law removing restrictions on the hours that pipeline workers can work and be on the road — a change some safety advocates say could pose a danger.

The legislation, passed by Congress in late December, was sponsored by U.S. Rep. Dan Lipinski, D-Illinois, and U.S. Rep. Rodney Davis, R-Illinois.

Both received key financial support from the international Plumbers and Pipefitters Union, which represents oil and natural gas pipeline workers and lobbied for the change in the law.

In the past three years, the Plumbers and Pipefitters Union’s political action committee has contributed $20,000 to Lipinski, who represents the Southwest Side and parts of southwestern Cook County and northeastern Will County, campaign records show.

U.S. Rep. Rodney Davis, right. Getty Images

And it’s given $15,000 to Davis, who’s from downstate Taylorville — including $5,000 weeks after the welders amendment passed the U.S. House.

Commercial truck drivers are subject to strict federal rules that, for safety reasons, dictate they can’t work or travel more than 60 hours in a seven-day period.

Pipeline welders — who piece together pipes that carry oil and natural gas — had been subject to the same regulations. The reasoning was that they routinely travel across state lines for work and drive pickup trucks that, when loaded with welding equipment, weigh more than 10,000 pounds.

Daniel C. Hendrix, business manager of Local 798 Pipeliners, representing 2,200 welders who work in Illinois and elsewhere, says pipeline welders often need to work at least 12 hours a day and up to 90 hours a week.

And they spend most of that time welding pipe, not driving, according to Hendrix, who said the rules were hurting a booming pipeline industry, which turned for help to its international union, the Plumbers and Pipefitters Union.

The union’s lobbyist, Russ Breckenridge, “was very instrumental in finding the right people,” Hendrix said — including Davis, who, like Breckenridge, grew up in Taylorville, and Lipinski, the senior Illinois congressman on the House transportation committee, where Davis has served since taking office in 2013.

Lipinski and Davis wrote to other members of Congress, pitching the exemption to provide “relief to welders who are subject to onerous regulations that provide little safety benefit.”

The measure — which removes the federal work limits on pipeline welders — was passed in December as an amendment to a larger bill and signed into law.

The changes could pose a danger, according to some safety advocates.

“We don’t want fatigued workers, no matter what type of work they were doing, getting behind a wheel and driving,” said John Lannen, executive director of Truck Safety Coalition, a Virginia-based advocacy group of truck-accident survivors and the families of accident victims.

Peter Kurdock, of the Washington group Advocates for Highway and Auto Safety, said, “Driver fatigue, especially in the trucking industry, has been a significant safety issue for years.”

Lipinski didn’t respond to a question about the campaign money he took from the union PAC. In an email, he wrote that he supported the changes because “welders are not truck drivers, and they use their vehicles to get to a job site where they conduct a trade wholly unrelated to the driving.”

Neither Davis nor Breckenridge responded to requests for comment.

Separately, another measure backed by Lipinski and Davis and passed by Congress in December allows automobile haulers, which transport cars to dealerships, to also carry other types of cargo on return trips rather return empty.

“Having these empty trucks on our roads is bad for the economy, bad for the environment and contributes to congestion on our roads,” Lipinski said.

The legislation was sought by Jack Cooper Transport, the nation’s largest over-the-road transporter of autos, and the Automobile Carriers Conference, which is part of the American Trucking Associations.

Robert Farrell, executive director of the auto carriers group, said the law lets the industry “fill the empty miles” and use modern trucks that collapse carrier scaffolding and operate as flatbed cargo trucks on return trips.

In the past three years, the American Trucking Associations’ PAC has contributed $4,500 to Lipinski and $6,000 to Davis, including $2,500 Davis got in December, just after the bill became law.

“Truck PAC, the bipartisan political action committee of the American Trucking Associations, supports members of Congress who have an interest in the issues affecting the trucking industry, which includes, in this case, Reps. Lipinski and Davis,” according to a written statement from the group.

This was written by Chuck Neubauer and Sandy Bergo of the Better Government Association.

A real estate venture created by President Barack Obama’s onetime boss and a nephew of former Mayor Richard M. Daley squandered $68 million it was given to invest on behalf of pension plans for Chicago teachers, cops, city employees and transit workers, a Chicago Sun-Times investigation has found.

The five public pension funds haven’t made a dime on the investments they made nearly a decade ago with DV Urban Realty Partners, a company created by Obama’s ex-boss Allison S. Davis and Daley nephew Robert G. Vanecko, records show.

In fact, the financially troubled pension plans have lost most of the money they gave DV Urban, which used the money to invest in risky real estate deals, primarily in neglected neighborhoods.

It invested in eight real estate deals that, for the most part, had gone belly up by Dec. 31, 2015, when the investment deals with the Chicago pension plans expired.

Though the pension funds lost out, DV Urban and its affiliated companies got about $9 million of the pension money for management fees. And they were in line for more until pension officials, facing losses, got a court order in 2012 to remove Davis and Vanecko from managing the retirement investments.

Following the sale of two properties last year, the pension funds recovered $6 million of their original investments — but $293,716 of that went to DV Urban, which had also invested some of its own money in the real estate deals.

The pension funds are still hoping to recover more money this year by liquidating the final two properties in DV Urban’s portfolio: a Lakeview lot on which a Mariano’s supermarket is under construction and a few storefronts at 3508 S. State St., former site of the Chicago Housing Authority’s Stateway Gardens housing project.

But Angela Miller-May, director of investments for the Chicago Teachers’ Pension Fund, which had the biggest stake in DV Urban, says, “The sales from the two remaining assets will not completely offset the losses from the other investments.”

Jared Davis

It’s unclear whether any proceeds from sales of the two remaining properties would go to either DV Urban, now run by Davis and his son Jared Davis, or Vanecko, who took part in all of the real estate deals involving the pension money.

Vanecko has said he “ended his involvement” with DV Urban in 2009 — two weeks after the pension funds were subpoenaed by a federal grand jury regarding their deals with DV Urban. What happened with that investigation isn’t clear.

Vanecko and Davis are being sued by SMS Financial, an investment company seeking to collect nearly $700,000 they borrowed from New City Bank a decade ago, when they were required to invest $7 million of their own money with DV Urban as part of their deal with the pension funds. Their investment in DV Urban was later reduced to $3.5 million.

According to Cook County court records, Vanecko and the Davises gave personal guarantees to repay the money they borrowed from New City Bank, which regulators shut down in 2012 over a string of bad loans.

Former Chicago Mayor Richard M. Daley in May 2015. AP file photo

In 2005, while Daley was mayor, Vanecko, a former attorney at the law firm Mayer Brown, went into business with Davis, an attorney who once headed the small Chicago law firm where Obama worked after graduating from law school.

At first, Vanecko and Davis had difficulty finding investors. Eventually, though, the teachers pension fund agreed to invest $25 million — a tiny sum for the multibillion-dollar fund.

DV Urban subsequently got $10 million to invest from the city’s laborers’ pension fund, $3 million from the CTA pension plan, $15 million from the municipal workers fund and $15 million from the police pension fund. One Chicago city workers retirement plan — the Chicago firefighters pension plan — declined to invest with Vanecko and Davis.

Since Davis is African-American, DV Urban qualified as a minority-owned business, helping the pension funds meet their diversity goals.

Daley has said he had nothing to do with lining up investors for his nephew’s real estate fund, though members of his cabinet served on three of the pension fund boards that invested with DV Urban. Those Daley appointees included Judy Rice, the city treasurer who is now a Cook County judge; Dana Levenson, the mayor’s chief financial officer, who now runs an assisted living facility in Massachusetts; and Steve Lux, the city comptroller, who is now chief financial officer for the Chicago Park District.

Rice, Levenson and Lux didn’t return calls seeking comment. Nor did Vanecko or the Davises.

Laurence Msall, president of the Civic Federation. | Ashlee Rezin / Sun-Times file photo

“It was an enormously risky venture,” says Laurence Msall, president of the Civic Federation, a government watchdog that has long warned that these five pension funds are “in financial distress” because of underfunding by City Hall, the Chicago Board of Education and the CTA.

“It was a double whammy for the pension funds,” Msall says. “Not only did they lose their investments and not make money on it, they also lost the opportunity to invest it” elsewhere.

“At the end of the day, it will have to be tax dollars that are brought in to make up for these losses,” Msall says. “This is a sad but important lesson on why the governance of these pension funds need to be reformed.”

Here’s how the Davises and Vanecko handled the pension money, according to documents obtained over the past nine years from the five pension funds.

• $9.9 million was lost on the purchase of the 344-unit building at 1212 S. Michigan Ave. Using pension money, Davis and Vanecko paid $65.2 million in September 2006 to buy it — and sold it about five years later for $65.5 million. The pension funds never got any money from the sale.

• $2.8 million was lost on two loans to the owners of the Chicago Defender’s former home, a boarded-up building at 2400 S. Michigan Ave. It’s unclear why DV Urban lent pension money to developers Brian O’Connell of LaGrange and his partner, Matthew A. O’Malley, a politically connected restaurateur who has been battling City Hall over a sweetheart deal to operate the Park Grill restaurant in Millennium Park. After a bank foreclosed on the Defender building, O’Connell and O’Malley sold the property in 2014. The pension funds didn’t get any money from the sale.

• $2.65 million helped DV Urban pay $11.7 million in 2007 for a commercial building at 217 N. Jefferson St. The building was sold last year for $14.5 million — one of the deals that helped the pension funds recover $6 million.

• $6.5 million was used by DV Urban toward $11.5 million it paid for a 162-unit apartment building at 7100 S. South Shore Dr. It was sold last year for $6.75 million, helping return some money to the pension funds.

• $3.5 million went toward $4.2 million DV Urban paid for the stores at 3508 S. State St., part of the CHA’s redevelopment of Stateway Gardens. The pension funds hope to sell the land this year.

• $16.9 million went to loans to developers of 3030 N. Broadway, where a Mariano’s store is being built, and to buy adjacent land at 3013-17 N. Waterloo. The property is expected to be sold this year.

• $4.2 million was invested with the firm Sydney Partners, which paid $10.5 million for a 15.6-acre industrial property at 3348 S. Pulaski. DV Urban leased part of the space to the city. But, beset by environmental problems including polluted soil, the property was sold for just $5.4 million in 2014, and the pension fund money was lost.

• $4.5 million was earmarked to buy the former headquarters of the National Association of Letter Carriers’ Chicago branch at 1411 S. Michigan, next door to the Chicago Firehouse restaurant owned by O’Malley. The deal ended up in court when DV Urban backed out of the deal, asking the letter carriers to return the money — which the union had used to build its new headquarters. The lawsuit was settled out of court, but the pension funds lost all of their money.

“The investment was effectively a total loss for DV Urban,” says Miller-May of the teachers pension fund.

DV Urban was paid $8 million in management fees between 2006 and 2012, when the pension funds got permission from a Delaware judge to fire the company.

A little over $1 million, for property-management fees, went to a company owned by Cullen Davis, another Davis son, who oversaw some of the apartment buildings bought with pension money.

Another $1.7 million went to two companies, including Newport Capital Partners, to manage the DV Urban portfolio and sell off the assets in an effort to recover as much money as possible for the pension funds.

Beyond the money lost on the investments with DV Urban, the pension funds also had to pay $2.5 million for attorneys who fought the firm for two years in courtrooms from Chicago to Delaware over control of the real estate investments.

“Bad investments are things that are going to happen to you,’’ says Charles Burbridge, who was hired as executive director of the teachers pension fund a year ago, long after the DV Urban deal soured. “Hopefully, we have controls in place to minimize these problems.

“This is still in litigation,” Burbridge says, noting that the pension funds are still trying to recover money in court from DV Urban. “The story’s not finished.”

You’re far from the only one who’s getting plumper when you stop to get a bite before boarding a flight at Chicago’s airports.

Many members of the city’s political class long have found a favorite, deeply lucrative feeding trough in operating airport concessions.

Now, there’s a new scramble going on for the rights to belly up to the Midway money buffet. And a long line of players with close ties to Mayor Rahm Emanuel is hoping to dine sumptuously, according to bid documents I obtained.

The documents show one of the teams bidding to revamp the airport’s restaurant and retail offerings is known as Midway Partnership and includes these familiar faces at City Hall among its partners:

•      Becky Carroll, the longtime Emanuel ally who leads the mayor’s Chicago Forward political-action committee, which spent millions of dollars in last year’s city election campaigns. She was the top spokeswoman for Chicago Public Schools.
•     Martin Cabrera, who has led the Chicago Plan Commission and City Colleges of Chicago board for Emanuel and who’s a mayoral appointee to the city-county agency that oversees public building projects. His Cabrera Capital Markets is often involved in underwriting public bond deals.
•     Geneva Rand, a relative of Timothy Rand, the biggest concessionaire at Midway, with 2014 revenues of more than $30 million. Timothy Rand’s company successfully sued to avoid paying property taxes on his Midway restaurants, the Better Government Association recently reported in the Chicago Sun-Times.

The lobbyists for that bid team are John Borovicka, who served as Emanuel’s district director when he was a congressman, and John Dunn, once a top aide to Mayor Richard M. Daley.

Emanuel’s 2011 re-election campaign manager, Mike Ruemmler, also has worked as a consultant for the Midway Partnership bid team, sources told me.

And city records show Brad O’Halloran — who resigned as Metra board chairman amid a 2013 scandal over severance pay for the transit agency’s CEO — attended a pre-proposal meeting in September. He signed in as a consultant to a company that’s part of the Midway Partnership team.

For 12 years when Daley was mayor, O’Halloran and top Daley political adviser Jeremiah Joyce were partners in a concessions deal at O’Hare’s international terminal.

OPINION

Virginia-based SSP America and New Jersey’s Hudson Group are leading the Midway Partnership effort. A spokeswoman described them as “the world’s largest food and beverage operator and the world’s largest travel retailer.”

“The local leaders included in our proposal, along with the substantial number of local brands, means that we have a team ready to hit the ground running,” said the spokeswoman, Lana Cramer.

The Hudson Group currently runs newsstands and retail stores at Midway.

But Midway Partnership isn’t the only bid team with clout-heavy local allies.

Mike Alvarez, a commissioner for the Metropolitan Water Reclamation District of Greater Chicago, and Tim Dart, brother of Cook County Sheriff Tom Dart, are lobbying for the joint bid of Atlanta-based Hojeij Branded Foods and Paradies Shops Inc., owned by a French company.

A third bidder, OTG Management of New York, has hired lobbyist William Filan. A former aide to Illinois House Speaker Mike Madigan (D-Chicago), Filan lobbied in Springfield for the City of Chicago and also represented the company that ran the city’s red-light camera system — until the federal bribery scandal.

The Midway stakes are sky-high. Concessions at the Southwest Side airport rang up a total of about $89 million in sales in 2014.

City Hall “is committed to a fair and impartial selection process” for the new deal, an Emanuel spokesman said.

The city has hired an “independent evaluation committee” of industry experts to review the proposals, officials said. They want the evaluators to remain anonymous and their deliberations be kept private until a recommendation is made to the Aviation Department and the City Council.

Sources said the Hojeij/Paradies team promises to serve up the food of Piccolo Sogno, Rockit Bar & Grill, Frontera Grill and Rush 34, a restaurant to be owned jointly by Walter Payton’s son, Jarrett, and the Bears.

The Midway Partnership team includes Calvin Klein, Billy Goat Tavern, Intelligentsia Coffee and a Cooper’s Hawk wine bar, according to their bid documents.

Also in the Midway Partnership lineup is a classic Chicago political hangout: Schaller’s Pump. It has been open since 1881 in Bridgeport, across the street from the offices of the Daley family’s 11^th Ward Regular Democratic Organization.

No matter what the rest of us will be able to eat while waiting to board, chances are somebody who’s gorged on public deals before will get their fill again at Midway for many years to come.

For months the three Democratic candidates for Cook County state’s attorney have been trading shots about each other’s integrity in a race largely defined by questions about the Laquan McDonald shooting.

Now, they’re all making sure they have enough cash to keep up the attacks through the March 15 primary.

Challenger Kim Foxx this week reported a $250,000 contribution from the campaign fund of her former boss, Cook County Board President Toni Preckwinke, state records show. Before launching her bid to be the county’s top prosecutor, Foxx served as Preckwinkle’s chief of staff.

That brings the total Foxx has received from Preckwinkle’s fund to more than $301,000 – including $25,000 for a 2015 poll that the Foxx campaign didn’t initially report, a violation of state law. Earlier this week the Illinois State Board of Elections fined the Foxx campaign more than $19,000 for that and other infractions. Foxx’s campaign plans to appeal.

The campaign of incumbent Anita Alvarez slammed Foxx for being a “puppet” of Preckwinkle’s and accused the county board president of funneling money from county contractors.

“Kim Foxx has ‘doubled down’ on pay-to-play tactics,” Alvarez campaign manager Mike Carson said in a statement. “How can the voters trust a candidate to enforce the law when she simply will not follow it?”

Challenger Donna More also weighed in, calling Foxx “Toni Preckwinkle’s proxy in the state’s attorney’s race.”

“If people don’t want an independent criminal justice system, then I suppose that’s OK,” More said.

Foxx has said she will be an independent prosecutor but added she’s proud to have the support of Preckwinkle, whom she described as a leader in advancing reforms that Alvarez has resisted. “Toni has been working on these criminal justice issues for years,” Foxx said.

Preckwinkle isn’t the only big donor to Foxx’s campaign. In the last month she’s also received $400,000 from prolific Democratic contributor Fred Eychaner.

George Soros, a billionaire advocate for criminal justice reforms, and the Civic Participation Action Fund, a Washington, D.C.-based advocacy organization, have each given $300,000 to Illinois Safety & Justice, a separate “independent expenditure fund” that lists Foxx as the only candidate it’s backing.

In a statement, Robert Foley, a spokesman for Foxx’s campaign, said she has a wide range of supporters “who know it’s time to transform our broken criminal justice system.”

In the meantime, Foxx’s rivals have dipped into their personal funds for campaign cash.

On Feb. 25 Alvarez and her husband, Dr. James Gomez, loaned her campaign $200,000, records show. During Alvarez’s first run for state’s attorney, in 2008, Gomez loaned the campaign $640,000, allowing her to buy television ads that helped propel her to victory.

“It’s not surprising that Anita Alvarez is having to tap into her personal wealth to try to save her job, given her track record of failure as state’s attorney,” Foley said.

And More – a former Cook County and federal prosecutor now in private practice – spent $200,000 of her own money last week on a media buy with AKPD, the political messaging firm founded and once led by David Axelrod, a former top adviser to President Obama.

More also loaned herself $250,000 in December, triggering a clause in the state campaign finance law that allows all the candidates in the race to collect unlimited contributions. More and her mother have given a total of more than $603,000 to her campaign, records show.

“I’m beholden to myself, for sure,” More said, “but I’m not beholden to the machine.”

Altogether, Foxx and the “independent” fund backing her have reported about $2.3 million in contributions for the race while Alvarez has reported $1.3 million and More $1 million.

Campaign fund-raising records are poised to fall before the March 15 primary, thanks to the political proxy war between Gov. Bruce Rauner and Democratic House Speaker Mike Madigan that’s stoked massive investments in a handful of races.

Rep. Ken Dunkin, D-Chicago, earned the enmity of his fellow Democrats when he denied Madigan the votes he needed to override Rauner vetoes.

He also earned his political fund the largest single campaign contribution in state history — $500,000 from a political action committee backed by Rauner supporters.

Another Rauner-linked PAC has put more than $1 million into ads either promoting Dunkin or tearing down Juliana Stratton, his opponent in the race to represent the 5th District, who has taken in more than $1 million in campaign cash herself, according to the Illinois Campaign for Political Reform, a watchdog group.

Chicago Rep. Ken Dunkin’s fight with House Speaker Mike Madigan over votes needed to override Gov. Bruce Rauner’s vetoes fueled what’s on target to be the costliest Illinois House primary race ever. | Rich Hein / Sun-Times

“If all the funds they have available now — and there is probably going to be more coming in these last couple of days — it will blow away the spending record for a House primary,” says Kent Redfield, a professor at the University of Illinois-Springfield who tracks campaign spending.

“We’re talking about more than $2 million in a House primary,” Redfield says, which is roughly double the highest previous total in a House primary — the roughly $1 million tally in the race two years ago between Democrats Christian Mitchell and Jay Travis in Chicago’s 26th District.

“The cost of these things is going up cycle after cycle,” says Redfield. “There’s no end in sight. This will almost certainly be the most spent in a year when there was no race for governor.”

Through the end of last week, 16 races across the state had gotten contributions from self-funded candidates or “independent expenditure” groups greater than $100,000. And such massive donations can spur even larger surges of cash because they lift contribution limits and allow individual donors to pour even more money into a race.

Contribution caps came off in Madigan’s race in the South Side 22nd District after the super PAC Illinois United for Change spent more than $240,000 on consulting services and advertising for one of Madigan’s opponents, political newcomer Jason Gonzales.

Illinois United’s biggest donor is Chicago businessman Blair Hull, the former U.S. Senate candidate who has criticized fellow Democrat Madigan as “not a team player.”

Illinois United’s big spending on the race meant that Madigan also could take in unlimited contributions. That means the House speaker could boost his war chest exponentially through the primary — money he could then dole out to other Democrats come the general election.

Madigan already has $2.3 million in his own candidate account, and he controls around $7 million more in campaign funds as ward committeeman, head of the state Democratic Party and leader of the House Democrats.

The governor also has used this year’s elections to show his disdain for members of his party who don’t vote in line with his wishes. Downstate Republican Sam McCann has jousted with Rauner over anti-union initiatives in the governor’s Turnaround Agenda, and the conservative Liberty Principles PAC has dumped $1.3 million on ads supporting McCann’s primary opponent, Bryce Benton.

The massive infusion of cash into political campaigns has been fueled in large part by spending from PACs, with Republican-linked committees taking in nearly all their money from a handful of millionaire and billionaire donors, and Democratic PACs drawing their support from labor unions.

Massive amounts of cash coming from outside a district and even outside the state distorts the democratic process, says Sarah Brune, campaign finance expert for the Illinois Campaign for Political Reform.

“When candidates are getting all of their money from these kinds groups, who are they going to be responsive to?” Brune says. “The groups that donate to their campaigns? Or the residents of their district?”

Redfield points out that these high-priced elections are a bipartisan affliction, noting that, in general election races, the two parties typically match each other in campaign spending.

“You’re creating a class of legislators that have a debt to interests outside their districts,” says Redfield. “If you’re a Democrat or a Republican that’s a wholly owned subsidiary of someone else, it doesn’t matter who has bought and paid for you.”

In 2012, the last time Dunkin faced a primary opponent, fewer than 11,000 people voted. If there’s a similar turnout this time and he and Stratton spend a combined $2 million — which, at this point, Redfield sees as a low-ball estimate — they will have burned through $424 for each person who voted.

Particularly in smaller races, the big spending can quickly reach a point of diminishing returns, according to Redfield, who says races like Dunkin-Stratton are more a show of force in the larger Rauner-Madigan struggle than sound election strategy.

“There are only so many mailers you can send and commercials you can air before people start to tune you out,” he says. “And when there is money involved, there tend to be political consultants, and that means the majority of the advertising is going to be negative. That’s a turnoff for voters.”

Myra Olaopa, who lives in Dunkin’s district, has grown tired of having her South Loop mailbox turned into a political battleground.

“I get something from — what’s her name? — Stratton every single day,” says Olaopa, who called and emailed Stratton’s campaign to try and get off the candidate’s mailing list.

And, she says, “I get something from the other guy maybe two times a week.”

She doesn’t plan to vote until the general election — she says she hasn’t ever voted in a primary — and doesn’t see the point in saturating the neighborhood with political flyers.

“Even if I was interested, I would read it just once,” Olaopa says. “Why would I want to read something every day? I hate it. It comes out of my mailbox and goes right in the trash.”

COSTLY CAMPAIGN

$500,000

• Largest single campaign contribution in Illinois history

• Went to state Rep. Ken Dunkin, D-Chicago, from a political action committee backed by Gov. Bruce Rauner’s supporters.

More than $1 million

• What another Rauner-linked PAC has put into ads promoting Dunkin or ripping his opponent, Juliana Stratton.

More than $1 million 

• Amount Stratton has taken in.

$424

Amount Dunkin and Stratton are expected to end up spending per voter for each person who votes in their contest.

By Andrew Schroedter

The U.S. attorney’s office in Chicago has subpoenaed the town of Cicero for records of deals with two politically connected companies, the Better Government Association has learned.

Federal authorities asked for invoices, payment records and other documents relating to You & Me and the Woodridge promotional products company’s owners, Rosemary Walsh Konz and her husband Daniel Konz, since 2008, according to a copy of the subpoena obtained from Cicero through a public records request made under the Illinois Freedom of Information Act.

Last year, the town spent $19,061 to buy items including lip balm, nail files and pencil sharpeners from You & Me — all imprinted with the name of Cicero Town President Larry Dominick, records show.

Since Dominick took office in 2005, Cicero has spent more than $890,000 on merchandise bought from You & Me Inc., whose co-owner Rosemary Konz is the daughter of Cicero Trustee Lorraine Walsh, a longtime Dominick supporter.

The items also have included thousands of ice cream scoops, mouse pads, back scratchers, lint rollers, hand sanitizers and holiday ornaments, as well as beach balls and balloons imprinted with contact information for Cicero’s rodent control department, the Chicago Sun-Times has reported. They typically were given away at town events.

The subpoena — which lists the names of an Internal Revenue Service agent and a federal prosecutor — also demanded town records regarding Lembke & Sons True Value Hardware in Berwyn and an affiliated business.

Lembke & Sons Hardware in Berwyn. | Sun-Times file photo

The Sun-Times has reported that Cicero spent more than $3 million at Lembke & Sons since 2005. The store, owned by Alan Lembke, has contributed more than $69,000 to Dominick’s campaign funds since 2005, Illinois State Board of Elections records show.

The town’s records were to be turned over to a special grand jury that convened Dec. 15, according to the subpoena. Grand juries typically are convened so evidence can be considered in a criminal investigation.

Joseph Fitzpatrick, a spokesman for the U.S. attorney’s office, would not comment.

Ray Hanania, a Cicero town spokesman, declined to comment on the subpoena.

But, Hanania said, “The contractors have been doing business with the town long before Larry came to office in 2005.”

Rosemary and Daniel Konz founded You & Me in 1998, according to the company’s website. Rosemary Konz has been a member of the town’s Housing and Real Estate Board since Dominick appointed her in 2006.

Rosemary Walsh Konz and Daniel Konz | Photo from You & Me Inc. website.

You & Me has contributed $6,550 in cash and merchandise to Dominick’s campaign funds since 2005, and Walsh has given more than $21,000, according to elections board records.

Cicero’s spending at You & Me has declined since hitting $149,573 in 2012. Town officials spent $49,131 there in 2013, $40,915 in 2014 and $19,061 last year, records show. Last year’s purchases included $2,157 for 3,500 sticks of cherry lip balm, $2,600 for 5,000 nail files and $2,580 for 2,500 pencil sharpeners, all emblazoned with Dominick’s name, invoices show.

Rosemary Konz had no comment.

Walsh couldn’t be reached.

Lembke didn’t return messages.

Last year, in another case that had drawn federal scrutiny, the owner of a sewer repair company was sentenced to six months in prison for non-payment of federal income taxes on money he was paid by Cicero. The company, Superior Sewer Solution, had gotten no-bid work from Cicero. The company and its owner had been Dominick campaign contributors.

When he was a candidate for River Forest’s village board a year ago, lawyer Richard C. Cooke said he and his family “were going to spend the rest of our lives here.”

Within days of losing that election, though, Cooke formed a campaign fund to become a Cook County judge representing a district miles from his home in River Forest.

By last June, Cooke had registered to vote from an apartment he owns near Logan Square — in the county’s Sixth Judicial Subcircuit.

Now, he’s running unopposed in next Tuesday’s Democratic primary for a judgeship from the subcircuit, which is predominantly Latino.

Illinois set up the judicial subcircuits 25 years ago to expand diversity on the Cook County bench. Still, it’s not unheard of for white guys such as Cooke to make sudden moves across town to get elected from majority-minority districts with vacancies.

What’s especially interesting here is how Cooke engaged in a broad, aggressive push to win over the subcircuit’s political judge-makers.

OPINION

Cooke loaned himself $500,000 last April, six days after forming his campaign committee to run for judge, and then gave his campaign another $160,000, records show.

More than $67,000 from that stash was passed on to politicians, including party leaders who oversaw Cooke’s slating as a judge candidate.

Records show Cooke’s committee wrote checks to four Democratic wards in the subcircuit — the 27th, 30th, 31st and 33rd — and seven aldermen. Other contributions from the aspiring judge went to the 14th Ward Democrats of Ald. Edward Burke — who oversees slating for judges — and Mike Madigan’s state Democratic Party.

And Cooke’s campaign paid another $40,000 to Spartacus 3, a company owned by state Rep. Luis Arroyo Sr., D-Chicago, and his wife.

Arroyo says the company’s $5,000-a-month services included gathering nominating signature petitions for Cooke.

Many Northwest Side political players are grumbling that Arroyo, whose son is a county commissioner, is growing his clout. They’ve nicknamed him “King In The North,” after a character in the blood-drenched TV drama “Games of Thrones.”

Arroyo says he’s hoping to retire from Springfield soon and just wants to do some consulting through Spartacus 3. He lauds Cooke for scaring off potential rivals by pouring huge amounts into his own campaign fund.

“When people drop a half a million dollars into a bank account, you really got to think hard about running against them,” Arroyo says.

Cooke says Arroyo offered his services to him.

“He told me he had intimate, intimate knowledge of the voting blocs in the subcircuit,” Cooke says. “I said, ‘That sounds good to me.’”

Cooke says he self-funded his campaign because he was “just not comfortable asking other people” to finance his dream of becoming a judge. With no rivals, his campaign ended up not needing to spend most of the money he loaned himself.

The judge-to-be still is registered to vote in River Forest, at his house valued at more than $850,000. And Cooke continues to participate in River Forest’s village zoning panel, which he was appointed to last May.

Richard Cooke ran for village trustee from this home in River Forest. | Kevin Tanaka/For the Sun-Times

But Cooke says he and his wife had separated and he moved to the second-floor apartment in Logan Square before he registered to vote in Chicago last year. Signs for 33rd Ward boss Dick Mell’s re-election as committeeman are in the apartment’s windows.

Cooke rebuts carpet-bagging allegations by noting his law office, two gas stations and car wash are in the subcircuit.

“I meet the residency requirements under the law,” he says.

Richard Cooke says he now lives on the second floor of this building in Logan Square in Chicago. | Kevin Tanaka/For the Sun-Times

You can violate the supposed spirit of a law while adhering to the letter.

At this point, the people of the subcircuit and the rest of the county can do nothing more than think about that — and about how Judge Cooke came to wear his robes — when they’re standing before his honor soon.