Did Chicago already have a privatized Longer School Day called 'After School Matters' during the Daley years... After School Matters scandal helps explain why Arne Duncan didn't push for longer school day during 2003 and 2007 contract negotiations

It's easy to dismiss a lot of what Chicago Inspector General Joseph Ferguson proclaims about budgetary matters, since he has been going way beyond the scope of his office during the past four or five months (beginning mostly with the May 2011 inauguration of Rahm Emanuel). But on October 3, 2011, the focus on the controversial "After School Matters" program and the corruption involving the former mayor's wife, TIF funds, and some of Chicago's major corporations may help explain more than one 21st Century mystery: Why the "Longer School Day" ™ being pushed by Mayor Rahm Emanuel wasn't a major issue years earlier, when Mayor Daley was running the schools and Arne Duncan was running the schools for him.

[CPS readers should note: The Inspector General of the City of Chicago, Joseph Ferguson, should not be confused with the Inspector General of the Chicago Public Schools, James M. Sullivan. The IG for the schools has spent the last several years ignoring major scandals involving powerful people and CPS — and focusing obsessively on catching teachers who are living outside the City of Chicago. Nothing connected with the Daley family has ever been investigated by the CPS IG. Substance also reaffirms our warning to teachers thinking of trying to blow the whistle on corruption to the CPS I.G.: don't. The I.G. functions very effectively as a spy agency for the boss, and until both the CPS Law Department and the Inspector General's office are completely reorganized, it's not worth the risk taking scandals to the people who will inspect you for knowing about them].

Could the fact that the Daleys already had a "longer school day" (lower case) program have something to do with Duncan's lack of interest in the length of the city's elementary school day between 2001 and 2009? More questions need to be asked.

Since Mayor Rahm Emanuel launched his attack on the Chicago Teachers Union under the guise of the need for Chicago elementary school children to have a "Longer School Day," the question has to be raised (if only here in Substance) as to why Emanuel's predecessor refused to negotiate for the longer school day under two Chief Executive Officers (Paul Vallas and Arne Duncan), both of whom negotiated contracts with the Chicago Teachers Union during their time in office. On September 9, 2011, I asked Arne Duncan that question. Duncan negotiated two contracts with the school system's unions. In 2003, Duncan, then two years in office, negotiated a contract with the Chicago Teachers Union (then under the presidency of Deborah Lynch). In 2003 the "Longer School Day" was not a big deal, and nothing was said about it for the remainder of the decade.

In 2007, Duncan, still CEO of CPS, negotiated a contract with Marilyn Stewart, who had ousted Lynch at President of the Chicago Teachers Union following widespread member dissatisfaction with Lynch's 2003 contract. Again, Duncan didn't say a word in public about the need for a Longer School Day.

Suddenly, in 2011, with former White House Chief of Staff Rahm Emanule in the mayor's office in Chicago, Duncan starts calling the city names because supposedly Chicago has (perhaps, remember, they are ignoring the high schools and any elementary school that was not on closed campus) the shortest school day among the nation's urban school districts. And, according to the new "team" at Chicago Public Schools, the short CPS school day is the reason why Chicago kids are falling behind (even those who aren't?).

During the recent media event (September 9, 2011) at Chicago's Schurz High School, I asked two of the three men most responsible for those two union contracts why they didn't get a longer school day for Chicago's elementary children through collective bargaining in 2003 and 2007. The two men I asked were Charlie Rose, who was one of the lawyers negotiating the contracts on behalf of Duncan both years, and Duncan himself.

After composing himself following an uncharacteristic bit of rudeness, Rose affirmed that CPS had had the "longer school day" on the bargaining table in both years. Rose, now the top lawyer for the U.S. Department of Education, was in town with Duncan's entourage and standing at the back of the crowd listening to the media event at Schurz.

Then I followed Duncan out of the building, asking him three times why he hadn't gotten the longer school day when he had the power to negotiate for it as CEO of CPS in 2003 and 2007. Duncan gave the same answer to my question all three times: "We were unsuccessful." But I didn't ask whether they had gotten the longer school day (I knew (a) that they had tried and (b) that they hadn't gotten it). I asked why if it was so important in 2011 it wasn't in 2003 and 2007. Obviously, if Duncan's former buddy from the White House (Rahm Emanuel was Barack Obama's Chief of Staff during two of the three years since Duncan began serving as U.S. Secretary of Education) is making it a "wedge issue" against unionized teachers in Chicago in 2011, how can Duncan be pontificating about it when it was his failure that supposedly deprived a generation of children of the longer school day Duncan now claims they needed all along. Duncan served as Chief Executive Officer of Chicago's public schools from July 2001 through December 2008. A child who entered kindergarten the first year of Duncan's office (in September 2001) would have been in first grade in September 2002, second grade in September 2003, third grade in September 2004, fourth grade in September 2005, fifth grade in September 2006, sixth grade in September 2007, seventh grade in September 2008, and eighth grade in September 2009. By the time Arne Duncan was in his second year as U.S. Secretary of Education (by June 2010), that child would have been graduating from eighth grade in a Chicago public school.

The most complete coverage of the scandal on October 3, 2011, when the IG's report came out, was on the blog by Greg Hinz at Crain's Chicago Business. Here is what Hinz had up as of dinner time on October 4, 2011:

Daley staff forced TIF winners to give to Maggie Daley's charity, city IG charges

Posted by Greg H. at 10/3/2011 5:48 PM CDT on Chicago Business

Former Mayor Richard M. Daley's administration forced more than a dozen firms that received city development subsidies to kick over a share of their grant to a charity run by Mr. Daley's wife, Maggie Daley.

That's the blockbuster charge in a report being released today by Chicago Inspector General Joseph Ferguson.

The report specifically deals with After School Matters, a much-praised but also politically connected youth program that for much of the past decade served as the unofficial charity at City Hall.

According to Mr. Ferguson, the city — often to the surprise of even grant recipients — required firms that got tax increment financing subsidies to donate a share of that money to specific non-profit groups.

Of the 27 grant agreements signed between 1985 and 2009 that directed cash contributions to private non-profits, at least 16, or 59%, specifically designated After School Matters or an affiliate. Altogether, After School Matters received $915,000 through such "public benefits" clauses, according to the report. This is on top of more than $54.5 million in direct city grants since 2004.

Included in that figure is a $6.5-million contract that, as previously reported, was signed four days before Mr. Daley left office in in May.

Under an agreement with Mr. Ferguson's office, I haven't yet called the Daleys or After School Matters for their reaction. But I'm doing so now, and you can bet they'll have something to say.

Meanwhile, though, Mr. Ferguson isn't holding back.

"The frequent selection of After School Matters for public benefits creates the appearance of preferential treatment for an organization with close ties to the city," his reports states.

"Regardless of the nature of the work performed by After School Matters, the lack of transparency in the city's public benefits program undermines the public's trust."

The report suggests Mr. Ferguson effectively stumbled on the TIF donations matter and that he had a hard time getting city employees to detail exactly how things worked.

The figures as to how many TIF deals, technically known as redevelopment agreements, required payments to After School Matters is only a "best estimate" from the city's law department, the report says.

Detailed data were not kept by the city, nor were any rules or standards established as to which groups should get the money, the report says.

The recipients — including such prominent firms as the Wm. Wrigley Jr. Co., LaSalle Street Capital Inc; a building in which bank ABN Amro has offices and Central Station Properties LLC — also were kept in the dark, the reports states.

In interviews with nine recipients, all but one said, "The city unilaterally chose" After School Matters as the agency to which the recipient had to make a cash donation. The recipients generally found out "during later stages of the (TIF) negotiation process."

In the ninth case, the corporation that received TIF aid was headed by a former mayoral deputy chief of staff. But even in that case, the TIF contract with the city specified that TIF aid would be reduced dollar for dollar for any shortfall in required charitable donations.

One other private group actually received more money via the public-benefits clause, but only because of a $1.25-million payment to the Leland Apartments Development in one TIF project.

The city also required some TIF recipients to agree to spend money on city projects.

Mr. Ferguson's report comes at delicate time for Mayor Rahm Emanuel, who has vowed to reform but continue the TIF program.

Other groups want to tap hundreds of millions of dollars being held in reserve for TIF projects and instead use it to shore up the city budget and keep city employees from being laid off.

* * * 2 p.m. update -- Still no response from either the Daleys or After School Matters. I'm told a statement from the latter is coming, sometime today.

* * * 4:10 p.m. update -- After School Matters finally is out with a response.

In a statement, the schools group terms "flat-out false" any "impression" that TIF recipients "had to agree to donate to After School Matters." The organization termed that "an insult to the work that former first lady and After School Matters Chair Maggie continues to do."

The statement notes that "only" 16 of 73 TIF deals over the past 25 years directly benefitted After School Matters, and says the group has helped more than 200,000 school kids since 2003.

Neither the former mayor nor his wife will be available for questions, says the statement, which was issued by Jasculca Terman & Associates, a public relations firm.


By Hal Dardick and Jeff Coen, Tribune reporters, October 5, 2011

Developers who got taxpayer subsidies from Mayor Richard Daley's administration were repeatedly required to donate to a nonprofit group founded by Chicago first lady Maggie Daley as part of the deal.

More than $900,000 ended up flowing to After School Matters, but city officials couldn't explain why — and had no guidelines to evaluate how the money was directed to that group and other charities that received contributions.

Those conclusions were drawn by Chicago Inspector General Joseph Ferguson, who released a report Tuesday that suggested Mrs. Daley's program benefited disproportionately since 2003 from its obvious connections to city government.

The report raised questions for new Mayor Rahm Emanuel on two fronts. Emanuel is a former board member at After School Matters, where his wife, Amy Rule, now serves. And the findings applied new pressure on Emanuel's pledge to reform the city's much-criticized tax-increment financing system.

Emanuel offered little in the way of reaction Tuesday.

"I've got to look at the report," Emanuel said at an unrelated news conference Tuesday. "As you know, in the first three days I established a TIF board review. Two, the charge of the TIF board was to reform TIFs, so they were focused on economic and business and job creation and weren't an instrument of politics or political favoritism, but economic growth."

A city spokeswoman later added that Emanuel's administration has not entered into any agreement requiring a private developer to make cash donations to a private charity.

Ferguson also noted that Emanuel's TIF Task Force had not mentioned the possible "preferential treatment" to Mrs. Daley's charity, which oversees after-school activities in the arts, athletics and academics at schools, parks, libraries and community centers.

Ferguson said he was not calling into question Maggie Daley's efforts.

"We are not raising questions about After School Matters, Mrs. Daley or the work of that organization," Ferguson said in an interview. But the report does question "the absence of transparency, accountability and specific guidelines, which resulted in an extraordinarily disproportionate number of donations going to After School Matters."

Emanuel has made it clear he will continue to rely on TIF districts as an economic development tool, even as he tries to address public criticism of the program.

The task force's recommendations, which Emanuel said the city will adopt, included a call for a new "internal governing body" that would craft measurements for evaluating TIFs on job creation, private investment, property value increases, worker training and affordable housing.

According to Ferguson's report, between 1985 and 2009, there were 73 city redevelopment agreements, or RDAs, that included what are known as "public benefits clauses." Almost all of them came after Daley was elected in 1989. More than two dozen directed payments to nonprofits — with no public guidelines — and 16 sent money to the charity Maggie Daley co-founded as first lady.

Through a representative, Richard and Maggie Daley declined to comment.

After School Matters released a statement saying the program has enjoyed wide support and noting that dozens of other charitable organizations received contributions from developers. It said any suggestion that companies had to agree to donate to the Daley charity in order to get city help is "flat-out false."

"It is also an insult to the work that former first lady Maggie Daley continues to do for the youth of this city," the group said.

The inspector general said that investigators asked 10 firms why their contributions were directed to After School Matters and that nine of them said the city made the choice "unilaterally."

City employees said there were no established guidelines for selecting charities for donations and those interviewed by investigators could not explain in detail how charitable donations were made, the inspector general said.

"City employees interviewed for this review could only report that decisions are made collectively by the city's Department of Housing and Economic Development, the mayor's office and aldermen," the report stated.

It was difficult to find any information related to the public benefits clauses on the city's website, Ferguson noted.

Some of the information is available online, but the clauses about charitable donations are found deep inside the lengthy individual agreements.

Ald. Scott Waguespack, 32nd, the main sponsor of the city's TIF sunshine ordinance, said the review showed even more transparency is needed.

"It just proves that the system is broken, and the only way to fix it is to put every expenditure out there for the public to see," Waguespack said. "But just putting information online isn't going to solve the whole problem. You have to put in very strict measures for people managing the TIFs to say no to abuses that have taken place in the past."

After School Matters has its roots in the Gallery 37 student arts program, which kicked off in 1991 on what was then known as Block 37, a then-vacant parcel in the heart of the Loop. It was the idea of Maggie Daley and Lois Weisberg, the city's cultural affairs commissioner at the time.

Five years later, the program partnered with Chicago Public Schools, and in 2000 it expanded to include technology, sports and communications programs. Its budget last year was $27.5 million, and it counted 75 full-time employees.

And while Ferguson's report made it clear he was not offering any opinion on the performance of After School Matters itself, the success of the organization's efforts has been questioned recently. A study published this summer by Northwestern University reported its overall effectiveness may be limited.

Ferguson reported that After School Matters was not the leading nonprofit beneficiary of donations in the Chicago TIF process. That nod went to the developer of the Leland Apartments in 2002, a project that included affordable housing on the North Side.

After School Matters' last tax return showed the group reported that it brought in $17.4 million in government grants and contributions, $2.6 million from fundraising and $3.1 million in all other contributions and gifts. The organization claimed assets of $6.1 million and reported its highest paid staff member was Executive Director David Sinski, who made $120,316.

The After School Matters board is a who's who of influential Chicagoans, including former Daley chief of staff Roger Kiley, the mayor's former press secretary Avis LaVelle, Chicago Board of Elections Chairman Langdon Neal, and former top Daley aide Victor Reyes. Other members include well-known actors and restaurateurs.

Maggie Daley remains chair of the After School Matters board, taking no salary from the organization. Emanuel was effusive in his praise of her and her program when he introduced her recently at the group's 20th anniversary gala. The event at Navy Pier attracted about 1,500 people and raised more than $2.8 million for the group.

"We are a richer city, a better city, because of Maggie Daley's perseverance," Emanuel said to loud applause. "There have been countless groups from other cities, other countries, (that have come) to see Maggie Daley's after-school program. And she has taken an idea, and turned that idea into reality. Every person in this city, one way or another, has been touched by your vision and your determination."

Tribune reporter Kristen Mack contributed.



October 18, 2011 at 1:16 AM

By: John Kugler

Rumor Has It

Tuesday, October 18, 2011

He's Back?

Oh this would just be priceless:


An interesting rumor has just surfaced...anyone hear anything more? It's being bantered about at CPS.

RON HUBERMAN is rumored to be making a comeback to Chicago...and guess why?

We all know that the CPD and the CFD are going to be merged at CPD headquarters....well, guess who Rahm is bringing in to 'facilitate' this monumental merge?

You guessed it...the same man who left OEMC with a major scandal involving a contract for police radios. The same man who left the CTA in shambles. The same man who left the public schools in shambles...oh, wait...they STILL are. The man quoted by former Mayor mumbles as the reason why he (shortshanks) 'slept good at night, knowing Ron Huberman was in charge of things.' Ladies & gents, strap in and hang on, it's gonna be a real interesting and bumpy ride if this comes to fruition,

And just HOW is Tiny Dancer 9.5 going to justify bringing this well educated bureaucratic destroyer back into the fold? What kind of salary will he command? How can Rahm justify paying this well educated non-boss a princely sum? I guess we'll see soon enough!

So Officer Huberman might be figuring out another way to sneak back into a gold braid pension again? Or just back to finish the job he started? Hey Garry? Run. Run far away if this is true.

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