BGA Investigation Finds Stroger Fundraising Practices Alarming

January 11, 2006

County Contractors and Employees Gave More than 51% of Itemized Contributions; Some Contributions Violate County Ethics Ordinance

CHICAGO, ILLINOIS — The 83-year old nonpartisan Better Government Association (BGA) today released the findings of a six-month investigation into the fundraising practices of Cook County Board President John Stroger, revealing that more than 51 percent of his itemized 1999-2005 campaign contributions came from government contractors and county employees. The BGA further reports that many of these contributions are in direct violation of the 1993 Cook County Ethics Ordinance.

"Illinois is awash in scandal and corruption," Said BGA Executive Director Jay Stewart. "Former Governor George Ryan is on trial, Governor Blagojevich’s administration is the subject of numerous investigations, and the Hired Truck scandal has resulted in dozens of guilty pleas and indictments in Mayor Daley’s City Hall. A common thread with all these scandals is questionable campaign contributions, contracts and hiring."

Specific Findings

* Between early 1999 and the middle of 2005 President Stroger raised approximately $2,413,246 million dollars in itemized contributions.

* During that period, at least $ 615,078.99 (25.5%) in itemized contributions were raised from county contractors, their owners, agents and employees.

* At least $ 624,543 (25.8%) in itemized contributions was raised during that time from Cook County employees who ultimately report to his office.

"The astonishingly large percentage of contributions from contractors and employees revealed by the BGA investigation represents a continuing and massive ethical blind spot by President Stroger," continued Stewart. "At the very least, it creates the appearance of impropriety to a public that too many times has seen political players and cronies rewarded with taxpayer’s hard-earned dollars."

Ethics Ordinance Violations

Passed in 1993, the Cook County Ethics Ordinance prohibits county contractors from donating more than $3,000 to county officials in election years and $1,500 in non-election years. Many of Stroger’s contributions directly violate section 2.14 of the Ordinance.

For example:

* Environmental Design International, Inc. (EDI) gave $1,900 to Citizens for Stroger in 2001. EDI had County contracts in 2000 and 2003.

* Hefter Industries gave $5,600 to Stroger for President in 2002 and $3,500 to Citizens for Stroger in 2004. Hefter had County contracts in 2000, 2001, 2003 and 2004.

* Gareda Diversified Business Services gave $2,500 to Citizens for Stroger in 2001, $3,280 to Stroger for President in 2002 and $5,000 to Citizens for Stroger in 2004. Gareda had County contracts in 1999, 2000, 2002, 2003, 2004 and 2005.

"Given the massive amount of fundraising coming from county contractors, it is not surprising that the Ethics Ordinance has been violated. Nevertheless, it is disappointing," said Stewart. "The BGA calls on President Stroger to return any and all contributions that have been made in violation of the county’s Ethics Ordinance."

Faustech Indicted, Juvenile Detention Center Investigated – What Next?

This isn’t the first time the BGA has raised concerns about Stroger’s campaign contributions. Specifically, in October 2000, the BGA publicly questioned whether donations made by Faustech Industries to Cook County Board members, including President Stroger, influenced the awarding of a $49-million radiology contract at Cook County Hospital. The contract was eventually revoked, yet Cook County continued to award business to Faustech. On September 15, 2005, a federal grand jury indicted Villazan and Faustech for bribing a Cook County employee in order to win the contract.

Similar corruption investigations are unfolding in Cook County government. In addition to the Faustech indictment, Illinois Attorney General Lisa Madigan subpoenaed numerous records of the Cook County Juvenile Temporary Detention Center as part of a civil fraud investigation reported on December 14, 2005. On December 15, 2005 Cook County States Attorney Dick Devine indicted the former fiscal manager of the President’s Office of Employment Training on numerous charges including theft, fraud and bribery.

End Pay-to-Play Government

While Mayor Daley, Comptroller Dan Hynes, Attorney General Lisa Madigan and Lieutenant Governor Pat Quinn have all banned contributions from contractors because of the ethical problems such contributions can cause, President Stroger continues to collect an alarming amount of money from entities and individuals with whom he contracts and supervises. This represents a far greater percentage of contractor and employee contributions than any other government official including Governor Blagojevich.

The BGA calls upon President Stroger to stop accepting campaign contributions from County contractors and employees and to return any contributions made in violation of the Ethics Ordinance.

"Illinois’ campaign finance system is broken. President Stroger needs to make pay-to-play a thing of the past in Cook County," said BGA Executive Director Jay Stewart. "If he is going to ask taxpayers to reach into their wallets for even higher taxes and fees, he should stop asking contractors and employees to reach into their wallets to keep his campaign committees functioning."

Investigation Methodology: To compile the above figures, the BGA utilized a database of Cook County contracts, campaign finance reports filed by Citizens for Stroger, Stroger for President and the 8th Ward Democratic Organization, the Secretary of State’s database of registered corporations, online minutes of Cook County Board meetings, internet search engines such as Google and commercial databases such as Westlaw.

The BGA counted itemized contributions to the 8th Ward DemocraticOrganization as contributions to President Stroger because the 8th Ward Democratic Organization lists supporting John Stroger as its purpose and John Stroger as its President. In counting itemized contributions from County employees, the BGA did not include employees working for other countywide officers such as the Sheriff or the Assessor nor did the BGA include contributions from county judges. When compiling itemized contributions from county contractors, the BGA included contributions from the business entity, its principals, agents and employees.