Ald. Edward Burke cashed in on projects he boasted of landing for his ward

on Apr26
by | Comments Off on Ald. Edward Burke cashed in on projects he boasted of landing for his ward |

2019-04-26 06:30:07

Embattled Ald. Edward M. Burke, who won re-election in February despite facing federal corruption charges, boasted during his campaign about how he brought home the bacon — literally — to his Southwest Side ward.

Even as Burke stood accused of leveraging his clout as Chicago’s most powerful alderman to shake down a businessman for legal business, his campaign played up his effectiveness at landing big economic development projects for his 14th Ward.

Among them was a $25 million Amigos Foods warehouse and plant to process pork, beef and other meats on 10 acres of former railroad property at 51st Street and St. Louis Avenue. It topped the list of Burke-led development initiatives the alderman touted on his campaign website and also sent to the Chicago Sun-Times and Chicago Tribune editorial boards in seeking endorsements.

The Amigos project also paid off for Burke’s law firm, which handles property tax appeals, according to a Better Government Association investigation that found he benefited from this and other development projects.

The company hired his law firm, Klafter & Burke, months after the alderman, who was then the chairman of the Chicago City Council’s finance committee, shepherded zoning changes through the council for the project in the fall of 2017.

For years, 14th Ward businesses seeking approval for city zoning changes, tax breaks and other matters have hired his law firm for their property tax appeals.

Burke’s firm has financial ties to nearly every development project he touted during his latest campaign, the BGA found. In addition to the Amigos development, the list includes a shopping center, medical facilities, a charter school, an apartment complex, a distribution center for home-delivered retail goods and even the relocation of the Chicago Park District’s headquarters from a Streeterville high-rise to his ward.

Ald. Edward M. Burke's appearances at groundbreakings and a ribbon-cutting in the 14th Ward in 2018. Clockwise from top left: Esperanza Brighton Park health center at 4700 S. California Ave.; Amigos Foods facility at 51st Street and St. Louis Avenue; DaVita Dialysis Center at 4737 S. California Ave.; Last Mile Logistics Center at 3507 W. 51st St.

Ald. Edward M. Burke’s appearances at groundbreakings and a ribbon-cutting in the 14th Ward in 2018. Clockwise from top left: Esperanza Brighton Park health center at 4700 S. California Ave.; Amigos Foods facility at 51st Street and St. Louis Avenue; DaVita Dialysis Center at 4737 S. California Ave.; Last Mile Logistics Center at 3507 W. 51st St. | Burke campaign websites

These revelations come amid an ongoing federal investigation of Burke, who federal prosecutors accused in January of trying two years earlier to shake down the owner of a Burger King franchise in his ward. According to the criminal complaint they filed against Burke, he was caught on secretly recorded wiretaps pushing to play “hardball” to get the fast-food franchise owner to hire Klafter & Burke in exchange for his greenlighting a proposed renovation.

The FBI was listening in on the alderman’s cellphone for at least eight months, during which at least 9,475 calls were made or received on the phone. Citing the complexity of the corruption case they continue to investigate, prosecutors on Thursday asked for a 35-day extension of what had been a May 3 deadline for a grand jury to determine whether Burke will face additional charges as part of a federal indictment.

Though authorities haven’t said what the grand jury is looking at, key milestones in several of the economic development projects highlighted by his re-election campaign came during the period when federal agents were monitoring Burke’s calls.

Burke and the lawyers representing him in the criminal case didn’t respond to calls seeking comment or to questions emailed to them.

Previously, one of his lawyers, Charles Sklarsky, has called the accusations against Burke “false.”

RELATED

• Ald. Ed Burke tied to bribery case involving developer who needed city favors, April 14, 2019
• Trump insider Felix Sater wanted to develop South Loop site but couldn’t strike deal with Tony Rezko, April 7, 2019
• Feds’ wiretap shows Madigan, Solis eyed development of state land in Chinatown, March 1, 2019

In highlighting his accomplishments in response to newspaper candidate questionnaires ahead of February’s election, Burke, 75, said this about why he deserved re-election to a record 13th term: “Over the past two years, I have worked to increase the economic development opportunities for those that live and work in the 14th Ward.”

The Amigos project was one of two multimillion-dollar warehouse developments on old railroad property in Burke’s ward that the city council approved in the fall of 2017, when federal agents were recording the alderman’s calls.

Burke’s law firm has ties to the developers of both warehouses.

Amigos had spent $2 million to buy land from the Grand Trunk railroad and needed the city council to rezone the property to allow its development.

“His willingness to guide and support us shows he truly cares about the success of Amigos Foods and the betterment of the community,” Manny Rangel, Amigos’ chief financial officer, said in a testimonial posted on Burke’s campaign website.

Within months of the November 2017 rezoning vote, Burke’s law firm began representing Amigos, records show. Prior to the vote, Amigos had another lawyer handle tax matters for property it already owned in Burke’s ward. By 2018, that tax work was going to Klafter & Burke.

Weeks ago, the council approved a resolution paving the way for a tax break for the new Amigos plant. Burke voted in favor of it, according to council records, even though he had done legal work for the firm months before.

Rangel said his company had no comment.

Records show three of the projects Burke’s campaign highlighted involved the sale of properties in his ward that were owned by developer James Avgeris, a client of Klafter & Burke since at least 2008. Avgeris was paid nearly $7.7 million for the three sites after Burke, as the local alderman, approved rezoning and provided official support that enhanced the properties’ value.

The Noble Network of Charter Schools bought one of those sites, 5.5 acres at 47th and Richmond streets, for $3.7 million in 2016, according to Noble spokesman Cody Rogers. It’s now home to Noble’s Mansueto High School, which opened in 2017.

Burke supported the school despite some neighborhood opposition.

In March 2016, with Burke recusing himself from the vote, the city council approved the rezoning Noble was seeking for the school. Three months later, Noble and Avgeris closed on the sale.

Rogers said the charter-school operator wouldn’t have bought the property if it had not been rezoned to allow a school there. Rogers said Burke was critical to the rezoning, which he said was the only matter for which Noble sought his support.

“We did not know that Alderman Burke was the tax lawyer for the property until reading about it in this email,.” Rogers wrote in response to questions. “We have not been contacted by the FBI, U.S. attorney’s office or any other law enforcement agency regarding Ald. Burke.”

Avgeris did not respond to questions about the Noble property sale or two others in Burke’s ward. Records show he continued to use Burke as his tax lawyer for another property elsewhere in the city.

Another Avgeris-linked deal touted by Burke’s campaign was the $17 million Esperanza Brighton Park health clinic at 47th Street and South California Avenue, where a ribbon cutting is scheduled next month. Avgeris was paid nearly $3.2 million in 2017 by the clinic’s parent for 3.7 acres, according to Esperanza CEO Daniel Fulwiler who said he had not been contacted by authorities about Burke.

That deal also closed soon after getting a zoning change from the city council on a vote that Burke recused himself from.

Fulwiler said he wasn’t aware Burke had done property tax work for the seller of the property.

Fulwiler said his medical group approached Burke about the zoning change and that “we met with the alderman or his staff on at least three occasions, either in his ward office or downtown.”

The list of accomplishments Burke campaigned on also included the opening of the DaVita Dialysis Center also on California Avenue near the Esperanza clinic. Developers of the project, Clark Street Real Estate, paid Avgeris $802,000 for a one-acre lot in May 2017, records show. That was after Burke wrote to state regulators on council stationery the previous October to urge they approve the center.

Burke’s firm continued as the tax attorney for the property after its sale, records show, though the owners switched to a different lawyer for tax work in 2018.

“Patient-need is the number one driver in identifying new center locations,” Abby Domenico, a spokesman for DaVita, wrote in response to questions. “We ensure all policies and procedures are adhered to in our work with local community and government officials in all our locations.”

Clark Street representatives declined to comment.

Burke’s re-election campaign included ads showing the transformation of a once-troubled slice of his ward into a shopping plaza.

“This vacant lot & hub for crime at 4200 S. Pulaski…became the $34 million Pulaski Promenade,’’ the ads said. “Alderman Burke led the fight to transform vacant property into an economic center.”

The project was built with $8 million in tax subsidies approved first in 2012 by Burke’s finance committee and then by the full council. He also wrote a letter supporting the subsidies.

Burke’s firm then began doing legal work for the property, records show. In 2014, when the council revised the funding deal for the plaza, Burke recused himself from the vote. In 2015, Burke’s firm filed the first in a series of tax appeals for the Pulaski site.

Neither the lead developer of the project, Chicago-based IBT Group, nor IRC Retail Centers, the majority owner and manager, responded to questions about Burke’s involvement.

At an event last September, Mayor Rahm Emanuel announced the park district would move its headquarters from the old Time-Life Building in Streeterville to a long-vacant, 17-acre industrial site in Brighton Park. Emanuel hailed Burke as “the driving force and a partner” in the deal, which got $8.5 million in city tax subsidies to buy the land from Lexington Homes, which had planned to build as many as 1,500 homes there until the housing market collapse of the Great Recession.

When Emanuel made the announcement, Burke called the project “a big, big effing deal” and credited Lexington for helping to make it happen.

Burke’s law firm had worked for Lexington since at least 2009, records show.

The tax-subsidy deal to buy the land from Lexington was approved by Burke’s finance committee and the full city council in December, with Burke recusing himself.

Lexington officials did not respond to questions.

Burke’s campaign website also featured a photo of him at the groundbreaking last year for a sprawling logistics center on the site of a former railroad freight yard across 51st Street from the Amigos Foods project.

In October 2017 Burke wrote a letter supporting a rezoning request for nearly 20 acres sought by the project’s developer, Conor Commercial Real Estate. And he voted with the rest of the council that November to approve the change. The next month, he wrote another letter backing a tax subsidy to underwrite the project and introduced a council resolution to make it happen, though the alderman recused himself from the vote, records show.

Why Burke refrained from one vote and not the other isn’t clear.

With the city tax help in hand, Conor closed on its $4 million purchase of the land.

At Chicago Park District announcement of new headquarters in the 14th Ward in September 2018, Mayor Rahm Emanuel shakes hands with Ald. Edward Burke as city Planning Commissioner David Reifman and parks Supt. Michael Kelly look on. | Burke campaign website

Dan McShane, Conor’s general counsel, said Burke’s firm did not represent it on property tax work for the warehouse project. Records show Klafter & Burke had done tax work in 2014 in the suburbs for a sister company of Conor.

“It predates any development work we ever did in the city and doesn’t even relate to real estate located in Chicago,” McShane wrote in response to questions.

State campaign records show Conor contributed $7,000 to political committees controlled by Burke since 2017 and bought more than $7,200 of food for a campaign fundraiser last year for Illinois Supreme Court Justice Anne Burke, the alderman’s wife.

“We weren’t given a hard sell on these fundraisers, nor were we ever asked (let alone pressured) to use Ald. Burke’s law firm,” McShane wrote.

He said his firm hasn’t been contacted by federal agents about its dealings with Burke.

Another 14th Ward project hailed by Burke’s campaign was the 2017 opening of the Park Place Apartments, a 78-unit affordable family rental complex at 50th Street and Lawndale Avenue.

City records show Burke recused himself from voting in 2013 on a rezoning request for the property from the prior owner, Park Place Venture. He also recused himself in March 2015 when the council approved a $6.6 million taxpayer-subsidized affordable housing loan to developer Brinshore Development to build the complex. That was before Brinshore closed on the $1.78 million purchase of the land.

“I am not sure why he recused himself,” said David Brint, chief executive officer of Brinshore. “We never hired his firm and we never paid his firm anything. Believe me when I say I was waiting for it but it never came.”

Burke’s law firm had represented the seller, Park Place Venture, and prior owners of the property dating to at least 2007, records show.

Burke helped an earlier ownership group secure up to $7.4 million in taxpayer subsidies for developing the site. That group included Ted Mazola, a former alderman whose ward covered downtown.

Though Brinshore didn’t keep Burke’s firm on when it bought Park Place, the seller of the property still uses Burke on tax matters involving other land in the 14th Ward.

Brint said Burke never solicited Brinshore but “I know our property manager was asked to use his firm but no pressure was applied and he was not hired.”

Asked whether he had been contacted as part of the federal investigation of Burke, Brint said: “You know that even if I were contacted I couldn’t answer.”

 

Chuck Neubauer and Sandy Bergo are reporters for the Better Government Association.

BGA



Previous postDCFS Releases Timeline of Interactions With Crystal Lake Family After Boy's Death Next postDCFS Missing Red Flags As Children Die In Agency Care, Advocates Say


Chicago Financial Times


Copyright © 2021 Chicago Financial Times

Updates via RSS
or Email