From the Chicago Tribune

Subpoena looks into Daniels' pork deals

By Ray Long and Matt O'Connor, Tribune staff reporters. Ray Long reported
from Springfield, and Matt O'Connor reported from Chicago
Published October 23, 2003

SPRINGFIELD -- The records of millions of dollars worth of state pork-barrel
projects tied to former House Republican leader Lee Daniels have been
subpoenaed by a federal grand jury conducting a criminal investigation,
according to sources.
Federal authorities based in Chicago served the sweeping subpoena in late
August for records related to dozens of grants involving Daniels
(R-Elmhurst) and other grants involving former Rep. Anne Zickus (R-Palos
Hills), sources said.
The subpoena represents the farthest-reaching examination yet by federal
authorities of the state's controversial use of pork projects. It was served
on the Illinois Department of Commerce and Economic Opportunity and
encompasses grants made while Gov. George Ryan was in office.
In Daniels' case the subpoena also requests records dating back to the
administration of Ryan's predecessor, Gov. Jim Edgar.
Daniels, who is under investigation for allegedly misusing state employees
on campaigns, stepped down from his positions as leader of the House
Republican caucus and as leader of the Illinois State Republican Party last
year. He retained his House seat.
Zickus, who lost her race for re-election in November, is making more than
$93,000 a year as a top official in the Illinois Office of Banks and Real
Estate thanks to an 11th-hour appointment by Ryan.
Neither Daniels nor Zickus has been charged with wrongdoing. Jeffrey Cole,
Daniels' attorney, said the lawmaker "has never been involved in any kind of
impropriety in connection with these projects or any other."
"I am absolutely confident whatever inquiry they are going to make will
vindicate Mr. Daniels," Cole said.
Edward Barron, Zickus' attorney, said he was unaware of any subpoena.
The federal investigation into Daniels' office amid allegations of using
government workers and resources for political purposes is under way as
authorities are probing similar questions about the offices of House Speaker
Michael Madigan (D-Chicago) and Senate President Emil Jones (D-Chicago).
Madigan and Jones have not been accused of wrongdoing.
Word of the Daniels-Zickus subpoena follows the Tribune's disclosure that a
subpoena was issued earlier this year in an investigation of a $750,000 pork
grant that the Ryan administration gave to the owners of Sportsman's Park
racetrack three days before Ryan left office.
Gov. Rod Blagojevich, who succeeded Ryan on Jan. 13, has demanded repayment
of the grant, but Sportsman's officials have defended the grant's propriety
and are fighting to keep the funds.
$1.6 billion in pet projects
Over the four years Ryan was in office, he and the General Assembly set
aside about $1.6 billion for legislators' pet projects. Edgar's last budget
gave the four caucuses the opportunity to divide about $220 million, the
largest amount of his tenure.
The focus of the August subpoena is on records and information about
so-called "member initiatives." It calls for all records of the initiatives
involving Daniels from Jan. 1, 1998, through Sept. 1, 2002, and for Zickus
from Jan. 1, 1999, through Dec. 31, 2001, sources said.
Such a request would cover Daniels' brief stint as state party chairman but
did not stretch through his term as the minority leader of House
Republicans, which ended in January. Daniels announced he was stepping down
as party leader in June 2002 and announced in October last year that he
would not seek another term in leadership despite holding the post for two
decades.
It is unclear which of the Daniels grants have drawn the most interest or
the precise number of grants federal authorities are reviewing.
Records obtained while Ryan was in office showed that Daniels was listed as
a sponsor for as many as 150 grants through the Department of Commerce and
Community Affairs during the Ryan administration. The majority of them would
be covered by the subpoena. Zickus had about 30 grants handled by the
department that were paid for during the time period requested by the
subpoena, according to the records from the Ryan administration.
Partly because of his former role as a leader, Daniels had a wide range of
projects and causes that he supported with the special taxpayer funds. They
ranged from southern Illinois communities in need of fire, police and rescue
equipment to money for Argonne National Laboratory, the Illinois Math and
Science Academy, the Field Museum and the Lincoln Park Zoo, which named a
polar bear "Lee" in his honor.
Daniels also directed grants to private groups, such as $4.6 million for
Elim Christian School in Palos Heights for land acquisition and construction
of residential facilities and a greenhouse. The school previously counted
Daniels' daughter among its clients. Two Elim School officials gave his
campaign fund $11,000--money Daniels and the officials said had no link to
the grants.
Zickus' grants mostly concentrated on traditional infrastructure, public
safety projects or technology for libraries. She also sought state money for
a copy machine for the Justice Park District and a commercial mower for
Palos Hills, records showed.
Laura Hunter, spokesman for the Department of Commerce and Economic
Opportunity, which is the new name for the Department of Commerce and
Community Affairs, said she could not confirm or deny an investigation.
Likewise, Randall Samborn, a spokesman for the U.S. attorney's office,
declined to comment and refused to confirm or deny the existence of an
investigation.
Pork for Willow Springs
Federal officials previously identified $2 million in pork money for Willow
Springs as part of an investigation linked to former Republican state Rep.
Roger Stanley, a political consultant who has pleaded guilty to corruption
charges and to paying kickbacks to win state contracts and campaign
business.
According to sources, a key aide to Daniels allegedly helped obtain the $2
million in return for Stanley placing a Downstate Republican candidate in a
ghost-payroll job at Heritage Renaissance Partners, developers of a $40
million residential and commercial project in Willow Springs. The candidate
lost to the Democratic incumbent.
Stanley's plea agreement refers to the man who helped obtain the grant as
"Official One." The aide has flatly denied he was "Official One," and his
attorney has said the aide "didn't knowingly place anyone in a
ghost-payrolling job in exchange for providing a state grant."
In 2001 the state awarded the Village of Willow Springs $2 million to make
improvements to Archer Avenue. Among the chief beneficiaries of the
improvement was Heritage Renaissance. Stanley is listed in public records as
a part owner of the business, which had been a contributor to Zickus'
campaign fund.
Zickus represented Willow Springs in the legislature. State records show the
Ryan administration approved two Zickus grants totaling $2 million that were
linked to the Archer Avenue project. She also had applied for a $225,000
grant that is pending, according to state records.
"It continues to be a good project," one source familiar with the grant
said. "It was good enough to pass the smell test. It sounded good. It had
all the earmarks of a valuable member initiative."
Zickus repeatedly survived challenges until Democrats won the right to
redraw the district lines and beat her in the new district in November.
Two months later, only days before he exited his job as governor, Ryan
recommended Zickus to the Senate for appointment as a deputy commissioner in
the Office of Banks and Real Estate.
The Senate, still in Republican hands at the time, confirmed her for the
position with a salary of $93,300--giving her a raise of about $27,000 over
her legislative pay and an opportunity to sweeten her pension. Her
appointment will expire Jan. 31.