Chicago Fi­nance Of­fi­cial Ex­its Af­ter Fed­eral Cor­rup­tion Charge

The Bond Buyer - - Front Page - By yvette Shields

CHICAGO – Chicago City Coun­cil Fi­nance Com­mit­tee Chair­man Ed­ward M. Burke stepped down from the post that holds sway over city bond deals Fri­day, one day af­ter be­ing charged by fed­eral author­i­ties with at­tempted ex­tor­tion.

“I have spo­ken with Al­der­man Ed Burke, who agreed that the best course of ac­tion is for him to re­sign as chair­man of the Com­mit­tee on Fi­nance,” Mayor Rahm Emanuel said in a state­ment Fri­day. “Be­cause of his af­fec­tion for the city, deep re­spect for the in­sti­tu­tion of City Coun­cil and the needs of his con­stituents, Al­der­man Burke took the ap­pro­pri­ate step to put the in­ter­ests of the city above all else.”

A may­oral aid had made clear on Thurs­day that Emanuel would push for Burke’s re­moval if it did not come vol­un­tar­ily. He has held the chair­man­ship since 1989 and pre­vi­ously was chair­man be­tween 1983 and 1987.

The vice chair of the panel — Emanuel’s floor leader Pa­trick O’Con­nor — will take over man- age­ment of the com­mit­tee where city bond deals and other piv­otal fis­cal transactions are vet­ted and ei­ther tabled, held for fur­ther review, or ad­vanced to the coun­cil for a vote.

Key pieces of Emanuel’s agen-

da are still pend­ing be­fore Emanuel leaves of­fice in May. The com­mit­tee may con­sider early this year Emanuel’s pro­posal to lay the le­gal ground­work for a fu­ture $10 bil­lion pen­sion obli­ga­tion is­sue, although the bor­row­ing would prob­a­bly fall on Emanuel’s suc­ces­sor to pur­sue. He is not seek­ing re-elec­tion in the Fe­bru­ary mu­nic­i­pal elec­tions.

The or­di­nance in­tro­duced by Emanuel last month would es­tab­lish a spe­cial bank­ruptcy-re­mote en­tity to se­cu­ri­tize up to $7.7 bil­lion of bonds. The or­di­nance also pro­vides the frame­work for the city to sell $2.3 bil­lion of Wa­ter and Sewer Ex­cise Tax Re­ceipt rev­enue bonds.

If ap­proved, fur­ther con­sid­er­a­tion from the com­mit­tee and coun­cil would still be needed for the ac­tual fi­nanc­ing.

Emanuel is also aim­ing to win fi­nal ap­proval for $1.5 bil­lion in tax-in­cre­ment fi­nanc­ing sub­si­dies for big de­vel­op­ment projects that have re­ceived pub­lic and coun­cil push­back and the city is still work­ing on a con­tract with Elon Musk’s Bor­ing Co. on an ex­press rail line from down­town to O’Hare In­ter­na­tional Air­port.

Burke was charged in a 38-page crim­i­nal com­plaint with one count of at­tempted ex­tor­tion. The com­plaint was filed in the U.S. Dis­trict Court for the North­ern Dis­trict of Illi­nois, Eastern Di­vi­sion on Wed­nes­day and un­sealed Thurs­day.

Burke is ac­cused of shak­ing down a fast food restau­rant that was seek­ing re­mod­el­ing per­mits. Ac­cord­ing to the com­plaint, Burke used his power as an al­der­man to “cor­ruptly so­licit un­law­ful per­sonal fi­nan­cial ad­van­tage in the form of fees aris­ing from re­ten­tion of Burke’s law firm, Klafter & Burke.” The firm is a prom­i­nent player in prop­erty tax as­sess­ment mat­ters.

Burke also is ac­cused of so­lic­it­ing a cam­paign do­na­tion from an ex­ec­u­tive at the restau­rant for a lo­cal politi­cian. Although not named in the com­plaint, that politi­cian is Cook County Board Pres­i­dent Toni Preck­win­kle who is a may­oral can­di­date. Her cam­paign confirmed the in­for­ma­tion.

Burke ap­peared be­fore a fed­eral mag­is­trate Thurs­day and was re­leased. “The ac­tions de­scribed in the com­plaint does not make out ex­tor­tion or an at­tempt to ex­tort. We look for­ward to a prompt day in court to prove the in­no­cence of Al­der­man Burke. We have no fur­ther com­ment,” said Burke’s at­tor­ney Charles Skalrsky, of Jen­ner & Block.

If con­victed, the charge car­ries a max­i­mum pri­son sen­tence of 20 years and a $250,000 fine. A fed­eral grand jury in­dict­ment is ex­pected within the next month and Burke could face more charges. “Our of­fice’s in­ves­ti­ga­tion re­mains ac­tive and on­go­ing,” Joseph Fitz­patrick, an as­sis­tant U.S. At­tor­ney for the North­ern Dis­trict of Illi­nois, said in a state­ment.

Burke’s city hall and ward of­fices were raided by author­i­ties in late Novem­ber. Some won­dered if it were tied to his pre­vi­ous rep­re­sen­ta­tion of Pres­i­dent Trump in chal­leng­ing the as­sess­ment for the Trump Tower in down­town Chicago. Burke has also faced other fed­eral probes, in­clud­ing in­ves­ti­ga­tions over ghost-pay rolling and over the com­mit­tee’s man­age­ment of the city’s $100 mil­lion an­nual worker’s com­pen­sa­tion pro­gram.

Pre­vi­ous in­ves­ti­ga­tion did not re­sult in any charges.

Burke, 75, is near­ing his 50-year mark as al­der­man, mak­ing him the long­est serv­ing mem­ber ever of the 50-mem­ber coun­cil. He is of­ten re­ferred to as the “dean” and “coun­cil his­to­rian” known to pro­vide his­tory lec­tures as he seeks pas­sage of res­o­lu­tions.

He faces sev­eral op­po­nents for his seat in the Fe­bru­ary elec­tion.

Burke’s power over city fi­nances lies in his abil­ity to hold up or­di­nances, leav­ing city of­fi­cials scram­bling to an­swer ques­tions or make al­ter­ations in or­der to fi­nal­ize ap­proval for a city deal. He’s also spon­sored or sup­ported pro­pos­als that im­pose rules on bank­ing firms.

Mu­nic­i­pal par­tic­i­pants seek­ing work on bond deals are told that a visit to the “Chair­man’s” of­fice is part of their cul­ti­va­tion of city re­la­tion­ship.

Burke also holds sway over ju­di­cial selec­tions as chair­man of the county’s ju­di­cial slat­ing com­mit­tee and he’s amassed a $12 mil­lion cam­paign war chest.

Burke won elec­tion as al­der­man of the 14th ward on the city’s south­west side in 1969. It was a post his fa­ther had long held be­fore his death a year ear­lier. ◽

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