Is Cicero Towing Deal Taking Taxpayers For Ride?

Clout-heavy towing company finds work in Cicero, donates big to Town President Larry Dominick’s campaign funds while apparently getting free rent on municipal parcel.

Shortly after Larry Dominick was elected Cicero town president in 2005, the municipal government awarded a contract to Tuff Car Co., a towing company co-owned by the father-in-law of Michael Del Galdo, the town attorney and a Dominick campaign supporter.

As part of that contract, Tuff Car was to pay Cicero $20 for each vehicle it towed on behalf of the local government, while charging drivers lower fees than the previous towing contractor.

Town officials touted the deal as a win-win for taxpayers. But a decade later, taxpayers appear to be subsidizing Tuff Car’s operations rather than making money.

Tuff Car continues to tow vehicles on behalf of the local government – cars and trucks that are illegally parked, or involved in criminal cases and traffic accidents – but the company apparently hasn’t shared revenues with the town since 2008, the Better Government Association found.

What’s more, Tuff Car has been using a sizable town-owned parcel to store vehicles since 2005, but there’s no evidence the firm has paid rent to Cicero since 2009 – for six years, the BGA found.

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Larry Dominick (L) and Michael
Del Galdo (R)

Town officials cannot fully explain how and why the firm has gotten such treatment, though they insist it has nothing do with Del Galdo’s connections or Tuff Car’s donations to Dominick’s campaign funds – donations that total roughly $80,000 since 2005, records show.

"Campaign contributions are irrelevant to the process," said Dominick’s spokesman, Ray Hanania, via email. Del Galdo’s law firm "has recused itself from any involvement with the towing company and the Town since the inception. And any effort to insinuate otherwise is patently false."

Town officials said Tuff Car’s contract with Cicero formally expired in 2008 or 2009. They couldn’t answer why the company continues to tow vehicles for the municipality.

But Hanania said there’s a fairly simple reason why Cicero isn’t getting towing revenue from Tuff Car any longer. In many instances – if there’s a financial hardship, for instance, or if a car was seized during "police actions in which the individual was found not guilty" – the town waives towing fees, Hanania said. In such cases, Tuff Car gets no money, and neither does the town, he said.

To offset those losses for Tuff Car, the company keeps all of the money on tows where fees aren’t waived, according to Hanania.

"The towing company loses far more revenue through tow waivers than they would ever owe the Town," he said in an email.

However, Cicero could provide no records substantiating such claims. And Pat Potempa, Del Galdo’s brother-in-law who works for Tuff Car, told the BGA earlier that "it’s my understanding" Cicero indeed "is being paid" for the tows.

On state records, the company identifies its majority owner as Eugene Potempa. He is Del Galdo’s father-in-law, according to interviews and records. He did not respond to messages.

Meanwhile, Hanania had no explanation for why Tuff Car is apparently paying no rent on the Cicero-owned lot at 1924 S. Laramie in the gritty working-class western suburb.

The BGA asked to see Tuff Car’s most recent lease for the lot on Laramie but town officials were unable to provide a copy. The BGA, however, obtained a copy of a lease between the company and Cicero from the Illinois Commerce Commission, the state agency that among other things regulates towing firms. Hanania says he couldn’t verify that lease’s authenticity.

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A Cicero sign warning residents of tow zone.

The lease obtained by the BGA shows Tuff Car is to pay Cicero $2,500 a month. But if the company hasn’t paid rent since September 2009, as Cicero financial records indicate, taxpayers may have been shorted more than $172,000, assuming the terms remained the same.

Tuff Car towed 713 vehicles for Cicero in April and May alone of this year, town records show, potentially netting the company fees totaling more than $81,000, based on a minimum rate – per the company’s 2005 contract – of $115 for every tow.

If the town’s $20 cut was applied to those 713 vehicles, the town would have reaped more than $14,000 in revenues.

Tuff Car may not have been paying Cicero anything in recent years, but it’s been paying into campaign funds – $77,400 to political committees benefitting Dominick, ranking as one of his largest contributors, according to data from the Illinois State Board of Elections.

Del Galdo’s law firm has donated more than $55,000 to Dominick’s campaign fund, state records show.

Through a spokesman, Del Galdo said he has no financial interest in the contract or Tuff Car and that his ties to the company were disclosed to Dominick back in 2005. Del Galdo is Dominick’s hand-picked town attorney.

The BGA reached Dominick on his cell phone and told him about the findings.

"Is that right?" Dominick said. "I’ll get back to you."

He still hasn’t done so.

Last year, the BGA reported how the town paid a waste-hauling company more than $15 million over the last decade to dispose of residential garbage, even though the company had no written contract with Cicero’s municipal government – and apparently has, at least in recent times, kept the work without competitive bidding.

That waste-hauler and its executives had donated nearly $130,000 to campaign funds benefitting Dominick.

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This column – a regular feature called The Public Eye, appearing in the Chicago Sun-Times – was written and reported by the Better Government Association’s Andrew Schroedter, who can be reached at aschroedter@bettergov.org or (312) 821-9035.