July 26, 2014
WATCHDOGS: Firm got city deals after hiring lobbyist linked to indicted Rahm aide’s deputy
September 7, 2013 12:12AM
An insurance company got more than $2.5 million in contracts from the city of Chicago after hiring an Ohio lobbyist with ties to one of indicted former city Comptroller Amer Ahmad’s top aides at City Hall, a Chicago Sun-Times investigation has found.
James T. Raussen, who stayed on as the city’s managing deputy comptroller after Ahmad quit his city post in July, was a Republican state representative in Ohio before leaving office in 2008 to work as an insurance administrator for then-Ohio Gov. Ted Strickland, a Democrat.
Raussen left Ohio when Ahmad — a former Ohio deputy state treasurer who was indicted last month in a kickback scheme involving his Ohio government job — hired him in July 2011 to come to Chicago and be Mayor Rahm Emanuel’s point man on insurance matters.
Five months after Ahmad hired Raussen, USI Insurance Services hired Christopher S. Colwell to lobby the city finance department, including the comptroller’s office, for more insurance brokerage business from City Hall, according to city ethics department filings.
The firm had been the city’s broker for excess liability insurance coverage for years but hadn’t hired a City Hall lobbyist before retaining Colwell, who has been paid nearly $50,000 by USI’s Midwest office to date.
Raussen and Colwell have ties going back more than a decade, Ohio campaign finance records show. Colwell was among the former Ohio legislator’s earliest political backers, contributing $1,500 to Raussen’s campaigns between 2000 and 2008. Raussen also got $4,153 in contributions from the Cincinnati Bell telephone company between 2000 and 2004, when Colwell was the company’s vice president of government relations.
As Raussen weighed whether Colwell’s client should be given more city insurance business over other companies vying for the work, it’s unclear whether he disclosed to Ahmad or other city officials that Colwell had given him campaign money, Emanuel spokeswoman Sarah Hamilton said. City ethics rules do not require him to do so, according to Hamilton.
USI, which bills itself as the 10th largest insurance broker in the United States and 14th largest in the world, ended up winning two city contracts for insurance brokerage services — a $200,000 deal in May 2012 and a $1.5 million deal in October 2012 — that Ahmad signed. The larger contract calls for USI to be the city’s insurance broker for O’Hare and Midway airports and special events including Taste of Chicago, in addition to excess liability coverage.
Two weeks before he resigned from Emanuel’s administration on July 23, Ahmad amended the second contract, extending it for two years, through August 2017, increasing its value from $1.5 million to $2.5 million.
Colwell’s website touts his lobbying experience in the Ohio General Assembly and in Congress, as well as his work two decades ago as finance director for former Republican Ohio Gov. George Voinovich’s campaign. A Loveland, Ohio, resident, his only lobbying client in Chicago city government is USI.
Colwell reported being paid $48,000 in lobbying fees by USI in 2012. He also billed the firm for $5,437 in expenses, mostly for airfare between Cincinnati and Chicago.
He stopped lobbying for the company on Feb. 1, 2013, but then re-registered to lobby for it on Aug. 7 under an “oral agreement” that calls for him to be paid an undisclosed “monthly retainer.”
Raussen, who makes $127,824 a year in his city job, served five years in the Ohio statehouse, from 2003 to 2008, when he resigned to take a job as director of insurance and financial services development with the Ohio Department of Development under then-Gov. Strickland.
Efforts to reach Raussen, Ahmad and Colwell for comment by phone and email were unsuccessful. A USI spokeswoman declined to comment.
Raussen has not been disciplined by city officials over the USI deals, according to Hamilton, but his conduct will be investigated as part of an internal city review of Ahmad’s office launched in the wake of Ahmad’s indictment in Ohio.
That independent investigation is being headed by two attorneys — Gordon Nash and Dan Collins of the law firm Drinker Biddle — working under the supervision of city Corporation Counsel Stephen Patton and city Inspector General Joseph Ferguson.
“We expect the independent review being conducted by Drinker Biddle to be comprehensive and thorough, and it will include all areas under Mr. Ahmad’s purview, including city insurance,” Hamilton said.