December 3, 2012 11:23 AM
Curious questions arise about O’Hare Airport janitorial contract and the mayoral ally who stands to benefit.
By Andrew Schroedter/BGA
Juan Rangel runs the United Neighborhood Organization, an increasingly influential community group known as UNO that, with the help of tax dollars, operates charter schools catering to Chicago’s growing Latino population.
UNO also has a political dynamic: Rangel was co-chairman of Rahm Emanuel’s mayoral campaign, and has been a vocal backer of the first-term Chicago mayor.
Now comes word UNO is branching into a new line of public-sector work – janitorial services – and stands to benefit from a $99.4 million cleaning contract at O’Hare Airport that recently was awarded by the Emanuel administration.
But how that contract came to be awarded is raising questions – and accusations that the Emanuel camp unfairly steered the work to the winning bidder, United Maintenance Co., a Chicago-based company that indicates in bid-related documents that it planned to pay UNO up to $5 million to help fulfill the contract.
"The city predetermined whom they wanted to give the contract to," says John W. Tyler, CEO of Kaleidoscope Cleaning Co. The Maryland firm had the lowest bid out of 11 interested companies – $66.4 million – but was disqualified from the process because, city officials say, its financial projections weren’t realistic.
United Maintenance is run by Richard Simon, a former cop and long-time neighbor of former Mayor Richard M. Daley whose ties extend not only to politicians, but to union and reputed organized crime figures.
Tyler says the whole situation reeks of "dirty dealing" and prompted him to have a congressional ally, U.S. Rep. Roscoe Bartlett (R-MD), contact Emanuel, a former member of Congress, to ask him to reconsider the disqualification.
Emanuel’s chief procurement officer, Jamie Rhee, confirms Bartlett’s office contacted City Hall but says officials were not persuaded. The bid review process was legitimate and fair, she says, as is the decision by United Maintenance to partner with UNO and other community groups, if it so chooses.
Rhee says Kaleidoscope was disqualified because the city determined it couldn’t afford to "pay the required wages" at the amount it had proposed. The living wage is $11.53 an hour, Rhee says, adding that United Maintenance’s starting pay of $11.90 an hour, plus benefits, is higher than what’s required.
Tyler, who says he is considering filing a lawsuit over his losing bid, counters: "We agreed to pay whatever the city demanded. We have a warehouse full of supplies. That’s how we can pass along the savings to the City of Chicago."
Emanuel personally signed the United Maintenance contract, as is standard in such cases, but relied on his staff to vet the proposals and make a recommendation, city officials say.
"I can tell you unequivocally that [Emanuel] doesn’t get involved in contracting processes of this sort," mayoral spokesman Tom Alexander says.
Rangel echoes this, saying he didn’t discuss this deal with Emanuel and that the mayor played no role in connecting Rangel with Simon.
The United Maintenance contract stretches five years and takes effect Dec. 15, at which time hundreds of union workers from a now-expiring janitorial contract with Scrub, Inc., are being fired and replaced with lower-paid nonunion workers. Union officials have been staging protests, accusing Emanuel of "making it possible for millionaires and profitable corporations to help themselves to even bigger profits at the expense of good middle-class jobs."
O’Hare is owned and operated by Chicago’s municipal government, so it falls under Emanuel’s control.
UNO, a nonprofit, is perhaps best known as one of the state’s largest charter school networks, with 13 schools serving 6,500 students in mostly Hispanic neighborhoods across the city. Though privately run, the group receives public funding, with much of the cash routed from the Emanuel-controlled Chicago Public Schools. (This year alone, UNO is budgeted to receive $44 million from CPS, according to a CPS spokeswoman.)
State records show that UNO’s for-profit janitorial arm, UNO Janitorial and Maintenance Service LLC, was formed in June 2008. The firm of about 60 employees mainly cleans UNO’s charter schools and other commercial venues but has never held a city contract, Rangel says.
On an economic disclosure statement and affidavit that United Maintenance filed last year with the city as part of the O’Hare bid process, UNO’s janitorial division was listed as an "anticipated" subcontractor.
The statement estimated it could be paid 5 percent, or nearly $5 million. But Rangel and United Maintenance indicate those plans have changed. The UNO’s cleaning operation isn’t a subcontractor, or even listed on the contract, they note.
But UNO is hosting job fairs and performing other tasks as needed to help United Maintenance fill some 300 open jobs, Rangel says, adding he expects UNO to be compensated, though it won’t be anywhere close to $5 million.
"We’re interested in doing outreach because Hispanics in our community need good jobs," Rangel says.
"I would expect they would pay us," he adds. "But I expect it would be more modest" than what was mentioned in the bid-related paperwork.
Simon, president of United Maintenance, didn’t return numerous phone calls.
He is the onetime chairman of the Chicago Convention & Tourism Bureau, and has been an investor in the Park Grill Restaurant at Millennium Park along with a host of other politically connected individuals – including Emanuel’s chief of staff, Theresa Mintle, who happens to be a cousin to Daley. (Meanwhile, the Chicago Sun-Times reported that Simon also partnered in another business venture with a reputed mob figure.)
A statement released by United Maintenance says, "UNO was originally anticipated as being able to provide as much as 5 percent of our workforce. With 300 jobs available through this contract, that’s roughly 15 positions. Given the broad reach and strong community ties that UNO has, it is not unreasonable to think that 15 hard-working people could be employed by United after learning about the job through UNO."
United Maintenance no longer plans to pay UNO, according to the statement.
If Tom Balanoff has his way, United Maintenance won’t need help filling any jobs. As president of Service Employees International Union Local 1, he’s calling on the mayor to rebid the janitorial contract, even as city officials stick to their guns.
Balanoff says of the situation, "It’s backwards."
This story was written and reported by the Better Government Association’s Andrew Schroedter. He can be reached at (312) 821-9035 or email@example.com.