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False Fronts

Fullerton Industrial Supply isn’t much to look at. From the street, the Lincoln Park storefront appears to be vacant, with a couple of gang symbols smudged on the windows. The front door, with the occupant’s name pasted in tiny letters, is locked even in the middle of the day.

Inside, random boxes of hardware and janitorial supplies rest on tables or sit on the floor. Fullerton owner Lauren Bellagamba emerges from a back office, but she is reluctant to talk about her business, which on paper looks far more prosperous than this modest headquarters would suggest.

Yet records show that this nondescript business plays a central role in a shell game perpetrated by Chicago’s biggest general contractors and the public entity that awards them hundreds of millions of dollars for taxpayer-financed construction.

The city of Chicago has certified Ms. Bellagamba, who is Latino, as proprietor of both a minority- and woman-owned enterprise. That makes her very popular with the area’s largest construction companies. Since 2008, they have hired Fullerton 22 times on projects awarded by the little-known Public Building Commission of Chicago, which oversees construction contracts for schools, libraries, parks, police and fire stations and other municipal developments.

The PBC requires general contractors to spend at least 24 percent of their project dollars on minority firms and 4 percent on women-owned businesses. To qualify, these businesses must fulfill a “commercially useful function,” which means actually performing, managing or supervising the work involved. Brokers do not qualify.

Commission contracts show more than $10.6 million in payments to Fullerton for plumbing, electrical and other construction materials over the past four years. But Crain’s can find no evidence that the company maintains a supply warehouse or delivers materials to job sites. In fact, based on PBC records and numerous interviews with other subcontractors, Fullerton appears to be nothing more than a pass-through broker.

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Shifts seen for CHA, Roosevelt Square

(Crain’s) — The Chicago Housing Authority may relax a key rule determining the housing mix at its future residential projects, a major shift in policy necessitated by the housing crash.

The CHA’s top executive said Tuesday night that the agency may no longer require that its new projects include three types of housing in equal proportion: public housing for its poorest residents, affordable condominiums and townhomes, and residences offered at market prices.

Splitting the unit types into thirds at CHA redevelopment sites has been a hallmark of the agency’s Plan for Transformation, its 12-year-old plan to replace high-rise complexes like Cabrini-Green with mixed-income communities built by private developers.

“I can safely say that instead of having a blanket a third, a third, a third concept in place for all the transformation communities, we will decide what the income mix needs to be community by community, and sometimes building by building,” CHA CEO Charles Woodyard said at a meeting Tuesday night on the Near West Side.

Mr. Woodyard declined to comment further after the meeting, where developer Related Midwest LLC proposed changes to its Roosevelt Square project. The West Side project is replacing the former ABLA Homes in the area south of the University of Illinois at Chicago.

Instead of adhering to the three-way housing mix, Related wants to follow an 80/20 percent rule, building two 60-unit rental buildings at 1255 W. Roosevelt Road and 1355 W. Roosevelt Road. The buildings, which would cost a total of $29 million, each would have 48 apartments rented out at market prices and 12 set aside for public-housing residents.

Related is seeking to forge ahead with the apartments though it has not built the for-sale units slated for the second phase of Roosevelt Square.

“The rest of phase two for sale would occur when it becomes fiscally viable to build town homes and condominiums and sell them,” Curt Bailey, Related’s CEO, said at the meeting. “Today, frankly, it’s not.”

The pace of constructing the replacement communities has varied among different CHA sites, and having additional flexibility could prove attractive to the private developers to carry out the Plan for Transformation. Some developers are already seeking to depart from previously laid plans, in part because the real estate market has made building for-sale housing all but impossible in recent years.

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Mayor Emanuel and Cook County Board President Preckwinkle Announce Reciprocal Certification for Minority- and Women-Owned Businesses

New Program Will Spur Job Creation by Allowing Businesses to Save Time and Money While Eliminating Bureaucracy
 

CHICAGO – Mayor Rahm Emanuel and Cook County Board President Toni Preckwinkle today announced a reciprocal certification program the two governments have agreed upon, which will create crucial jobs in women- and minority-owned businesses in Chicago and Cook County. The new program will allow small minority- and women-owned businesses to be certified by just one government, and have that certification accepted by both entities.

“I am committed to finding additional ways to collaborate with President Preckwinkle and the County government, particularly on important issues such as these, which create jobs and opportunity in our neighborhoods,” said Mayor Emanuel. “The reforms we are proposing today are commonsense changes that will cut through bureaucracy and make processes easier and more efficient for business owners.”

“The new certification process offers one-stop shopping for minority and women owned businesses – another way county and city government are working together to streamline processes and provide opportunity in challenging economic times,” President Preckwinkle said.  “We are always searching for creative ways to empower small businesses and help level the playing field, and our office is also committed to ensuring the program is fair, honest and open.”

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Illinois plans $500 million bond sale this month

(Crain’s) — In a deal that might be dubbed the “Big Lotto,” Illinois plans to sell another $500 million in tax-exempt bonds this month, the second of two debt offerings planned this year in the range of $500 million to $750 million to repair schools, roads and other infrastructure needs. 

Although the latest offering is at the low end of that range, the state ended up selling $800 million in taxable and tax-exempt bonds in January to take advantage of interest rates hovering at historic lows.

The January bond issue was sold in a competitive auction, but the upcoming $500 million bond sale will be managed by New York-based Ramirez & Co. and Minneapolis-based U.S. Bancorp, which were picked at random last year by Illinois Lottery announcer Linda Kollmeyer among the state’s pre-qualified list of 43 potential underwriters.

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Mayor Emanuel Releases First Plan for Economic Growth and Jobs

Plan Will Position Chicago Area as Economic Powerhouse in Global Economy and Chart Course for Job Creation and Development; World Business Chicago Led a Team of Stakeholders and Leaders in Designing the Plan

Mayor Rahm Emanuel today released the first draft of a powerful, regional economic growth plan, created to drive Chicago’s leadership in the global economy and articulate clear, actionable strategies for economic growth and job creation. The plan was called for by Mayor Emanuel last fall and contains ten strategies that will help Chicago advance its economy and become a better destination for families and businesses.

“A global city like Chicago needs a clear set of goals, a clear framework for analysis and clear strategies for economic growth and the creation of jobs,” said Mayor Emanuel. “By establishing these, the business community can work in conjunction with labor, the public sector and the non-profit community to execute together and achieve these objectives. This is an important step in that direction and I am looking forward to incorporating the public’s input and comment as we develop this vision for our economic future, enabling the creation of more of the jobs that our city needs.”

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Mayor Emanuel Announces the Allocation of Funds From Allied Waste Settlement Will Support Minority and Women-Owne​d Businesses

Allocation Will Benefit All Chicagoans, Improve Minority and Women-Owned Business Enterprise Opportunity Throughout the City

Today, Mayor Emanuel announced the City’s plans for the $11 million received from a settlement of a dispute with Allied Waste Transportation, Inc. The entire $11 million will be used exclusively for the development and improved administration of the City’s Minority-Owned and Women-Owned Businesses (M/WBE) programs and the encouragement of M/WBE participation.

“I am deeply committed to fostering opportunities for minority- and women-owned businesses throughout Chicago,” said Mayor Emanuel. “It is fitting that we use this entire settlement to improve our programs for these businesses and work actively to promote participation throughout the city.”

The City of Chicago’s Department of Law announced on January 19, 2012, that the City had settled a dispute with Allied Waste over the participation of M/WBEs in contracts between Allied Waste and the City.

“Under the leadership of Mayor Emanuel, we are engaged in a thorough analysis of the MBE/WBE Program,” said Jamie Rhee, Commissioner of the Department of Procurement Services (DPS). “This analysis is already resulting in the positive transformation of City procurement.  The settlement funds from Allied Waste will enable us to accelerate the changes already underway in the M/WBE Program, as well as dedicate additional resources to other aspects of reform.”

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Chicago Housing Authority Launches Plan for Transformation 2.0 Planning Process

With support of City of Chicago, Mayor Emanuel, HUD and MacArthur Foundation, CHA will engage community to craft strategies for the future

The Chicago Housing Authority (CHA) will recalibrate the Plan for Transformation – the largest public housing redevelopment effort in the history of the United States – by engaging a broad spectrum of stakeholders in a collaborative, open process, similar to the processes employed successfully by Mayor Emanuel during the City’s budgeting process in 2011.

Begun in 2000, the Plan has led to the reintegration of thousands of public housing families back into the fabric of the city of Chicago and has helped many residents move along the path to economic independence.  Dozens of blighted buildings have been demolished as CHA has increased the quality, safety, and affordability of its properties.

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Mayor Emanuel and Senator Durbin Announce $65 Million in Tax Credits to The Chicago Development Fund

Funding is part of $3.6 billion competitively awarded by the Treasury Department

Chicago Mayor Rahm Emanuel and U.S. Senator Dick Durbin (D-IL) today announced that the Treasury Department has awarded $65,000,000 in New Market Tax Credits to the Chicago Development Fund which will use these tax credits to invest in projects and businesses in Chicago’s low-income communities.  New Markets Tax Credit Program, established by Congress in December 2000, is designed for community development organizations with the goal of saving and creating jobs and spurring economic development in distressed communities.

“Since their creation in the late 1990s, New Markets Tax Credits have been an essential program that allows governments to leverage private investment and make crucial advances in our neighborhoods,” said Mayor Emanuel.  “I am thrilled that here in Chicago, we’ll be able to use this important tool to create crucial jobs in key sectors, such as the healthcare and retail industries, and that these jobs will be available in neighborhoods that need them the most. These credits will help achieve a key goal of my administration: growing business and fostering opportunity throughout the city.”

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Mayor Emanuel Announces Reforms to Neighborhood Capital Planning to Enhance Infrastructure Improvements and Job Creation

New Collaborative Aldermanic “Menu” Process Will Improve Coordination of Projects and Focus on City’s Most Pressing Infrastructure Needs

CHICAGO – Mayor Rahm Emanuel today announced reforms to the City’s neighborhood capital planning efforts.  The reforms will include a new, more collaborative process for Aldermanic “menu” project requests that will ensure better coordination with other infrastructure work, focus on the most pressing capital needs, and enact a stricter timeline for project selection.

“Continued investment in the city’s infrastructure is critical to support and enhance neighborhoods, stimulate job creation, and provide quality City services. Planning for capital improvements must be a comprehensive and forward-looking process that ensures taxpayer dollars are spent responsibly and strategically for economic development,” said Mayor Emanuel.

“While the City’s resources become increasingly limited, its infrastructure needs continue to grow. It has become even more important to direct the capital funds that are available to the highest priority and most necessary capital improvements, and to utilize these funds more efficiently,” he added.

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