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Rahm Emanuel to propose ordinance forcing contractors to report corruption

Mayor Rahm Emanuel

Mayor Rahm Emanuel

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Updated: December 14, 2013 6:40AM



Chicago contractors would be required to report corruption or other wrongdoing by their employees — or risk losing their city business — under a crackdown to be introduced Wednesday by Mayor Rahm Emanuel at the behest of Inspector General Joe Ferguson.

Two months after reappointing Ferguson to another four-year term, Emanuel will deliver on an apparent promise to his corruption-fighting inspector general that may well have been a key to their political detente.

At Wednesday’s City Council meeting, the mayor plans to introduce an ordinance that would build into all future city contracts a mandatory reporting requirement that now applies only to city employees.

At the risk of default punishable by contract termination, companies doing business with the city would be required to report “all information that he or she knows or reasonably should know to involve corrupt or unlawful activity” by the firm’s own employees or by “another individual involved in city business.”

According to the mayor’s office, Chicago is one of the nation’s first major cities to build in such a strict reporting requirement and compel city contractors to “act as partners” in fighting corruption.

“This is a key reform and I am thankful to the inspector general for this recommendation,” Emanuel said in a news release. “This initiative will reduce the opportunity for fraud and ensure that contractors are meeting the same obligations to protect the residents of Chicago that are required of city workers.”

Ferguson, who complimented the mayor while testifying at City Council budget hearings, could not be reached for comment.

The decision to deliver on one of Ferguson’s pivotal demands comes just over two months after Emanuel buried the hatchet with the fiercely independent inspector general after two years of tension between the two.

The detente produced an agreement that resulted in Ferguson being reappointed for another four-year term — with the unwritten understanding that he’s likely to step down after next summer — after the former adversaries fulfill their mutual desire to get out from under the Shakman decree and the costly constraints of a federal hiring monitor.

The decision to extend Ferguson’s tenure even for a day marked an abrupt about-face for Emanuel, who inherited Ferguson from former Mayor Richard M. Daley and had been at odds with the former federal prosecutor ever since.

The tension stemmed from Emanuel’s efforts to block Ferguson’s pursuit of unbridled subpoena power — all the way to the Illinois Supreme Court — and Ferguson’s attempts to audit city programs to verify the mayor’s bold claims on savings and to hold Emanuel to honor campaign promises to expand the inspector general’s investigative powers to the City Council, the Public Building Commission and the Chicago Park District.

Ferguson and federal hiring monitor Noelle Brennan also had hounded the mayor to punish high-ranking city employees who testified under grants of immunity at federal trials that culminated in the conviction of Daley’s former patronage chief, Streets and Sanitation commissioner and two others on charges of rigging city hiring and promotions to benefit the now-defunct Hispanic Democratic Organization and other pro-Daley armies of political workers.

Until the political cease-fire, Emanuel appeared to be laying the groundwork for Ferguson’s exit. He told Ferguson he must re-apply for the job he has held since 2009 and justified that by arguing that the formal selection process was mandated by his Ethics Reform Task Force.

Two members of that task force and Ferguson’s predecessor, David Hoffman, disagreed. They said the ordinance clearly empowered Emanuel to re-appoint Ferguson.

Still, Emanuel showed no signs of bending until the stunning indictment of former City Comptroller Amer Ahmad in an alleged $500,000 kickback and money-laundering scheme in Ohio. That forced the mayor to use the inspector general he despised as political cover.

The mayor flatly denied that he should have known about Ahmad’s alleged wrongdoing as deputy treasurer of Ohio and promised an exhaustive investigation — with Ferguson and Corporation Counsel Stephen Patton overseeing the work of two outside attorneys — to make certain Chicago taxpayers and pension funds were not similarly victimized.

Patton and Ferguson were adversaries in the marathon court battle that tied Ferguson’s hands and insulated Emanuel and his top aides from investigation.

The Ahmad investigation — and Emanuel’s desire to end Shakman and avoid the political backlash that would come from dumping Ferguson — combined to buy the inspector general at least another year. Now, the two men appear to be working as a team.

Email: fspielman@suntimes.com

Twitter: @fspielman



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