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Daley calls city audit on donations to charity ‘insult to my wife’

Former Mayor Richard Daley tours Millennium Park Monday  October 10 2011 Chicago. | Jean Lachat~Sun-Times

Former Mayor Richard Daley tours Millennium Park, Monday, October 10, 2011 in Chicago. | Jean Lachat~Sun-Times

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Updated: November 16, 2011 12:19PM

Former Mayor Richard M. Daley on Monday denounced as “disgraceful” and a “personal insult to my wife” an internal audit concluding that recipients of city subsidies were told to donate to Maggie Daley’s After School Matters program.

The former mayor insisted that no arms were ever twisted to produce donations to the charity that his wife founded to occupy and educate Chicago teenagers.

Daley defended his wife before leading a walking tour of his signature project — $475 million Millennium Park — as part of Chicago Ideas Week.

Maggie Daley has suffered from a series of recent setbacks in her 10-year battle against metastatic breast cancer.

“I wish more people would volunteer for the children of Chicago like my wife did. That was a personal insult to my wife. ... Disgraceful thing they did. But, you accept that in public life,” Daley said.

“My wife has been involved with After School Matters since 1989. No one — no one — talked to anyone” to force developers and companies receiving tax-increment-financing (TIF) subsidies to donate money to the charity, Daley said.

Inspector General Joe Ferguson, whose office produced the explosive audit, was not about to sit back and allow his integrity to be impugned by the former mayor who appointed him.

“The report is clear. Neither Mr. Daley’s wife nor After School Matters were at issue. Moreover, no allegations of any sort were made,” Ferguson said.

“Instead, the report lays bare the simple fact of a near total absence of transparency, accountability or ownership in the city’s process for leveraging TIF subsidies to benefit private not-for-profits.”

Last week, Ferguson charged that After School Matters received $915,000 in contributions over a ten-year period from companies that received tax-increment-financing subsidies from the city.

TIF recipients interviewed by Ferguson’s investigators reported that, in the vast majority of cases, the charities were “unilaterally chosen” by the city with no specific standards for making those decisions.

Emanuel responded to the audit by acknowledging that it was wrong for City Hall to dictate charities or compel charitable giving as a condition for receiving city help. He also ordered safeguards to prevent it from happening again.

But, as a former board member of After School Matters whose wife still serves in that capacity, Emanuel was clearly uncomfortable with the subject.

“What I don’t want to see happen is because of one report that we shut down after school activities that will affect everybody’s neighborhoods and their children. I want to keep encouraging corporations to step up in the public way they have done,” the mayor said last week.

After School Matters had an annual operating budget of $27.5 million in 2010. Since 2004, the organization has received more than $54.5 million in city funds through eight city grants for operating expenses and special programs.

The most recent grant — for nearly $6.5 million — was made just four days before Richard M. Daley left office. At least three city employees also work on behalf of After School Matters, primarily on the grant-seeking process.

During the course of his investigation, the inspector general interviewed representatives from ten developers, nine of whom agreed to make charitable contributions to After School Matters.

All but one reported that the city “unilaterally chose” the non-profit.

The one corporate executive who denied city involvement previously served as a deputy chief-of-staff under Richard M. Daley and “was familiar” with the work of After School Matters.

To avoid similar conflicts, Ferguson recommended that Emanuel either stop designating private entities as charitable recipients as part of TIF agreements or develop specific criteria for selecting those charities.

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