CHICAGO | Politics and Current Events

[LouisVanDerWright]

Source: Feds Probe Illinois Gov. JB Pritzker, First Lady For Property Tax Appeals On Gold Coast Mansion

Tony Arnold, Dave McKinney
April 24, 2019

Democratic Illinois Gov. JB Pritzker, his wife and his brother-in-law are under federal criminal investigation for a dubious residential property tax appeal that dogged him during his gubernatorial campaign last year, WBEZ has learned.

A law-enforcement source familiar with the investigation confirmed to WBEZ that the probe, which has not been revealed publicly until now, began last October and remains active. There are no signs that criminal charges are imminent.

WBEZ has also confirmed that Illinois First Lady MK Pritzker’s personal assistant who was involved in the property tax appeal, Christine Lovely, is being represented by one of Chicago’s most high-powered lawyers. Her attorney, Reid Schar, is a former federal prosecutor who helped convict ex-Illinois Gov. Rod Blagojevich on corruption charges.

The developments demonstrate that the billionaire governor and his wife may face a serious legal threat arising from their controversial pursuit of a property tax break on a 126-year-old mansion they purchased next to their Gold Coast home.

A Cook County inspector general’s report, first published by the Chicago Sun-Times, later found MK Pritzker directed workers to remove all toilets from the mansion in order to have it declared “uninhabitable,” which gave the Pritzkers a huge property tax break. The report also found that Lovely and the governor’s brother-in-law, Thomas J. Muenster, made “false representations” on tax appeal documents.

The county watchdog said all of that amounted to a “scheme to defraud” taxpayers out of more than $331,000.

The governor’s office referred WBEZ’s questions to a lawyer representing JB and MK Pritzker. The lawyer, Marc Elias, denied his clients engaged in any wrongdoing.

“Neither the Governor nor the First Lady have been contacted by law enforcement regarding the property tax appeal,” said Elias, a partner with the Perkins Coie law firm, which has done extensive legal work on behalf of Pritzker’s gubernatorial campaign. “We are confident that any further review of the matter will show that the appropriate rules were followed.”

Schar, the attorney for the first’ lady’s assistant, declined to comment.

Muenster, the governor’s brother-in-law, did not respond to WBEZ’s request for comment. He had listed himself as the owner and manager of the mansion, according to the inspector general’s report.

A spokesman for U.S. Attorney John Lausch, who was appointed by President Donald Trump with support from both of Illinois’ Democratic U.S. senators, declined to comment.

Disclosure of the investigation comes at a sensitive time for a governor, who’s still on a political honeymoon after his blowout victory last fall. And the distraction of a federal criminal probe could threaten to disrupt his aggressive first-term agenda in Springfield.

In the next five-and-a-half weeks, Pritzker will need to expend political capital to pass a graduated income tax, a budget, the legalization of recreational marijuana and sports wagering, and a multibillion-dollar infrastructure plan possibly dependent on a big gasoline tax increase.

‘A scheme to defraud’

A little more than three months into his governorship, the most serious campaign issue confronting Pritzker last fall appeared to have gone dormant.

The property tax scandal picked up steam just a month before the November 2018 gubernatorial election, when the Chicago Sun-Times published news of a confidential memo from Cook County Inspector General Patrick Blanchard.

The report found the Pritzkers had caused the residence they had purchased next to their home to fall into disrepair, in part, by removing its toilets in October 2015 in order to lower the home’s property taxes by having it declared “vacant and uninhabitable.”

On that basis, the Pritzkers’ lawyers persuaded then-Cook County Assessor Joseph Berrios’ office to lower the home’s market value from more than $6.25 million to slightly less than $1.08 million. That ultimately led to a dramatically lower property tax bill for the mansion.

According to the report, MK Pritzker had ordered workers to reinstall one working toilet after the house was reassessed at a lower rate, though it’s unclear whether that happened.

Furthermore, the report found that Muenster, MK Pritzker’s brother, and Lovely, her personal assistant, made “false representations” on tax appeal affidavits when they declared the home had been without functioning bathrooms for years before the 2015 toilet removals. That resulted in more than $132,000 in property tax refunds for 2012, 2013 and 2014.

Combined with future tax relief as a result of the lower assessed value, the Pritzkers gained more than $331,000 from the county.

The confidential Sept. 28, 2018 report by the inspector general characterized the Pritzkers’ tax appeal as a “scheme to defraud” taxpayers. Blanchard also connected the scheme to possible violations of state and federal law, including perjury and mail fraud.

On Oct. 4, 2018, three days after the Sun-Times published its story, Muenster cut five checks totalling $331,432 on the Pritzkers’ behalf and sent them to Cook County Treasurer Maria Pappas’ office. In a letter to the treasurer, Muenster insisted the refunds to the county were “in no way an admission of any wrongdoing.”

And on that same day, Cook County State’s Attorney Kim Foxx’s office revealed it had opened an investigation into the tax appeal and turned it over to its special investigations unit.

Unanswered questions

The scope and intensity of the federal investigation is not entirely clear.

Through open-records requests, WBEZ could find no trail of any subpoenas either in the Cook County assessor’s office, which signed off on the Pritzker tax appeal, or the Cook County treasurer’s office, which cut refund checks in the case.

Likewise, current and former employees of the assessor’s office, including ex-Assessor Berrios, said they have not been contacted by federal investigators. Berrios’ one-time former top aide, Thomas Jaconetty, would neither confirm nor deny any interactions with investigators.

It’s also unclear whether Foxx’s county investigation remains active. An aide to the state’s attorney would neither confirm nor deny the existence of that probe, though the office had spoken publicly about it last fall.

Last fall, the issue gave Rauner’s limping re-election effort a fleeting injection of hope, with the former governor warning that JB Pritzker could face serious legal peril from the property tax appeal.

“He has committed, in all likelihood, white collar crime,” Rauner told reporters after a gubernatorial debate in mid-October. “This is as serious as a heart attack. Perjury, mail fraud, tax fraud. This is serious stuff. This is not a joke.”

Pritzker dismissed the issue as politically driven.

Elias, the Pritzkers’ lawyer, would only refer back to his written statement when asked additional questions by WBEZ.

Elias is one of the most recognizable legal names in national Democratic Party circles. He served as general counsel to Hillary Clinton’s 2016 presidential campaign and to the 2004 presidential campaign of John Kerry.

Elias’ law firm has billed Pritzker’s gubernatorial campaign fund nearly $1.5 million for legal services, including more than $618,000 since the property tax appeal controversy surfaced last October, state campaign records show.

But publicly available records don’t make clear how much, if any, of those campaign expenditures related to matters surrounding the property tax appeal case.


https://www.wbez.org/shows/wbez-news...8ec98bca63/amp

Soooo good, hope JB goes down in flames in this. I have now heard from two separate sources that there's another round of indictments coming against potentially half a dozen or more alderman. One source told me they might be out the first or second week of May!

EDIT: Thanks to whatever mod deleted the partisan national politics bullshit. I think we can all agree that we should arrest as many local Illinois politicians (or wanna be carpetbaggers like JB) as possible.

[Steely Dan]

* posts deleted *


remember folks, any posts mentioning national politics in this thread will be swiftly and summarily deleted.

local politics only.

[SIGSEGV]

Someone needs to probe all property tax reductions for impropriety and any lawyers involved in such schemes should be disbarred.

[the urban politician]

^ This has everything to do with the lie that this bloated bastard told the public when he ran for office, chastising people far less wealthy than him because they "aren't paying their fair share" in taxes--the irony being that here he was, a BILLIONAIRE, doing all of these shady maneuvers just to save a couple tens of thousands off of his tax bill himself. The tragedy being that the unfunded pensions were NOT the fault of the high income earners--they paid their taxes, but Springfield failed to make their contributions towards the pensions for years.

[the urban politician]

Double post

[the urban politician]

^ Don’t bother, the sheep have already flocked to their new Messiah

If JB says it, it must be a good thing. After all, Illinois Medicaid will now cover “gender reassignment surgery” because JB made it so. Never mind the fact that Medicaid still doesn’t cover Voltaren gel—something that would help tens of thousands of people who suffer from pain every day. But then, covering that medicine won’t score him any headlines or points with the hard core progressives.

JB is already just a typical Illinois pol—watch, though, it’s only gonna get worse.

[emathias]

Originally Posted by the urban politician

^ Don’t bother, the sheep have already flocked to their new Messiah

If JB says it, it must be a good thing. After all, Illinois Medicaid will now cover “gender reassignment surgery” because JB made it so. Never mind the fact that Medicaid still doesn’t cover Voltaren gel—something that would help tens of thousands of people who suffer from pain every day. But then, covering that medicine won’t score him any headlines or points with the hard core progressives.

JB is already just a typical Illinois pol—watch, though, it’s only gonna get worse.

Did you really mean Voltaren gel, really? A typical dose, used daily, costs about $40/month with generic or $60 with the name brand using GoodRX, a free discount service, at CVS or Target. That price seems generally affordable except for the lowest income patients. It's not like it would be free even with insurance.

Worst-case, using the maximum body-wide dose would cost between $150 and $250 per month, again using GoodRX at CVS or Target. At least some of these patients would be suitable candidates for oral Celebrex (another COX-2 inhibitor). Generic Celebrex, a mac-dose 30-day supply (60 200mg pills), can be had using GoodRX at Mariano's, Jewel, Walmart, or Costco for between $12 and $33. For patients able to make due with 200mg/day, cut those costs in half.

Can you offer insight into similar gender-reassignment opportunities so cheaply?

[LouisVanDerWright]

^^^ you obviously don't know any poor people then. $60 a month is back breaking for people living off $800 or $900 a month SSI. I know because I have tenants who live off that kind of income and a wild people's gas bill in winter has them eating top Ramen for months.

Gender reassignment is not addressing any sort of physical Ills. It's totally elective.

[the urban politician]

^ Exactly. Let’s not forget that we are talking about Medicaid patients, so $40 per month is a lot, especially considering that I just picked up a bottle of antibiotics the other day for $3.00 (I have private insurance).

Voltaren is an important drug to cover, particularly for people over 60. It can help mass numbers of people with aches and pain without causing the harmful effects of Ibuprofen (gastritis, stomach ulcer, raising blood pressure, kidney and heart disease). It’s also anti-inflammatory unlike Tylenol. Voltaren gel is the first line treatment for pain for people over 60, according to many professional medical societies, but it’s too expensive for countless patients and it’s not covered, unlike oxycodone!

Instead of trying to get coverage for a real medicine that is practical and will help lots of people (people I see every day suffering from pain), Pritzker goes the sleazy route by chasing headlines and announcing that Medicaid will cover gender reassignment surgery.

This is the same old flavor-of-the-day fad-driven dog whistle kind of stuff that our politicians have gotten caught up in, and it’s maddening. It’s not about thoughtful, practical solutions that help regular people any more. Pritzker is obviously just more of the same, not that I’m surprised or anything. I (and even my Mom, who is a life long self-described Communist) could spot that he was a fake POS from a mile away, but I know that he still has a lot of people who voted for his slimy ass fooled.

[the urban politician]

I found this interesting, a Cook County judge slams Kim Foxx:

https://news.yahoo.com/judge-slams-c...194158475.html

[emathias]

I'll admit I thought you'd mentioned Medicare patients, most of whom are not particularly poor. You are right, of course, that Medicaid patients have far fewer resources.

I would rather the problem of people in retirement only having income of $900 be fixed. I know that's a real problem - I know that SSI, for example, actually is capped at 75% of the poverty line - what kind of evil government caps a payment that is funding of last resort for desperate people will below the poverty line?

[LouisVanDerWright]

^^^ One that doesn't want people to rely on it as their only retirement plan? SSI is supposed to simply prevent people from falling into total destitution, not provide a retirement.

[LouisVanDerWright]

As I've said many times, the new ARO requirements and pilot areas have simply crushed new supply effectively reducing the total number of affordable units delivered:

https://therealdeal-com.cdn.ampproje...pment-study%2F

I've also noticed an explosion of as of right construction in many areas of the city which is likely making up for these backwards rules. Of course that just means more rapid displacement over much of they city. I was just driving down Cermak today and felt a wave of sadness that the beautiful community and culture there is about to be bulldozed because of backwards rules preventing new construction anywhere else that would alleviate demand.

[glowrock]

Originally Posted by LouisVanDerWright

As I've said many times, the new ARO requirements and pilot areas have simply crushed new supply effectively reducing the total number of affordable units delivered:

https://therealdeal-com.cdn.ampproje...pment-study%2F

I've also noticed an explosion of as of right construction in many areas of the city which is likely making up for these backwards rules. Of course that just means more rapid displacement over much of they city. I was just driving down Cermak today and felt a wave of sadness that the beautiful community and culture there is about to be bulldozed because of backwards rules preventing new construction anywhere else that would alleviate demand.

While I'm not necessarily doubting that overall apartment construction is down in those specific areas, LVDW, the article itself reads as an extremely self-serving piece by a realty group(s) that specifically put this out to get the incoming mayor to listen, and hopefully acquiesce, to their demands. Besides, the article talks about not enough luxury apartments being built, which doesn't exactly seem to be the true problem.

Everything involving affordable housing is a complicated situation, and I don't doubt that the realty/development groups are speaking some kernels of truth. But I don't really blame the city for requiring either affordable units, either.

Aaron (Glowrock)

[the urban politician]

Originally Posted by glowrock

While I'm not necessarily doubting that overall apartment construction is down in those specific areas, LVDW, the article itself reads as an extremely self-serving piece by a realty group(s) that specifically put this out to get the incoming mayor to listen, and hopefully acquiesce, to their demands. Besides, the article talks about not enough luxury apartments being built, which doesn't exactly seem to be the true problem.

Everything involving affordable housing is a complicated situation, and I don't doubt that the realty/development groups are speaking some kernels of truth. But I don't really blame the city for requiring either affordable units, either.

Aaron (Glowrock)

^ No doubt that any piece put out by an industry rag will be slightly self-serving in nature, but at the end of the day we return to the basic question:

When did we ever create affordable housing by limiting new supply?

Look back in human history, lets say 8000 years.

Answer: NEVER

So if the socialist crowd comes up with an ARO formula that kills off large numbers of new projects in the name of creating affordable housing, they are effectively going too far and should be called out for it....loudly, by the industry that is most affected by their actions.

That article LVDW posted makes the case that, mathematically, 30% ARO is simply too much. It is killing off several new projects, and in the end we will not be adding new supply of affordable units to a community that needs it. So the policy needs changing, period. Whether Racist-Ramirez Rosa listens is a different story...

[LouisVanDerWright]

Originally Posted by glowrock

While I'm not necessarily doubting that overall apartment construction is down in those specific areas, LVDW, the article itself reads as an extremely self-serving piece by a realty group(s) that specifically put this out to get the incoming mayor to listen, and hopefully acquiesce, to their demands. Besides, the article talks about not enough luxury apartments being built, which doesn't exactly seem to be the true problem.

Everything involving affordable housing is a complicated situation, and I don't doubt that the realty/development groups are speaking some kernels of truth. But I don't really blame the city for requiring either affordable units, either.

Aaron (Glowrock)

Yes, it's definitely not a neutral source.

However, there definitely is a problem of not enough luxury housing going up. Let's look at this logically for a second:

A. Chicago's poor population is not rising, it is falling.

B. Chicago's middle class population is not rising, it is falling.

C. Chicago's upper class population is skyrocketing.

Given A-C, does it really make sense to suppose that the "affordable housing crisis" is occurring because there is suddenly a ton of demand for affordable housing that wasn't there before?

OR

Does it logically follow that the needs of the large waves of upper or upper middle class people pouring into the city are not being met, causing them to move into formerly "affordable" apartments? Does it not follow that the issue is rich people are buying older, more affordable, buildings, renovating them into luxury units or SFH's, and then jacking the rents up? Isn't that the process we call gentrification?

So given those facts, it would seem that we do, in fact, have a luxury housing shortage and that, since rich people have more money than poor people, that shortage is simply being met by the people with more money simply bidding the people with less money out of their homes? If that's the case, doesn't it make sense that the solution would be to build even nicer housing on empty lots so that the beat up, broken in, older buildings don't seem so appealing to those with the money to push out their current inhabitants?


The fact is Chicago has no affordable housing shortage. There are dozens of square miles of very very affordable cityscape. What Chicago has is a huge surge in demand for downtown-proximate luxury housing which, due to stupid and restrictive policies, is being met not by wave after wave of new construction, but by downtown, transit oriented, neighborhoods that were previously affordable middle class or working class areas, being gutted (literally) wholesale and rehabbed into luxury housing districts.

The result of the recent wave of DSA aldermen who have promised to basically end new construction on the NW side and in Pilsen proper will be a rapid intensification of gentrification in these areas and across the city. Think of how many people now live in TOD buildings along Milwaukee Ave, what 1000+ units built over the past 5 years? So that's probably 2000-2500 people? How many two flats or three flats does that equate to? Where would those people be living now if those buildings had not been built? The answer is simple, the would have gobbled up another 500-1000 vintage neighborhood buildings that provide the bulk of affordable units in this city. Without the TOD boom along Milwaukee ave, you have thousands more hipsters eviscerating the surrounding side streets instead of a shiny new glass building built on a vacant lot where it displaces no one.

Now imagine what is going to happen if suddenly the spigot is turned off on that kind of high density new construction? It's not like people are going to suddenly be like "well they stopped building TOD in Logan Square, it's not worth moving there anymore". No, those people are all going to pile into the surrounding neighborhoods. If they can't find housing there, then they will pile into Little Village or East Garfield Park or McKinnley Park. They will go to the 30th ward where Reboyras is the last remaining voice of reason and loves to had out upzonings. So now the new construction will push further up Milwaukee and draw people even further into the last remaining bastion of affordable neighborhood streets on the NW side. These polices do not work as intended and unfortunately the very people who were sold this snake oil remedy will pay the price, not the rich people who are moving wherever they want no matter what anyone has to say about it.

[the urban politician]

Originally Posted by LouisVanDerWright

The fact is Chicago has no affordable housing shortage.

^ Problem is, in a ward-specific world, it's a problem.

Racist Rosa doesn't care that there are about 120 square miles of affordable housing in Chicago. He just doesn't like that his ward is seeing an influx of white people. So he is being a prick about it.

[emathias]

Originally Posted by LouisVanDerWright

^^^ One that doesn't want people to rely on it as their only retirement plan? SSI is supposed to simply prevent people from falling into total destitution, not provide a retirement.

SSI is used by people who have *never* been able to hold down a job, mostly severely disabled people and, occasionally, widowed spouses who, for whatever reason, don't qualify for spousal support under SS or SSDI, so probably too old to realistically get work. You're expecting them to get a job? The person I know best who is on SSI has suffered from auditory hallucinations and severe paranoia for a decade and currently complains constantly about "mind control," a very real, scary example of what might be called "tin-foil hat" paranoia. He's spent over a year in psychiatric hospital in just the past five years. He will *never* be employable, barring some sort of miraculous new pharmaceutical treatment. And his parents are citizens but as working-class immigrants even just housing and feeding a grown adult iwith serious issues strains their finances.

The "official" reason SSI doesn't get more is that states and other agencies are supposed to help bridge the gap, but it seems like a horribly inefficient way to distribute resources and one that varies widely from state to state and is dependant on strained people navigating a collection of agencies that even I have trouble keeping track of.

Regular SSDI is for previously employed people who are disabled. Regular SS is for retired folk. But even regular SS wasn't supposed to be a full retirement plan although millions of people use it as their only source of retirement income.

[ardecila]

Originally Posted by LouisVanDerWright

B. Chicago's middle class population is not rising, it is falling.

This is an interesting problem... the data showing a loss of middle-class people is based on per-capita income, not household income. I.E. many young professionals are "rich" by this metric until they have kids, at which point they drop into the "middle class". This is also the time at which many families choose to move to the suburbs, purely for access to better, free public school systems (which only seem "free" until you look at property tax bills, but at least they accept all students).

This is not to deny that having kids can strain your budget (it absolutely can) but to point out that "middle class" is a really really hazy concept that shifts around depending on who is talking. A different metric might show middle-class households growing in many parts of the city, and not just the glitzy North Side neighborhoods you'd expect. There are probably several Latino or Asian neighborhoods showing an increase of middle-class households. Plenty of neighborhoods on the far NW and SW sides transitioning from old white ethnic folks to Latino.

[the urban politician]

^ At least here it's a nuanced discussion.

Go to "City Discussions" and it's always some sundry knucklehead from California or the Sunbelt starting some new thread about "metro population data" and it's the repeated, lazy story about "awwww, poor widdle Chicago losing people, when will it boom like Nashville or Austin?" We all know that it's a far more blended story here. Multiple demographic forces, multiple flows of people, all occurring at the same time. A mixed bag.