Category Archives: News

Worth Reading: Bloomberg News Investigates State Payouts

Runaway costs aren’t just an Illinois problem. A special report from Bloomberg, an international news and financial information organization, reveals how rising personnel and pension payouts are swamping other major states.

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Mayor’s Office Employee Arrested Twice For Allegedly Soliciting Sex

When Chicago Mayor Rahm Emanuel holds a news conference, Gene Mc Neil is the city employee who makes sure the sound system runs smoothly.

But the veteran city employee was a little too smooth with the ladies, police reports indicate.

Mc Neil was arrested twice since 2005 for allegedly soliciting undercover cops who were posing as prostitutes. One of those arrests came while he was on the clock for taxpayers, he acknowledged.

Mc Neil, 55, was not convicted in either case; the arresting officers didn’t show up for some reason, so the cases were thrown out, court records show.

Reached just before a mayoral news conference a few weeks ago, Mc Neil said the arrests were misunderstandings. He said he was simply in the wrong place at the wrong time.

In 2005, Mc Neil was arrested for allegedly soliciting oral sex for $10, court records show. In 2007 he allegedly offered $25 for sex, records show. In the second instance, Mc Neil relayed to us that he was on the clock and en route to buy a newspaper when a woman approached him on the street and starting walking with him.

Referring to the Chicago Police Department, he said, “I understand they’re trying to get their numbers up. . . . I didn’t make any overtures.”

Whatever the truth, it’s interesting to consider Mc Neil’s proximity to a politician known for such a carefully crafted image.

When asked about Mc Neil, an Emanuel press aide said this was the first she heard of his troubles. But within an hour, word came down that Mc Neil was being transferred to other duties, at least for the time being.

Mc Neil, who’s been on the government payroll for 25 years and worked for Richard M. Daley as well, has a salary of about $84,000 a year.

This blog post was written and reported by BGA Senior Investigator Patrick Rehkamp. He can be reached at prehkamp@bettergov.org or (312) 386-9201.

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Lemont Pol’s iPhone Woes Puts the Byte on Taxpayers

Is there an app for this? (Image mynetx/Flickr)

A five-night getaway to Puerto Vallarta can run about $650 a person—covering round-trip airfare and a room at a classy hotel in the Mexican resort town.

Steven Rosendahl’s tab ended up considerably higher when he visited there over Thanksgiving—and taxpayers covered part of the bill.

Rosendahl is the 57-year-old Lemont Township supervisor, an elected part-time post in the southwest suburbs that carries a $20,900-a-year salary—and use of the iPhone.

While away on vacation with his family, Rosendahl decided to check his work email on his smartphone, he recalled in a recent interview with the Better Government Association. But in the process he accidentally downloaded all of his emails, racking up huge data-transfer charges.

The resulting bill, which came due in January, totaled $1,760.81—with roughly $1,616 of that coming from the mistaken data dump in Mexico.

Rosendahl ended up expensing the entire tab, meaning taxpayers paid for it.

His logic: the mistake occurred while he was doing work, so work should pay for it. And they—well, we the public—did.

“I wasn’t happy about it,” Rosendahl said of the bill. “I tried to protest it [to AT&T] but they said there was nothing I could do. It didn’t give me any warning. I was just checking my email.”

Rosendahl, who has been supervisor for the past six years, said he threatened to cancel his service if the carrier wouldn’t help lower his bill. But he never got around to following through on the threat, he acknowledged.

Jim Chilsen, a spokesman for the watchdog Citizens Utility Board, said that, unfortunately, the story from Lemont Township isn’t that unusual, although his group doesn’t keep statistics on the scope of the problem.

“It’s easy to inadvertently rack up a huge bill,” Chilsen said. “You have to be very careful when you use your cell phone outside U.S. borders.”

He said telephone companies should be more sympathetic to such mistakes, instead of engaging in “this gotcha mentality.”

An AT&T spokeswoman said the company does not comment on individual phone bills.

For what it’s worth, Rosendahl’s phone cost $1,781.61 for all of 2010, according to records obtained by the BGA under the Illinois Freedom of Information Act.

Lemont Township Trustee Francis Wozniak, who is among those to approve spending within the organization, said he hadn’t heard about the bill—even though the board he sits on apparently signed off on it.

“I’m going to have to ask some questions and I got to find out what’s happening,” said Wozniak.

The township—which maintains some local roads, provides property tax assistance and offers social services for residents—paid for seven phones in 2010 costing a total of $12,036.62, records show.

Critics of the township form of government decry it as outdated and wasteful, and it’s a topic the BGA has taken an interest in this year and plans to keep writing about.

This story was reported and written by BGA Senior Investigator Patrick Rehkamp and BGA Intern Ricardo Torres. They can be reached at (312) 386-9201, or at prehkamp@bettergov.org

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Higher Ed. Hire Raised Ire in Previous College Job

George W. Reid (Photo/Illinois Board of Higher Education)

George W. Reid—the man recently hired to run the day-to-day operations of the Illinois Board of Higher Education, at a taxpayer-funded salary of $190,000—has an impressive resume that includes a litany of top academic posts.

Less flattering are the press reports and public documents touching on his tumultuous tenure at Kentucky State University, a historically black liberal arts school of about 2,800 students that Reid ran from 1998 to 2002.

Among the issues outlined in these reports:

  • Reid presided over an administration that came under fire from the state’s auditor, which found in 2000 that KSU didn’t “assure the security of cash and records,” had “the highest default rate for Perkins loans” among Kentucky’s public universities and didn’t “effectively manage the time and attendance of its employees.” (Perkins loans are government loans for “needy” college students.)
  • The Kentucky attorney general found the school, while Reid was in charge, violated or “subverted” the state’s open records law several times in responding to document requests from local reporters, legal records show.
  • Reid used university funds to cover personal items that included a trailer hitch for his boat and a cat scratching post, and when this came to light, he reimbursed the school more than $1,600, according to media accounts that cited school documents.

There’s more tumult, including lawsuits filed by Reid against the school and a local newspaper, a no-confidence vote by faculty and a forced exit from KSU in 2002 after his board of regents renewed—then voided—his contract.

We asked Carrie Hightman, chairwoman of the IBHE—a governmental agency that helps “coordinate and regulate” colleges and universities in Illinois —whether she knew about the problems and, if so, why Reid was brought on board.

“I’ve read what you’ve read,” she said of the numerous news articles written on Reid a decade or so back.

Hightman said she also spoke with his previous employers—before coming on board in late December, he worked at the Maryland Higher Education Commission as assistant secretary of planning and academic affairs—and she and her colleagues found that Reid is “a respected professional in higher education.”

So what about the Kentucky upheaval?

In a nutshell, Hightman said the difficulties from Kentucky State were not about Reid doing anything wrong so far as she can tell, but shaking things up and ruffling feathers along the way, thereby drawing fire from critics.

Reid told the BGA he “inherited” a troubled system at KSU and made vast improvements not only in the education arena, but also in athletics, finances and student enrollment.

“I was a turn-around president, I turned around an institution that was failing,” he said, pointing to audits that charted improvement in the areas of finance and oversight, enrollment gains and big money he raised from donors.

As for the questionable KSU expenditures, Reid said he had an arrangement that allowed him to use university funds for all kinds of spending, and he’d settle up at a later time if he needed to reimburse. (A university spokeswoman said she could not confirm that.)

Reid said he should be judged on his decades-long career, not just a few years.

Either way, this is a critical juncture for higher education in Illinois.

Confidence in our government-run system—and in the leadership—has been shaken in recent years by revelations that clout played a role in student admissions at the University of Illinois.

Tuition continues to rise at many institutions, making college unaffordable or very difficult for lots of students and parents.

And just days ago a report from a state watchdog slammed another public agency—the Illinois Student Assistance Commission—for hiring a politically connected company that recommended investing millions of dollars in a bank that ended up failing.

The IBHE had its own troubles when former state Rep. Judy Erwin, Reid’s predecessor, was found to have done political work for Barack Obama’s 2008 campaign while on the clock for taxpayers. She resigned this past summer.

Let’s hope Reid is part of the solution here, and whatever happened in Kentucky was akin to a bad grade on an otherwise stellar report card.

This story was reported and written by Robert Herguth, the BGA’s editor of investigations. Contact us with tips, suggestions and complaints at (312) 821-9030, or at rherguth@bettergov.org.

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Dog Gone: Oak Brook Leader Returning Donation From Hot Dog Honcho

Earlier this year, Oak Brook Village President John Craig insisted “there is not a cent of money in my campaign fund from a bar or a restaurant, nor will there ever be.”

That remark came during the Jan. 25 village board meeting—a day after the Better Government Association revealed that Craig had accepted, and then returned, a $10,000 campaign donation from Gibsons Bar & Steakhouse.

The BGA’s disclosure was significant because Craig doubles as Oak Brook’s liquor commissioner—and months before the October donation, he’d signed off on a liquor license allowing Gibsons to open for business in the western suburb.

Now comes word that a Gibsons investor also contributed to Craig, raising another conflict of interest question.

Dick Portillo, who runs the Chicago-area’s popular Portillo’s hot dog/Italian beef chain, gave $500 to Craig’s campaign fund around the same time the Gibsons check was cut, according to the Illinois State Board of Elections.

Reached on the phone by the BGA, Craig said he didn’t know Portillo was part of the Gibsons ownership group—even though Portillo’s name is listed on the village’s liquor license application. Now that Craig is “becoming aware of that,” he said he “will return the $500 immediately.”

The donation was tied to “a little cocktail party that he attended, it had nothing to do with business,” Craig added.

Dick Portillo told the BGA the donation had nothing to do with Gibsons—and everything to do with helping a solid candidate and “great guy.”

“He didn’t solicit me or anything, I’ve been in this community for a long time, I have an office here, my grandkids go to school here…I just think he’s the best man for the job,” said Portillo about Craig.

He added: “Public service really takes a significant contribution and sacrifice…if I can get qualified people in office, I’m happy to do so…I’m a resident of Oak Brook and as a result I really have a personal interest in the leadership.”

Portillo noted that as an investor in the Oak Brook Gibsons, “I have no say in the management or other activities” of the restaurant. Documents filed with the village as part of the Gibsons liquor license application list Portillo and his wife as a “Class A Member” with no voting rights.

(Separately, the Portillo Restaurant Group has offices in Oak Brook, but no eateries or liquor licenses in the western suburb, Craig said.)

Portillo said he hopes this topic and line of questioning by the BGA “is not politically motivated by the other party.”

Craig is running against Oak Brook Plan Commission member Gopal Lalmalani in the April 5 election.

For the record: The BGA is a non-profit non-partisan group, and does not endorse nor back political candidates.

This story was reported and written by Robert Herguth, the BGA’s editor of investigations. Contact us with tips, suggestions and complaints at (312) 821-9030, or at rherguth@bettergov.org.

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Wealthy Donors Backing Hopefuls In Chicago’s Hot 43rd Ward Election

Chicago's 43rd Ward

In 2005, Jennifer Tremblay got into hot water with the City of Chicago when officials determined she was a minority business front for some members of the O’Brien family, of the well-known O’Brien’s Restaurant in Chicago’s Old Town.

In short, city officials accused Tremblay of being a partner in name only for the O’Brien-controlled Camino Latino restaurant concession at O’Hare International Airport, and denied her disadvantaged business certification.

These days, Tremblay has a different role: along with businesses affiliated with O’Brien’s, she’s a generous financial backer of one of the two aldermanic candidates running in the 43rd Ward, which includes Lincoln Park and Old Town.

Tremblay donated $5,000 in March to aldermanic hopeful Tim Egan’s campaign, according to records from the Illinois State Board of Elections. Another $7,500 was donated in two chunks to the campaign from JLT Hospitality, Inc., a company that, according to the Illinois secretary of state records, lists Tremblay as its president.

O’Brien businesses and family members also have been quite active in the 43rd Ward race, in which Egan will face Michele Smith in the April 5 run-off election.

Aside from $3,000 in “in-kind” contributions—apparently in the form of food for fundraisers, provided by O’Brien’s Restaurant—another $22,500 was donated to the Egan campaign by four other companies that share the same Wells Street address (found here and here), and that city records show are affiliated with the O’Brien family.

(Peter O’Brien, a proprietor of O’Brien’s Restaurant, serves as finance chairman of Egan’s campaign, an O’Brien spokesman said. Tremblay is a long-time employee of O’Brien’s Restaurant. Neither Tremblay nor O’Brien, whose family has deep roots in local Democratic Party politics, returned BGA calls.)

Candidate Egan said he’s “proud to have the support of many independent businesses and individuals in the ward.”

However, Smith criticized him for taking money “from all vested economic interests” in the area.

But Smith has a major contributor of her own. That would be the retired Helen Meier, of Wilmette.  This election cycle, Meier has given Smith’s campaign $95,000. Going back to Smith’s previous run for alderman in 2007 and her 2008 win for Democratic ward committeeman, Meier has donated roughly $360,000 to Smith.

Meier is a friend and described by Smith as “a second mom.” Smith served as an unpaid director of the arts foundation run by Meier and her husband, according to the charity’s tax records.

While Egan said Meier’s generous contributions have been talked about during the campaign, he added that it is not something he has brought up.

“I’m an issue-focused candidate. I’m not concerned about what her [campaign disclosure forms] say, how she raises her money or what she does,” said Egan.

Meier denied any taint of a political angle or self-interest.

“I don’t buy diamonds and yachts,” Meier said, “I believe in good causes. Sometimes it needs volunteering, sometimes it needs money.”

Meier was allowed to donate so much because the money came before new campaign contribution limits were imposed by the state at the start of this year.

Under the old rules, Illinois was just one of a handful of states allowing unlimited political donations to candidates. With the new rules in place, individuals can give no more than $5,000, while companies, unions or associations can donate up to $10,000. PACs and candidate political committees can give as much as $50,000.

But as with many attempts at reform, there are loopholes.

Some donors are using their corporate entities to spread the contribution wealth beyond normal limits, as highlighted by the Chicago News Cooperative in a recent story about mayoral contributors.

That’s how Tremblay and the O’Briens were able to contribute so much.

However the race shakes out, it has involved big bucks by aldermanic standards. In total, Egan and Smith have collected more than $700,000 in campaign contributions since the start of last year, records show.

Full disclosure: The BGA is a non-partisan, apolitical watchdog organization that does not endorse political candidates. BGA President and CEO Andy Shaw is a resident of the 43rd ward. In 2009, before she became a candidate, Michele Smith did some temporary and voluntary advisory work for the BGA. The BGA’s examination of the 43rd aldermanic race is based on a tip that raised important good government and campaign finance issues in this high-profile aldermanic campaign.

This blog entry was reported and written by BGA Investigator James Edwards, who can be reached at (312) 821-9036, or at jedwards@bettergov.org.

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After Gas Heater Arrest, County Worker on Hot Seat

 

Matsuyuki/Flickr

Cook County government employees are feeling the heat these days as newly seated Board President Toni Preckwinkle imposes layoffs and makes significant budget cuts.

But one politically active county worker may lose his job for allegedly seeking heat.

Frank J. Phillips, an $87,000-a-year operating engineer at the county-owned and -operated Oak Forest Hospital, was arrested earlier this winter and charged by prosecutors with attempted theft for trying to steal a giant kerosene heater from a secure area of the medical center, officials said.

Phillips, 46, was suspended without pay on Jan. 13, a day after his arrest, said Lucio Guerrero, spokesman for the Cook County Health and Hospitals System.

A county hearing officer likely will make a decision in coming weeks about whether he should be fired, Guerrero said.

Phillips’s next court date is March 10.

The heater was considered “homeland security” equipment, and was being stored in a restricted area of the hospital, Guerrero said.

Phillips allegedly was caught attaching wheels to the unit, which was described by a county official as resembling the heaters on the sidelines of NFL games. Several sources within county government said the heater appeared destined for a tailgating event.

But Phillips—who in 2004 donated $300 to then-Cook County Board President John Stroger’s campaign fund and has given $1,000 over the years to a political committee run by a union—told the BGA: “That would never happen, it wouldn’t even fit” in a car.

Phillips, who started work at the county in 1988, insisted he was assembling the heater so he could use it outdoors for a boiler project at the hospital.

He said he was making do with equipment that was sitting around because “every time you need something fixed they give you $5 and a stick of gum.”

This entry was written and reported by BGA senior investigator Patrick Rehkamp. He can be reached at (312) 386-9201, or at prehkamp@bettergov.org.

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