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Chicago City Workers Pension Broke

Mayor Daley Chicago.jpg Daley creates commission to confront choked pensions BILLIONS UNDERFUNDED | Benefit cuts, 401(k) plans may be options January 13, 2008 BY FRAN SPIELMAN City Hall Reporter/fspielman@suntimes.com Mayor Daley on Friday created a commission drawn from labor, business and banking to confront a problem that threatens to choke future generations of Chicago taxpayers: underfunded city pension funds. The comprehensive solution Daley is seeking within 18 months could include everything from benefit reductions and increased employee contributions to a shift away from "defined benefit" pension plans and toward the "defined contributions" or 401-K plans favored by private industry. The city could raise the age for new employees to become eligible for full pension, as the CTA has done. If union leaders agree to make sacrifices, half the net proceeds from the proposed privatizing of Midway Airport could be pumped into the pension funds, under legislation approved by the Illinois General Assembly. The only thing certain is that something's got to give. The city's four pension funds alone have $10 billion in unfunded liabilities to employees and retirees. If they run out of money, Chicago taxpayers get stuck with the tab. "They need to reduce the benefits. They need increased contributions by employees and... benefits more in line with what's offered in the private sector," said Civic Federation President Laurence Msall. The 32-member commission that will confront the pension fund crisis at the city, Park District, CTA, CHA, City Colleges and Chicago Public Schools will be co-chaired by Daley's Chief Financial Officer Paul Volpe and by Volpe's predecessor, Dana Levenson, who now serves as head of North American Infrastructure for the Royal Bank of Scotland. "There are no easy answers," Levenson said. Volpe stressed that the pension crisis is "not an immediate problem," nor does he view the commission as "a forum by which we reduce employee benefits." But, he said, "The longer we wait, the harder this problem will be to solve." At the end of 2006, the firefighters pension fund had assets on hand to meet just 40 percent of its liabilities. The ratio was 49 percent for police, 67 percent for municipal employees and 92 percent for laborers. Fraternal Order of Police President Mark Donahue questioned why the city's two largest unions -- police and fire -- were not represented on the 32-member commission. Donahue said his members are "realistic" and willing to consider increased contributions. But the FOP president said he would insist on maintaining defined benefits. And he rejected the widely held belief that pensions for city employees who get sharply reduced Social Security benefits are overly generous. "Public service employees deserve better because of the sacrifice and commitment they make to the communities they serve. That's the trade-off. There are more opportunities in the private industry for advancement and greater wage earning," he said. Last year, pension obligations cost the city $475 million -- more than 15 percent of Chicago's corporate budget. The Chicago crisis mirrors the pension dilemma facing government agencies and private companies across the nation. Levenson sounded the alarm about the pension crisis in June 2006, but his call for a dialogue with city unions went nowhere. At the time, Chicago Federation of Labor President Dennis Gannon reminded top mayoral aides of what happened in 1997, when the city robbed Peter to pay Paul -- and made the pension problem worse. With union consent, City Hall reduced its contribution to the well-funded Laborers and Municipal Employees pension funds and funneled $20 million of that money into the underfunded police and firefighters pension funds. The landmark deal also paved the way for a $20 million property tax cut and $200 million worth of neighborhood improvements. "I read 'em the riot act. I said, 'You came to us 10 years ago and we gave you relief.' We saved them hundreds of millions of dollars. They took money out of two good funds and gave it to police and fire. Now, they're saying those two good funds are in the same mess. And I reminded them that early retirement [which made the problem worse] was their idea," Gannon said then. Great, Mayor Daley and his family will find a way to steal more pension money, said Patrick McDonough. Photo edited by Patrick McDonough.

Comments

Kiss your pension goodbye. I warned you years ago.

Maybe that $500,000 in diverted (skimmed) tax dollars that went into the TIF slush fund could have helped make these pension funds solvent.

But that would have meant sacrifices from the thieves we call our elected public servants.

HAVE NO DOUBT, VOTE INCUMBENTS OUT

where are the reports from robert vanecko on where that 63 million in pension funds he borrowed is going. i will tell you where. he is in trouble on that high rise he is building and that is to help float him. he better have checks showing where all that money went. i bet he gave a nice chunk of that to daleys son, thats the only reason daley let him loot the pension funds. if daley is not indicted soon then we need to have patrick fitzgerald investigated for conspiracy to cover up massive fraud. a two year old can see whats going on. i love you mr. fitzgerald, but you finally have me wondering if all is being handled properly. put me in charge of things and you will see evidence and indictments in 6 months. as a private citizen i have helped the fbi uncover millions in fraud with my own investigative work. i'm watching and i don't like where this is not going. the feds also need to look at the payoff from oscar d'angelo to mayor daleys son. that payoff was from his million dollar ohare check that oscar recieved for helping maggie daleys friends open a book shop. that was 8 f^#@ing years ago. the feds need to wake up. when reporters asked daley last month if his son had any other secret contracts with the city, he replied "i don't know". that means he has 20 other secret contracts. where are the feds? im fed up!

Can we say 'obstruction of justice'?

More importantly, can Fitzgerald?

Uh, Tom, it's painfully obvious that the 'feds' ain't gonna move on Daley and his clan until they see who the Dems will be running for President.

If it's Obama, THEN they'll drop the hammer on Daley.

The 'feds', ie., the Republicans, need Daley to push Obama over the top, so they can have a better shot at keeping their own, national version of corruption in the White House.

Fitzgerald's a lap dog, nothing more and nothing less.

A Republican lap dog, no different than Dick Devine has been Daley's lap dog.

All protecting their own status quo.

With many public, and not so public, faces intimately involved in every kind of crooked deal imaginable.

American Politics has never been so dirty.

Pat,I am going to ask this Question again.Do you live in Desplanes Il.At 1964 Everett to be exact?If so then how can an idiot like you work for the CWMS?I know there is a residency requirment.Arent you therefore then becomming part of the citys ongoing Corruption that you are trying to stop?Please answer and dont delete.If you are honest and post honestly I wont turn you in.I have plate#s type of cars,adresses,shall I go on.Time of day 6Am and you return around 4pm.And also tell me how an unemployed plumber can afford a 1/4 million dollar house in Wind Lake Wisconsin?

to all the kings men; something had better hit soon. i am openly letting the feds know that if they can't do the job then bring me in. and don't laugh. i have personally worked under cover on my own to bring some big federal indictments. the feds can contact me. but you can bet your butt they wont contact me. fitzgerald has all the ammunition he needs to wrap this up. it could be that daley is such a cunning sneak who knows all the judges (ie sorich appeal)that fitzgerald needs a ton of ammo to bring him down. there is no reason they can't indict daley unless they are incompetent, and you know damn well that they are not. you know that bush would pardon daley, this could be another factor for the feds to wait. if a democrat gets in the white house, you know that if daley is indicted and convicted he will be pardoned. this whole thing stinks. you know that patrick daley is up to his eyeballs in poop. don't ever think for a minute that the feds do not have the goods to indict, they do. so what the f#@%ing hell is going on? i am frustrated big time!

The Republicans want Obama as the Democratic candidate.

They truly believe that they'll have their best shot at retaining control over the nation if Obama is their only obstacle.

If Obama makes it, before the General Election, watch for the Republicans to, (discretely, mind you), do the following:

1 - Move on the indictments of as many Democrats as possible, focusing on Chicago and Crook County.

2 - Use their well developed skills at propagandas to foist the following on the American Public and against Obama:

a - Oh my God, he's BLAAAAAAACK!!!!

b - He ain't no REAL Christian, he's a f****** Muslim RADICAL!!!!

c - He's Daley's n*****.

d - We can't let these young folks run OUR country, they don't know nuthin' about the REAL world.

e - If he's like John Kennedy, we 'conservatives' didn't like what he did either. That's why we had him whacked. Ask your great grandfather, he'll tell you.

f - When you ain't got nothing truthfully bad to say about Obama, make something up.

f - Remember Willie Horton. Before It's Too Late.

And whatever else they can dream up, exaggerate, distort, twist and fabricate.

3 - Prepare to pull another 'Florida' wherever and whenever they can.

4 - Use every legal trick in the book to impede a free and fair General Election.


It's politics as usual.

If you can imagine the total amounts of tax payer dollars that Daley, Stroger, Madigan, Jones, et al., have skimmed, scammed and milked from the taxpayers, take a guess at how many zeros you'd have to add to that figure, to understand the amounts on the federal level.

There is no joy in Muddville........

(Response) Make your point without showing your lack of education.

good points mighty casey, oh smart one casey, please give your views on why sorich is not in prison yet. is sorich not in prison because daley is delaying everything until daley dies in 5 years from his heart attack like his father. and why patrick daley was hustled off to the army. is he untouchable by the feds there? or will the army try him for stealing millions of dollars and not paying his taxes on it. remember when oscar d' angelo made a million dollars commission by helping maggie daley's friends open a gift shop at ohare, and how the press hounded daley till he had a coronary. and i bet that patrick got half of that million bucks. lets hear it oh mighty guru...awaiting your expertise.

oh casy, and why has daley been so scared and grumpy looking this past 8 months, does he see his or his sons indictment coming. please guru, the daley haters await your response......

The only individuals who are truly 'untouchable' are those who have died.

Though, even the dead leave behind those living who they had loved.

Politics is one of those 'games' that can only be won by not playing.

In theory, Politics is not the same as Democracy, nor is it the same as governing.

In theory.

In practice, there will always be those, in the minority, who will strive to be 'king of the hill', regardless of the environments in which they exist.

In practice, Democracy interferes with the desires of those who seek to dominate and control their environments, democracy being the concept of the majority, with consideration of the minority, determining, by some degree of consensus, what is in the best, or better, interest of the whole.

The 'devil', being always in the details, is the operative factor in 'Murphy's Law' of human activities, ie., 'Anything that can go Wrong, Will go Wrong', with 'wrong' being defined by the individual situation, circumstance, activity and motivations of those human beings concerned.

Until, and unless, the majority recognizes the immense effects that the small minority's efforts to be, and remain, the 'kings of the hills' have on their living environments, economic, legal, social and physical, those in the majority will rarely make the efforts necessary to regain some semblance of control over the minority's compulsive need to dominate.

As for specific, individual members of the 'king of the hill' club, it's like our founding fathers figured it; keep them all so busy fighting, and seeking to f*** each other, and they will rarely unify enough to thoroughly harm the majority.

In addition, the majority possesses the potential, in their greater numbers, to regularly thwart the efforts of the minority of 'kings' to unify, by systematically, and deliberately, ensuring that no one group has the political power to dominate for any great length of time.

That's what elections are for, to prevent those whose goals are to rule from maintainng the authorities to do so.

(Response) Neat concept, but is it real?

daley is truly smart. but i believe he got sloppy 10 years ago. his controlling of the judges is helping his tactics of delay which is very apparent in the sorich appeal. it took 10 years to bring down george ryan. it may take that to bring down daley. which means he has another 4 years to go. but i firmly believe that his son patrick, who has always been a renegade, got very sloppy with stealing money and not paying his taxes.patrick daley will go down fast. and daley is about to fire his inspector general because mr. hoffman is about to bring down patrick.thats why patrick daley was hustled off to the army.(forget all this bull#*&t about his fighting for his country, he's fighting for his own survival) the 63 million dollars that robert vanecko stole from the pension funds was for 3 things. 1. to give some of it to patrick daley 2. to help vanecko bail out his high rise that he is building on roosevelt and michigan (it's deeply in trouble)3. that pension money is the payoff to vanecko to keep his mouth shut and cover up for his and patricks crimes. mayor daleys childhood friend mike tadin got another 57 million dollar city contract 6 months ago even though he swore off anymore city work. tadins contract was also hush money to keep him quiet as the feds move in on daley. just like marco morales's kid who recieved 40 million in contracts from the city after his father fled to mexico. daley has a sure fire way of giving tens of millions of dollars of taxpayers money to those he wants to silence. there is something hugely afoot going on. i worked under cover and busted up a brazillian mafia ring that was into social security identity fraud, realestate fraud, insurance fraud, and high scale theft that netted 15 indictments. no, i do not have first hand knowledge of exactly what daley has done. but it's clear he's a crook. and it's also clear that these huge amounts of money he has given to tadin and vanecko, are to buy thier silence. and you can bet that the 63 million dollars of pension fund money will never , never ever be returned. want proof? go to the pension board and ask for current statements from vanecko on where the money has so far been invested. you will never get one report from the pension board because vanecko will never supply anything. vanecko, from what i heard in one news report had borrowed over a million dollars of that pension fund money to a third party, a friend of his to help him out. he also declined to give specifics why he loaned out some of the pension fund money. daley knbows that it will be after the next re-election of his, before it becomes clear that vanecko stole the pension money and will never return it. that means , as far as daley is concerned,the 63 million dollar vanecko pension fraud will never hurt daley. trust me on this. the feds can indict daley, and his kid. either they are waiting to bring a lock tight case, or they just are not going to do it. because they have what they need. the feds know damn well whats going on! and all the little people like us can do is sit and wait to see what happens.

(Response) Well done.... The largest problem is the inability of the "little guy" coming forward to make government more honest. Retaliation is a swift sword in the Daley Administration. Mayor Daley's Law Department is part and parcel of the scheme. The Chicago Mafia and Crime Families under Daley have flourished, sad but true. Patrick McDonough

Tax cut for Tadin mansion

January 31, 2008
Michael Tadin, onetime king of the Hired Trucks, got a $28,430 break on his property taxes last year when the Cook County Board of Review cut the assessed value on his Gold Coast mansion. Days later, Joseph Berrios, chairman of the county agency, got $1,000 in campaign contributions from Tadin's trucking companies.

All three board members signed off on Tadin's tax break. Says Berrios: "My staff agreed with the other two people. I feel good about this one.''

Cook County Assessor James Houlihan -- who's backing Berrios' challenger, Jay Paul Deratany, in Tuesday's election -- had assessed Tadin's home at $479,885. Tadin appealed to the Board of Review, which cut the figure to $281,953. That meant Tadin paid $38,430.27 in property taxes vs. the $67,150 he would have had to pay.

This was the second time the board cut Tadin's assessment.

Tim Novak

1-br condo 4 sale w/1 catch
For sale: one-bedroom condo in a "great south Loop location" with a "partial city view," hardwood floors, kitchen with maple cabinets and granite counters.

One catch: The government has a lien on it because the condo is one of 11 homes put up as security to allow Tony Rezko to go free on bail for months while awaiting his corruption trial.

To see the $230,000 home owned by Rezko friend Roger Malki, you'll have to call listing agent Jozaphene Aramanda. She's married to former Rezko business associate Joseph Aramanda, whom federal prosecutors call "Individual D."

Prosecutors say Joseph Aramanda gave $10,000 -- derived from a kickback scheme Rezko allegedly orchestrated -- to Sen. Barack Obama's campaign when Obama ran for the Senate in 2004. Obama gave the money to charity last year. Aramanda hasn't been charged with any crime.

Dave McKinney

Whistleblower found fake 'siblings'
Magnet Schools | Principal spotted application rigging, officials say -- parent group fears it's 'tip of the iceberg,' pushes for audits

February 3, 2008
BY ROSALIND ROSSI Education Reporter
A plot to rig applications for prized seats at a Chicago magnet school was detected by a rookie principal with “guts,” school authorities say.

Though suspicions have long swirled around how magnet schools select students, officials say the discovery marks the first indication of magnet application tampering in the 27-year history of the program.

Barton Dassinger was a new principal at Sabin Magnet School when he noticed -- and reported -- application fraud, officials say.

A new report by school Inspector General James Sullivan says his office found “rigging’’ at Sabin Magnet, at 2216 W. Hirsch, in the West Town neighborhood.

Twelve applicants for this school year falsely claimed to have a brother or sister at Sabin, a relationship that gave them a clear edge over other applicants, Sullivan said. Five of them cited the same Sabin student — a school clerk’s niece — as their sibling.

'I did nothing wrong'
The clerk even added her niece’s name to one application, saying “this would help the child get into the school,’’ Sullivan said one parent told investigators.

The clerk denies any wrongdoing, and Chicago Public Schools officials called the case “an aberration.’’ They said no changes have been made in its wake.

Others contend the irregularities prove magnet applications should be audited.

“It’s likely this is the tip of the iceberg, based on all the rumor, whispers, winks and nods that have gone on around this program since day one,’’ said Julie Woestehoff of Parents United for Responsible Education, a parent advocacy group.

Sabin Principal Barton Dassinger blew the whistle last February, in time to place children claiming phony siblings in the correct admissions lottery.

But for almost a year, Dassinger said, he was told by CPS lawyers not to comment on his findings.

During that time, a mentor of Dassinger’s said, the rookie principal endured “public whippings’’ at local school council meetings by parents who rushed to defend the clerk, a 17-year Sabin employee and daughter of a CPS principal.

Finally cleared to speak last month, Dassinger told the Chicago Sun-Times he felt morally bound to report the irregularities.

“I believe in giving everybody an equal shot,’’ said Dassinger, 31, the son of an Alabama teacher. “Even though I knew it might cause problems and controversy, I did what I thought was ethically proper.’’

The clerk, identified in local school council minutes as Sandra Alverio, resigned Oct. 1, a day before her dismissal hearing, CPS officials said. CPS has flagged her as a “do not hire.’’

“I did nothing wrong,’’ Alverio told the Sun-Times. “I didn’t advise anybody of anything.’’

A diabetic, Alverio said she finally decided to resign because “my sugar levels were off the map’’ and she was “depressed.’’

‘I don’t have a sibling’
Magnets such as Sabin, which admit kids using computerized race-based lotteries, are among dozens of schools created after 1980 to attract citywide enrollment and promote diversity. Hundreds of children often apply for what can be as few as 26 seats per school.

At lottery magnets, having a sibling already at the school can put a virtual lock on an entry-level seat.

That’s because up to 45 percent of open slots can go to siblings — so many spots that CPS officials say only Hawthorne Scholastic had to hold a “sibling lottery” for entry-level seats this school year because sibling demand in that grade outstripped its sibling allotment.

Neighborhood kids can claim another 30 percent of magnet-schools slots. The remainder enter a citywide lottery.

About six months into his first stint as principal, Dassinger said, he was trying to understand the arcane application process when he noticed some applicants had different last names than the siblings they were claiming.

Curious, he questioned kids.

“Five, six, seven kids I spoke to said either, ‘I don’t have a sibling,’ or, ‘I know that person, but it’s not my sibling,’ or ‘I don’t know who that person is,’ ” Dassinger said.

Dassinger alerted CPS, and the inspector general was called in. Sullivan said two parents clearly implicated Alverio, but the false-sibling claims extended far beyond them. He said his investigators found:

†Five applicants spread among four parents falsely listed Alverio’s niece as a “sibling.’’ This included one child who was in the same grade as Alverio’s niece, a kindergartner.

†A fifth parent said that, at Alverio’s suggestion, she listed her own three children’s cousin, who did attend Sabin, as the trio’s sibling.

“I don’t know what lies they are bringing up,’’ Averio countered.

“When you’re a clerk and everybody knows your name and who your family is, who knows who tried to get away [with something] by putting my niece down?’’

Other parents also tried to pass off cousins as siblings but didn’t name Alverio in any way, Sullivan said.

One said she thought sibling meant “relative,’’ even though applications request the name of a “brother or sister currently enrolled at this school,’’ Sullivan said.

The parent of three other applicants said the children’s cousin told them they’d have a better shot if they claimed another cousin, then a Sabin student, as a sibling, Sullivan said.

‘Related’ by graduation
During the investigation, Alverio’s supporters staunchly defended her at local school council meetings, saying Alverio was part of the “fabric of Sabin’’ and that Dassinger should have handled the matter “in his private quarters,’’ not by tipping off CPS, local school council minutes show.

“We have an entire school supporting Sandra. We are insulted, flabbergasted. We want this to stop,’’ one parent identified in the minutes as “Ms. Cao-Romero” told LSC members last February.

“If this continues, the issue will get much bigger,’’ Cao-Romero warned. “There are a lot of people out there questioning the credibility of the school. You [Dassinger] came into our community. We embrace you. You need to embrace us. . . .”

“We stick together,’’ the parent said at another point. “If you are not related, then by the time you graduate, you are related.’’

“You came here after six months and disrupted the family,’’ said another woman at the next meeting. “. . . It’s bad that you don’t have a conscience.’’

Not being able to respond took a deep toll, Dassinger said, causing stress and sleepless nights, and hindering his ability to build trust with his staff during his critical first year.

Dassinger’s former boss at Chavez Elementary, now-retired Principal Sandy Traback, called Dassinger a person of “high moral fiber’’ who “suffered terribly’’ by his required silence.

He took “horrible beatings . . . almost like public whippings’’ at LSC meetings, and “residual effects’’ lingered for months, Traback said.

Chicago Public Schools CEO Arne Duncan saluted Dassinger, saying, “He nipped this problem in the bud.’’

“Particularly for a new principal,’’ Duncan said, “I think he displayed great judgment. It took courage. It took guts.’’

‘This is Chicago’
Dassinger said CPS officials were eager to keep the selection process taint-free. However, several current or former principals described potential weak points.

Principals said they’d catch a false-sibling claim because they know their students. But otherwise, schools usually accept application information without question, particularly when it’s mailed in, they said.

“There’s no way you could verify all the applications,’’ said Amy Narea, recently retired principal of LaSalle Magnet. “Principals are swamped. They are constantly short-staffed.’’

At enrollment, winners bring in acceptance letters that do not say what lottery they sought. Usually, principals say, schools ask enrollees for a birth certificate and proof of city residence, such as utility bills, but they do not backcheck to see what address, race or sibling — all ways to get an application edge — were claimed on applications.

“We would not double check [sibling status] once they come in through the sibling bank,’’ said Disney Magnet Principal Kathleen Hagstrom. “I suppose they could cheat and have a leg up.’’

“What they put on an application, I don’t question,’’ said Murray Magnet Principal Michael Keno. “Once they show up, all they are told to do is bring in a birth certificate and proof of residency.’’

Plus, magnet application forms for admission in 2006, 2007 and 2008 did not ask parents to affirm that their information is accurate. But parents must vouch for accuracy when applying to CPS schools with admissions tests, such as schools for gifted students.

And although race can give kids a leg up, schools do not verify it. Said CPS attorney Sherri Thornton-Pierce: “We’re not going to challenge people. . . . We don’t police things by checking and saying on the first day of school, ‘You don’t look like what you put down on your application.’ ”

Some say the application process is vulnerable to clout because before lotteries begin, principals can handpick 5 percent of slots.

“This is Chicago,’’ Woestehoff said. “There are probably 100 different ways to insinuate your way into a magnet school.’’

Woestehoff called for written assurances from anyone handling an application, and annual magnet audits to check for accuracy.

CPS spokesman Michael Vaughn could not recall such an audit ever being done. He said principals are responsible for verifying all application information — before lotteries begin.

Magnet seats are so prized, Vaughn said, that if there were lots of problems, Sullivan would be swamped with calls. Instead, Sullivan said, he rarely receives magnet selection complaints, although he does get city residency beefs.

“This is the only time this has ever happened,’’ Vaughn said. “Our principals and our staff do a great job of verifying information and making sure the lottery process is handled the appropriate way. . . .

“We don’t consider this a widespread problem. It’s an isolated incident and an aberration.’’

Magnet concerns? E-mail rrossi@suntimes.com.


i think mayor Daley is too powerful to take down. we, the citizens of Chicago let this happen by trusting the other crooks, such as judges, prosecutors, and city hall employees to do the right thing, when in actuality to do so would cut there own conniving, cheating, and lazy asses away from the public trough.