Who's making out on the great DePaul Basketball land swindle?

Just in case you thought Rahm's DePaul Arena land grab was about basketball -- it ain't. Rather it's nothing less than one of the great taxpayer rip-offs in Chicago history. The deal enriches a web of the mayor's clouted friends using millions in TIF funds that should have gone to bail out a bankrupt school system. It is the culmination of massive kickbacks and political contributions from investors, bankers, and lakefront property owners to Gov. Quinn, Ald. Burke, Mayors Daley and Emanuel.

While everyone has lately had their eye on the penny-ante shenanigans of the Chicago machine boys, like Boss Madigan's hiring of his pals and relatives over at the RTA, Tribune writers Kathy Bergen and Bill Ruthhart were documenting the major league stuff in last Sunday's business section. 

Best and funniest quotes:

"This isn't some clout project," McPier CEO Jim Reilly said. "That isn't how we do business."

Emanuel spokesman Tom Alexander said the mayor's chief lobbyist, Matt Hynes, also has recused himself in any negotiations connected to the project because of his father's involvement with DePaul but said "there would have been no conflict or rules violation" had Hynes chosen to work on such a deal.

"The city has one interest and one interest only when it comes to negotiations — to find the best deal for taxpayers."

 Like Reilly, the mayor has no concerns about potential conflicts of interest, and Alexander said "the notion of any conflict is preposterous."

In a statement, [Gov.]Quinn spokeswoman Brooke Anderson said, "The governor has zero tolerance for any conflicts of interest," but she did not elaborate on whether the Democratic governor had concerns that any such conflicts could exist with the McPier project.

"He expects board members to fulfill their fiduciary duty and make these decisions based on the best interest of taxpayers," Anderson said of McPier's land acquisitions. "The process should be open and transparent."

[Lakeside Bank Pres. Vincent] Cacciatore said his record as a donor to DePaul is irrelevant. 

"God knows how many thousands of donors there are," he said. "Does that mean that no property owners who are donors to DePaul — that the city couldn't buy their properties?"

[CenterPoint co-founder John S. Gates] said he recused himself and left the room whenever the legal proceedings came up for discussion. "It's not that I had to — I had no financial interest," he said. "But there could have been an appearance of conflict of interest because CenterPoint is a company I was involved with for a long time."

I'll stop now. I'm laughing too hard. 

Rahm's great TIF school rip-off

David Orr

The city should send any extra development funds to the public schools, says Cook County Clerk David Orr.

"How do we explain to school kids that gym, music and art classes are canceled while profitable businesses are tapping into the city’s tax base?" Orr said Thursday in an annual report on Tax Increment Finance districts. -- DNAInfo

CPS Liar-In-Chief Becky Carroll jumps into the fray.

 "No combination of one-time fixes is going to address a structural financial deficit at CPS that has built up over decades and currently stands at $1 billion, including $400 million from increasing pension payments," said CPS spokeswoman Becky Carroll. "We have made more than $600 million in cuts to the central office while doing everything we can to protect critical classroom investments. 

So Wendy Katten  calls her on it -- what $600 million in cuts?

“It just makes me laugh,” says Wendy Katten, who runs the parent advocacy group Raise Your Hand. “If [the savings] are true, they should show us the line items.” 

L-I-C Carroll responds -- um, errr.

 CPS spokeswoman Becky Carroll admits it would be impossible to find evidence of the reductions in the official budget book. “It is not the way it works,” she says... In other cases, the district saved money in one area, but paid more for something else-- and therefore, Carroll says, the reduction is not reflected in a line item. -- -- Catalyst

And she does all this with a straight face.

Learning from Prof. Joravsky about Rahm's latest TIF deal

Rahm's Choose Chicago cronies applaud the great TIF swidle.

I continue to learn from Professor Joravsky about TIF, the Mayor's own taxpayer supported slush fund. Today, the prof schools us on what might be Rahm's greatest-of-all scams, the DePaul Arena TIF swindle, by which he takes millions in taxpayer dollars that should go to Chicago Public Schools and funnels them to his rich pals and corporations. In the latest case, that means spending $55 million of your property tax dollars to build a hotel and basketball arena for DePaul, on the near-south side. This at the same time he's about to close more than 50 neighborhood schools, primarily in the city's most under-served black communities, because the city is too broke to operate them.

Writes Joravsky:

 And what do you, the taxpayers, get for this $55 million? You get a hotel that you'll probably never stay in. And an arena for DePaul basketball games that you'll probably never attend. Because let's face it—there are even fewer fans of the Blue Demons in this town than of the White Sox, who also play in a subsidized facility that doesn't often fill up.

Since the deal costs $55 million, we'll have less money to spend on schools. Which means most of them will still go without music, art, drama, intramurals, or reduced class sizes.

At this point, I should remind everyone who doesn't know that DePaul is a private university with tuition costing more than $30,000 a year for undergraduates. That means it's a long shot for average Chicagoans, unless they're willing to go into severe debt to pay for it. 

Which is exactly why I'm sharing Professor Joravsky's piece with my students who are doing exactly that.  I'd like the get their take on the great TIF swindle.

Side bar

Interesting (at least to me) was the sudden resignation of billionaire Republican candidate for governor, Bruce Rauner as chairman of Choose Chicago, the city's tourism arm. The resignation came on the eve of the announcement of the DePaul Arena deal. Rauner was named chairman of the Chicago Convention & Tourism Bureau in 2010 by former Mayor Richard Daley. When the CCTB merged with the Chicago Office of Tourism and Culture last year, Mr. Rauner became chair of the newly created Choose Chicago.

Is candidate Rauner now trying to distance himself from the DePaul deal, in case it collapses in scandal?

Rahm has named former White House social secretary Desiree Rogers, as Rauner's replacement. You might remember how Obama was forced to dump Rogers after two wannabe reality TV stars crashed the first White House state dinner, an event to honor of the prime minister of India. I suppose this was a way to give her a place to land. It usually works that way in the City the Works.