Morton Grove Melodrama Part 13 – We’re off to see the Wizard!

Village president DiMaria, during his last campaign fashioned himself as “the face of the village”.

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Considering that his name and picture are plastered all over the quasi-political campaign literature laughingly referred to as the village newsletter, and his smiling visage appears in almost every local “news” story featured in “the Champion”, you can see that Mr. DiMaria takes his self-styled title very, very seriously.

There has been much talk in the national media lately about the narcissism and ego of a certain politician. Fair enough, but many of the same opinions and comments can be made regarding the Morton Grove Village President.

There’s little question that politicians wield vastly more power and control than the average citizen.

Moreover, privy to non-public, industry-related knowledge affords them all sorts of opportunities (blatantly unethical under Morton Grove ordinances) to substantially augment their income through “insider” trading and investments. For many of them the appetite for material riches can be insatiable.

Large bills fanned out and held in hand
Large bills fanned out and held in hand

Which helps explain why at times the liberty that some of them can’t resist taking with the public trust is so flagrant that (moralistically kicking and screaming) they actually end their careers behind bars. (Does the name “Rod Blagojovich ring a bell?)

One of the primary characteristics of narcissists is their exaggerated sense of entitlement.

It’s hardly surprising then that so many politicians (like our current village president) somehow think they “deserve” to game the system. After all, from their self-interested perspective, isn’t that what the system is for?

In their heavily self-biased opinion, if they want something, by rights it should be theirs. So, nothing if not opportunistic, they take from public and private coffers alike whatever they think they can get away with. (Consider the increase in stipend and “technology allowance” that the current administration granted itself without the benefit of public notice, public input or a public vote).

And given their grandiose sense of self, they’re inclined to believe they can get away with most anything. Sad to say, in today’s politics their judgment isn’t that skewed. Which is to say they’re much more often right than wrong.

Exploiting their privileged position in such a manner hardly leaves them plagued with guilt.

In general, guilt isn’t an emotion they’re prone to. How could they be if they feel entitled to the objects of their desire? In their minds their very ability to attain something must certainly mean it was merited. So it’s only when they’re caught with their hands deep in the till and their various efforts at denial have failed them, that they’re ready to admit responsibility, and posture remorse. But even then, whatever alligator tears they might shed are calculated to lessen the penalties for their misbehavior—or the time that otherwise they might be required to spend in lockup.

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Ironically, despite the steadfast ethical values they profess, these politicians can be viewed as “moral relativists” in that what they adamantly deem immoral for others is yet somehow acceptable for themselves.
In our village, this raises it’s ugly head in playing “bait and switch” with TIF money earmarked for one project but funneled into a sweetheart deal behind the scenes, or changing a zoning/planning ordinance to pressure a landowner to take actions contrary to his/her own best interests, or something as simple as taking credit for increased businesses in town when there are still an overwhelming number of vacant retail properties on Dempster street, (Who are you gonna believe, Village President DiMaria or your own lying eyes?)

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Whether we characterize the personal “allowances” they make as constituting a double standard or outright hypocrisy, these privileged concessions to self clearly broadcast their overblown sense of entitlement. Which is precisely what enables them to regard themselves as sufficiently exceptional to exclude themselves from the rules and standards they impose on others.

What is hard for us to understand is why the village trustees have forfeited any credit, let alone much of a mention, for any of the “so-called” achievements of the DiMaria administration. Little acknowledgment of trustee Grear, who is, after all, the senior and longest serving trustee. Little acknowledgment of trustee Witko, who, while secure in her seat is defending the position of village president DiMaria while he stands mute and doesn’t defend himself.

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Strange… strange indeed.

The saying “Promises are made to be broken” rings particularly true for them. It’s become almost a joke that the devout pledges they made on the campaign trail bear only trifling resemblance to what they’ve done once in office.

The ability to convince voters that they’ll best represent their interests is what defines their success. Actually implementing what they avowed they’d tirelessly work for isn’t really an essential part of their agenda—which is typically well-hidden from constituents. In short, their campaigns measure how well they can dupe the public, not how well they’ll fulfill their responsibilities once declared victorious.

Perhaps the question Morton Grovers need to ask themselves is; “Are the village and myself better off now than we were 4 years ago”?

The Action Party, and village president DiMaria don’t want you asking that question, but, like in the scene from “The Wizard of Oz”, thunder; “Pay no attention to that man behind the curtain”. DiMaria behind the curtain

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Morton Grove Melodrama Part 12- Two plus two equals “dog”

There has been quite a bit of “buzz” lately about the Morton Grove/Niles/Evanston water “deal”. At the forefront of “news” coverage has been the claim by Morton Grove village president DiMaria that this agreement will “save” the residents of Morton Grove some Ninety Million dollars over the next 40 years. Of course, that doesn’t take into account that Evanston has already telegraphed a 12% or so increase between 2018 and 2010.

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A Morton Grove Champion article states; “Morton Grove officials said at Monday’s meeting that they expect to save $90 million to $100 million over the life of the 40-year contract, which locks in the suburb’s water rates over that time period. The contract includes the option for two, 10-year extensions.”

Later on in the same article it says; “The two villages are expected to pay about $90 million for a new water transmission main in Evanston at McCormick Boulevard and Emerson Street and other infrastructure needed to deliver water from that city, according to officials from all three towns. That construction is expected to be financed with bond sales.”

Something here sounds like common core new math. Taking a conservative view, assuming that the “savings” projected are accurate, that would amount to a saving of $2,250,000 per year on the water rates, (about $265 per year per household).

However, in order to take advantage of these projected savings, the village will have to pay $90,000,000 to build a new water transmission main and other infrastructure needed to get the water from Evanston to Morton Grove… and that expense is expected to be financed by bond sales.

We need to remember that Morton Grove’s bond rating was recently lowered a second time under this administration which means that borrowing money by issuing bonds will cost taxpayers more money.

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In another Morton Grove Champion article on the lowering of the bond rate, it mentioned that the village’s Equalized Assessed Valuation, (EAV) had dropped 22.4% over a five year period. Simply stated, the EAV is a multiplier used to determine what we pay in real estate property tax. A lower EAV means that each individual property owner must shoulder more of the tax burden.

Currently the village’s bond rating is Aa3, and, even if the administration can get a rate of 2.1% that would amount to an interest cost if $1,800,000 on $90,000,000 of municipal bonds, (and that doesn’t count the cost of underwriting the bonds which include such things as “Gross spread”, which is a complicated combination of what is called “take down” [the difference between what the underwriter pays out to the village and what they get for the bonds on the open market];”management fee; underwriter’s expenses and “Other fees”, [which may include such things as Financial/Municipal advisory fees,  Bond counsel fees; Disclosure counsel fees, Rating agency fees, bond insurance/credit enhancement fees, trustee fees, escrow agent fees, feasibility study costs, auditor’s fees and printing costs]. Figuring out what it costs to issue bonds is, at best, complicated.) Spreads are usually quoted in terms of dollars or points per thousand bonds. For example, a gross spread of $5.00/$1,000 bond on a $90 million issuance would be $450,000: [($90 million /$1,000) *$5.00]. If you are feeling “nerdy” you might check out this article that somewhat explains the process.

If the current administration had kept it’s promise of transparency and had held public meetings telling us the upfront costs of the deal, at least taxpayers could have had some input on  spending close to ONE HUNDRED MILLION TAX DOLLARS. Maybe village president DiMaria, trustee Grear and all the other Action Party trustees figured that it would be easier to ask forgiveness rather than permission.

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So, let’s recap the math on this deal;

  1. The “savings” estimated by village president DiMaria on the water deal: $90,000,000 over 40 years, ($2,250,000 per year).
  2. The up-front cost of the “build out” for water main piping and other infrastructure: $90,000,000.
  3. The cost of issuing the municipal bonds, (not counting “miscellaneous” “OTHER FEES”): $450,000 [approximately].
  4. The cost of interest on the bonds, (assuming a 2.1% rate, recently Aa bonds have been returning between 3.3% and 3.7%):  $1,800,000.

Wait a minute! What happened to that $90,000,000 savings that village president DiMaria spoke about?

“Savings” over 40 years:                         $90,000,000
build-out cost:                                         -$90,000,000
“gross spread” to underwriter:             -$450,000
interest, (based on 2.1% yield)              -$1,800,000

Net cost to Morton Grove taxpayers:    -$2,250,000, (or about $265 per household)

Doesn’t seem like much of a deal to us… sounds more like a fast shuffle.

money down the toilet

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Morton Grove Melodrama Part 11 – Somethings Shaking in Morton Grove

Over the past week there have been a couple of things that should make Morton Grover’s shake their heads in wonderment.

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Last week, a mailing was sent out to Morton Grove businesses in a hand-addressed envelope that showed the return address of Village President DiMaria. Inside the envelope was a message that began; “Mayor Daniel P. DiMaria cordially invites you to the 2017 Business and Leaders Forum to discuss the Progress, Opportunities and Challenges for Morton Grove businesses…” Later on it states; “Meet the Candidates for the 2017 election…”. It is only after reading the back of the invitation and the enclosed card that it becomes apparent that this is a fund-raising ploy aimed at squeezing money out of the businessmen and businesswomen of our village under the guise of a Business and Leader’s Forum. Accidental “bait & switch”? Not likely.

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Also last week the “Winter edition” of the Morton Grove village newsletter was delivered to the homes in town. Interestingly, the content of the village newsletter mirrors the content on the first page of the Action Party web site, (including the use of the outline of the tree which is part of the village logo and the use of the village motto which first appeared on the village stickers). Use of village communications for private political activity is prohibited by not only village ordinance, but also by Illinois ethics statutes, ( ELECTION CODETITLE 15. REGULATING POLITICAL FUNDS AND CAMPAIGNSCHAPTER 255. REGULATING POLITICAL ADVERTISING AND CAMPAIGN COMMUNICATIONS ).

What DiMaria and the Action Party seems to have done bears a resemblance to what passed for politics as usual in Chicago in the 1950s. Richard J. Daley, who was mayor at the time, used to offer a succinct piece of ethics advice to newly elected aldermen. “Don’t take a nickel,” Daley told them. “Just show them your business card.”

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Even the greenest of political newcomers understood exactly what Daley meant. He was telling them that people with an interest in city council decisions would be happy to throw an alderman a little cash on the side to help bring about a favorable outcome. They just had to find an acceptable way to do it.

A law office was a good place. Petitioners who needed a favorable council vote could be depended on to pay generously for a little legal work. An insurance agency was even better.

It was all considered quite legal, at least in the ethical climate that existed in Chicago at the time. There was no quid pro quo, or any need to discuss out loud what the petitioners might want the city council to deliver for them. That part was understood. If a landlord or a building contractor or a labor union wanted to flatter a public official by doing business with him, they had every right to do so.

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The Hobbs Act, passed by Congress in 1946, says that perfectly voluntary transactions can qualify as extortion as long as one of the parties is acting “under color of official right.”

So now, apparently, Village President DiMaria and the Action Party are not satisfied with shaking down village businesses “under color of official right”, but they are blatantly making use of 0000000mad-as-hellmaterials that have been paid for by the taxpayers of Morton Grove no matter if they support the Action Party or not.

Bathhouse John Coghlin and Hinky-Dink Kenna, (two old-time Chicago machine politicians) would be proud… maybe the residents of our village, not so much.

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Morton Grove Melodrama Part 10 – Mo money!

pay-to-play

 

 

 

 

 

 

In last weeks story we were going through how village president DiMaria self-styled himself as the face of the village and plastered his name on everything but a check to help pay for his political ambitions. Mr. DiMaria seems to have a bad case of alligator arms when it comes to picking up the check.

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Last week’s story also recounted how Mr. DiMaria, Mr. Grear and the rest of the the Action Party took political contributions from those doing business with the village in violation of the ethics ordinance that they had all voted to accept and had pledged to honor.

We could easily see what the Action Party was getting out of the deal, but it could be rightfully questioned why the various businesses would ante up. Based on what we know, most likely they look at these political contributions as an investment with a great return.

Let us take, for example, the contributions from Heartland, (the parent of 8700 Waukegan LLC).

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For a relatively small sum in contributions to the Action Party coffers, this developer will receive Six hundred thirty six thousand dollars in TIF money, (money that was originally earmarked to revitalize the Prairie View shopping center),                          00000000prairieview003

 

to underwrite the project which adds high-end rental apartments to an already saturated market. Looks like a smart investment on the developer’s part where their profit on the deal is apparently front-loaded with TIF money. According to Action Party president and village trustee, Billy Grear, in an article in the Pioneer Press on March 19, 2015; “It’s going to bring a new type of person into the village…”. We’re not quite sure what that means unless Mr. Grear is referring to folks gullible enough to think that this type of white-collar patronage is a good idea. It’s also interesting to consider who would want to spend  $1,500 per month and up rent to live on one of the most heavily used major roads in the near north suburbs.

Let’s now take a look at the Dempster street property that is designated to be the new Moretti’s restaurant. This deal started out when the Action Party elected officials purchased the plot that used to house Maxwell’s and The Studio, two fairly popular Morton Grove eateries.

There were grandiose plans for a multi-use structure, but the original buyer was foreclosed on by the bank.

Through assistance by the village, the property was resold to Ted Mavrakis, a political contributor to mayor DiMaria for the purpose of building a Tilted Kilt restaurant.

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Those plans fell through, and the village repurchased the parcel giving the mayor’s buddy a quick $500,000 profit while he retained ownership of approximately 30% of the site.

Subsequently, the Village (Action Party) Board makes a deal for the Village taxpayers to finance a Moretti’s Italian Restaurant and Gambling Café with a fifteen year, zero interest mortgage, (Moretti’s is a political donor to the Action Party).

 
Moretti’s will pay off the fifteen year mortgage by simply being in business for fifteen years. After fifteen years in business, without paying a dime of principle or interest, Moretti’s gets the property for free!
There was, however, a problem that raised it’s ugly head. This land too, was found to be contaminated and required EPA clean up.
When Moretti’s found out that the property was contaminated and would cost hundreds of thousands of dollars to clean up,they renegotiated the whole deal. The Action Party Board of Trustees & Mayor upped the taxpayer’s gift to Moretti’s to pay for the contamination problem to be cleaned up  for the benefit of their political donor.
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Morton Grovers are now stuck with an additional $300, 000 or more for clean up and with the other sweeteners, the total may cost the taxpayers several hundred thousand dollars more.

In a Morton Grove Champion article dated February 4th, 2017 it says; “…village officials agreed to sell the property for $1.525 million and loan Ala Carte Entertainment $636,000 to cover eligible tax-increment-financing expenses, Village Administrator Ralph Czerwinski said in a report to the board.If the Moretti’s location stays open for 20 years, Morton Grove officials also will forgive the loan to cover TIF-eligible business development expenses, Czerwinski said. The mortgage the village agreed to with Moretti’s also would be forgiven if the business stays open for 15 years, he said.”

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So, lets do some simple math. $500,000 profit to Action Party contributor Ted Mavrokis when the village repurchased to property; a minimum of $300,000 to remediate the environmental problems at the property; a mortgage of $1.525 million on the property which will be forgiven if the restaurant remains open for 15 years and a loan of $636,000 which will be forgiven if the restaurant stays open for 20 years… that comes out to a total of $2,961,000 dollars returned on their political contribution investment with the Action Party.

Village president DiMaria has always bragged about his experience in “high finance”, whether it was when he traded on the Chicago Merchantile Exchange in the past or now in his current career as a mortgage broker. He certainly has provided an astronomical return on investment for those who made political contributions to him and his Action Party… for Morton Grove taxpayers…  not-so-much.

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