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Editorial: If only Juan Rangel would learn to play by the rules

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The tragedy of Juan Rangel, who built up a system of charter schools in Chicago serving thousands of lower-income Hispanic kids, is that he has failed to hold himself to the highest ethical standards.

Rangel is a man of smarts and personal charm. He has done good work. He was destined, we once thought, to do so much more.

And maybe, for all we know, he will yet.

But somewhere along the line — or was it from the start? — Rangel fell in love with the old Chicago way of doing things, steering contracts and favoring friends and relatives for jobs. Whatever good he was doing, he threw mud all over it.

Rangel, former leader of the United Neighborhood Organization, on Tuesday agreed to pay a $10,000 fine without admitting any wrongdoing to settle securities fraud charges. In announcing the settlement, the U.S. Securities and Exchange Commission said Rangel broke the law in 2011 when he OKd a document related to an UNO bond sale that didn’t disclose “conflicted transactions.” The conflicts, uncovered by the Sun-Times, were that UNO paid millions of dollars from a state grant to companies owned by brothers of a top UNO executive.

Rangel says he never read the bond sale document and relied on others to brief him. At minimum, if we accept that explanation, he failed to do his job. And, even then, that doesn’t explain the grubby matter of throwing big contracts to the relatives of an UNO insider.

EDITORIAL

Rangel, who grew up in Little Village, became CEO of the UNO community organization in 1996 and built up a charter network of 16 privately run, government-funded schools. These were schools that needed to be built, serving kids too long stuck in crummy neighborhood schools.

Along the way Rangel became a leading civic figure. Mayor Daley appointed him to the Park District board. He co-chaired the 2011 election campaign of Mayor Rahm Emanuel, who later appointed him to the Public Building Commission. He also had strong ties to Ald. Edward M. Burke (14th) and Illinois House Speaker Michael Madigan (D-Chicago). At one point, he was arguably the most influential Latino in Chicago politics.

But Rangel, like some of those pals and mentors, also revealed no particular objection to self-serving cronyism, backroom deals and nepotism.

There was more than the contract conflict that led to the SEC action. One nephew was his deputy chief of staff. Another nephew was on the payroll as an information technology manager. His niece Araceli Estrada was paid more than $49,000 a year as an apprentice kindergarten teacher. And, as the Sun-Times reported, Rangel and other UNO officials piled up big bills for restaurant meals and travel at taxpayers’ expense.

If Rangel had taken a peek at CPS’ ethics policy, he would have seen that no public school official is allowed to hire or appoint a relative or help a relative get a contract that the official manages. He failed to put those same rules in place at UNO. In 2013, under pressure, he resigned as UNO’s chief executive.

Today, at age 50, Rangel keeps a lower profile, but you can bet he’ll be back in the game soon enough. He likes being a player.

Here’s hoping he plays by the rules.

Follow the Editorial Board on Twitter: Follow @csteditorials



Razing high-rises reshaped city — a Sun-Times/BGA special report

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As a longtime public housing resident, Robert Tate has had a front-row seat to the demolition and rebirth of the neighborhood where the Cabrini-Green public-housing projects once stood.

Tate, 52, has spent most of his life at the Cabrini-Green row houses — the only remnant of what once was a sprawling Chicago Housing Authority complex on the Near North Side with more than 3,500 apartments.

Outside the 17 row houses that remain in use, it’s hard to see poverty anywhere else in the now-fashionable neighborhood. A service center for Lamborghinis and other imported cars is a block away on Chicago Avenue, across from a new luxury apartment building. Cranes are at work on more high-end properties under construction just to the east, north and south.

Yet the redevelopment of the neighborhood — part of the CHA’s massive “Plan for Transformation” — hasn’t left everyone better off, Tate says.

“We knew gentrification was coming,” he says. But “they took a community and moved it someplace else.”

The Near North Side and other neighborhoods ringing the Loop have boomed in the 16 years since the launch under then-Mayor Richard M. Daley of “the largest, most ambitious redevelopment effort of public housing in the United States,” which razed public housing high-rises and began replacing them with mixed-income developments.

Yet the plan also has resulted in new clusters of subsidized housing in neighborhoods on the city’s South Side and West Side that already were grappling with disinvestment and crime, a Chicago Sun-Times and Better Government Association analysis has found.

Natasha Holbert, program director for Chicago Lights Urban Farm, a not-for-profit community produce garden adjacent to the Cabrini row houses, has worked near Cabrini for nearly two decades.

Natasha Holbert has worked in the Cabrini-Green area nearly two decades. | Brett Chase / Better Government Association

Natasha Holbert has worked in the Cabrini-Green area nearly two decades. | Brett Chase / Better Government Association

“Poverty here is a lot more invisible now,” she says.

The Near North Side still has more than 3,200 families who live in rehabilitated public housing or use Section 8 vouchers issued by the CHA or the federal Department of Housing and Urban Development to help pay their rent in privately owned buildings.

But that’s 599 fewer families in subsidized housing than the neighborhood had 16 years ago. During that time, new residents have flocked to the area. The white population in the Near North Side surged by about 10,000 between 2000 and 2014.

“There’s a lot of separation between the longtime residents and the newer people,” Holbert says.

From Skid Row to trendy

The story is similar in the West Loop, which has become a real estate and restaurant mecca since the Henry Horner Homes and other nearby public housing developments were demolished in the 2000s. Earlier this month, McDonald’s Corp. announced it would move its world headquarters there from Oak Brook, joining an influx that includes Google’s Chicago offices.

George Lemperis. Sun-Times file photo

George Lemperis. Sun-Times file photo

George Lemperis, owner of the Palace Grill at 1408 W. Madison St., a popular stop for fans headed to the United Center to see the Blackhawks or Bulls, has witnessed the decline and rise of the Near West Side over four decades. Lemperis points to the eight luxury townhouses being built next door to his restaurant.

“They’re starting at $2 million apiece,” he says. “Twenty-five years ago, you probably could’ve bought this whole neighborhood for $2 million.”

He credits Daley for spurring the changes. Along with the construction of the United Center, “A lot had to do with them tearing down the Henry Horner Homes,” Lemperis says.

For all but two of her 77 years, Yvonne Patterson has also lived on the Near West Side. She and her late husband, a former Chicago Sun-Times truck driver, lived on the sixth floor of a 16-story Horner Homes tower for a time.

“I’ve seen the projects come, and I’ve seen the projects go,” the mother of six adult children says.

When the CHA decided to tear down her building, she was given a choice: She could move to replacement housing in the neighborhood or get a voucher to go wherever she wanted. She decided to stay, choosing a four-bedroom apartment in a three-flat owned by the CHA just north of the United Center.

“You know, we like it better — we’re not stacked on top of each other,” Patterson says. “To me, this is still Horner. All my friends that ain’t dead, I still see.”

chaprojectMany others who were displaced when the CHA high-rises were torn down didn’t return to the neighborhood. Between 2000 and 2015, the Near West Side lost 579 subsidized-housing units.

“If you look at [the plan] from the standpoint of residents living in mixed-income, it’s overwhelmingly a success,” says Robert Whitfield, an attorney and former top CHA executive in the 1990s who has represented public housing residents. “The negative side is it came with a cost: There are fewer public housing units than there were before. Some of the criteria have kept people out.”

Altogether, the number of people living in CHA-owned projects citywide fell by about 13,200 between 2000 and 2015, according to data from the CHA and HUD. At the same time, the number using Section 8 vouchers issued by the CHA or HUD to help pay their rent soared by 47,700.

It all adds up to 187,600 people citywide now living in properties subsidized through the CHA or HUD — an increase of 23 percent in 15 years.

‘People couldn’t adapt’

As the CHA leveled its high-rise projects, many former tenants took a voucher, but few moved far. And other families getting new vouchers ended up in the same West Side and South Side neighborhoods, with their abundance of rental properties and growing poverty. North Lawndale, Austin, Auburn-Gresham, South Shore, Chatham, Greater Grand Crossing, East Garfield Park and Roseland all gained more than 900 households with CHA vouchers between 2000 and 2015.

On the North Side, in contrast, the affluent North Center and Lincoln Park community areas have lost a total of more than 600 public-housing families since the CHA began closing down the Lathrop Homes, a group of low-rise apartment buildings along the north branch of the Chicago River near Diversey Parkway. Built in 1937, Lathrop is slated to be replaced by a mixed-income development — a plan critics call a land grab removing poor people.

Few of the displaced Lathrop Homes tenants have remained in the area: Between 2000 and 2015, North Center didn’t gain any voucher households. Lincoln Park lost three.

Dorothy Battie, 61, raised six children in the Robert Taylor Homes. She now lives in South Shore, which has the most subsidized-housing households of any community area in Chicago. | Brett Chase / Better Government Association

Dorothy Battie, 61, raised six children in the Robert Taylor Homes. She now lives in South Shore, which has the most subsidized-housing households of any community area in Chicago. | Brett Chase / Better Government Association

On the South Side, Dorothy Battie, 61, moved to the Robert Taylor Homes on South State Street in 1974. She lived in seven apartments there over the next three decades as she raised six children. The complex, which included 28 high-rises, once held the distinction of including half a dozen of the poorest census tracts in the entire country.

By the time the CHA started demolishing the Robert Taylor high-rises, Battie, like thousands of others in public housing buildings, was no longer officially on a lease — she was living with her daughter Lee Lee Henderson and her two grandchildren.

Battie says she has stayed in touch with a number of old neighbors who had rough transitions from the high-rises. Most were only able to find apartments in other impoverished areas. “A lot of people couldn’t adapt to a new environment,” she says.

While Henderson has moved 11 times in search of a safe, stable home for her kids, her mother found an apartment she likes in South Shore.

“Everybody tells me how bad South Shore is,” Battie says, “but I haven’t experienced it yet.”

The predominantly black lakefront community has long been home to middle-income residents as well as poor families. But South Shore lost more than a fifth of its population from 2000 to 2014, falling to about 49,000 people living there.

With an increase in voucher-holders — including 250 families who formerly lived in public housing — the neighborhood now has the highest total of subsidized-housing households in the city: 5,096.

Activist Val Free lives in a South Shore apartment complex using a HUD Section 8 project-based voucher. | Brett Chase / Better Government Association

Val Free. | Brett Chase / Better Government Association

Neighborhood activist Val Free says the concentration of poverty has contributed to crime and instability. She says “slumlords” shoulder a big portion of the blame because they don’t screen tenants or maintain their properties.

Free points to boarded-up windows and standing water under back stairways in the HUD-administered complex where she’s lived for 20 years. And so far this year, 29 crimes have been reported on her block alone, police data show.

“There was no plan in place to monitor how this played out,” Free says. South Shore should have ended up with more resources to help families in need, she says, “but that didn’t happen.”

RELATED STORIES:

The CHA’s great upheaval — a Sun-Times/BGA special report

As subsidized housing spreads, suburbs face rising number of poor

Contributing: Data Reporting Lab editor Darnell Little

                                                                                                               Brett Chase is an investigator for the Better Government Association.

 


As subsidized housing spreads, suburbs face rising number of poor

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Decades ago, Yolanda Crawford had a chance to leave the Chicago Housing Authority’s Dearborn Homes in Bronzeville and move to Naperville.

She turned it down. That’s a decision she regrets.

Now, from the front porch of a small three-bedroom home in Burnham that she leases using a Section 8 “housing choice” voucher, the retired postal worker has some advice for other mothers raising children in Chicago’s crime-ridden neighborhoods.

“I advise any mother: Move to your suburban areas,” she says. “Not taking anything from the city, [but] there’s too much going on. Take your Section 8 voucher. Take it and go to Atlanta. Take it and go to Los Angeles.”

Crawford, a 58-year-old grandmother, took her voucher and headed to Burnham, just a few blocks south of the city limits. She leases her home from a retired teacher who moved to Wisconsin. The voucher covers all of her rent: $1,200 a month.

Burnham is among several south suburbs — also including Park Forest, Calumet City, Dolton, Lansing, University Park, Country Club Hills and South Holland — that have seen some of the six-county region’s biggest gains in subsidized housing since the CHA began demolishing the city’s high-rise housing projects 16 years ago under its “Plan for Transformation.”

During that time, 13 suburban housing authorities and the U.S. Department of Housing and Urban Development also changed their policies, issuing more Section 8 vouchers to low-income families throughout the region.

As a result, the number of subsidized households in the suburbs — from suburban Cook County to the surrounding counties of DuPage, Lake, Kane, McHenry and Will — has risen 28 percent, from 32,292 in 2000 to 41,493 last year, according to HUD data and U.S. Census Bureau figures analyzed by the Chicago Sun-Times and Better Government Association.

Altogether, the suburbs had more than 84,000 residents using housing choice vouchers or some other form of taxpayer-funded housing assistance in 2015, the HUD data show.

The migration has come as the suburbs, in general, have grown more diverse and less affluent. Between 1999 and 2014, the number of suburban families living in poverty rose from about 53,000 to 104,000, rising from 4 percent of the population to 7 percent, according to census data.

chaproject

Spreading out

Nearly half the suburbs’ subsidized-housing units — about 19,600 — are in suburban Cook County. Of the 17 Cook County suburbs with more than 400 such households, 11 are in southern Cook County, which has experienced great economic and racial upheavals as white residents — as well as middle-income black families — moved elsewhere, according to records and interviews.

It’s a migration pattern that has evolved, starting with whites who fled the South Side for the south suburbs in the 1960s and 1970s. Blacks followed years later and now are spreading further out.

Whites, meanwhile, are moving farther south, to Will County. Since 2000, Will County has added 57,763 white residents — more than any other collar county.

“None of these people really want people with vouchers coming in to them,” says William Sampson, a DePaul University sociology professor who focuses on race and poverty. “This is as much about socioeconomic status as it is about race. I hadn’t thought that middle-income blacks would be as opposed to have low-income blacks move in as whites. . . . [But] middle-income black folks said, ‘No, we won’t tolerate it.’ ”

Only a fraction of the suburbs’ subsidized-housing population is living in traditional public housing — like the high-rise buildings the CHA tore down under the Plan for Transformation.

Instead, the vast majority use housing choice vouchers, issued by 13 suburban housing authorities, that pay all or part of the rent for them to live in privately owned apartments, townhouses or single-family homes. Others live in apartment complexes that have HUD project-based vouchers assigned to them.

SUBURBS’ SUBSIDIZED HOUSING: Click on interactive map below.

 

Burnham, population 4,225, has seen a 55 percent increase in subsidized households since the CHA transformation plan began in 2000. Over roughly the same time, its white population plunged 50 percent, while the number of black residents rose 17 percent and the number of Hispanic residents shot up 44 percent. Last year, the suburb had 231 residents living in 87 households using housing vouchers.

There’s been an even greater influx of subsidized-housing residents over the past 15 years in bigger suburbs in southern Cook County.

Calumet City had 3,150 subsidized-housing residents in 2015 — the highest number outside Chicago in Cook County and a 20 percent increase since the CHA high-rises started coming down. They make up about 8 percent of the suburb’s population. Once predominantly white, Calumet City now has the state’s fourth-highest black population.

Lansing, which has about 28,500 residents, saw its subsidized-housing population double, to 1,032, between 2000 and 2015.

The same has happened in Dolton, where one in 10 residents last year lived in homes or apartments rented with vouchers.

Park Forest gained 515 subsidized households between 2000 and 2015 — the second-biggest increase in subsidized units of any suburb in the six-county area.

Not all south suburbs have seen increases. Some that have been home to African Americans for decades — including Harvey, Ford Heights, Phoenix and Robbins — saw decreases in subsidized-housing households.

Harvey saw a decline of 574 subsidized households between 2000 and 2015 — the biggest drop in the six-county area — though it still had 1,896 residents on taxpayer-funded housing assistance last year. The financially depressed suburb’s population also has fallen, to 25,225 — down 16 percent since 2000.

Chicago Heights, population 30,410, saw a decline of 418 subsidized-housing households between 2000 and 2015. But it still had 2,495 people living in: three public-housing developments operated by the Housing Authority of Cook County; homes rented with housing choice vouchers; and privately owned apartment complexes with HUD project-based vouchers.

The rise in the number of poor people in the south suburbs is “an enormous problem and something we’ve been dealing with for 30 years,” says Edward Paesel, executive director of the South Suburban Mayors and Managers Association. “The demolition of the CHA high-rises exacerbated the problems.

“We were telling anybody that would listen that this was a disaster waiting to happen,” Paesel says. “The initial proposal was there would be replacement housing [in Chicago]. But that didn’t happen. Those residents had to move, and they chose the south suburbs.

“The increase of subsidized residents happened with the decline of jobs. We’re having families move in to areas where there are few jobs . . . and a lack of social service agencies that can provide for the needs of the families.”

He says township governments have stepped up to provide those services.

Thornton Township Supervisor Frank Zuccarelli, for example, operates a food pantry in Harvey, while another township program provides financial assistance to people who don’t qualify for state or federal welfare programs but still need shelter, utilities or medical assistance.

Big rise in DuPage County

The growth of subsidized housing in other communities, while not as great as in southern Cook County, is also evident in other parts of the region. Of 245 suburbs in the six-county metro area, 193 — nearly four of five — have seen a rise in the number of subsidized-housing households.

Several communities that reported having no subsidized households 15 years ago now have dozens of them, among them Darien, Inverness and South Elgin.

The most dramatic increase has come in DuPage County, where the number of subsidized households has doubled, to about 5,700, even as the county’s population has held relatively steady.

Naperville and Carol Stream each gained more than 500 households receiving housing aid. They’re among six DuPage County communities — Downers Grove, Glendale Heights, Wheaton and Westmont are the others — with more than 300 subsidized-housing units.

Those communities all have large numbers of apartments that voucher-holders can rent, says Kenneth E. Coles, executive director of the DuPage Housing Authority, which oversees nearly two-thirds of the county’s subsidized households.

“For so many years, DuPage was really under-utilizing the number of vouchers they had available,” Coles says. “We’ve had growth over the last couple of years, building up to what our limit should be. It’s going to even off.”

Lake County had the second-highest number of subsidized units in the region — more than 7,300, many of them concentrated in Waukegan, Zion and other communities in the county’s northeast corner.

They include Park City, a community of 7,551 near Waukegan and Gurnee. Fifteen years ago, it had only about 50 subsidized-housing residents. It now has seven times that: 350 people.

The Colonial Park Apartments in Park City, near Waukegan, have become a destination for low-income people who once lived in Chicago. More than 84,000 people are now living in the suburbs using vouchers or other forms of public-housing assistance. | Chris Fusco / Sun-Times

The Colonial Park Apartments in Park City, near Waukegan, have become a destination for low-income people who once lived in Chicago. More than 84,000 people are now living in the suburbs using vouchers or other forms of public-housing assistance. | Chris Fusco / Sun-Times

Veronica Johnson is one of them. She grew up in the Robert Taylor Homes, Henry Horner Homes and Altgeld Gardens and, until four years ago, lived in market-rate housing in Englewood.

Johnson, 47, got a voucher from the CHA and was offered a chance to “port” it to Park City under a regional housing program. When she first moved there, she says she “was crying for a whole month and wanted to go back.

“But, now, nuh-uh,” says the mother of eight, who has a four-bedroom, two-bath apartment in the Colonial Park Apartments, a sprawling complex sandwiched between the Park City police station and a senior housing development. “There ain’t no shooting out here. Nobody’s getting raped or robbed. I sleep with my windows open at night.

“In Chicago, I couldn’t do that.”

RELATED STORIES:

The CHA’s great upheaval — a Sun-Times/BGA special report

Razing high-rises reshaped city — a Sun-Times/BGA special report

Contributing: Data Reporting Lab editor Darnell Little

Brett Chase is an investigator for the Better Government Association.


The CHA’s great upheaval — a Sun-Times/BGA special report

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In 1999, Mayor Richard M. Daley boldly promised to transform public housing in Chicago — in part by tearing down the high-rise housing projects that lined the city’s expressways and surrounded the Loop.

Today, nearly every Chicago neighborhood — and almost every suburb — has felt the impact of the Chicago Housing Authority’s “Plan for Transformation,” a Chicago Sun-Times and Better Government Association analysis has found.

In the city, areas surrounding the Loop still have hundreds of subsidized-housing tenants, but demolition of high-rise projects like Cabrini-Green has cleared the way for rapid gentrification by wealthy whites and businesses.

South Shore is the new subsidized-housing capital of Chicago.

Of 245 suburbs in the six-county metropolitan area, 193 — almost four of five — have seen an increase in the number of subsidized-housing households. As in the city, the overwhelming majority of those families are living in apartments, townhouses or single-family homes they rent with the aid of government subsidies known as Section 8 vouchers.

“This has been a game-changer in different ways for neighborhoods,” says Andrew Greenlee, an assistant professor of urban and regional planning at the University of Illinois at Urbana-Champaign. “The plan was not only about transforming public housing but also fundamentally changing the neighborhoods across the entire city of Chicago.”

While the Plan for Transformation aimed to break up heavy pockets of poverty created by expansive public housing projects, “in some ways, [it] reinforced historical divisions,” Greenlee says, displacing families and continuing racial and class segregation.

“What we have here is a story of noble intentions but also unintended consequences.”

chaproject
A ‘Plan’ to fight ‘worst housing’

At the time the Plan for Transformation was presented, concentrated poverty, high crime, decrepit building conditions and a long history of mismanagement had turned many of the CHA’s developments into what officials acknowledged was “some of the worst housing in America.”

For massive housing projects such as Cabrini-Green on the Near North Side and the Robert Taylor Homes along South State Street, federal and city officials — including Rahm Emanuel, then the vice chairman of the CHA board — decided the solution was demolition. A total of 18,000 apartments would see the wrecking ball, to be replaced by mixed-income developments. Other CHA properties would be extensively rehabilitated. In all, Daley and the CHA promised to build or rehab 25,000 units.

Most of the CHA’s 16,800 families would have to move, at least temporarily. Those deemed by the CHA to have followed agency rules would get a “right of return” — the opportunity to go back to the rebuilt units or to move, with the aid of a Section 8 voucher, to privately owned housing.

Experts predicted most displaced CHA residents would move to other African-American neighborhoods where they could find apartments cheaply and quickly.

Lee Lee Henderson, a former Robert Taylor Homes resident, has moved nine times since leaving the housing project. | Jared Rutecki /Better Government Association

Lee Lee Henderson, a former Robert Taylor Homes resident, has moved repeatedly since leaving the housing project. | Jared Rutecki /Better Government Association

That’s what Lee Lee Henderson did. Using a Section 8 voucher to rent it, her first house was on a rundown block in Englewood — next to a vacant lot infested with cat-sized rats, she says.

Henderson, 41, a former Robert Taylor Homes resident, can still rattle off the addresses of the homes she’s rented since then — 11 of them — as she tried to find a safe and well-maintained place for herself and her two children. They’re now living on the first floor of a two-flat in West Garfield Park on the West Side. It’s not far from where she works at a YMCA.

Still, she wishes some things had been different. She doesn’t think the CHA gave tenants enough time or help to adjust. “They should have thought this process through before they took our homes away.”

What happened to those whose lives were disrupted by the upheaval? Examining a wide range of data from the U.S. Department of Housing and Urban Development, CHA, U.S. Census Bureau and elsewhere, the Sun-Times and BGA found:

• Of the approximately 16,800 families living in CHA buildings at the end of 1999, 4,100 of them — 24 percent — were in mixed-income or traditional public housing in Chicago at the end of 2015.

• Another 3,500 — 21 percent — moved into privately owned housing with the help of housing vouchers from the CHA. Though they moved to areas across the city, most of these former CHA tenants now live in just 10 neighborhoods on the South Side and the West Side: South Shore, Grand Boulevard, Auburn-Gresham, Washington Park, West Englewood, Austin, Roseland, Woodlawn, Greater Grand Crossing and Englewood.

• About 6,100 former CHA families — 36 percent — have died or violated their lease terms.

• The CHA doesn’t know where thousands of others ended up. Officials say about 3,100 families didn’t respond to inquiries. And the whereabouts of those who’d been staying in CHA apartments under leases in someone else’s name — estimated to be thousands more — also are unknown.

“A relatively small number were able to move back to these mixed-income developments,” says Paul B. Fischer, a retired Lake Forest College urban affairs professor who has been studying public housing in the Chicago area for decades. “Many of them probably feel that’s an improvement. The families that chose a voucher, how they ended up, it’s very hard to say.”

CHA officials say thousands of former public housing tenants now live in areas that are safer and more racially and economically integrated.

Also, Molly Sullivan, a CHA spokeswoman, says, “Chicago has been the testing ground for new ideas and strategies — many of which are working and some which have provided lessons learned.”

METROPOLITAN CHICAGO’S SUBSIDIZED HOUSING: Click on interactive maps below.

Beyond the projects

The demolition of the high-rise projects represents just a part of the shift in the region’s approach to housing for the poor since 2000. As the six-county Chicago area has grown more racially and economically diverse overall, the CHA, 13 suburban housing authorities and HUD all have increased the use of Section 8 vouchers — either with “housing choice” vouchers, which cover all or part of the rent for apartments or houses leased from private landlords, or project-based vouchers allotted to specific apartment complexes.

As a result, the number of households getting some kind of public housing aid in the six-county Chicago area rose by about 30,000, from 100,696 in 2000 to 131,011 last year, according to HUD data.

Most of that rise — 20,000 households — was in Chicago. After the CHA razed its high-rise developments, it nearly doubled the number of housing choice vouchers it issues.

As of the end of last year, Chicago had 89,500 subsidized-housing households with a total of 187,600 residents — 7 percent of the city’s total population.

About three-quarters of those people were getting housing assistance through programs administered by the CHA, with the rest living in developments overseen by HUD.

The spike in vouchers, combined with the demolition of the high-rises, has had a dramatic effect on Chicago neighborhoods:

• South Shore — a predominantly African-American lakefront neighborhood with a mix of $500,000 homes, high-rise condos and multi-unit rental buildings — now has the most households receiving vouchers or living in public-housing properties: 5,096. It’s followed by the Near West Side (4,386), Austin (4,203), Uptown (4,164) and Grand Boulevard (3,767), according to CHA and HUD data.

• Seven of the 10 city neighborhoods with the most subsidized housing units are predominantly African-American. So are all 13 neighborhoods with the biggest gains in CHA vouchers.

• The neighborhoods with the fewest households getting a housing subsidy are all on the Northwest Side or the Southwest Side: Edison Park (7), Mount Greenwood (10), Norwood Park (25) and Archer Heights (32). All are majority-white but Archer Heights, which went from majority-white to Hispanic between 2000 and 2010.

• Nearly 1,200 subsidized families have left the Near North Side and Near West Side since the high-rises of the Cabrini-Green and Henry Horner Homes developments were torn down. Both projects have been replaced by mixed-income developments that include hundreds of public housing and voucher households mixed among market-rate units. High-income residents and businesses have flocked to both areas.

Ald. Leslie Hairston. | Rich Hein / Sun-Times

Ald. Leslie Hairston. | Sun-Times

Ald. Leslie Hairston (5th), whose South Side ward includes a large swath of South Shore, says the CHA either steered families to the neighborhood or did nothing to prepare for them moving there.

“I doubt that everybody who was in a housing project woke up one day, stretched their arms and said, ‘I want to move to South Shore,’ ” Hairston says. “To take people from one area to another is not a transformation.”

That neighborhood doesn’t have the resources to help everyone in need of social services, according to Hairston, who says, “I am still working with the CHA and encouraging them to put resources in communities to help people lead healthy lives.”

CHA officials say they provided social services to former public housing residents from the start of the Plan for Transformation and continue to offer counseling and other support to families with vouchers.

Eugene Jones Jr., tapped by Mayor Rahm Emanuel last year to head the CHA, says the agency has nearly delivered the 25,000 units it promised — though it initially pledged to do so by 2010, before repeated extensions.

The agency’s job, Jones says, is to provide affordable housing. Many people getting housing assistance end up in segregated areas, but Jones says that’s their choice, often to stay close to their families, friends, jobs and schools.

“I can’t fix the segregation problem,” Jones says. “If we help desegregation, that’s great. But it’s not the mission.”

A suburban shift

Some of the former city-dwellers appear to have ended up in the suburbs, which census data show gained 105,500 black residents between 2000 and 2014 — a 22 percent increase — while Chicago’s black population dropped by more than 200,500 people — roughly 19 percent.

William Sampson. DePaul University

William Sampson. DePaul University

That doesn’t surprise DePaul University sociologist William Sampson, who says he thinks the Daley administration and the CHA always intended to displace African-Americans.

CHA high-rise tenants should have gotten more relocation assistance, Sampson says, but “the politicians don’t have to worry much about the response from the public about how poor non-whites are treated. Those folks don’t vote a lot.”

The growing racial and economic diversity in the six-county area outside Chicago has been accompanied by an increase in subsidized housing:

• Between 2000 and 2015, the number of subsidized households in the suburbs went up from about 32,300 to 41,500 — a 28 percent rise, with more than 84,000 people living in those households.

• The rise in subsidized units outside the city has been clustered in several south suburbs, including Park Forest, Calumet City, Dolton and Lansing; the far north suburbs around Waukegan and Zion; and the southwest corner of DuPage County.

Lillie Martin never lived in public housing, but she used a housing voucher to move from Chicago to Calumet City nearly 20 years ago. At the time, Martin, who’s African American, was adopting a son out of foster care and wanted to raise him in a safe, racially mixed community. She ended up in a two-story apartment building on a quiet street up the block from her son’s neighborhood elementary school, where she volunteered.

Her son’s now in college, and Martin, 77, is no longer as enamored as she once was with her neighborhood. People are moving away. Homes are sometimes left vacant — including one next door to hers. Sometimes, she doesn’t feel safe.

“It has changed,” she says.

Contributing: Data Reporting Lab editor Darnell Little

Brett Chase is an investigator for the Better Government Association.

HOW THE ANALYSIS WAS DONE

The Chicago Sun-Times and Better Government Association analyzed data from the U.S. Department of Housing and Urban Development’s online portal, “A Picture of Subsidized Households.” The analysis included households living in public housing or receiving Section 8 vouchers to help pay their rent. HUD programs aimed at seniors were not included.

This data was analyzed by census tract in the city of Chicago and by municipality in the six-county suburban area for the years 2000 and 2015.

In addition to the HUD numbers, the Sun-Times and BGA acquired and analyzed extensive records from the Chicago Housing Authority, including data showing the number of households at every CHA-owned property in 2000 and 2015.

These stories also include U.S. Census Bureau data on race and poverty analyzed by census tract in Chicago and by municipality in the suburbs.

 

RELATED STORIES:

Razing high-rises reshaped city — a Sun-Times/BGA special report

As subsidized housing spreads, suburbs face rising number of poor

 

ABOUT THIS SERIES

In 2000, the Chicago Housing Authority embarked on the largest public housing makeover in the country. The Chicago Sun-Times and Better Government Association have been examining the effects of the city’s massive “Plan for Transformation.” Click below to read earlier stories.

Chicago’s public housing divide — March 13, 2016

You paid to build them, now you pay to lease them — March 14, 2016

Emanuel blasts CHA voucher program as policy ‘gone awry’ — March 16, 2016

CHA moves to strip aid from suspect in gym murder — March 20, 2016

Cashing in on the CHA — April 24, 2016

CHA tenants shivered until city sued landlords over heat — April 25, 2016

CHA might take over Section 8 from contractors in wake of reports — June 12, 2016

 

The downtown skyline provides a backdrop May 31, 1996, to the Robert Taylor Homes public housing project, now torn down. Beth Keiser / AP file photo

The downtown skyline provides a backdrop May 31, 1996, to the Robert Taylor Homes public housing project, now torn down. Beth Keiser / AP file photo

 


WATCHDOGS: Ex-Gov. Jim Edgar aims to cash in on state’s cash woes

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At the same time he’s criticized Gov. Bruce Rauner for failing to pass a state budget, former Gov. Jim Edgar and his business partners are looking to profit from the state of Illinois’ financial crisis, records obtained by the Chicago Sun-Times show.

Edgar is chairman of the board of Illinois Financing Partners, which on Wednesday won the Rauner administration’s OK to advance money to vendors that have been forced to wait months to get paid by the state. The payoff for the Edgar company? It gets to keep the late-payment fees when the state finally pays up.

Edgar — a Republican who was governor from 1991 to 1999 — says somebody needs to stand up for state vendors.

His company joins five others already in the business of bailing out businesses owed money by state government.

“Because we’re in the financial mess we’re in now, you need something like this to protect the vendors,” says Edgar, whose company’s vice chairman is another former politician — ex-U.S. Rep. Jerry Costello, a downstate Democrat who’s now a lobbyist in Springfield and Washington.

Edgar says he gets an undisclosed monthly stipend from the company. He and Costello also each have a 1 percent stake in it, records show.

Rep. Jerry Costello, D-Ill., smiles as he walks past friends on his way to a news conference Tuesday, Oct. 4, 2011, in Sauget, Ill., at which he announced that he will not be a candidate for re-election to Congress in 2012. (AP Photo/Belleville News-Democrat, Derik Holtman)

Former Democratic U.S. Rep. Jerry Costello | AP file photo/Belleville News-Democrat

Illinois legislators approved a temporary state budget Thursday after more than a year of wrangling that forced drastic cuts in social services and other programs.

Edgar has been among those calling on fellow Republican Rauner to reach a compromise with Democrats, led by Illinois House Speaker Michael J. Madigan, D-Chicago, on a comprehensive spending plan that would cover the state’s full fiscal year, which began Friday.

“You can’t get things done if you’re not willing to meet your adversary halfway,” Edgar said of Rauner June 7 at an Illinois Campaign for Political Reform luncheon. “It’s obvious what we’ve done the last year hasn’t worked.”

The budget impasse has contributed to an $8 billion-plus backlog in unpaid state bills. The state has to pay 1 percent interest a month on all bills that are more than 90 days past due.

Rather than wait months to get paid, state vendors that qualify can collect 90 percent of what they’re owed by selling their unpaid bills to one of the six “qualified purchasers,” who pay them the remaining 10 percent when the state pays the bills in full. In exchange, the vendors forego their late-payment interest.

That interest can be lucrative: Since 2003, the state of Illinois has paid more than $1 billion in late fees, including more than $508 million in just the last three budget years, according to state Comptroller Leslie Munger’s office.

In the year without a budget, Munger lacked the authority to pay many bills, which has slowed the “Vendor Payment Program” that now includes Edgar’s company to a virtual halt. But the Rauner administration has set up an alternate program, called the Vendor Support Initiative, that’s allowed the qualified purchasers to keep fronting money to certain vendors.

Approval of a complete state budget is expected to make the vendor-bailout business more stable. Still, Edgar says his urging Rauner to pass a budget isn’t about enriching himself.

“If the state ever did get their act together, this entity would go out of business,” Edgar says of his company. “Unfortunately, we’re not there.”

Lindsay Trittipoe. | Illinois Financing Partners

Lindsay Trittipoe. | Illinois Financing Partners

Edgar says he got involved with Illinois Financing Partners through Bill Fleischli, who worked for the state Department of Transportation when he was governor and now is executive vice president of the Illinois Petroleum Marketers Association. The majority owner of Illinois Financing Partners — Lindsay Trittipoe of Richmond, Va. — has financed environmental cleanup around defunct underground petroleum storage tanks through another company he heads.

Illinois Financing Partners says it has a $500 million commitment from Bank of America to help purchase vendors’ bills, according to its application to the state Department of Central Management Services filed in April.

Since the Vendor Payment Program’s inception in 2011 under then-Gov. Pat Quinn, a company founded by Madigan aide-turned-lobbyist Brian Hynes and Patti Solis Doyle, a former campaign manager for Hillary Clinton whose brother is Ald. Danny Solis  (25th),  has gotten most of that business, the Sun-Times reported last fall.

Since then, their company, Vendor Assistance Program, has bought more than $706 million in vendors’ unpaid bills, including $432 million belonging to state health insurance provider Blue Cross Blue Shield. Vendor Capital Finance has purchased $137 million in unpaid bills, and Payplant has bought $391,037 in bills.

Though he’s been critical of Rauner on the budget, Edgar lauded him Friday in a statement released by Illinois Financing Partners, saying: “By allowing this financing to take place, the governor has helped over 80,000 state employees, their families and retirees. He deserves praise for putting people before politics.”


Cook County judges not following bail recommendations: study

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Cook County judges routinely make bail decisions for crime suspects contrary to what the judges’ new risk-assessment system calls for, according to a review of more than 1,500 cases this year obtained by the Chicago Sun-Times.

A review by the Cook County sheriff’s office showed judges’ bail decisions differed from the guidelines about 85 percent of the time. The review tracked cases in 30 weekday sessions — between Feb. 10 and March 29 — in Central Bond Court at the main Leighton Criminal Courthouse at 26th and California.

The sheriff’s study found bail decisions were “inconsistent,” even when defendants’ backgrounds and the charges they faced were factored in.

The 90-page study, the results of which Chief Cook County Judge Timothy Evans disputes, also found that the amount and conditions of bail varied widely depending on which judge was presiding on a given day.

In a speech last month in Chicago, Illinois Supreme Court Justice Anne Burke, who pushed for the new assessment system, said: “One of the key problems with our bond court judges is not just their unwillingness to apply the risk assessments when making their decisions but stems from the fact that they are not being sufficiently trained and supervised and are not being held accountable by the system.”

The system was launched in July 2015 to consider two key factors in addition to the 36 bail factors set out in Illinois law:

• The threat that a defendant might pose to the community.

• And the likelihood of showing up for subsequent court dates.

Those assessments are done by Evans’ pretrial service division. It assigns a number according to the risk level that corresponds to a recommended bail.

One aim was to identify more nonviolent offenders who qualify for release pending trial.

Pat Milhizer, director of communications, Office of the Chief Judge. | Rich Hein/Sun-Times

Pat Milhizer, director of communications, Office of the Chief Judge. | Rich Hein/Sun-Times

Pat Milhizer, a courts spokesman, says that’s exactly what’s happening. In the three months before the assessments began, 52 percent of defendants charged with nonviolent, non-weapons felony charges were released on bail or electronic monitoring, Milhizer says. From January through May, that rose to 67 percent, he says.

Mike Carroll, director of information services for Evans, says the sheriff’s sampling was too small to draw conclusions — 7 percent of cases that came through Central Bond Court this year through May 31.

Milhizer says judges and pretrial services officers have received extensive training on the new system but that it doesn’t replace sound judgment. He points to a case in which, based on the assessment system, the recommendation was to release a man charged with gun possession even though he was accused of pointing the gun at someone and pulling the trigger twice, without it firing. Despite the recommendation, the judge set a significant bail, Milhizer says.

Cara Smith. | AP file photo

Cara Smith. | AP file photo

Cara Smith, Sheriff Tom Dart’s policy chief, said, “It is unfortunate that the chief judge’s office would disregard the objective findings of this report, which could be tremendously helpful in improving the bond court process and improving public safety.”

The sheriff’s office did bail comparisons of defendants charged with similar crimes. For instance, two drug defendants had risk levels that called for release from jail. A 28-year-old white man suspected of cocaine possession was freed on a no-cash bond while a 33-year-old black man was ordered held on $50,000 cash bail for possession of two Viagra pills.

The study also examined how judges’ decisions varied with the risk assessments for certain crimes. In gun-possession cases, the assessments called for defendants to be jailed without bail in about 5 percent of cases but judges set bail for 98 percent of those suspects and freed the rest on electronic monitoring, according to the study.

Most of those gun-possession cases involved “D bonds,” meaning the defendant was required to post cash to be released. About 20 percent of them were able to post bail and were freed pending trial.

Gun possession was the charge for which most defendants were released on bail, according to the sheriff’s study.

In comparison with gun offenders, only 2 percent of those charged with shoplifting were able to post bail, the study found.

In her June 23 speech, Burke said, “Judges — apparently distrustful of the information provided to them by pretrial services — refuse to allow eligible individuals to be released on their own recognizance and, instead, continue to require large cash bonds, even for relatively minor, nonviolent crimes. But even low bonds are too large if you are poor.”


THE WATCHDOGS: Casino owners jump on video-gambling bandwagon

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The number of video-gambling machines at Illinois bars, strip malls and other small venues is booming, growing from zero to more than 23,000 in the past four years, records show.

That’s nearly double the number of gambling spots the state’s 10 casinos have.

Which has casino owners, who once fought against video gambling, now taking a different tack: If you can’t beat ’em, buy ’em.

The latest example: A Canadian private equity firm that has a 40 percent stake in the state’s top-grossing casino, Rivers Casino in Des Plaines, announced a $32.5 million investment last month in Accel Entertainment Gaming, the biggest operator of video-gambling terminals in Illinois.

That investment comes after two companies that own four casinos in Illinois bought two other big video-gambling operators: Gaming & Entertainment Management and Prairie State Gaming.

“Regional casino revenue is down throughout the country, and Illinois is kind of the forerunner in what’s expected to be the next wave — if there is another wave — in gaming,” says Michael Gelatka, president of the Illinois Gaming Machine Operators Association.

The casinos “see another revenue source out there and see a way to hedge their bets on the future,” says Gelatka, who owns G3 Gaming, a video-gambling company in Lansing. “If you have a regional casino and you feel video gaming is eating your lunch, then you have the ability to be a part of it” by investing in the industry or buying terminal operators outright.

As of the end of May, there were 23,406 video-gambling terminals operating at 5,658  locations statewide — including bars, restaurants, truck stops, gas stations and so-called casino cafés, many of them located in strip malls.

Revenues from those video poker, slot and other types of gambling machines are split roughly in thirds among terminal operators, owners of the sites where the machines are placed and the state, with a portion of the state’s tax share going to local governments.

State law caps the number of terminals at five per establishment. It also places lower limits on wagering and payouts on the machines than the limits at casinos.

Last year, video-gambling terminals took in $913 million, the most yet in Illinois, with $274 million of that going to the state and host communities.

In the first five months of this year, revenues are up 25 percent over the same time last year, to $459 million. That’s almost the same amount as the state’s 10 casinos generated in the same period.

The casinos — limited to 1,200 slot-machine and table-game positions apiece — still took in more revenue last year than video-gambling spots, $1.4 billion, and provided more taxes to the state and local governments, $488 million. But their revenues and the number of people visiting them have been decreasing since 2012, when video gambling began taking root throughout the state.

Chicago is among 150 municipalities that ban video gambling, though industry advocates have been trying to convince Mayor Rahm Emanuel the machines would produce much-needed tax revenue for the cash-strapped city. Emanuel instead wants a Chicago casino, but plans for that have yet to materialize.

When the state law authorizing video gambling was approved in 2009, “The original intent was to help the bars, restaurants and some of the truck stops earn some revenue for themselves and for the state,” says Tom Swoik, executive director of Illinois Casino Gaming Association, which represents eight of the state’s 10 casinos. “I think what happened was with the advent of the cafés — and also with the liquor stores and gas stations — people realized there were ways it could expand. And it’s just gone crazy.”

Under the law, most establishments must have licenses to pour liquor to have video gambling. Some communities, hungry for video-gambling tax revenue, have issued such licenses to casino café chains — among them such now-common names as Dotty’s, Stella’s Place and Shelby’s — which collectively have hundreds of terminals operating at dozens of sites throughout the suburbs.

Stella's Place, in Hickory Hills. |Leslie Adkins / Sun-Times

Stella’s Place, in Hickory Hills. |Leslie Adkins / Sun-Times

Others have granted liquor-pouring rights to liquor stores and fast-food restaurants so they can have video gambling. Machines also are going in at gas stations that technically qualify as truck stops under the law.

Originally, video-gambling terminal operators were prohibited from having “a substantial interest” in no more than 5 percent of the machines licensed by the Illinois Gaming Board. But lawmakers rescinded that provision in 2010.

That’s opened the way for small video-gambling operations to grow — and made them an attractive target for casino companies to buy.

Penn National Gaming, whose holdings include the Hollywood casinos in Aurora and Joliet, announced its acquisition of terminal operator Prairie State Gaming last summer. Delaware North, owner of Jumer’s casino in Rock Island, announced its purchase of Gaming & Entertainment Management in May. Those companies together have machines in a total of 13 percent of video-gambling sites statewide.

On June 22, Clairvest Group Inc. — the Canadian company that owns the 40 percent stake in Chicago real estate magnate Neil Bluhm’s Rivers Casino — announced it was making its $32.5 million investment in Accel Entertainment. Clairvest said that gives it a “minority interest” in Accel, which has machines at 20 percent of video-gambling locations in Illinois.

Bluhm, who long has opposed video gambling, had no role in Clairvest’s decision to invest in Accel, says Dennis Culloton, a spokesman for Rivers Casino.

Clairvest’s decision followed small investments by Bluhm’s son, Andrew Bluhm, and one of his top executives, Greg Carlin, in a casino café company, Laredo Hospitality Ventures — a development reported by the Chicago Tribune last year. A college roommate of Andrew Bluhm and Carlin runs Laredo, which operates Stella’s Place and Shelby’s cafés.

“There’s been another funding [call] for that company since that story, and Greg and Andy did not make an additional investment,” Culloton says. “They had a small percentage in the first place, and it’s even smaller now.”


WATCHDOGS: Targeted firms still get tax money after charter raids

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Days after federal agents swept into the headquarters of Concept Schools and a charter school it operates in Rogers Park in June 2014, top Chicago Public Schools officials took notice of the raids on the taxpayer-funded charter operator but decided to steer clear.

Jack Elsey — the CPS official in charge of overseeing publicly financed, privately run charter schools like those run by Concept — emailed the district’s top lawyer at the time, James Bebley, and copied then-schools CEO Barbara Byrd-Bennett about the federal investigation.

“James, any guidance on how we should react?” Elsey wrote, attaching a link to news coverage of the raids at Concept’s main offices in Des Plaines and its Chicago Math and Science Academy, at 7212 N. Clark. “My inclination is to see how this plays out.”

“At this point, I don’t know what we would be reacting to,” Bebley replied. “There is really nothing to say except that we will monitor events as they play out.”

“Good, just wanted to confirm my ‘gut’ on this one,” Elsey wrote back.

Byrd-Bennett responded, “Jack, Jack … Jack,” and closed her email with a backwards smiley face emoticon — (: — as she often punctuated more light-hearted email exchanges with other CPS officials. Elsey replied with a correctly executed smiley face: “:)”.

Byrd-Bennett quit as Mayor Rahm Emanuel’s top schools official last year amid an unrelated bribery scandal, pleaded guilty to federal corruption charges and awaits sentencing.

More than two years since the FBI raids brought the still-ongoing federal investigation involving Concept to light, the charter operator has continued to do business with contractors identified in court documents as allegedly having been involved in defrauding a government grant program, records obtained by the Chicago Sun-Times show.

The charter-management organization — which runs four taxpayer-funded charter schools in Chicago and dozens more across the Midwest — has paid more than $519,000 since the raids to companies federal authorities said were involved in the corruption probe and their subsidiaries, according to documents the newspaper obtained from individual Concept schools.

There has been no correspondence between CPS and Concept Schools — which gets millions of taxpayer dollars a year to operate its Chicago schools — regarding the federal probe, according to CPS and the charter operator.

A CPS spokeswoman declined to comment Friday, citing the ongoing investigation.

Similarly, a Concept Schools spokesman said: “Because [the investigation] is ongoing, we are limited in what we can discuss on the matter. Concept Schools’ commitment to excellence extends to every classroom, student and faculty member. It also extends to the management and operations throughout Concept’s network.”

Concept operates about 30 schools in Illinois and six other states, with four Chicago campuses that have a total of 2,220 students. They include the Chicago Math and Science Academy, known as CMSA, which opened in Rogers Park in 2004, and the 2-year-old Horizon Science Academy–Southwest Chicago Charter School, located at 5401 S. Western, both chartered by the Chicago Board of Education.

Chicago Math and Science Academy was one of 18 Concept Schools locations raided. | Sun-Times file photo

Chicago Math and Science Academy was one of 18 Concept Schools locations raided. | Sun-Times file photo

CPS rejected plans proposed by Concept to open two more schools in Chicago because of questions about students’ performance at CMSA. But the charter operator successfully appealed to the Illinois State Charter School Commission, which, in 2012, overrode the Board of Ed, authorizing them to open. As a result, the state commission, rather than CPS, oversees those two schools: Concept’s Horizon Science Academy–Belmont, 5035 W. North, and Horizon Science Academy–McKinley Park, 2845 W. Pershing.

Weeks after being raided by federal authorities, Concept Schools asked the U.S. Department of Education for about $340,000 for its Horizon Science Academy-Southwest Chicago Charter School, 5401 S. Western Ave. | Leslie Adkins / Sun-Times file photo

Weeks after being raided by federal authorities, Concept Schools asked the U.S. Department of Education for about $340,000 for its Horizon Science Academy-Southwest Chicago Charter School, 5401 S. Western Ave. | Leslie Adkins / Sun-Times file photo

A week after the 2014 raids, the charter commission’s deputy director spoke with Sedat Duman, Concept’s president, according to internal commission records.

“They ask that everyone withhold judgment until the conclusion of the investigation,” the commission’s deputy director at the time, Karen Washington, told Jeanne Nowaczewski, the state agency’s executive director.

At the commission’s board meeting the following month, Nowaczewski said the two schools overseen by the state hadn’t been raided, nor had they benefitted from the federal grant program that CMSA and other Concept schools were involved in, which is the focus of the investigation.

Nowaczewski also told her board that the commission’s lawyer had “reached out to the FBI for more information without success,” according to minutes of that July 2014 meeting.

On Friday, Hosanna Mahaley-Jones, the commission’s current executive director, said, “once findings and/or a decision is rendered in the case, the commission will proceed accordingly.”

Concept records show the two schools it operates in Chicago that are overseen by the state commission have paid a total of more than $533,000 in fees to the agency, which is funded by the schools it regulates.

After the FBI raids, all four of the chain’s schools in Chicago continued to do business with companies named in the federal search warrants that were served at Concept’s main offices, CMSA and other schools run by Concept in Peoria, Indianapolis and Ohio, records show.

The investigation has centered on Concept’s involvement in the federal “E-Rate” program, which funds the expansion of high technology in schools serving low-income families.

According to a sworn statement from Geoffrey Wood, a U.S. Department of Education investigator, the feds suspected that Concept and some of its schools “engaged in a scheme to defraud a federal program” for at least seven years. Court records show Wood told a judge that Concept violated government bidding rules by steering more than $5 million in E-Rate funds to companies with ties to the charter group.

“By giving work to related vendors, Concept was able to direct large portions of E-Rate program money away from the charter schools . . . and enrich those particular vendors,” Wood wrote.

Since the raids, Concept’s schools here have paid more than $102,000 to Advanced Solutions for Education, run by Ozgur Balsoy, a former Concept Schools executive and E-Rate program consultant. Authorities raided the firm’s Schaumburg offices as well as the Mount Prospect home of Balsoy, who has denied any wrongdoing.

According to court records, the biggest beneficiary of the alleged E-Rate fraud by Concept was Core Group Inc. of Mount Prospect, which got more than $2.8 million in federal funding through the program. The FBI raids included the offices of Core and the Elk Grove Village home of its president, Ertugrul Gurbuz.

Since the raids, Concept’s four Chicago schools have paid an additional $416,867.19 to Core and its subsidiaries, according to a Sun-Times review of financial records from the charter campuses.

Concept was founded in 1999 by Turkish immigrant educators with ties to Fethullah Gulen, a Muslim cleric who lives in Pennsylvania and has been accused by the Turkish government of conspiring to overthrow the government.

Despite the investigation, which federal officials say is continuing, Concept applied for and was approved for a grant of nearly $340,000 from the U.S. Department of Education last year, earmarked for Horizon Science Academy-Southwest Chicago.

CPS initially balked at releasing records involving the federal investigation of Concept. After the Sun-Times appealed to the Illinois attorney general’s office, which mediates public-records disputes, Chicago school officials turned over 363 pages from 2014. They said there are no more recent records regarding the investigation.

Soon after the raids, Concept canceled plans for a new school in Chatham that the Board of Ed had approved to open in the fall of 2014. CPS records show officials were instructed to tell parents the late-summer decision — which sent many families scurrying to find new schools in time for the start of classes — had nothing to do with the FBI investigation.

Still, CPS officials appear to have been leery of how their treatment of Concept might be viewed. When CPS decided in November 2014 not to extend a food-services contract with Concept’s schools in the city, top Byrd-Bennett aide Tim Cawley told her that going to the Board of Ed to get the deal approved would be “inviting yet more criticism of our relationship with Horizon Concept (and their FBI investigation),” records show.



Exiled Muslim cleric with Chicago ties denies role in Turkey plot

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As a military coup fizzled in Turkey, that country’s president blamed the uprising on a reclusive, elderly Muslim cleric living in exile in Pennsylvania whose followers have a strong presence in Chicago.

Fethullah Gulen —honorary president of the Chicago-based Niagara Foundation, one of several Gulen-affiliated groups across the United States— denied any knowledge of the failed plot against his ally-turned-enemy, the democratically elected President Recep Tayyip Erdogan.

Gulen told reporters Saturday at his mountain compound in the Poconos he knows only a “minute fraction” of his legion of sympathizers in Turkey and couldn’t speak to their “potential involvement.”

“You can think about many motivations of people who staged this coup,” Gulen, who was born in Turkey but has lived in the United States for more than 15 years, said through an interpreter. “They could be sympathizers of the opposition party. They could be sympathizers of the nationalist party.”

The reclusive cleric made his comments shortly after Erdogan demanded the United States extradite him. Secretary of State John Kerry said the Obama administration would entertain an extradition request but that Turkey would have to prove wrongdoing by Gulen.

Gulen, who is in his mid-70s, said he wouldn’t have returned to Turkey even if the coup succeeded, fearing he’d be “persecuted and harassed.”

“Longing for my homeland burns in my heart, but freedom is also equally important,” said Gulen, who lives on the grounds of the Golden Generation Worship & Retreat Center, an Islamic retreat founded by Turkish-Americans.

The Des Plaines-based Concept Schools network — which includes 30 publicly funded charter schools in the Midwest, four of them in Chicago — was started by people with ties to the Gulen movement.

No one associated with the schools has been charged with wrongdoing, but the Chicago Sun-Times reported a week ago that a federal investigation involving Concept continues two years after its headquarters and its Chicago Math and Science Academy in Rogers Park were among 19 locations federal agents raided.

Investigators suspect the schools defrauded a government grant program, according to court records that show they obtained search warrants for the 2014 raids because they believed Concept officials were rigging grant-funded contracts to steer more than $5 million in federal funding to insiders. Some of the proceeds were wired to Turkey’s Bank of Asya, authorities said. News accounts in Turkey have reported the bank was founded by Gulen’s movement, which controlled it until he fell out with Erdogan.

“Chicago is a very important center for the Gulen movement,” said Robert Amsterdam, the Washington, D.C., lawyer hired by the Turkish government to investigate Gulen and his followers. “This is one of the most sophisticated influence-peddling movements in the world. But now there’s no excuse for people not waking up and opening their eyes to the danger this guy represents.”

Mevlut Hilmi Cinar, the Niagara Foundation’s president, didn’t respond to requests for comment Saturday.

The Niagara Foundation hosted dozens of trips to Turkey for Illinois House Speaker Michael Madigan, D-Chicago, his wife and other Springfield lawmakers in recent years, the Sun-Times has reported. Madigan also did a video testimonial for a Concept school.

Andrew Madigan, the speaker’s son, made another video praising a Concept school. The company he works for, Mesirow Insurance Services, does business with the chain’s schools in Chicago.

Mike Madigan’s trips to Turkey were among 32 “educational missions” House Democrats reported taking there as guests of the Niagara Foundation between 2008 and 2012.

Madigan spokesman Steve Brown, who accompanied Madigan to Istanbul, Ankara and Ephesus in 2012, has said the speaker paid for “all known expenses” but listed four trips to Turkey on gift-disclosure statements because “there might be expenses that Niagara had that he was not aware of.”

Other Illinois politicians who toured Turkey on Niagara-hosted trips included Ald. Joe Moore, whose 49th Ward includes a Concept school at 7212 N. Clark. Moore said he went two times, including one trip at the suggestion of Salim Ucan, Concept’s vice president.

Gulen and Erdogan once were allies. Both are said to be pious Muslims in a country ruled as a secular republic for nearly a century. They have feuded since 2013. Even before Friday’s coup, the Turkish government accused Gulen of plotting to overthrow the government.

He has criticized Erdogan over the Turkish leader’s increasingly authoritarian rule. The Erdogan regime has launched a campaign against Gulen’s movement in Turkey and abroad, purging civil servants suspected of ties to the movement, seizing businesses and closing some news organizations.

On Saturday, Gulen denounced Erdogan for “repression and persecution” of his followers in Turkey and said his government has “no tolerance for any movement, any group, any organization that is not under their total control.”

Erdogan has accused Gulen’s followers of “being treasonous, of trying to overthrow the Turkish government and trying to put themselves in power somehow,” said Scott Alexander, an Islamic studies professor at the Catholic Theological Union in Chicago who is a Niagara Foundation trustee. “These are baseless and preposterous allegations.”

Although Concept and other charter operators linked with Gulen have sought to downplay their connections to him, Gulen’s lawyers boasted of his school network in court papers in 2008.

“As founder and head of the Gulen movement, Mr. Gulen has overseen the establishment of a conglomeration of schools throughout the world, in Europe, central Asia and the United States,” according to the filing by attorneys for Gulen, who successfully sued to overturn the U.S. government’s initial rejection of his permanent residency.

The statement in the immigration case was the result of a “misunderstanding between Mr. Gulen and his lawyers,” Alp Aslandogan, executive director of Gulen’s New York-based Alliance for Shared Values, told the Sun-Times in 2015. Aslandogan’s group is the umbrella body for U.S. organizations affiliated with Gulen, including the Niagara Foundation.

Contributing: AP, Maudlyne Ihejirika

 


THE WATCHDOGS: Chicago’s segregated police stations

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Chicago has 22 police stations scattered across the city, and white police officers hold at least half of the jobs in 12 of them — including two stations serving black neighborhoods on the West Side, where murders and shootings are rampant.

Black cops have more than half the jobs in just two police stations — both on the South Side, one serving Hyde Park, Kenwood, Bronzeville, Grand Boulevard and Washington Park, the other covering Roseland and West Pullman. Some districts have hardly any black officers at all.

Hispanic police officers hold more than half the jobs at only one police station, a district that includes Little Village, one of the city’s most heavily Mexican neighborhoods.

More than 70 percent of Chicago’s nearly 12,000 police officers are assigned to one of the city’s 22 police districts. They include Chicago’s street officers, the most visible cops in the city, the ones most likely to respond to calls for help, but not the department’s detective units and other specialized bureaus.

But how these cops are deployed in different parts of the city varies widely by race and ethnicity, a Chicago Sun-Times analysis has found. The findings are based on data obtained from the Chicago Police Department detailing the race and gender of every officer assigned to every district.

They come as the department finds itself the subject of intense scrutiny over race since a judge ordered the release last year of police video showing Laquan McDonald, a black teenager, being shot 16 times by Officer Jason Van Dyke, a white cop who’s now charged with first-degree murder.

The public outcry that followed the release of that video prompted Mayor Rahm Emanuel to fire his first police superintendent, Garry McCarthy, who is white, and replace him with Eddie Johnson, an African American who has spoken of the need for the city to recruit more minority cops. That’s become a key issue in a city in which 52 percent of the police department is white, while two-thirds of the city’s residents are minority.

The U.S. Department of Justice is looking into how the city assigns cops to districts as part of its broader investigation of the police department’s practices and policies that began last year after the release of the video showing Van Dyke killing McDonald as the 17-year-old appeared to be walking away.

McDonald was killed in the Chicago Lawn district, where the Sun-Times analysis found 65 percent of the cops are white, 26 percent are Hispanic and 7 percent are black.

State Sen. Kwame Raoul, seen here with Supt. Eddie Johnson on July 1, . | James Foster / Sun-Times

State Sen. Kwame Raoul, seen here with Supt. Eddie Johnson on July 1, wants more black officers assigned to black neighborhoods. | James Foster / Sun-Times

State Sen. Kwame Raoul, D-Chicago, says he thinks Chicago needs more black officers assigned to black neighborhoods — which are often patrolled by rookies, black or white, who are typically assigned to high-crime beats because they have no seniority to transfer to other assignments.

“You can’t presume everything just based on race,” Raoul says. “But there’s an increased likelihood that, if you have an African American, they’re more familiar with the nuances of the African American community. There’s a certain cultural competence that can allow for officers to distinguish between one individual who may be dressed in a hop-hop type of attire that’s not a threat and somebody who is, in fact, a threat.

“We have to accept that people have certain prejudices, whether or not they’re malicious, just based on the things they’re familiar with and the people they’re familiar with,” Raoul says, citing “the sort-of segregated nature of the city. And it leads to people prejudging certain circumstances.”

But Wesley Skogan, a Northwestern University professor who specializes in police issues, says race shouldn’t factor into the assignment of police officers, an issue he says was debated by Emanuel’s Police Accountability Task Force.

“It flies in the face of police research,” says Skogan, who, like Raoul, was among the experts who served in working groups to help the task force suggest reforms for the police department. “Cops are blue in color, with race predicting very little about their behavior or performance.”

Raoul says that, “ideally . . . it doesn’t matter how you deploy cops of certain races because people understand each other better.” But he says, “We’re not completely there yet.”

Among other key Sun-Times findings on police deployment in Chicago:

• Blacks cops have fewer than 10 percent of the assignments in nine police districts — often trailing Hispanics or Asians. Of the 1,901 black officers assigned to districts, 69 percent of them were posted to eight police stations, all on the South Side.

• Englewood is one of the city’s smallest police districts, but it has more cops assigned to it than any other district — 509 — in the face of gang violence that’s resulted in 39 murders this year through June 22. About 44 percent of Englewood District cops are white, 29 percent are black and 23 percent Hispanic.

• The number of cops in Englewood is twice that of Jefferson Park, one of the largest police districts, where thousands of white cops have raised families for generations. Jefferson Park, which has the city’s lowest overall crime rate, has 250 cops — including 190 who are white, 37 Hispanic and a dozen black.

• The South Side’s eight police districts together account for 3,347 cops — about 40 percent of all cops assigned to the city’s 22 districts.

• There are more than three white cops for every black cop assigned to two West Side districts covering black neighborhoods that include Austin, West Garfield Park and East Garfield Park. Both districts are run by black commanders.

• Seven police districts — including the Central District, which covers the Loop — are the most racially diverse in the city. No one group holds more than half of the jobs in those districts. White cops are the biggest group in five of them, including the Central District, where they hold 49 percent of the jobs.

• Nearly 20 percent of all officers assigned to any district — 1,626 in all — have been detailed to another police unit, sometimes in another police district. Others have been assigned to the department’s marine unit, the mounted patrol, news affairs, the police academy, human resources and the superintendent’s office.

      [Click here for a searchable database of Chicago police officers broken down by district assignment, race and gender.]

“The Chicago Police Department works to ensure that officers represent the communities they serve,” spokesman Frank Giancamilli says. “Officers’ assignments are based on the individual needs of each district, as well as bids by officers for appointment based on seniority, where applicable. Furthermore, CPD also listens to direct feedback from community members about the presence of officers in each neighborhood.

“As Superintendent Johnson has made clear, he is a strong advocate of community policing and believes that, beyond the issue of race, rebuilding public trust requires respectful and professional interactions between police officers and residents. By reinvigorating our community policing efforts, collaborating with residents and treating each other with respect — regardless of skin tone — we are taking steps to rebuild the public trust that is essential in making Chicago a safer city.”

Police officers are allowed to request one transfer per year under their union contract. Many officers prefer to work as close to home as possible. Many white cops might choose to work at West Side stations because they are closer to their homes on the Northwest Side, some suggest.

And a desire to be close to home might also explain why few black officers work in North Side districts, says Dean Angelo Sr., president of the Fraternal Order of Police Lodge 7, the city’s largest police union.

“If I live in Roseland or South Shore, I don’t want to drive to Rogers Park every day,” Angelo says. “Police officers are very good at what they do, and they’re very professional. If I call the police, I wouldn’t care if it’s a guy or a girl, if they’re black or brown or white — as long as they get there quick.”

Contributing: Data Reporting Lab editor Darnell Little, Sam Charles

Chicago police districts: crime, racial breakdown of officers

 


Burke’s street plowed early, often: IG report says

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Streets and Sanitation plows deviated from their normal course to clear a path to Ald. Ed Burke’s fortress-like house after a major winter storm last year, City Hall’s inspector general said Monday.

The report from Inspector General Joe Ferguson came nearly 18 months after the Chicago Sun-Times revealed how the 14th Ward boss’ block was improperly plowed early and often in response to a 19.2-inch snowfall.

Buried deep in Inspector General Joe Ferguson’s routine quarterly report, he said investigators found snow-removal crews hit the powerful City Council member’s block on West 51st Street 46 times in five days after the fifth-largest winter storm in Chicago history paralyzed traffic on many local streets on Super Bowl Sunday last year.

“The elected official’s block was plowed before neighboring streets received service even though the official did not live on a main snowplow route, which receives priority plowing,” Ferguson wrote. “These actions were in apparent violation of [Streets and San’s] stated employee guidance and policies, including the city’s official snow program maps.”

Ferguson suggested the practice of favoring Burke’s block without reason had been going on for a long time, saying he found it “equally concerning” that an unidentified supervisor in Streets and San “was untroubled by the appearance of preferential treatment and assumed the route deviation was expected as a past practice.”

Nevertheless, the inspector general’s office did not to seek punishment of any city employee involved in the plowing that served the city’s longest-serving alderman so well.

“The investigation did not reveal deliberate preferential treatment, but rather a welter of fundamental misunderstandings of responsibilities and expectations in the snow program,” Ferguson said.

Hamlin Avenue, a couple blocks from Burke's house, shown in early February 2015. It remained unplowed days after a snowstorm while the street in front of Ald. Ed Burke's nearby house was clear. | Dan Mihalopoulos/Sun-Times

Hamlin Avenue, a couple of blocks from Ald. Edward M. Burke’s house, shown in early February 2015. It remained unplowed days after a snowstorm while the street in front of Burke’s house was cleared. | Dan Mihalopoulos/  Sun-Times

Ferguson began his investigation because the Sun-Times used city Plow Tracker data compiled by clearstreets.org to show how Burke benefitted from taxpayer-funded plow service again and again, even as neighbors in his working-class ward spun their wheels on snow-covered streets after the historic whiteout.

While nearby side streets became rutted and remained ice-bound for days, Burke’s lightly travelled 3900 block of 51st was cleared, salted and as passable as it is today within hours of the storm’s end.

The same pattern emerged after another snowstorm a few weeks later, in February 2015, the Sun-Times reported.

Snow shameBurke, the council’s longtime Finance Committee chairman, and his wife, state Supreme Court Justice Ann Burke, live in a three-story, 5,600-square-foot home that looms large in a neighborhood of relatively modest ranch houses and bungalows.

When first asked about the Burkes’ most-favored-block status after the storm, the alderman’s spokesman claimed it was deserved because the 3900 block of 51st is “classified as an arterial street.”

That’s not true, the Sun-Times found. The nearest main route deserving of priority snow-removal service is a half-mile from the Burkes’ house.

Burke’s street was hit by Streets and San crews long before City Hall had cleared all the busiest streets and “vital” locations around town. Until that’s done, plows are not supposed to be re-directed to side streets, including where Burke’s house is.

Mayor Rahm Emanuel has outfitted snow-removal equipment with GPS devices and published the tracking data online in real time in an effort to prove that no trucks are purposely sent to aid of those with clout before regular folks without political connections.

Emanuel — whose home block on the North Side did not enjoy Burke-style VIP treatment from his administration’s snow-fighting crews, according to the data — referred the issue to Ferguson’s office.

Emanuel’s Streets and San commissioner, Charles Williams, has said snowplow drivers claimed to use Burke’s block to turn around after completing a main route and did not intend their off-course wanderings as an homage to Burke.

In the newly issued report, Ferguson wrote, Streets and San has made changes to its procedures to work more efficiently after snowfalls.

The department “said it provided drivers and foremen with training on the changes and reviewed with them basic policies, procedures and rules,” according to the inspector general.

The spokeswoman for Ferguson declined to comment further.

It appears the Inspector General’s office only looked at the administration’s actions and not at Burke personally. The council did not give Ferguson’s office the power to investigate aldermen or their aides until after the snow-plowing incidents revealed by the Sun-Times.

A spokesman for Burke, who has been alderman for 47 years, did not respond to requests for comment Monday.

Ald. Ed Burke's plowed street

Later in February 2015, Ald. Ed Burke’s block again was clear, though nearby streets were not. The street was plowed earlier than it was supposed to be after a snowstorm, Inspector General Joe Ferguson found. | Sun-Times file photo

Side streets near Ald. Ed Burke's block became rutted and remained ice-bound for days after a February 2015 snowstorm.

Later in February 2015, after more snow, it happened again, with the street in front of Ald Ed Burke’s house relatively clean and side streets nearby remaining rutted and ice-bound. | Sun-Times file photo


Struggling municipal golf courses turn to video poker, slots

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Struggling municipal golf courses are turning to video poker and slot machines in an effort to make up for declining revenue.

More than a dozen taxpayer-funded golf courses in Illinois have tried legal gambling in the past three years, though with mixed results.

The public courses are located in New Lenox, Elk Grove Village, Hoffman Estates, Joliet, Countryside, Blue Island, Glenwood, Worth and North Chicago and, outside the Chicago area, in Winnebago County, Streator, Cahokia and Moweaqua.

The municipal courses split any profits with the gaming-machine owners. Altogether, they took in a total of more than $1 million from 55 machines located in their clubhouses, after taxes, records show.

Gaming machines at The Sanctuary in New Lenox. | Doug Longhini / BGA

Gaming machines at The Sanctuary in New Lenox. | Doug Longhini / BGA

“It’s just becoming part of the norm,” says Bob Schulz, director of golf at The Sanctuary, an 18-hole course owned by the New Lenox Community Park District.

Still, two public golf courses — in Chicago Heights and University Park — didn’t bring in enough money to continue operating the gambling machines. Seven machines were removed from those courses after taking in a total of just $17,268 after taxes in little over 18 months.

Citing hundreds of thousands of dollars in losses overall, University Park closed its course earlier this year, then turned over management to a private company.

The gambling machines are allowed under a state law passed seven years ago to help bars and restaurants.

Since early 2013, gamblers have spent a total of $18.7 million on machines at municipal golf clubhouses, bringing in about $450,000 in state and local taxes, records show.

One of the first local government agencies to offer video gambling was the Foss Park District in North Chicago, which installed five machines in April 2013 at its 18-hole Foss Golf Course. Since then, gamblers have poured more than $8.7 million into the machines there, won $7.9 million back and netted the park district about $254,000.

Foss Park Golf Course. | Casey Toner / BGA

Foss Park Golf Course. | Casey Toner / BGA

The Foss Park District board voted earlier this month to give its video-gambling machine contract to HyperActive Gaming, where Anthony Jones, a park board member, works as a compliance officer. Jones recused himself from voting on the contract.

Jones was appointed to the park board in May to fill a vacancy left by Susan Dixon, who was convicted of theft for stealing from a 2014 park district Toys for Tots charity event. HyperActive hired Jones in January 2014, months after he retired from the Illinois State Police, where he spent the previous 14 years overseeing licensing investigations for the Illinois Gaming Board.

In Hoffman Estates, the park district’s Bridges of Poplar Creek Country Club has struggled even after it began operating the machines in June 2014, taking in only $5,946 since then. Last year, the park district lost more than $65,000 on the course.

Brian Bechtold, the park district’s director of golf, says the small amount of revenue may spur the video gaming operator, Gold Rush Amusements, to remove the machines.

Glenn Leonard, Gold Rush Amusements’ compliance director, says, “If they are successful, we will be successful, and we won’t remove the machines.”

The New Lenox Community Park District began operating five video gambling machines at its golf clubhouse last September, keeping them in a room that’s closed during the district’s youth golf league. They’ve brought in $7,379 so far for the course, which loses $50,000 to $200,000 a year, according to Greg Lewis, the district’s executive director.

“If you want people to keep coming out, you have to invest money into the course, or you will have a goat ranch,” Lewis says. “You won’t have something people will pay top dollar for.”


THE WATCHDOGS: State won’t explain ‘Chicago Fire’ tax credits

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Gov. Bruce Rauner’s administration issued $15.9 million in tax credits for the hit TV show “Chicago Fire” late last year, but state officials no longer will release the names of the Illinois residents and businesses the show hired to get those tax breaks.

That’s a departure from last year, when the state released the names and amounts the producers of “Chicago Fire” spent on actors, extras, crew and businesses that worked on the series’ pilot episode in 2012. Those records detailed expenditures including $215,161 to Cinespace Chicago Film Studios, $6,200 to the Chicago Fire Department for “fire equipment” and $272 to Nordstrom for two pairs of shoes for the character Kelly Severide, played by actor Taylor Kinney.

But NBCUniversal Media, which owns the show, has now convinced Rauner administration lawyers that releasing such information about episodes since then would violate “trade secrets,” according to a July 8 letter attorney Patrick M. Callahan sent to Illinois Attorney General Lisa Madigan explaining the state’s refusal to provide the information to the Chicago Sun-Times.

“NBCUniversal objected to the disclosure of information that was proprietary, the release of which would yield competitive harm,” Callahan wrote. “In light of the foregoing, the department agreed with NBCUniversal’s claims that this information was exempt” from release under the Illinois Freedom of Information Act.

Madigan’s staff is reviewing the Sun-Times’ appeal of the Rauner administration’s decision.

Without seeing the records, it’s impossible for the public to know, for instance, whether politically connected people are benefiting from the series’ taxpayer-supported spending. Expenditures on the pilot episode of “Chicago Fire,” for example, included $57,810 paid to William T. Hogan III, son of the former Teamsters Local 714 boss, to work as a “driver captain/trans coord.”

Hollywood on the lakeCallahan said the state previously released the information for the “Chicago Fire” pilot because NBCUniversal didn’t include a “standard letter requesting confidentiality protection” when it applied for its first tax credit, which totaled nearly $1.6 million and was awarded in 2013.

Illinois offers 30 percent tax credits to TV and movie producers who spend at least $100,000 on Illinois goods and services and to TV commercial producers who spend at least $50,000. Producers also can get 30 percent credits on wages of up to $100,000 for each worker — including actors — who has an Illinois driver’s license or state ID before filming starts.

Since the Illinois General Assembly created the program in 2008, the state film office had awarded a total of 1,095 tax credits totaling $268 million, records show, as of the end of April.

Other big tax credits last year went to the movie “Divergent,” which got $11.5 million, and for the pilot episode of the hit Fox TV series “Empire,” which got $1.5 million.

To get the tax credits, applicants must provide documentation that the credit will save them money compared to filming in at least one other state. Producers have up to two years after they spend their last dollar on a production to submit an audit showing how much they spent in Illinois.

State officials review that audit, then the state film office issues the credits, which have to be used within five years. Many production companies are based out of state and don’t pay Illinois’ state income tax, so they sell the credits to businesses and individuals that do pay taxes here.

The film office says the program helped generate $330 million in spending statewide in 2015, up 18 percent over the previous year, and created thousands of jobs.

So far, the state has awarded “Chicago Fire” $17.4 million in credits for the 24 episodes in the show’s first season. There have been no credits issued for the series’ following three seasons. Nor have credits been issued for its sister shows, “Chicago P.D.” and “Chicago Med.”

The documents the Sun-Times obtained last year for the “Chicago Fire” pilot showed expenditures to Chicago actors including Amy Morton and Joe Minoso, as well as to Chicago firefighters who served as extras and consultants.

Records obtained for another TV series, “Mob Wives Chicago,” showed producers got a $2 million credit for expenditures including nearly $4,000 to exhume the body of reputed mob hit man Frank “The German” Schweihs.

Producers of the movie “Transformers: Age of Extinction” spent $415,381 for rooms at Trump International Hotel & Tower. In all, they were awarded a $6.1 million credit.

 

 

 

 


WATCHDOGS: CPS gives $250,000 contract to firm linked to top aide

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The Chicago Board of Education approved a deal Wednesday that will pay as much as $250,000 to a law firm where Chicago Public Schools CEO Forrest Claypool and his handpicked general counsel, Ron Marmer, both formerly worked and that still has financial ties to Marmer, records obtained by the Chicago Sun-Times show.

Acting in closed session, the Board of Ed formally voted to hire Jenner & Block LLP at the behest of Claypool for work it already had done preparing a never-filed lawsuit against the state seeking increased funding.

Marmer left Jenner & Block in 2013 but is set to receive severance payments from the law firm totaling $1 million, according to records and interviews.

Marmer didn’t respond to interview requests, and CPS declined to make him available.

He reported getting $200,000 from the firm last year, according to the economic disclosure statement he filed for 2015. That was one of five yearly severance installments Marmer is getting, according to CPS spokeswoman Emily Bittner, who said the payouts are due to end in 2018.

Under CPS’ code of ethics, no school official can have any “contract management authority” over a board deal with a contractor “with whom the employee has a business relationship” — defined as any transaction worth at least $2,500 in a calendar year to the CPS employee.

The law firm began working for CPS on March 3 and, through June 30, had billed it for more than $182,000, according to records released Wednesday. CPS had refused to release any invoices from the firm for more than two months, since the Sun-Times filed a public records request seeking them in May.

According to Claypool, Marmer wasn’t involved in CPS’ hiring of Jenner & Block, which he said “was my decision” along with Frank Clark, the Board of Ed president.

“He recused himself once Frank and I let it be known we wanted to retain them because of the stakes involved here,” Claypool said. “Jenner & Block is a top litigation firm. We wanted to make sure we had the strongest legal firepower given the existence of the school system was at stake.”

Claypool said the lawsuit wasn’t filed, though, because legislators and Gov. Bruce Rauner agreed on a stopgap budget deal, approved June 30, providing hundreds of millions of dollars to CPS in additional funding.

Bittner, the CPS spokeswoman, said of the $1 million the law firm is paying Marmer: “As a former equity partner in Jenner & Block, Ron Marmer is entitled to receive fixed withdrawal payments, which are common among law firms. At Jenner & Block, withdrawal payments are based on years of service and the percentage of firm earnings that the partner was entitled to receive. Payments are typically spread over five years.”

The school board initially balked at Claypool’s recommendation to hire Marmer. After failing to muster the votes to approve his appointment at its September 2015 meeting, the board agreed to so the following month, though two board members opposed Marmer’s appointment to the $185,000-a-year post.

Marmer had no experience working for a school district or other public agency, but Claypool — tabbed by Mayor Rahm Emanuel as his schools chief a year ago — pointed to Marmer’s background as a securities litigator.

Marmer and Claypool worked together decades ago at Jenner & Block. Claypool worked there in 1982, his first job out of law school. Marmer was at the firm from 1978 to 1993 and from 1997 until 2013.

Marmer — who was a sole practitioner after leaving Jenner & Block and started work at CPS on Nov. 2, 2015 — has made $29,000 in campaign contributions to Claypool’s bids for elected office since 2003, including $10,000 toward Claypool’s unsuccessful run for Cook County assessor in 2010. Marmer also gave $5,000 to Emanuel’s 2011 campaign for mayor.

Jenner & Block had done little business with the school board in recent years, CPS records show, being paid about $14,550 the past three years.

The firm is getting CPS’ standard rate of $295 an hour, according to an agreement signed June 20.

The Jenner & Block lawyer who signed the deal with CPS was Randall Mehrberg, who has spent most of his career at Jenner & Block but previously worked for the Chicago Park District for several years in the 1990s, including a period when Claypool was parks chief under then-Mayor Richard M. Daley.

State records show Mehrberg contributed a total of $30,500 to Claypool’s election campaigns and $5,000 toward each Emanuel bid for mayor, in 2011 and last year.

Mehrberg didn’t return calls seeking comment Wednesday.

Jenner & Block spokeswoman Anne Gallagher said, “CPS has asked that we not provide any comment and refer all questions to them.”

According to the invoices released Wednesday, another Jenner & Block lawyer who worked on preparing the CPS case is Blake Sercye, who was political director for Emanuel’s 2011 campaign and had the mayor’s endorsement in his failed bid for a Cook County Board seat in 2014.


Daley nephew’s probation ends in Koschman case

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Former Mayor Richard M. Daley’s nephew Richard J. “R.J.” Vanecko has completed his involuntary-manslaughter sentence for throwing a punch that killed David Koschman in 2004.

Maureen P. McIntyre — the McHenry County judge who handled the case after the Illinois Supreme Court decided too many Cook County judges have connections to the Daley family — terminated Vanecko’s probation Friday during a brief hearing in Woodstock.

Vanecko declined to comment leaving court.

After twice being cleared by the Chicago Police Department when Daley was mayor, Vanecko pleaded guilty on Jan. 31, 2014, following a Chicago Sun-Times investigation that led to the appointment of a special prosecutor.

Now 41, Vanecko was given a 30-month sentence — 60 days in jail, 60 days on home confinement and the rest on probation — for the crime he committed when he was 29. At the time of his conviction, he was living in Costa Mesa, Calif., and working as a millwright. It’s unclear where he lives now.

Vanecko’s exit from Cook County’s probation rolls follows Mayor Rahm Emanuel’s administration’s decision earlier this year to fire or suspend six police officers involved in a 2011 reinvestigation of Koschman’s death prompted by the Sun-Times reporting. That investigation concluded that the 6-foot-3, 230-pound Vanecko punched the 5-foot-5, 125-pound Koschman in self-defense outside the late-night bars along Division Street on April 25, 2004. Koschman, 21, died of brain injuries 11 days later.

Special prosecutor Dan K. Webb impaneled a grand jury that indicted Vanecko in December 2012 and produced a report that attacked the police department’s self-defense conclusion and documented other problems with the 2004 and 2011 police investigations.

Webb, a former U.S. attorney, named the six cops in his report, saying he considered charging them with obstructing justice or official misconduct but didn’t have enough evidence to convict them.

Four of those officers — Chief of Detectives Constantine “Dean” Andrews, Cmdr. Joseph Salemme, Lt. Denis P. Walsh and Detective James Gilger — retired, avoiding discipline.

Detective Nicholas Spanos went back on the job this month after shaving 10 months off his one-year, unpaid suspension by cashing in accrued paid-leave time.

Sgt. Sam Cirone is challenging his one-year suspension before the Chicago Police Board. Meanwhile, Cirone is still collecting his salary and has full police powers while working “in an administrative role in the detective division,” according to police spokesman Anthony Guglielmi.



Ex-Rep. Lipinski drops federal lobbying after Sun-Times/BGA story

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Former U.S. Rep. Bill Lipinski has dropped his federal lobbying practice after the Chicago Sun-Times and the Better Government Association reported the longtime Chicago congressman was paid $4 million since 2007 by clients with issues before the U.S. House transportation committee on which his son, U.S. Rep. Dan Lipinski, D-Illinois, serves.

Among those clients were the Chicago Transit Authority, which paid the elder Lipinski $100,000 a year for lobbying Congress, and Metra, which paid him $60,000 a year to do that.

Lipinski told his clients he would no longer lobby Congress in January, about two months after the Sun-Times/BGA report, records show.

Lipinski didn’t respond to questions about why he dropped his federal lobbying practice. Metra and CTA officials said it was his decision.

Lipinski continues to lobby on behalf of the two agencies in Springfield, for which the CTA pays him $72,000 a year and Metra pays him $60,000, records show.

According to the monthly reports he submitted to the two public transit agencies, Lipinski, 78, who works out of his Western Springs home, typically spoke a few times a month with members of Congress by phone and also spoke often by phone with CTA and Metra officials and another Metra lobbyist.

Though Lipinski’s reports didn’t detail how much time he spent lobbying for the two agencies, CTA and Metra officials say his knowledge and contacts were key to their success in obtaining federal funds.

“I’m sure I speak for everyone at Metra in saying that we will very much miss having your assistance with the federal government in the future, ” Martin Oberman, Metra’s chairman, said in a letter to Lipinski.

The two men spoke several times a month, according to Metra records.

“We were sorry to see him go,” CTA spokeswoman Tammy Chase said.

Neither agency has hired another federal lobbyist to replace Lipinski.

“I don’t know that he’s replaceable,” Oberman said. “Do you know any other former congressmen that knows all the people he knew and had all the relationships he had?”

Bill Lipinski spent 22 years in Congress, where he was an influential member of the House transportation committee. His son succeeded him in Congress and also is on the transportation committee, whose decisions affect federal funding for road and transit projects nationwide.

The Lipinskis have said they had a policy that the father wouldn’t lobby the son.

The former congressman’s monthly reports to the CTA and Metra during the first six months of 2015 documented that he called U.S. Rep. Peter DeFazio, D-Oregon, the transportation committee’s ranking member, once or twice a month and made two other lobbying calls, one to a U.S. Department of Transportation official and another to a House staffer. During those months, much of his work — 65 calls — consisted of consulting with his clients or another Metra lobbyist.

Things picked up later in the year, as the federal transportation authorization bill — the first long-term road and transit bill in 10 years — finally moved through Congress. It became law in December.

Oct. 25, 2015, story.

Oct. 25, 2015, story.

Lipinski’s lobbying intensified in the fall, reporting to the CTA and Metra that he made seven contacts with members of Congress in September, seven in October and nine in November. On behalf of Metra, he also left a voicemail message for Sen. Dick Durbin, D-Ill. And, as before, he made many more calls to CTA and Metra officials.

In November, he reported to Metra that he spoke with three senior members of the transportation committee — DeFazio, James Duncan and Jerry Nadler — about “what Metra needed in the bill, what they didn’t want in the bill and how to add more funding in the bill.”

And he reported to the CTA that he spoke with those same congressmen “about what the CTA needed in the bill, what they didn’t want in the bill and how to add more funding in the bill.”

Asked about the overlap, Oberman said he had concerns when he learned Lipinski lobbied for both Metra and the CTA but came to feel that he represented both effectively. Also, Oberman said, the agencies weren’t competing for the same funding.

A CTA spokesman said Lipinski worked on one issue of particular concern to the agency — an attempt to put restrictions on transit funding that would have threatened plans to modernize the Red Line and Purple Line.

Dan Lipinski authored an amendment to preserve the funding and spoke on the floor of Congress Nov. 4 about its importance. The amendment was passed.

The CTA spokesman said the elder Lipinski lobbied other members of Congress on the issue.

Chuck Neubauer and Sandy Bergo are investigators for the Better Government Association.

 


WATCHDOGS: 18 aldermen avoid hefty property tax hikes, 5 pay less

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Three of every four property owners in Chicago have been hit with higher property taxes this year, a Chicago Sun-Times analysis shows — often thousands of dollars more and in some cases in the Loop and surrounding hot neighborhoods twice what they were last year.

That’s the result of a perfect storm of higher property assessments from Cook County Assessor Joseph Berrios and Mayor Rahm Emanuel’s $318 million tax hike, passed to shore up the city’s shaky finances and boost police and fire pension funds that for years have been shortchanged.

Eighteen of the city’s 50 aldermen — including Ald. Patrick O’Connor, the mayor’s City Council floor leader who rounded up the votes to pass the tax increase last fall — staved off the hefty tax hikes, shifting a total of $19,484 in taxes to other property owners. Those aldermen, including several whose wards have seen real estate prices skyrocket, did that by convincing Berrios or the Cook County Board of Review to lower the estimated value of their homes or apartments.

Five of those aldermen — including four who voted against the tax hike — owe less than they did last year, even as most of their constituents pay more, the Sun-Times found in an analysis of the 882,965 tax bills sent to Chicago landowners. Monday is the deadline to pay.

Ald. Nicholas Sposato (38th), who voted for the tax hike, is among those five. His tax bill went down because he convinced Berrios and the Board of Review his home isn’t worth as much as Berrios first thought. Without those appeals, Sposato’s taxes would have risen $1,371 this year. Instead, he’s paying $377 less than he did last year, while more than 70 percent of taxpayers in his ward saw increases averaging $211.

“I didn’t vote for it just so my constituents could pay more taxes,” says Sposato, who, as a Chicago firefighter, belongs to a pension fund that’s among the city’s most poorly funded. “We have an obligation to pay these pensions.”

At the other end of the spectrum, Ald. Proco Joe Moreno (1st) got hammered. The bill on his two-story home in Wicker Park went up 117 percent, to $19,833, largely because Berrios determined the value of Moreno’s house soared to $1.1 million — more than double the $518,980 value Berrios put on the property three years ago, when it was divided into apartments.

Moreno didn’t challenge the higher assessment, which helped boost his taxes by $10,680, far above the average rise of $1,233 the Sun-Times analysis found for his booming, hipster neighborhood.

Ald. Proco Joe Moreno's home. | Kevin Tanaka / Sun-Times

Ald. Proco Joe Moreno’s home. | Kevin Tanaka / Sun-Times

“While I was anticipating an increase in my property taxes this year, I was not expecting that the county assessor’s decision would be to more than double the assessed value of my home and, more importantly, the homes of many others in my ward,” Moreno says. “I think it may be time to revisit the fairness of the appraisal system.”

Berrios’ staff declined to discuss specific property assessments, saying the values are based on sales as well as market conditions since 2012, the last time all Chicago property was reevaluated under his office’s once-every-three-years assessment system.

The assessment determines each property owner’s share of the taxes imposed by local governments. In Chicago, City Hall gets about 20 percent of all property taxes, and the Chicago Public Schools about half, with the rest going to the Chicago Park District, the county and other government bodies.

Between Berrios’ new assessments and Emanuel’s higher taxes, the tax burden in Chicago continued shifting toward downtown, the Sun-Times found. Of $5.3 billion in property taxes Chicago real estate owners must pay, about 32 percent comes from the Loop and the Near North Side — about $372 million more than those areas paid last year.

While taxes overall are up in each of Chicago’s 77 community areas, about 23 percent of tax bills citywide went down — at least 11 percent of them in each community area. Only 17 tax bills stayed exactly the same.

The Loop, Near North Side and Near West Side were hit especially hard, with tax bills up 28 percent overall in those areas. Other hot neighborhoods handed a bigger tax burden included Lincoln Park, West Town, Lake View and Logan Square. Together, those seven community areas now pay 54 percent of all property taxes in Chicago — up about 2 percent over last year.

Mayor Rahm Emanuel. | Lou Foglia / Sun-Times

Mayor Rahm Emanuel. | Lou Foglia / Sun-Times

Emanuel’s tax bill on his home in Ravenswood on the city’s North Side went up 20 percent, to $20,513. That’s partly the result of the tax hike but also because Berrios decided the mayor’s home is worth $1.1 million, up from $946,680. Emanuel didn’t challenge the assessor’s estimate.

Emanuel lives in the 47th Ward, where 79 percent of the tax bills went up — on average by $1,104.

The mayor declined to talk about his tax bill, but aides pointed to his $21 million program offering tax rebates as high as $200 to as many as 155,000 homeowners whose household incomes are $75,000 or less.

Cook County Assessor Joe Berrios speaks during the Cook County Democratic Party meeting to reconsider making an endorsement in the race at the party's headquarters downtown, Thursday, Jan. 14, 2016. | Ashlee Rezin/Sun-Times

Cook County Assessor Joe Berrios. | Ashlee Rezin / Sun-Times

Berrios, who also chairs the Cook County Democratic Party, owns a two-flat in the Northwest Side’s 31st Ward — where nearly 72 percent of property tax bills rose an average of $346. Berrios’ own tax bill went up 11.6 percent, to $5,665, after his staff determined the building is worth $335,200, up $34,890 from the last assessment. The assessor’s office says the assessment is higher than most similar buildings on the block.

Ald. Edward M. Burke (14th) — the city’s most powerful aldermen, who also heads a law firm that’s won millions of dollars in property tax cuts for clients including Donald Trump by getting their assessments cut — tried but failed to save himself some money, unsuccessfully contesting the value Berrios put on his three-story home in West Elsdon on the Southwest Side.

Berrios estimated Burke’s huge house is worth $781,000, up from $670,420. With the higher assessment and the tax hike he supported, Burke’s taxes rose 16 percent, to $13,489. Tax bills went up for about 75 percent of his constituents, with an average increase of $340.

Eighteen other aldermen — including 11 who voted against Emanuel’s tax increase — successfully appealed assessments on their homes or other property, winning reductions that kept their taxes from rising a collective $25,750, the Sun-Times found. The savings ranged from $448 on the Lake View condo owned by Ald. Tom Tunney (44th) to $3,952 on the Kenwood home of Ald. Sophia King (4th). Tunney voted for the mayor’s tax hike. King wasn’t appointed by Emanuel to fill a City Council vacancy until after the tax hike passed.

O’Connor challenged the reassessment on his home in Budlong Woods on the North Side, which Berrios originally valued at $645,680 — which would have been an increase of 14.3 percent. Berrios agreed to lower that, and the alderman and his attorney won a larger cut from the Board of Review, which valued the home at $596,360, saving O’Connor about $904 in taxes.

Without the assessment cuts, O’Connor’s tax bill would have been $11,356 — about $1,359 more than last year. Instead, it ended up being $10,447 — up about $450 over last year, while 69 percent of the taxpayers in his ward were hit with tax increases averaging $719.

Ald. Jason Ervin (28th) is paying 31 percent less than he did last year after convincing Berrios to lower the estimated value of the East Garfield Park townhouse the alderman shares with his wife, Melissa Conyears, who’s running for the Illinois House of Representatives this fall. Berrios estimated the townhouse was worth $420,000 two years ago but lowered the value to $240,870 last year. Conyears appealed, pointing out the purchase price three years ago was $185,000.

Ald. Jason Ervin's home. | Kevin Tanaka / Sun-Times

Ald. Jason Ervin’s home. | Kevin Tanaka / Sun-Times

“That was just wrong,” Ervin, who saw the largest tax decrease of any alderman, says of the original assessment.

The lowered assessment saved Ervin $1,024, leaving him with a tax bill of $2,909 — about $1,300 less than last year. Ervin says he and his wife are due refunds on past taxes — about $8,665, according to county officials. Ervin, who opposed Emanuel’s tax increase, now has the lowest tax bill of any townhome in his building.

These are the tax savings for the other aldermen whose assessments were reduced:

• Ald. Brian Hopkins (2nd), $475 on a condo he sold last month.

• Ald. Roberto Maldonado (26th), $2,079.

• Ald. Milly Santiago (31st), $864.

• Ald. Scott Waguespack (32nd), $835.

• Ald. Deborah Mell (33rd), $650.

• Ald. Gilbert Villegas (36th), $851.

• Ald. Anthony Napolitano (41st), $458.

• Ald. Brendan Reilly (42nd), $1,246.

• Ald. Michele Smith (43rd), $1,165.

• Ald. John Arena (45th), $579.

• Ald. James Cappleman (46th), $812.

• Ald. Harry Osterman (48th), $1,152.

• Ald. Deborah Silverstein (50th), $619.

Among the 18 aldermen whose assessments were reduced, only Arena, Cappleman, O’Connor, Smith, Sposato and Tunney voted for Emanuel’s tax hike.

Like Moreno, most aldermen didn’t contest their assessments, and all of those council members except for Ald. David Moore (17th) saw their tax bills go up between 2 percent and 117 percent. Moore’s assessment rose slightly, but his bill fell by $3.67.

 

The Sun-Times analysis also found:

• Chicago’s average property tax bills range from $35,319 in the Loop to $1,286 in West Englewood.

• A dozen wards now pay at least $100 million in property taxes annually — two more than last year.

• 89 percent of the tax bills rose in Mount Greenwood — higher than any other community area — while just under half the tax bills went up in Kenwood.

The tax bill for Casey Moran’s, a popular bar across from Wrigley Field, plummeted — from $66,345 last year to $36,436 this year after owner Kevin Killerman and his attorney Steve Pearlman protested Berrios’ attempt to raise the assessment by 10 percent. Pearlman convinced Berrios and the Board of Review to slash the proposed assessment by 49.3 percent, saving Killerman more than $35,000 in taxes on a building that’s assessed as a residential property, with two apartments and a commercial space.

Killerman, who couldn’t be reached for comment, owns several popular bars on the North Side and previously controlled beer sales at Lollapalooza. He has obtained numerous liquor licenses from City Hall after hiring attorney Mark Vanecko, a nephew of former Mayor Richard M. Daley.

Many River North homeowners were hit with big tax increases, among them former NBA star Antoine Walker, whose tax bill soared $66,493, to $119,032.

Tax increases were even larger on the Gold Coast, including those for a co-op building near Oak Street Beach at 209 E. Lake Shore Dr., where the tax bill topped $3 million, an increase of $939,374.

Bruce Gelman, a tax attorney, saw the bill on his Near North Side home hit $168,742, nearly $105,000 more than last year.

Hopkins, who represents the Gold Coast, expected his ward would be hit hard. He leases an apartment near the Water Tower, where he moved when the City Council redrew ward boundaries, putting Hopkins’ Michigan Avenue condo in Reilly’s 42nd Ward. Hopkins sold the condo after the condo association won a cut in the assessments, saving $475 in taxes this year.

“Sooner or later, the perception is going to be that the property taxes are too high, and people may leave,” Hopkins says. “But where are you going to go? Taxes are even higher in the suburbs.”

Contributing: Data Reporting Lab editor Darnell Little


City’s costly food fight with clout-heavy Park Grill settled

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The decade-long food fight between City Hall and Park Grill has come to an end 11 months after a judge ruled Mayor Rahm Emanuel couldn’t break the sweetheart deal Mayor Richard M. Daley gave a clout-heavy group to run Millennium Park’s only restaurant.

Emanuel has agreed to drop the city’s court appeal. And Park Grill’s operators agreed to finally start paying for garbage collection, natural gas and water and also to accelerate their rent payments.

The deal will save Chicago taxpayers $5.7 million over the next 18 years, according to Stephen Patton, City Hall’s top lawyer.

The lawsuit Emanuel filed in late 2011, months after succeeding Daley, has cost taxpayers $6.9 million in legal fees paid to private law firms hired by City Hall and the Chicago Park District to battle the restaurant’s high-powered lawyers.

Patton defended the legal battle, which included a 63-day trial before Cook County Judge Moshe Jacobius, who ruled last September the city had no grounds to break the 30-year deal the restaurant got from the park district under Daley.

“This was always about more than the Park Grill,” Patton said Friday. “It was also about sending a clear and powerful message that, under this administration, below-market deals that benefit a few insiders at the expense of taxpayers would not be tolerated.”

Park Grill attorney Stephen Novack said, “The city and the park district have now agreed to what we have been saying for years and what Judge Jacobius ruled — the concession agreement is and always has been legal, valid and binding.”

Novack pointed out the restaurant previously offered to pay for water, natural gas and garbage collection, but the city refused. While the city expects to save $5.7 million, Novack said, “The city’s exaggerated settlement calculation is based primarily on the exorbitant garbage charge that the park district has been overpaying but which the restaurant can replace at a fraction of the cost.

“In fact, my clients offered the city essentially what it is getting in settlement before the city filed its lawsuit and before the city and park district incurred millions of dollars in attorneys’ fees and costs.”

The lawsuit said taxpayers lost more than $8 million under the deal reached under Daley that provided free water, natural gas and garbage collection and allowed the restaurant to defer monthly lease payments to recoup construction costs.

ParkGrillSweetheartDealUnder Emanuel, City Hall argued the park district failed to get permission from the City Council and struck the deal while one of the restaurant operators, Matthew O’Malley, was having an affair with Laura Foxgrover, then a top park official. They have since married, and Foxgrover works for O’Malley.

O’Malley and James Horan, the owner of Blue Plate Catering, operate the restaurant, whose original investors included a group of clout-heavy insiders, among them associates of Daley and one of his cousins — whose husband is chairman of the restaurant’s management company.

O’Malley and Horan argued the Daley administration was aware of the negotiations, saying the former mayor personally involved himself in the restaurant’s construction, even suggesting the location of its bar.

ParkGrillDaleyIllness kept Daley from testifying during the trial, but in a deposition the former mayor said he couldn’t remember anything about the restaurant — not even attending its grand opening in November 2003, months before City Hall approved its liquor license.

Park Grill’s lease became another City Hall scandal in February 2005 after the Chicago Sun-Times revealed Foxgrover gave birth to O’Malley’s daughter while the park district was negotiating with O’Malley’s group. The restaurant was given a 30-year contract providing free gas, water and garbage collection. Park Grill also wouldn’t pay property taxes.

Daley criticized the deal, blaming City Hall’s top lawyer, Mara Georges, who began trying to renegotiate. City Hall put those negotiations on hold as the restaurant fought Cook County officials trying to make Park Grill pay property taxes, a battle the restaurant won.

During the spring of 2011, O’Malley and Horan sought to sell their management stake to Levy Restaurants for $8 million, a deal the park district refused to approve. The city then sued to break the lease.

ParkGrillIDon'tRecallUnder the settlement, Park Grill will hire a private company to collect its trash, and gas and water meters will be installed. The restaurant will begin making minimum rents payments on Oct 1, about 18 months earlier than its contract required.

Patton said taxpayers will save $3.8 million on the Park Grill’s garbage collection and $1.5 million on natural gas, while earning $367,000 on the accelerated rent.

And the park district is turning over the restaurant’s concession deal to City Hall, which operates Millennium Park.

The settlement vacates the judge’s ruling against the city last fall.


They were among Chicago’s murder victims in first half of 2016

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Many but not all of the 324 murder victims in Chicago in the first half of this year were caught up in gang battles or drug dealing. Some snapshots of the dead:

Dying over drugs

Derrius Lares. | Chicago Police Department

Derrius Lares. | Chicago Police Department

Drug dealers sometimes fight over lucrative spots for street sales. The police think Derrius Lares was a victim of one of those conflicts.

Lares was convicted of marijuana possession six times from 2012 to 2015 and did short stints in jail as a result.

On Jan. 12, police officers — conducting surveillance at South Homan Avenue and Harrison Street “due to the gang violence over street territory for cannabis sales” — arrested Lares after seeing him pull baggies from his waistband and exchange them for cash, according to a police report.

Lares spent two days in jail before getting out. A week later, Lares was shot to death, apparently from a car, at Homan and Polk Street. No one has been charged in his death. Investigators are pursuing drugs as the motive.

Another drug killing

Matthew Ehrenberg.

Matthew Ehrenberg.

In some North Side neighborhoods, the drug trade is conducted behind closed doors. But it can still turn deadly.

Matthew Ehrenberg was the first of the city’s 12 white murder victims in the first half of 2016. Ehrenberg, 37, had a minor criminal history — a 1998 conviction for misdemeanor marijuana possession.

Years later, he was warned by drug dealers not to sell out of his Northwest Side home, according to the police.

On Jan. 18, Ehrenberg was gunned down at close range after a fight with two men at his two-flat. Police said they found an ounce of marijuana and baggies of cocaine in the home. The case remains unsolved.

A gang shooting?

Vincente Avila.

Vincente Avila.

In African-American neighborhoods in Chicago, the conflicts that lead to shootings often involve small gang factions or individuals. In Hispanic areas, a frequent element is loyalty to large, structured gangs.

One of this year’s murder victims, Vincente Avila, was convicted in 2013 of illegal gun possession and sentenced to a year in prison. Last year, he was convicted of reckless conduct after the police said he flashed Two-Six gang signs and shouted “King killas” at a high school cross-country team.

RELATED STORY: Who gets killed in Chicago — a Watchdogs special report

On Feb. 13, Avila, 23, was shot in the chest and killed by someone in a Chevrolet Suburban who pulled up next to the car carrying Avila and two friends — all members of the Two-Six gang — in the 6800 block of South Lawndale, according to a report from the Cook County medical examiner’s office. Avila’s two friends were wounded.

An unintended victim

Aaren O'Connor.

Aaren O’Connor.

Occasionally, a stray bullet intended for a rival gang member claims the life of an unintended victim. It appears that’s what happened to Aaren O’Connor, 25, who’d moved to Chicago from California in 2014 to be near her boyfriend.

On Feb. 5, just before 7 p.m., she was in her car outside her Pilsen apartment, talking on her cellphone with her sister, when she was hit by a bullet the police believe was fired during a gang fight nearby. O’Connor died two days later.

Domestic violence

Matabias Biles. | Chicago Police Department

Matabias Biles. | Chicago Police Department

On Feb. 2, Matabias Biles, 34, got into an argument with a juvenile stepson the police say is mentally ill. They say he grabbed a knife and stabbed Biles in the face and chest. Biles drove himself to a hospital, where he died. The stepson was arrested, but prosecutors decided not to bring charges.

Some deaths a mystery

In March 2015, the police said they caught Anthony Howard with a handgun that had been stolen in a burglary in Aurora five years earlier. They say he begged officers to let him go, saying he’d bought the gun for protection after a mail carrier was shot and killed nearby two days earlier. “I ain’t a gangbanger or nothing,” he told them. Howard was charged with being an armed habitual criminal and released on bail.

Anthony Howard. | Chicago Police Department

Anthony Howard. | Chicago Police Department

In some unsolved cases, it’s not clear what happened or why.

His girlfriend, Kiara Rhone, said he was working to turn his life around, that he had a job as a forklift operator and that, in January, the couple had twin boys.

But on June 4, Howard was playing dice with a group near his Austin home when someone walked up and shot him “without provocation,” according to police.

Rhone says she can’t believe how many guns are on the street. “If you love your family, you live your life, and you’re doing something that can cause you to lose it, it’s not worth it.”


Who gets killed in Chicago — a Watchdogs special report

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On July 27, 2015, police on the West Side pulled over a black Chevrolet whose driver, they said, hadn’t signaled a turn.

The driver, DeMorrow Stephens, didn’t have a license, according to the police. And when they asked his passenger, Marcus Patrick, why he smelled like marijuana, they said he pulled seven baggies of it from his waistband.

The two men, both felons, were members of the Four Corner Hustlers street gang, according to police, who arrested them for having contact with another gang member while on parole. Each spent two days in jail before going back to their neighborhood, Austin.

Within a year, both were gunned down in separate shootings — victims of the surge in violence that claimed 324 lives in Chicago in the first six months of 2016 and put a national spotlight on the city.

Like Stephens, 26, and Patrick, 22, most of the dead were young, African-American men who were shot to death, according to a Chicago Sun-Times analysis of every murder in the city from Jan. 1 through June 30. They typically lived and died in neighborhoods crippled by poverty and flooded with drugs and guns — places where gang conflict and street stops by the police are a daily fact of life.

And, like the two friends, most already were in trouble with the police or caught up in violence long before they were killed.

Dandre Kelly grew up with Stephens and Patrick in Austin. He feels fortunate to have reached 27 years old. Counting Stephens and Patrick, he says he has had 10 friends fall victim to the city’s violence — and no one charged in any of their murders.

“It’s a blessing to see 25 around here,” Kelly says.

Among the Sun-Times’ findings, based on a review of police and Cook County medical examiner’s reports, court files and interviews:

• The vast majority of those killed in Chicago in the first half of this year — 90 percent —died from a gunshot wound.

• Seventy-two percent were African-American men, their average age 29.

• Four out of five had faced criminal charges in Cook County at some point, mostly for drug offenses — the leading cause of arrest in Chicago.

• Two out of five had drug convictions.

• More than a quarter had been convicted of a violent offense or illegal gun possession.

• Domestic conflicts, many involving mental illness, were involved in at least 24 of the deaths.

• At least four were killed by stray bullets. Others were shot while in the company of people who were targeted.

• The reasons behind other killings remain a mystery to the police.

Chicago Police Department officials say the findings reinforce that most of the city’s gun violence involves a relatively small group of gang members and drug dealers.

Aiming to stem that violence, they’ve been sending teams to meet with gang members flagged as being likeliest to end up a shooting victim or a shooter, based in part on an algorithm that takes into account factors like whether a person has ever been shot, has been convicted of a gun crime, is on parole or has been picked up by the police with anyone who fits such criteria.

“Today’s offender is tomorrow’s victim,” says Christopher Mallette, executive director of Chicago Violence Reduction Strategy, a not-for-profit group that organizes the visits. “They flip jerseys all the time.”

RELATED STORY: Faces of 2016’s violence victims

It’s no coincidence that most of the killings occur in areas rife with unemployment and high rates of incarceration, says Quiwana Bell, chief operating officer of the Westside Health Authority in Austin.

Quiwana Bell.

Quiwana Bell.

“Desperate people do desperate things,” says Bell, whose organization works with Mallette’s group, as well as with young people and ex-offenders.

With factions of fractured gangs now often warring with each other, Bell says that even dealing drugs from a street corner — a common way for young men in Austin and other low-income neighborhoods to make money — has become too dangerous for some.

According to Bell, even some “good kids” not involved in gangs or drugs have started carrying a gun.

“They don’t want to be easy prey,” she says. “They say, ‘I’m not going to walk down the street lackin.’ ”

Demorrow Stephens. | Chicago Police Department arrest photo

DeMorrow Stephens. | Chicago Police Department arrest photo

Living in the area around Augusta Boulevard and Menard Avenue in Austin, Stephens and Patrick had known each other for years.

Stephens loved computers. “If I had a computer or something, he could take it loose and put it back together,” says his grandmother, Beverly Stephens.

She says he left high school after a woman he was seeing got pregnant, though he later got his GED.

Kelly had known Patrick for so long they considered each other cousins.

“He brought energy and happiness,” says Kelly. “If you were down and out, he could bring you up.”

But the police say both were part of a faction of the Four Corner Hustlers known as the M ’n A Boys — named for the corner of Menard and Augusta. And, like many of their friends, Patrick and Stephens had criminal records. Kelly says that’s what happens when the police are quick to label young men as gang members if they’re black or Hispanic.

“I’m not going to sugarcoat it and say he wasn’t into anything,” Beverly Stephens says of her grandson. “I don’t know what they do in the streets. I’m just being honest.”

In 2008, Stephens served two jail terms for drug possession. Two years later, he was convicted of robbery and got eight years in prison. But he was out on parole when the police stopped him last year.

Marcus Patrick. | Chicago Police Department arrest photo

Marcus Patrick. | Chicago Police Department arrest photo

Patrick was on his own dangerous path, convicted in 2013 of dealing heroin near a school — his second drug offense that year. He was sentenced to 18 months in prison.

Their friend Kelly also attracted the attention of the police. In July 2013, he received a “custom notification” from the Chicago Violence Reduction Strategy, which included a letter from the police saying he was considered at risk of being involved in violence. They got in touch again the following year.

A gang member can get a “custom visit” for different reasons, Mallette says — among them, being engaged in an ongoing conflict or having recently been a victim of violence.

Or he could be on the police department’s “Strategic Subject List,” a group of people identified as gang members and deemed likely to become victims or shooters. The Illinois Institute of Technology developed the closely guarded computer algorithm that produces SSL scores.

Since 2010, police, social workers and community members — including the families of victims — have made more than 950 direct contacts with gang members, Mallette says. They warn them to keep away from violent conflicts and also offer help getting jobs, counseling and other services.

Of those contacted, 11 percent were victims of a shooting after a visit, according to Mallette, and 20 percent committed a new act of violence. Also, 19 percent reached out for help.

“It’s promising,” Mallette says of the results so far.

Dandre Kelly. | Facebook

Dandre Kelly.

Police officials say that after his second visit, Kelly expressed interest in getting connected with social services but never followed up.

Kelly says he felt harassed. Though he was convicted in a gun possession case in 2007 and charged with drug possession in 2014, Kelly says he’s stayed clean and become a neighborhood peacemaker.

“I haven’t done nothing in 10 years,” he says.

His takeaway from the visit: “If anything happens, you’re coming to get me.”

Kelly says that when his friend Patrick got out of prison, he didn’t have a place to live. “Marcus was living house to house,” he says.

That’s not unusual in Austin, where records show that about one in 50 residents is on parole. Along with thousands of other ex-offenders living on the West Side, the parolees often struggle to find steady work and housing. About half end up back in prison.

Under conditions of their parole, neither Stephens nor Patrick was supposed to have contact with anyone identified by the police as a gang member. But that’s nearly impossible in their neighborhood, according to Kelly.

Police put both Patrick and Stephens on their Strategic Subject List.

Stephens’s SSL score was 262 — not the lowest and not the highest. Those at the top of the list are in the 400s or 500s. Patrick’s score was even lower — 67. Within a few months, though, it soared to 327.

By then, Stephens was dead.

Early the morning of Jan. 30, police got a call of a shooting in the 4500 block of West Washington Boulevard. They found Stephens behind the wheel of a 2007 Audi that had crashed into a parked car. He’d been shot in the chest, torso, left thigh and pelvis, according to the Cook County medical examiner’s office. Police said the shooter was in a white sport-utility vehicle.

Beverly Stephens says she heard the SUV had been following her grandson. “I believe he was set up,” she says, though she doesn’t know why.

Stephens, 69, says she tries to keep her other eight grandchildren inside, especially the five boys. “You can walk out and get shot up” at any time, she says. “I don’t know what the heck is going on.”

Marcus Patrick. | Facebook

Marcus Patrick.

In April, a few weeks after Stephens was killed, his friend Patrick was arrested at a neighborhood gas station and charged with trespassing while in possession of a firearm. The handgun had eight live rounds, according to police. Patrick was sentenced to court supervision.

But on May 18 — exactly a month after his gun arrest — he was riding on a motor scooter on Augusta when shots fired from a passing car killed him and wounded another man, also a felon.

“I don’t know what he was shot for,” says Kelly. “But he didn’t deserve it. He wasn’t no bad guy.”

Some “animals” in his neighborhood will shoot people whether they deserve it or not, Kelly says. “It’s to the point where I think, ‘What’s next? Me?’ ”

Earlier this year, an Oak Park church began putting up knee-high purple crosses everywhere in Austin that someone gets shot and wounded or killed. They are on nearly every block around Menard and Augusta. On some blocks, there are several.

A purple cross marks the scene where someone was killed. | Brian Jackson / Sun-Times

An Oak Park church has been placing purple crosses to mark every spot in neighboring Austin where someone is shot and wounded or killed. On some blocks, there are several.| Brian Jackson / Sun-Times

Austin is plagued with a “never-ending cycle of retaliation,” says Bell, with few killers held accountable.

“There is really no consequence to murder in our community,” she says. “You can go home and eat a bowl of cereal afterward.”

Bell says that’s why her organization is trying to forge relationships among residents and between them and the police. She’s also pushing for more investment in the community, pointing to a recent University of Illinois at Chicago study that found nearly half of young black men in Chicago were out of school and unemployed.

Christopher Mallette.

Christopher Mallette.

“We want to get our young people working,” she says.

The police alone can’t stop the shootings, Mallette and police officials say.

“The police are the triage doctors,” Mallette says. “They are just stopping the hemorrhaging. You can’t get to the heart surgeon or the orthopedic surgeon until the bleeding stops.”

Tywanna Patrick, who isn’t related to Marcus Patrick, says she understands this firsthand. Her son Donald Joshua Ray grew up close to where Marcus Patrick and Stephens were killed. At least one of his friends was killed every year since Ray was 14, she says.

“When he made 21, he was like, ‘Wow, I did it,’ ” his mother says.

Tywanna Patrick. | Facebook photo

Tywanna Patrick. | Facebook photo

Ray got a job at a Dave & Buster’s restaurant and was going to college downtown.

But on July 6, 2014, he was shot to death in a car parked in the 5200 block of West Lake Street. Police said the shooting resulted from an argument involving his sister. Two men have been charged in Ray’s murder.

Patrick said she and her husband opened the Afrikan Village Chicago Cultural Center at 5840 W. Madison St. to teach young people martial arts and introduce them to African-American history to build their self-esteem.

“We have to see past all of this negativity,” she says.

 


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