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Funds and Games: Chicago 2016's "Stewardship Report"

A new donor report claims transparency but obscures details on who’s paying for the Olympic bid. And then there's the question of why they're paying.

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Over the past couple weeks news outlets across the country have run excerpts and mocking write-ups of Rod Blagojevich's new book, The Governor, which explains how he played the game of politics.

Meanwhile the Chicago 2016 committee—the nonprofit, tax-exempt organization created to prepare the city's Olympics bid—finally got around to releasing its report on who gave it how much, and the media barely mentioned it.

Blago continues to insist there's nothing inherently wrong with the state's top elected officials taking money from state contractors, particularly if those donors were already supporters anyway. At the same time, Chicago 2016's glossy, 23-page Stewardship Report, as it's called, works from the assumption that all the committee's benefactors—including a lengthy list of city contractors—gave freely and generously to the cause as if the iron hand of the mayor didn't exist.

As the report reminds us, Chicago's bid to win the games isn't being financed by public dollars. Instead, Chicago 2016 has collected money from corporate good Samaritans all over town. Between June 2006 and July 2009, the committee raised $72.8 million in "cash contributions and pledges" and another unspecified chunk in "pro bono" support, including donated office space, legal work, consulting, and manpower.

The donations enabled the committee to rack up about $42.3 million in expenses, including $10.6 million to employ a staff of 57—ten of whom make at least $135,000 a year—$1.7 million on hotel and housing bills, and $1,146,074 in airfare.

"Chicago 2016 is committed to operating with appropriate transparency," the report reads. "We believe this report demonstrates the fiscal responsibility with which we have conducted this campaign."

Transparency is relative, I guess. The report doesn't actually say how much any one donor has given. It lumps them into broad categories: $100,000 and over, $50,000-$99,999, and under $50,000. The pro bono contributions are divided into two categories, over and under $100,000.

"We have attempted to provide a complete listing of all cash and pro bono donors who have contributed $5,000 or more," reads a disclaimer at the end of the report. "We apologize to anyone we may have inadvertently omitted."

All in all, it's an impressive collection of supporters, a virtual who's who for the Chicago area. The $100,000-and-above club includes 3M, Abbott, Baxter International, BlueCross BlueShield of Illinois, AT&T, Bank of America, Jewel-Osco, the William Wrigley Jr. Company, and other corporate titans.

Even the Bears—notorious for being one of the cheapest outfits in the NFL—gave at least $100,000. But then that's the least they could have done, since the city gave them hundreds of millions of dollars to rebuild Soldier Field in 2002 and 2003.

The philanthropic community has also provided plenty of help to the Olympics effort. The MacArthur Foundation gave at least $100,000, as did the Pritzker Foundation, the Dr. Scholl Foundation, and at least ten other foundations. It's sort of interesting how all these organizations managed to scrape up the shekels to back the Olympic bid during these hard economic times but couldn't collectively find enough money to keep the Neighborhood Capital Budget Development Group going at a time it's more desperately needed than ever. One of the few independent watchdogs in town, the NCBDG lost its philanthropic support and closed its doors in 2007. I'd have loved to see its crack staff of researchers go through the 2016 financial books and scrutinize the mayor's funding plans.

In a way, you could argue that all of us have contributed to the Olympic effort since the utility companies Exelon and Peoples Gas—whom we have no choice but to pay for electricity and gas—gave at least $100,000 each. So did several big law firms, like Winston & Strawn and Foley & Lardner, that the city pays thousands of dollars a year to help out with lawsuits against the police and other departments. Donations over $100,000 also came from the Art Institute and the Shedd Aquarium, which are both subsidized by taxpayers through the Park District. The Children's Museum contributed less than $50,000, small thanks to the mayor for trying to move heaven and earth to cram them into Grant Park last year.

Then there's my favorite category of donors: individuals and businesses that have received handouts from the city's tax increment financing program, the mayor's multi-billion-dollar, off-the-books slush fund. You may recall that this program is supposed to be all about providing incentives for development in blighted, impoverished communities.

Among the TIF recipients who wrote checks for the 2016 bid were Boeing, developer John Buck, CNA, Navteq, and United Airlines, who all received money from the city in the last year to help develop that blighted, impoverished community known as the Loop. There are also donations from contractors and vendors that have received money for legal services, construction, or other work on TIF-funded projects, among them F.H. Paschen and Walsh Construction.

And there may be others—I can't say for certain since the city doesn't publish a complete list of vendors who've received TIF money for their work. I apologize to anyone I may have inadvertently omitted.

Companies involved in leasing the parking meters also gave to the Olympic cause. William Blair & Company and its chairman, Edgar Jannotta, each gave at least $100,000. In case you forgot, Blair is the investment firm that came up with the notion of leasing the meters, brought the idea to City Hall, conducted the city's lone analysis of the value of the meter system, and oversaw the bidding process. For these efforts the firm walked away with about $4.3 million in consulting fees.

Also on the donor list are the Katten Muchen Rosenman law firm, which did legal work on the meter deal, and Morgan Stanley, which of course won the right to run the parking system for the next 75 years.

Finally, support came from our fearless watchdogs in the local media: the Sun-Times, Tribune owner Sam Zell, CBS 2, NBC 5-Telemundo Chicago, ABC 7, WGN, WTTW, USA Today, Chicago magazine, the Chicago Defender, Polskie Radio, the Korea Times, N'Digo, and Fox Chicago all made cash or pro bono contributions.

Just about the only media outlet not kicking in was the Reader. According to Ben Eason, who until recently ran the company that owned us, no one from the Chicago 2016 committee even approached.

I called around and asked some of these donors if they really truly believed—cross your heart and hope to die—that the games would benefit Chicago. Most of them didn't respond, and the few who did wouldn't let me use their names.

More than one explained that they and others they know have given even though they don't think the games are going to be the boon for the city that the mayor keeps promising. But they tell me they feel all sorts of pressure to donate, some subtle, some not. Some describe an old boys' network of corporate leaders who succumbed to the arguments of 2016 CEO Patrick Ryan and other business and community leaders that it's their civic duty to help out. And there are the lawyers, accountants, architects, developers, builders, and contractors who figure the mayor, much like Santa, is watching to see who's been naughty and nice. They deny being afraid of old-school retribution, like being targeted by building inspectors if they don't give—they just express concern that they could be kept away from the trough if the games come to town.

"You have to realize there's going to be millions and millions of dollars of contracts that get doled out," one person explained.

So you think people feel they have to pay to play?

"I didn't say that."

Of course, there are those who truly do believe that the games will be good for Chicago, no matter how much they cost taxpayers or how many south and west siders are cut out of their neighborhood parks.

Just like some of Blago's campaign contributors felt the governor was doing a bang-up job for the people of Illinois.

Ben Joravsky discusses his work weekly with journalist Dave Glowacz at mrradio.org/theworks. And for more on Chicago politics, see our blog.

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