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Violence prevention: Corporate charity or citizenship?

Last year, community groups called on Mayor Emanuel and the business community to match the fundraising they did for the NATO Summit to fund youth programs in the neighborhoods.

Now, under the glare of national publicity for Chicago’s ongoing epidemic of violence, Emanuel has decided to deploy his famous fundraising skills to gather $50 million in corporate donations for violence prevention programs over the next five years.

Certainly, every effort to bring resources to desperate communities is welcome.  (And it’s churlish to point out that these folks raised nearly $50 million for NATO in a few weeks.) But is charity a substitute for good citizenship?

The Grassroots Collaborative is pointing out that Emanuel’s choice to co-chair the campaign heads a company that is profiting from controversial interest rate swaps that cost the city and the schools tens of millions of dollars a year.

Jim Reynolds is CEO of Loop Capital, which according to GC, has made $100 million in five interest rate swap deals with the city and CPS since 2005.

Interest rate swaps — also called “toxic rate swaps” by critics — are one of the wonderfully innovative financial products developed in the run-up to the financial crash a few years ago.  They provide set interest rates to cover variable returns on public bond deals.

Cost Chicago $72 million a year

But since the crash, the Fed has kept interest rates near zero, while local governments are locked into interest rates of 3 to 6 percent.  That costs Chicago $72 million a year; CPS loses $35 million a year on the deals, according to GC. (CTU has protested this arrangement.)

While applauding their “charity work,” GC notes, “Chicago business leader must address their role in creating the lack of resources for youth and communities in the first place.  They must stop gouging taxpayers and renegotiate these toxic deals.”

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Public left out of Emanuel’s budget

A Sun-Times headline from last August may be the crux of the matter:  “Rahm hears boos at budget chat.”

Rahm will hear no boos this year.

With virtually no notice from the media, Mayor Emanuel has sharply reduced public participation in the city’s budget process and completely eliminated public information about his budget proposal.

For over 30 years, the city has held open public hearings on the mayor’s proposed budget.  Emanuel has ended that, substituting closed sessions with specially-selected groups.

And while Mayor Daley always released his draft budget in August, Emanuel has released nothing – not even the standard update on expenses and revenues for the second quarter of the year.

On Wednesday, a delegation representing dozens of community and labor groups delivered an open letter to Emanuel calling on him to “release a proposed budget immediately and schedule public town hall meetings to ensure that our communities are involved in all steps of [the budgeting] process.”

“The Mayor’s shift away from community participation is not only a dramatic break with precedent, but also directly contradicts his campaign promise to create ‘the most open, accountable and transparent government that the city of Chicago has ever seen,'” said Elizabeth Parisian of Stand Up Chicago, one of the groups signing the letter.

“I didn’t think anybody could be more closed-door than Daley, but lo and behold, Rahm’s done it,” said Jerry Morrison of SEIU Local 1.  He believes Chicago is now “the only large city in America that has no public process for its budget.”

“Rahm is good on transparency in terms of putting things on the internet,” commented Dick Simpson, a former independent alderman now at UIC.  “He’s not so good on community participation and democracy.”

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Mayor Harold Washington initiated town hall budget meetings with the 1984 city budget.  “It was very, very important to him,” recalls Alton Miller, Washington’s press secretary and author of “Harold Washington: The Mayor, The Man,” who’s now at Columbia College.  “He filled his administration with people who had spent many years working on issues from the outside, banging on the doors of City Hall, and he said, let’s do it right.

“It was important to him that when budgets were being decided, it wasn’t just an inside deal with a few people at the table but was genuinely informed by what people in the neighborhoods said they needed,” Miller said.  “And the best way to get that was with open town hall meetings where anybody could ask a question or raise an objection or take issue with any of the proposals.”

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Protest to target River Point, LaSalle Central TIF

The news that the LaSalle Central TIF district took in no new revenue last year adds urgency to the demand of community groups that the TIF be shut down, said Eric Tellez of the Grassroots Collaborative.

On Tuesday, community activists will protest the newest LaSalle Central TIF subsidy, $30 million going to finance a plaza inside the planned River Point office development at Lake and Canal.

Starting at 11 a.m. (Tuesday, August 7), they’ll march from Merchandise Mart to the LaSalle Street district for a press conference and rally, and they’ll leaflet at a business owned by one of River Point’s developers.

They say “giving property tax dollars to wealthy developers to build in prosperous areas is not an effective strategy” for economic development – especially when basic services are being cut in the city’s neighborhoods.

In July, the annual TIF report from County Clerk David Orr revealed that annual TIF revenue in Cook County has declined 18 percent since the housing crash in 2007, and that LaSalle Central was among nine TIF districts with no revenue last year.

If that trend were to continue, the city could be forced to transfer funds from other TIF districts to pay for existing commitments downtown.  LaSalle Central TIF agreements involve multimillion-dollar subsidies to corporations including Miller-Coors, Ziegler Co., Accretive Health Inc., NAVTEQ, and United Airlines, which is collecting a $24 million handout.

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Not NATO’s kind of town

Mayor Emanuel is congratulating himself for a successful NATO summit – successful mainly because no disasters occurred, though the only real threats seem to have been those manufactured by police.

No doubt the black bloc is also congratulating itself that day-after front pages carried pictures of scuffles with police, rather than veterans returning their medals with members of Afghans For Peace looking on, certainly the most moving and meaningful drama of the weekend.

What would a real accounting of the summit’s costs and benefits look like?

“Obama projects desired image,” the Sun-Times titles one story, but the summit itself had some signal failures.  Two major goals – getting commitments from member states to fund the next phase of the war in Afghanistan, and reopening supply routes through Pakistan – did not pan out.

The protests cast a long shadow over Obama’s attempt to play the summit as a withdrawal from Afghanistan for the domestic audience (while lining up support from other countries for continuing operations).

Unfortunately for Emanuel’s legacy, the “Chicago Accord” that he was boasting last week would be signed at the summit – an agreement on how to proceed on Afghanistan – wasn’t to be, Rick Rozoff of Stop NATO points out.

Even the summit’s biggest actual accomplishment – the announcement that NATO’s missile defense system is going online – comes with no noticeable benefit and at great cost: major tensions with Russia, whose cooperation is needed for the alternative supply route to Afghanistan, Rozoff says.

He points out that the announcement included new plans for satellite technology, which he calls a fulfillment of Ronald Reagan’s Star Wars dreams, and a dangerous and costly step toward the militarization of space.

Largest anti-NATO protest ever

Meanwhile, NATO was subject to a great deal of negative attention – and Chicago hosted the largest anti-NATO demonstration in the entire history of the alliance, Rozoff said.

(Four city blocks – a half mile – of marchers filling four lanes of State Street probably amounts to two or three times the police/media estimate of 3,000 protestors.)

And there’s renewed attention to the obscene amounts the U.S. and NATO nations spend on armaments.  This at a time when suffering from a lingering economic crisis continues to grow, when cities and states are mired in crisis and slashing public services – and while Obama’s defense secretary is opposing relatively minor spending cuts agreed to in last year’s budget deal.

The media tends to see the protestors as bearing a confusing mish-mash of causes.  But listen to them and you see that they are all connected on a fundamental level. At the Grant Park rally on Sunday, speaker after speaker tied issue after issue to the question of war and militarization.

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What about the neighborhoods?

The Grassroots Collaborative is offering visiting journalists bus tours of working-class neighborhoods struggling with violence, foreclosures, and clinic closings — and they’re questioning the millions of dollars being spent on entertainment at the NATO summit.

Buses leave from the Hyatt Regency at 8:15 a.m. on Thursday and Friday, May 17 and 18, and return by 11 a.m.  Information is at thegrassrootscollaborative.org.

Thursday’s tour will cover Little Village, one of the city’s largest Latino neighborhoods, where community groups are working to address youth violence; and Back of the Yards, where one of six mental health centers recently closed by the city is located.

(The two clinics primarily serving Latino communities were closed, as were four of six South Side clinics, and half the bilingual staff was laid off, all to save $3 million.  Having been repeatedly rebuffed in attempts to hold meetings with city officials – including a City Council hearing blocked by the mayor– the Mental Health Movement is planning to march on Mayor Emanuel’s home on Saturday morning.)

Friday morning’s tour will cover Englewood, a poor African-American community hard hit by foreclosures and violence, and Brighton Park, where low-income Latino residents are developing community schools.

Grassroots Collaborative, a citywide coalition of labor and community organizations, is questioning the priorities of spending millions of dollars to host the NATO summit while the city shuts down clinics and schools, said Eric Tellez.

On another level, he said, NATO spends billions of U.S. taxpayer dollars while poverty and unemployment “devastates communities across the country” and “the global poor fall deeper into poverty.”

Party fund

Last month the coalition called on World Business Chicago, which is raising money to host NATO, to donate comparable sums to establish a Neighborhood Jobs Trust.  In recent statements, the group is focusing on the $14 million being spent on parties for the summit.

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Questions remain on infrastructure trust

Illinois PIRG is calling on aldermen not to approve Mayor Emanuel’s infrastructure investment trust without more public safeguards, and the Grassroots Collaborative is urging a “no” vote on the proposal.

Leaders of community groups and union members in Grassroots Collaborative will hold a press conference Monday, April 16 at 9:30 a.m. on the 2nd floor of City Hall to call on aldermen to vote against the ordinance establishing the trust.

The council’s finance committee holds at hearing on the ordinance at 10 a.m. Monday.

Emanuel’s new tweaks to the ordinance go just partway to addressing the groups’ concerns.  “He’s dealing with the easy stuff,” said Celeste Meiffren of Illinois PIRG.

PIRG has called for far more stringent conflict-of-interest protections than Emanuel has offered: “Members of the board of directors should be free from conflicts of interest and instead should represent Chicagoans as primary stakeholders,” Meiffren writes in a blog post.

She calls for requiring board members to divest from any holdings in companies doing business with the city and in banks investing in the trust, and to agree not to work for them for a period after serving on the board.

As it stands the board looks to be comprised of CEOs and CFOs who will be “controlling taxpayer assets” and “accountable to nobody,” Meiffren said.

She doesn’t think putting an alderman on the board “solves the problem.”  She’d like to see watchdog groups represented on a board structured so that business leaders had a purely advisory role.

More bad backroom deals

Beyond that are larger concerns about the purpose of the trust.  “The ordinance is so vague that worst-case scenarios are really possible,” said Meiffren.

PIRG says the trust should be specifically committed to getting the best deal for the city and taxpayers rather than investors; and each deal should be subject to an independent evaluation to make sure that happens.

“There’s nothing in the ordinance that would prevent another bad backroom deal from happening,” Meiffren said.  “We have a history of bad deals, so we need to go above and beyond to ensure that taxpayers aren’t ripped off again.”

She cites the one project Emanuel has specified for the trust: a $225 million effort to retrofit city buildings for energy efficiency.  “Why can’t we do that with municipal bonds, which will get us a much better interest rate?” she asks.

“Instead of just going to private investors every time, we need a mechanism for determining what the best deal is – that evaluates every deal against other options,” she said.  “Nothing here does that.”

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G8 summit funds for jobs?

World Business Chicago, recently tasked with raising $65 million to host the G8 summit, is off the hook for that – and 50 community leaders with Grassroots Collaborative will call on WBC leaders to realign their fundraising prowess to raise $100 million for local employment geared toward neighborhood safety, Tuesday, March 6, 10 a.m., at WBC’s offices, 177 N. State.

Coalition questions G8 costs, calls for community investment

Costs for the G8/NATO summit in May could be much higher than current projections from the city, according to a labor-community coalition which is calling for a Chicago G8/NATO Community Fund.

“We think that $65 million is very, very, very low, and based on the experience of other host cities, the actual cost is going to be much higher,” said Elizabeth Parisian, a researcher with Stand Up Chicago.

She said the 2010 G8 summit in Huntsville, Ontario, ended up costing over $1 billion, the bulk of which went to security costs. Costs of housing, transportation and entertainment totaled about $180 million, she said.

Like the upcoming summit, the 2010 G8 was a joint summit (that year it was with the G20), and as expected for the upcoming summit, there were big protests.

Stand Up Chicago is working on developing a more detailed independent cost estimate, Parisian said, but getting information is difficult.

“There’s been no transparency from the city,” she said, adding that “we need to know how much it’s going cost and who’s contributing.”

Last week the Chicago Reader reported that a $55 million federal grant described by officials last year as funding planning for summit security training is actually a routine grant that supports the city’s Office of Emergency Management and Communications. Security cost estimates will not be released before the summit, OECM told the Reader.

Funding for community needs

In a letter to Mayor Emanuel last week, community, labor, and civil rights groups asked him to call on corporations contributing to the summit host committee to provide matching donations to a community fund “which can be used to keep libraries and mental health clinics open, as well as to provide direct investment in Chicago’s many struggling neighborhoods.”

Six mental health clinics are slated for closing in April for a cost savings of $2 million. Library hours were recently cut in order to save $1 million.

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