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State's Attorney probing troubled State grant program

Wednesday, April 30, 2014
Chicago Tribune
by Monique Garcia & Ray Long

Cook County State’s Attorney Anita Alvarez has launched a probe of a troubled $55 million anti-violence program Democratic Gov. Pat Quinn put in place in 2010 amid a tough election battle.

A grand jury issued a subpoena seeking documents related to the Neighborhood Recovery Initiative Program, which funneled money to various community groups in what Quinn billed as an effort to target crime in some of Chicago’s most dangerous neighborhoods.

Republican critics contend the program was a slush fund designed to shore up support for Quinn in heavily Democratic Cook County, while a recent scathing state audit found the initiative was “hastily implemented” and failed to track how taxpayer dollars were spent.

Alvarez sought documents pertaining to the names and identities of those who received grants under the program, as well as copies of all payment invoices and related audits and compliance reports.

The investigation is the second blow in as many weeks to Quinn as he seeks a second elected term. Quinn’s public approval ratings have been low, but in a state plagued by a history of public corruption the governor had earned the perception among voters that he is honest.

Now Quinn’s standing on ethics is under attack by Republican challenger Bruce Rauner in light of Alvarez’s probe and other accusations filed in federal court last week that Quinn’s administration has continued patronage hiring at the Illinois Department of Transportation first put in place by his imprisoned predecessor, Rod Blagojevich.

“Today marks a new low even by Quinn-Blagojevich standards,” Rauner spokesman Mike Schrimpf said.

Quinn campaign spokeswoman Izabela Miltko issued a statement late Tuesday. “Everyone knows (Quinn) has been cleaning up state government since the day he arrived and always works to root out any problems whenever they should arise,” the statement read in part.

The Cook County subpoena was first issued on March 19, according to documents released by the Illinois Department of Commerce and Economic Opportunity, which now oversees community grants. But the subpoena was withdrawn about a week later after the department agreed to voluntarily turn over the information, according to a letter from Alvarez’s office to the state agency.

Agency spokesman David Roeder said the office gave the state’s attorney about 1,000 pages of materials, which he said included “minor redactions” to remove personal information such as social security numbers and home addresses. But on Tuesday, Alvarez’s office issued a second subpoena seeking unedited records, which the state agency turned over, officials said.

Roeder said the agency “has no tolerance for any misconduct or misuse of funds” and will work with Alvarez’s office to provide all the information it requests. A spokeswoman for the state’s attorney declined comment Tuesday.

The initial subpoena came after Auditor General William Holland issued a February report that found the agency first in charge of the program, the Illinois Violence Prevention Authority, failed to track how grant money was spent or to properly vet grant recipients.

The authority “failed to conduct its due diligence to document that the decisions related to the selection of lead agencies were free of any conflict of interest, the appearance of conflict of interest or that the agencies selected were the best entities to provide the needed services,” Holland concluded.

A few weeks later, Quinn said he was the first to spot “paperwork problems” in the program and moved to address issues long before Holland’s audit. On May 31, 2012, at the urging of Republicans, the Democrat-controlled Illinois House directed Holland to conduct an audit of the program. Quinn’s office has said it first found problems in June 2012.

The program was disbanded that October and anti-violence initiatives were transferred to another agency. However, many of the community groups that received grants under the program still get state money, and nearly $18 million is set aside in this year’s budget for community-based violence prevention efforts.

On Tuesday, the Republican co-chairman of the Legislative Audit Commission applauded the Democratic Cook County state’s attorney, saying Alvarez is “stepping up to the plate” after calls for a criminal investigation.

“This represents tens of millions of taxpayer dollars that was used as a political slush fund,” said Sen. Jason Barickman of Bloomington in a statement. “This blatant fraud and abuse has to be stopped, and those responsible need to be held accountable in a criminal court.”

The Chicago Sun-Times first reported the investigation.

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