In final act, Emanuel cements legacy of tolerating corruption, promoting segregation

The outgoing mayor’s agenda to advance Lincoln Yards, the 78, and a new police academy shows no break with his record of ignoring community and ethical concerns to subsidize gentrification.

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Photo by William Camargo

How will Rahm Emanuel go down in this city’s history? Judging from the agenda for his final months in office, it will be as a leader who embraced and built on the worst Chicago traditions of corruption and segregation.

Right now Emanuel is pushing two gigantic new TIF districts – for the huge new developments called Lincoln Yards and “the 78,” on the Near North and Near South sides, respectively – both of which are tainted by the aldermanic corruption scandal swirling around federal investigations of aldermen Ed Burke and Danny Solis. He’s also pushing a new police and fire academy on the West Side and has selected a contractor for that project with an extensive history of shady dealings.

Both mayoral candidates oppose both TIF proposals, and both oppose the police academy. But Emanuel and his City Council allies are aiming at pushing the deals through before a new mayor and council take office.  

Emanuel’s eight years in office have seen numerous scandals, starting with the attempt to bury the video of Laquan McDonald’s murder. His hand-picked Chicago Public Schools chief, Barbara Byrd-Bennett, went to prison for corruption. The CEOs of Emanuel’s two favorite charter school operators, Nobel and UNO, resigned in disgrace. Sexual abuse at CPS was covered up. Unsafe levels of lead in drinking water were covered up, and hearings on the issue have been blocked. And a new whistleblower’s lawsuit offers evidence that the code of silence covering up misconduct in the Chicago Police Department is as strong as ever.

That’s on top of the troubles of Burke and Solis, who were two of Emanuel’s top allies. So it’s no surprise that ethical issues abound in Emanuel’s final act.

The property tax attorney for Lincoln Yards developer Sterling Bay was, until recently, Ed Burke.  Burke was famous not just for the large number of times he recused himself from council votes involving his clients, but for failing to identify his conflicts of interest and continuing to influence proceedings on his clients’ behalf right up to the vote. According to the Better Government Association, he has routinely written ordinances, participated in debates, and presided over committee hearings – and then recused himself at the last minute.

That’s just what happened with Lincoln Yards. At a December 12 finance committee meeting chaired by Burke, progressive aldermen appeared to have the votes to advance a TIF reform ordinance that would have required developers to show that an area would not attract investment without a TIF subsidy, and that the area was blighted, vacant or obsolete. Passage of the ordinance would have threatened TIF proposals for Lincoln Yards and “the 78.”

Burke suggested calling a quorum and Ald. Patrick Daley Thompson scurried out of the chambers. The ordinance was blocked, and the TIF for Burke’s client was saved.

We don’t know much about Burke’s behind-the-scenes role in advancing the Lincoln Yards development, and we deserve full disclosure. We do know that his work reducing property tax assessments for Sterling Bay had the effect of maximizing the revenue going into the TIF, and minimizing the portion of the development’s property taxes going to schools and other taxing bodies.

We also don’t know much about backroom dealings to promote the so-called 78, though we know the development is almost entirely within the 25th Ward, where Ald. Danny Solis – until recently the chair of the zoning committee – is under federal investigation. Solis’s support for the development was highlighted in a 2016 FBI application for a search warrant for the alderman’s home and offices.

And by the way, the property tax attorney for “78” developer Roosevelt/Clark Partners LLC was none other than Ed Burke.

Together these two TIFs could total $1.6 billion, not counting hundreds of millions in financing costs. That’s a lot of money to spend on deals that could be crime scenes.

Meanwhile, Emanuel has selected AECOM, a global construction firm based in Los Angeles, to build the controversial $95 million police academy. As Jonah Newman of The Reporter has detailed, the company has paid hundreds of millions of dollars of fines and settlements over the past four years to resolve allegations of wrongdoing including overbilling, submitting false invoices, and using substandard materials.

The budget committee is expected to consider the AECOM contract March 12, and the full council could approve it the next day. It’s also anticipated that ordinances authorizing TIF districts for Lincoln Yards and the 78 will be introduced at the March 13 council meeting.

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Meanwhile, the two multi-billion-dollar mega-developments seem to continue what Chris Kennedy called Emanuel’s “strategic gentrification plan.” Under Emanuel, population loss has continued – in particular the city continues to lose African-American residents – with growth in one demographic only: young people (under 45) earning over $100,000 a year.

That’s the goal of Emanuel’s focus on a “global city,” on attracting corporate headquarters and building bike lanes. That focus hasn’t benefited black communities: from 2010 to 2017, covering most of Emanuel’s two terms – a period of economic recovery – the Chicago area’s black unemployment rate fell by just 0.4 percent to 17.2 percent, close to triple the rate for African-Americans nationally.

Emanuel also failed to speak up when an affordable housing proposal in a white middle-class area was subjected to racially-tinged attacks.

Lincoln Yards and the 78 are explicitly designed for the new gentry. Out of 10,000 housing units planned for the 78, just 500 will be affordable. At Lincoln Yards, Sterling Bay just doubled the number of affordable units it will build onsite to a whopping 600. That leaves 5,400 luxury-priced units.

Emanuel wants us to spend hundreds of millions of dollars to created what organizer John McDermott terms “essentially gated communities without the gates.” McDermott adds, “We need to stop building segregated communities.”

We certainly need to stop subsidizing them.

Finally, what does it mean that Emanuel is pushing these projects through a lame-duck council after Chicago voters backed two mayoral candidates who oppose them? I’d say if Emanuel refuses to recognize the results of a democratic election, he should stop calling himself a Democrat.

  • alexis martinez

    I find it fascinating that this kind of one-sided, distorted opinion pieces attemps to pass for balanced journalism..While I share many of the same concerns about how politicians and the longtime shady financial machinations that are present in almost ANY political unit. This is not just a Chicago thing…It happens all across the country..from precinct workers to the POTUS…Politicians and money are like Pooh Bear and honey pots…That is a universal problem …not just one unique to Chicago…
    The City Council is made up of 50 Alderman…32, an overwhelming majority are people of color…They could, at anytime overrule the edicts flowing out from the Mayor’s office. The reason is quiet simple.. The city needs young middle class people working and living in the city. They need to grow the tax base,
    The 78 and Lincoln Yards will not displace anyone …not a single home has existed in those plots in n generations… Nothing exists there.
    No streets, no shops, No tax revenues, no housing of any kind..This idea that developers building in these areas are some- how responsible for the terrible social and economic condition that exist in many areas of the city. This is just a form of misdirection..it avoids taking on the far more he nest and challenging job of rebuilding neighborhoods like Austin and Englewood…Setting aside 10,20,30% of units for affordable.renters or buyers in these new mega developments won’t do a damn thing to change the disparities that exist in the neighborhoods…Ask yourself why doesn’t a company like Sterling Bay take it’s 7 Billion dollars and build in Englewood?

    • Harvey Kahler

      You’re right, this piece isn’t balanced with BS. I will agree that gentrification growing the tax base is not a bad thing; but it shouldn’t be on the backs of the working and middle classes; and it doesn’t usurp the needs for affordable housing and neighborhood reinvestment.

      As for Sterling Bay, they are looking for the biggest return on their capital investment with high-end buyers and renters, especially if they can get someone else, John Q. Public, to provide the infrastructure, maybe a part of the construction, and gratitude for the enablers. Sterling Bay isn’t a charity for distressed neighborhood redevelopment for which the TIF program was intended. For what it’s worth, some redevelopment has accurred along the former industrial area along the North Branch, taking advantage of low property costs and demonsgtrates that private development will come on its own.

      Block 37 was a $300-million transit project for an airport express station that was a forerunner to Lincoln Yards and the 78 crimes in progress. The station just happened to coincide with the cost of the multi-story building above it that was sold for $90-million and debt assumption, there is no train, and it was never investigated! In an alternative universe, Lori Hotshot might have represented the Block 37 defendant.

  • Harvey Kahler

    Good job!

    The gentrification stategy was needed to pull the City out of a financial hole from neighborhood decline and reduced population income. Residents have been pushed out of once-bougeois neighborhoods that fell into disrepair and only commanded relatively affordable apartment rents that people would bear and would get by housing inspection.

    Neighborhoods are being redeveloped because of desirable location and low market prices with an opportunity for a larger return on investment, whether a single homeowner or developer. Real estate is one area where a person can make money and build wealth that is fundamental in our capitalist economy. Rent control would upset the basis on which real estate investment and mortgage financing was made and would amount to property seizure. This isn’t an economy where land is held in common and housing is provided by the state. No constitutional right allows a person to seize another’s property by occupation. The closest is the exercise of eminent domain for a general public good that on too many occasions has been stretched for the benefit of a developer over the ownership right of another.

    Even so, there is a legitimate need for decent affordable housing in the City for individuals, families, or sharing with good access for employment, schools, healthcare, shopping, and recreation. We learned that concentrations of poor has only enabled violence that can be avoided by spreading affordable housing throughout the City and in neighborhoods. Affordable housing is needed by the unemployed, minimum wage, low- and middle-income populations with respective increases in space in their apartments or condominiums.