Better Government Association Sues CTA Pension Plan

The $1.5 billion Chicago Transit Authority retirement fund repeatedly fails to turn over public documents as state law dictates, so the BGA takes the government agency to court.

Contacts:
Mary Frances O'Connor (312) 821-9026
Robert Herguth (312) 821-9030

CHICAGO—In its continued effort to promote transparency and accountability among public bodies, the Better Government Association filed a lawsuit against the Chicago Transit Authority's pension fund for failing to comply with the state's open records law.

The lawsuit claims the pension plan "willfully and intentionally" violated the Illinois Freedom of Information Act, or FOIA, by refusing to provide the BGA with expense reimbursements and records showing gifts or perks that have been bestowed on the fund's executive director. The suit also alleges the CTA pension plan failed to post basic information, including the names and contact information of FOIA officers, on its website, as required by law.

"The CTA's pension fund controls more than $1.5 billion of taxpayer money and is responsible for the retirement income of thousands of former CTA employees, so the public deserves to know how this agency is operating," said BGA President and CEO Andy Shaw. "Their lack of transparency is abominable, even by Illinois' woeful standards."

The BGA filed FOIA requests to the pension plan around the same time it published several articles that raised questions about the fund's governance. One investigation revealed how a board member of the retirement plan who is also a union official solicited pension fund vendors to donate to his union's scholarship fund – which handed out a monetary award to the trustee's daughter. The BGA also reported that the pension fund's investment adviser, Gray & Company, had come under scrutiny by the U.S. Securities and Exchange Commission for alleged conflicts of interest.

The BGA asked the pension fund for expense reimbursements covering a five-year period – a routine request by the BGA that another public pension plan fulfilled with no issue. After filing an extension for more time to respond, the CTA pension plan refused to provide the documents, calling the request unduly burdensome.

When the BGA asked for documents that would show what gifts or perks have been bestowed on board members and employees of the fund – again, another routine request that has been fulfilled by other public agencies – the CTA pension plan said it was unduly burdensome. The BGA agreed to narrow the request down to the fund's executive director and still the CTA pension plan only provided the BGA with "sample documents."

"Public officials routinely dodge their responsibility to provide information to the public by claiming that FOIA requests are unduly burdensome without even considering the public interest in disclosure," said Matt Topic, a FOIA and intellectual property lawyer at Loevy & Loevy who represents BGA in the suit. "The public interest in information about the financial controls at a public pension plan is tremendous and outweighs any supposed burden in producing the records."

This is the third transparency lawsuit filed by the BGA since April. The BGA has also sued the City of Harvey and Schiller Park School District 81 for failing to adhere to open records laws.

For more on the BGA's legal actions, please see:

http://www.bettergov.org/investigations/bga_legal_action.aspx

The Better Government Association is a Chicago-based nonprofit, nonpartisan watchdog group that works for integrity, transparency and accountability in government by exposing corruption and inefficiency; identifying and advocating effective public policy; and engaging and mobilizing the public to achieve authentic and responsible reform.