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Gov. Quinn says UNO must ‘straighten things out’

Sun-Times front page when state Illinois cut off funding for UNO's charter schools.

Sun-Times front page when the state of Illinois cut off funding for UNO's charter schools.

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Updated: May 29, 2013 7:53AM

Gov. Pat Quinn on Friday said his United Neighborhood Organization allies build impressive charter schools but must “straighten things out” before he would allow the Hispanic group to get any more state taxpayers dollars for new schools.

On Thursday, Quinn administration officials told the group’s CEO, Juan Rangel, they were suspending funding “until further notice” because of alleged violations of conflict-of-interest rules in the state’s $98 million grant agreement with UNO.

The state agency that oversees grants — as well as the state’s executive inspector general — had opened investigations after the Chicago Sun-Times reported in February that UNO funneled millions of grant dollars to two companies owned by brothers of a top executive.

“I have to be the goalie sometimes,” the governor said of UNO at an unrelated event in Lincoln Park. “Over the years, the organization had a good reputation, did a lot of good things. But if there’s something wrong now, we gotta get to the bottom of it.”

Quinn signed the legislation allocating the funds to UNO in 2009, and last summer the governor attended the groundbreaking for a charter high school being built on the Southwest Side with grant dollars.

UNO has received about $54.7 million in grant funds so far, according to the state’s website, and is relying on much of the rest of the $98 million for the $25 million high school at 5050 S. Homan.

“They can’t do anything more as far as government money until they answer the questions and straighten things out,” Quinn said in response to questions about the high school project’s fate. “If they don’t do that, then they won’t get any money.”

Work on the high school continued Friday. Asked if the funding suspension would prevent the school from opening on schedule in the fall, UNO chief operating officer Phil Mullins replied, “Obviously, there’s a concern. It could create a problem with construction at some point.”

House Speaker Michael Madigan (D-Chicago) sponsored the UNO grant. At a political fund-raiser last year hosted by Rangel and UNO Springfield lobbyist Victor Reyes, Madigan and his Illinois Democratic Party received more than $24,000 from contractors on the state-funded school projects — including a total of $7,500 from the two companies owned by brothers of Miguel d’Escoto, UNO’s senior vice president at the time.

Madigan spokesman Steve Brown said he did not know the speaker’s thoughts on the grant suspension. But Brown praised UNO for hiring a former federal judge, Wayne Andersen, to review its contracting practices. Andersen’s probe, which began in February, has not been completed.

“They’ve already retained Judge Andersen, who has an impeccable reputation,” Brown said. “I don’t know if you can do much better than that.”

But Andersen’s work “will not include whether an actual conflict of interest existed,” according to the state’s letter to Rangel. Mullins said UNO plans to hire an independent auditor for that.

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