Tag: Bob Fioretti

Chicago Lawmakers Request SEC Investigation Into Donations to Emanuel From Investment Firms With City Pension Contracts

Rahm Emanuel

Chicago aldermen announced yesterday they were requesting an SEC investigation into donations received by city Mayor Rahm Emanuel from investment firms that manage the city’s pension money.

From the International Business Times:

The aldermen scheduled a City Hall news conference Tuesday to announce the action.

In a letter to Andrew Ceresney, who directs the SEC’s division of enforcement, Aldermen Bob Fioretti, Scott Waguespack and John Arena write the donations constitute “pay-to-play actions” that “have violated the public trust and are a breach of the fiduciary duty” by the Emanuel administration officials who oversee the city pension systems. They say “Chicago has a deep history of pay-to-play” and that their “goal is to end these tactics and protect the citizens of Chicago and employees’ investments.” 

In a speech last week, Ceresney vowed increased enforcement of the SEC’s pay-to-play rule, which was passed in 2011 after an influence-peddling scandal at the New York State pension system.

The SEC and Emanuel’s office did not respond to IBTimes’ request for comment. In a statement about the donations emailed to Bloomberg News, Emanuel’s campaign manager asserted the donations comply with “the higher standards the mayor voluntarily imposes on himself per his executive order” banning contributions from city contractors. 

[…]

On top of the request for an SEC investigation, the aldermen are asking for the city’s inspector general to conduct a review of whether the donations violate Emanuel’s own executive order barring campaign donations from city contractors and subcontractors.

They are also asking Emanuel to release a full list of all the financial firms managing the city’s $23 billion pension system — including the firms in pooled investments known as a “fund-of-funds.” IBTimes obtained documents showing executives at a firm managing Chicago pension money through two Chicago pension systems’ fund-of-funds had made significant campaign contributions to Emanuel.

A copy of the letter sent to the SEC can be read below:

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Photo by Pete Souza

Emanuel Draws Flak For Retiree Premium Increase

Rahm Emanuel Oval Office Barack Obama

Chicago Mayor Rahm Emanuel increased retiree health premiums by 40 percent this week, and it didn’t take long for his challenger, Bob Fioretti, to criticize the decision. Fioretti, currently an alderman, told the Sun-Times:

“This will place an unsustainable financial burden on our retirees, who are already facing cuts to their pensions,” the 2nd Ward alderman said.

“Our retirees dedicated their lives to making our city work. How does this administration repay them? By breaking its promises and pushing struggling Chicagoans closer to poverty. It’s unconscionable at a time when we should be looking to build our [economy] from the middle out and lifting up our working families.”

Fioretti was asked where he would find the $27 million that Emanuel hopes to save in the city’s 2015 budget by continuing to phase out Chicago’s 55 percent subsidy for retiree health care.

“A lot of this they’ve known was coming down the road for a long time. It’s long-term bad planning. We should work to find ways to fund the promises we made,” he said.

“There are ways — whether it’s looking at a [1 percent] commuter tax [or] complete reform of TIFs — all of those are the real tough decisions we have to make to move this city forward. Those are solutions my administration will find.”

The city defended the premium increase as a fiscal necessity. From the Sun-Times:

Budget and Management spokesman Carl Gutierrez has called the increase “part of our efforts to right the city’s financial ship” and save Chicago taxpayers $27 million in 2015.

“For pre-Medicare retirees, there will be an additional reduction in their subsidy by only 25 percent, and the city is offering four plans to provide them with options for health care and to reduce their costs, including an option that would reduce their premiums,” he wrote in an email.

Bob Fioretti is running against Emanuel in Chicago’s mayoral race. Emanuel’s other main challenger, Karen Lewis, has not yet commented on the premium hike.

Photo by Pete Souza