A Scandal 150 Times Worse than Rod Blagojevich’s

Unsuspecting Taxpayers Greased the Chicago Political Machine

Rod Blagojevich became national news and fodder for comedians when he was arrested for attempting to sell Barack Obama’s U. S. Senate seat for $1 million. Blagojevich’s scandal concerning one political office and $1 million in campaign contributions is nothing compared to the amount of money and political offices that involve corrupt Chicago Board of Elections (CBOE) Commissioner and Chairman Langdon D. Neal.

Since the Circuit Court appointed Neal CBOE Chairman 15 years ago, Commissioner Neal has conducted and certified hundreds of local, county, state, and federal elections for the City of Chicago. Neal officiated numerous elections in which he had financial interests in the outcomes. On April 2, 2012, Chicago voters filed a 17-page petition in the Circuit Court of Cook County to remove Election Commissioner Neal.

Langdon Neal has cashed in his election board chairman position for an estimated personal net income of $30 to $40 million. This ranks him near the top of Chicago’s political “Hall of Shame.” Neal is the majority owner of the Neal and Leroy law firm. Between 2004 and 2011, Neal’s firm grossed over $100 million in exclusive no-bid City contracts. Neal’s acceptance of no-bid City contracts from the same politicians whose elections Commissioner Neal conducted and certified is a clear-cut conflict of interest.

When CBOE Chairman Neal supervised Chicago Municipal elections in 1999, 2003, and 2007, Neal had financial interests stemming from his City contracts granted by victorious office-holders Mayor Richard M. Daley and Daley’s compliant aldermen. After Neal conducted and certified the Daley machine’s elections, Daley extended Neal’s no-bid City of Chicago contracts into Daley’s next term of office.

When CBOE Chairman Neal conducted and certified the 2011 Chicago municipal elections, Neal’s financial interests from his City contracts in the Daley regime were continued under Rahm Emanuel. After Neal conducted and certified Emanuel’s election as mayor, Emanuel extended Neal’s law firm’s stream of no-bid city contracts into his first term. It’s obvious that Emanuel was the Daley political machine’s choice to succeed Daley since Emanuel retained most of Daley’s top henchmen and selected Daley’s cousin Theresa E. Mintle for his Chief of Staff.

Between 2004 and 2012 Neal also billed his clients for $11.2 million to lobby the bureaucracies of Daley and Emanuel on administrative and legislative matters. Neal’s $11.2 million in lobbying compensation does not include millions of dollars in profits that Neal received from his firm’s other lobbyists. Neal and his law firm’s attorneys’ lobbying City officials represents conflicts of interest.

CBOE Chairman Neal made election board decisions advantageous to the mayor and aldermen at the same time that Neal’s lobbying business income created financial interests for him in the outcomes of the elections Neal was officiating. When Neal conducted and certified Chicago municipal elections, his clients were also paying his law firm to lobby the mayor and aldermen during and after their elections.

Election Commissioner Neal was in a position of authority to help or hinder the candidacies of the Chicago public officials that he was lobbying. It appears that Election Commissioner Neal gave the aldermen and mayors Daley and Emanuel what they wanted at election time because the aldermen and mayors were willing to give Neal’s firm City contracts and what Neal and his attorneys sought as lobbyists.

A candidate’s decision to run for public office is a constitutional right, not a privilege like possessing a driver’s license. Thanks mainly to Election Commissioner Neal, it is significantly harder for candidates to exercise their constitutional rights to access the ballot in Chicago than it is for people to obtain the privilege of a driver’s license. Though constitutional rights are more sacred than privileges, only about 50% of Chicago candidates who submit nominating petitions actually appear on the ballot. Can you imagine the public uproar if 50% of driving license candidates failed to receive their licenses?

Election Board Chairman Neal is the highest Chicago election authority in a position to  approve or deny a candidate’s ballot access. If Chicago FBI agents and the U.S. Attorney asked candidates who believe they were unjustly denied Chicago ballot access to come forward, the line of scorned candidates would extend from the FBI and U.S. Attorney’s offices into the hall and around the block of the Dirksen federal building.

Other People’s (aka Taxpayers’) Money Foots the Bill for Election Workers

The fact that taxpayers foot the bill for Neal’s no-bid contracts should not come as a surprise since the Daley administration perpetrated a similar scandal. When Richard M. Daley was State’s Attorney and candidate for mayor, he promised city jobs to his campaign workers if he won his first mayoral election. After Daley took office in 1989, his administration rigged scores of job interviews and pre-employment tests in order to hire applicants whose jobs were contingent upon them continuing to campaign for Daley and Daley’s favored candidates.

Daley’s political army of campaign workers were City employees paid with taxpayers’ funds. Daley’s workers circulated petitions, rang doorbells, phoned voters, passed out campaign literature, and manned polling places on election day. Daley’s job- and election-rigging scheme continued surreptitiously for 16 years until the FBI put a stop to it in 2004. Daley and his hand-picked candidates did not pay for their campaign staff. Unsuspecting taxpayers shelled out untold millions of dollars to fund the Daley machine’s illegal election victories.

The term for Daley relying on other people to pay for his campaign workers is called “Other People’s Money,” or OPM. The Daley machine’s political monopoly was the result of taxpayers supplying Daley with the OPM. However, Daley’s administration violated the Shakman Court Decree and federal laws when it set up the OPM system for taxpayers to underwrite the Daley machine’s campaigns (search Donald Tomczak, Al Sanchez, and Robert Sorich).

Using the taxpayers to foot the bill for Election Commissioner Neal’s $100 million in no-bid contracts is one way Daley drew on Other People’s Money to gain unfair advantages at the polls. In addition to Neal’s no-bid City contracts, the Daley administration sanctioned Neal earning millions in compensation for lobbying his administration and aldermen even though Neal had obvious conflicts of interest. By allowing Neal to earn big, easy lobbying money, Daley used an OPM scheme that provided him with virtually unlimited political power.

Neal’s role in the Daley machine was more important than that of any of Daley’s campaign managers, staff, or field organizers. As election board chairman, Neal was the Daley machine’s gatekeeper. It was impossible for Daley or Daley’s political puppets to lose an election If Neal prohibited the names of candidates who didn’t belong to their political machine from appearing on the ballot.

Neal’s prevention of ballot access to non-machine candidates also allowed Daley to save his patronage army for hotly contested political races, including my own. Neal thinned the herd of anti-machine candidates, which enabled Daley to concentrate his political muscle against the candidates whom Election Commissioner Neal couldn’t stop from running for public office.

Daley kept stringing Neal along with endless no-bid City contracts and allowed Neal to earn a fortune each year as a lobbyist because Daley, not Neal, was really running the Chicago Board of Elections. Depending upon whether you are for or against the Daley political machine, the Daley-Neal political marriage was either a marriage made in heaven or hell. Like all marriages, each side gave up something and got something in return. Daley put many millions of dollars into Neal’s pockets, and in return Neal provided Daley with invincible political power that candidates and voters could not possibly diminish.

OPM cemented the Daley-Neal alliance for 20 years, and now that Emanuel is mayor, OPM has forged a new relationship between Emanuel and Neal.

Neal Earned $30 to $40 Million While Serving as Election Commissioner

Between 2004 and 2011 Langdon Neal’s law firm averaged over $14 million a year in no-bid City contracts. In addition to Neal’s no-bid contracts, Neal personally averaged $1.6 million a year in lobbying compensation from 2004 to 2011. Neal also earned huge profits from his cut of the earnings of his law firm’s lawyers, who were also paid lobbyists. Because many government records don’t exist any more, the grand total of Neal’s no-bid City contracts and lobbying compensation over his 15-year election commissioner tenure is unknown.

Based on what is known about Neal’s combined City contract and lobbying income of $112 million for seven years, it is reasonable to assume that Neal’s law firm’s City related gross income was between $150 million and $200 million during Neal’s 1997 to 2011 election commissioner tenure. Neal’s overhead costs primarily consist of his office, office supplies, legal staff salaries, and salaries of the attorneys Neal has working for him. If Neal personally took home a 20% profit on his firm’s $150 to $200 million gross income, his estimated personal income related to his City of Chicago businesses while serving as a Chicago election commissioner would be between $30 million and $40 million. It sure pays well to be a Chicago election commissioner, does it not?

Besides Neal’s hefty City contracts and lobbying income, taxpayers also pay Neal to serve as their election commissioner. Neal’s current election commissioner salary paid by Cook County is $91,223 plus payment for his dental, health, life, Medicare, and vision insurance. To add insult to injury, when Neal retires, he will collect a $70,000 a year government pension and health care benefits for the rest of his life.

Besides manufacturing votes and winning elections, the Chicago political machine is a money machine for people like Neal.

Election Commissioner Neal is a High Ranking Member of the Chicago Political Machine

The leaders of the Chicago political machine selected Langdon Neal CBOE Chairman because Neal is a third-generation Chicago politician and political machine stalwart. The  machine’s old guard trusts Neal to rule in favor of the machine’s candidates whenever it is plausible. Langdon Neal’s duties as an election commissioner and machine gatekeeper make him one of the most influential members of the Chicago political machine.

In the machine’s political hierarchy, Neal ranks higher than most elected politicians whose elections he officiated. There are 17 Cook County commissioners, 50 Chicago aldermen, and 118 Illinois state legislators. But there is only one CBOE chairman who rules with an iron fist over every Chicago election and every political race. Election Commissioner Neal guarding the rights of Chicago voters is the political equivalent of the fox guarding the hen house.

There are privileges that come with Neal’s influential status with the Chicago political machine. Neal can call any of his fellow machine politicians, including bureaucrats and elected and appointed officials, to ask for a favor and expect to get it. Once Neal requests his political favors from another political machine leader, the underlings of the person Neal called are usually the ones told to give Neal what he wants. Members of the political machine are scattered in jobs throughout the city, county, and state. The Chicago political machine’s vast network of loyal patronage workers explains why Neal’s $101 million in no-bid contracts come from 14 different government agencies and departments between 2004 and 2011 (Table 1).

 

Agency or Department

Amount Paid to Neal ‘s Law Firm

Chicago Board of Education

$9,192,531.11

Chicago City Colleges

$321,409.52

Chicago Department of Aviation

$16,309,923.18

Chicago Department of Transportation

$110,844.14

Chicago Housing Authority

$3,495.52

Chicago Park District

$580.00

Chicago Public Building Commission

$21,730,614.26

Chicago Transit Authority

$3,788,743.81

Chicago Department of Finance

$20,581,397.76

Department of Housing and Economic Development

$2,930,837.08

Chicago Department of Law

$20,393,987.26

Illinois International Port District

$834,450.80

Illinois Medical District

$852,922.41

Metropolitan Pier and Exposition Authority

$4,465,712.30

Total No-Bid Contracts Paid to Neal’s Law Firm

$101,517,449.15

 Table 1 

A True Oxymoron: The Chicago Board of Ethics

The regulation of City contractor and lobbyist Langdon Neal is primarily the responsibility of the Chicago Board of Ethics. The Ethics Board claims its mission is to “enhance public confidence” through education, interpretation, investigation, and regulation of Chicago’s ethics ordinances. However, the Chicago Board of Ethics key employees belong to the same Chicago political machine as Election Commissioner Neal.

During Neal’s Chicago Board of Elections reign, Mayor Daley appointed or hired all of the Board of Ethics management and board members who had the duty of regulating Neal’s City contracts and lobbying. The Daley Ethics Department went along with Neal’s City contracts and lobbying because of the benefits Daley was receiving from Neal, the election board chairman. Since May 16, 2011, it has been Mayor Rahm Emanuel’s turn to use the Chicago Board of Ethics for his political gain by awarding City contracts to Neal’s firm and letting Neal lobby his administration.

For Election Commissioner Neal to be a City vendor and lobbyist, Neal needs help from inside the Chicago Board of Ethics. Department of Ethics employees and board members either sanction Neal’s City contracts and lobbying with ridiculous rulings or they pretend that Neal’s ethical misconduct isn’t happening.

Chicago Board of Ethics board members and employees served at the mercy of Mayor Daley. If they had attempted to expose or stop Neal’s City contracts and lobbying, Boss Daley would have fired them immediately. For more information about the Chicago Board of Ethics involvement in Langdon Neal’s City contracts and lobbying, read the “Chicago Board of Ethics 1994 Advisory Opinion” and “More Chicago Board of Ethics Malfeasance” in the petition to remove Langdon Neal.

Since the Chicago Board of Ethics ruled that Chicago election commissioners are not City of Chicago employees, Election Commissioner Neal is exempted from filing a Statement of Financial Interests with the City. Neal files his Statement of Economic Interests with the County Clerk as he is required to do. During the last 10 years, Neal did not list any of his City contracts or lobbying compensation on his Cook County Statement of Economic Interests.

The authors who created the Cook County Statement of Economic Interests form deliberately allowed a public official such as Neal to withhold City contract and City lobbying compensation from the general public. It’s highly unethical for an election commissioner to file a Statement of Economic Interests form without disclosing his or her government contracts and government lobbying.

Let’s hope the scrutiny of Neal leads to a full disclosure requirement for public officials on Cook County Statement of Economic Interests and City of Chicago Statement of Financial Interests forms.

One More Thing: Neal’s Law Firm is a Minority Business

The Department of Procurement lists Langdon Neal’s law firm as a minority business enterprise (MBE). This allows the City of Chicago to give Neal’s law firm special City contract consideration. It defies common sense. Neal personally receives a $91,000 election commissioner salary and health benefits each year from Cook County for part-time work. Neal’s Cook County salary and benefits package is high enough to disqualify him from receiving special consideration for City of Chicago contracts. Awarding contracts worth millions of dollars to Neal’s “minority-owned” law firm is an example of how politically connected rich people like Neal abuse the political system to get richer.

Even if Neal’s law firm deserved minority contractor status, the City should have cut the firm’s MBE designation after it reaped enough profits from City contracts. Whether it be $5 million, $10 million, or $20 million, at some point, Neal’s firm took home enough cash from City contracts to have the MBE designation rescinded.

Neal’s $100 million in City contracts would have helped many other MBE businesses if they were divided among multiple firms. The City could have taken Neal’s $100 million in City contracts and divided them into twenty $5 million minority, women, or disabled business contracts. $5 million income spread over seven years is a significant amount of money for small law firms. Neal will most likely claim that his law firm had special knowledge and skills that were necessary to handle City business. However, nearly all of Neal’s legal work involved real estate law that any competent attorney who holds a Illinois law license is capable of doing.

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