From the Chicago Tribune

Governor asked lobby firm to help pick board
By Ray Long and James Kimberly, Tribune staff reporters. Tribune political
reporter Rick Pearson contributed to this report
Published July 15, 2004
SPRINGFIELD -- The administration of Gov. Rod Blagojevich last year enlisted
a lobbying firm close to the governor to help search for new members for the
state agency that oversees hospital expansion, and the firm was then quickly
hired by a Naperville hospital to lobby the new board.
A lobbyist with Wilhelm & Conlon Public Strategies, founded by Blagojevich
confidante David Wilhelm, said that in June 2003 a top aide to the governor
asked him to field possible appointments to the Illinois Health Facilities
Planning Board.
The panel, revamped by Blagojevich last year with all new members, is now
embroiled in a wide-ranging controversy in which it has been linked to
extortion charges and come under scrutiny of federal agents.
Mathew Pickering, a lobbyist with Wilhelm & Conlon, said the request for
potential nominees to the board came from Louanner Peters, Blagojevich's
chief deputy for social services. Pickering said he delivered a list of 15
to 20 names for consideration.
It was about that same time that officials at Naperville's Edward Hospital
began talks with Wilhelm & Conlon about using the firm to help win board
approval to build a controversial new facility in Plainfield, according to
Pickering and the hospital. By July, Wilhelm & Conlon had been formally
hired by the hospital.
One supported Edward plan
One of the names submitted by the Wilhelm firm was Annamarie Carey York,
executive director of an Aurora outpatient ambulatory surgical treatment
center, who later was picked by Blagojevich to sit on the board. When the
Edward matter eventually came up for a vote, York was the only member to
support it.
Kevin Conlon, president of Wilhelm & Conlon, said York's name was simply
passed along and that the firm "had no relationship whatsoever" with her.
"We simply heard that she would be a good board member who had a good
reputation," Conlon said. "Our reputation, I hope, is that we are thoughtful
people who have good judgment and integrity. That's why people call us."
York did not respond to requests for comment.
Cheryle Jackson, Blagojevich's spokeswoman, said House Republican Leader Tom
Cross of Oswego also recommended York for the position.
Jackson said numerous health-related groups and advocates as well as
industry, political and community leaders were asked for input, ranging from
the Illinois Hospital Association to U.S. Rep. Bobby Rush (D-Ill.)
"The goal is to create as large of a pool of candidates as possible,"
Jackson said.
Governors make hundreds of appointments a year to state boards and
commissions, and it is common practice to field suggestions from many
sources. A top official of a previous Republican administration said it was
common to solicit suggestions for appointments from interest groups, but not
from lobbyists who might someday be paid to try to influence the regulator.
A key mission of the board is to control hospital expansion as a check
against unneeded facilities that might drive up costs. At Blagojevich's
request, the legislature last year reduced the size of the board from 15 to
9 members. Blagojevich was also given the power to start fresh with all new
appointments to the panel.
York was among several new appointees Blagojevich announced on Aug. 12,
including two medical specialists who just 18 days before had contributed a
total of $50,000 to the governor's political fund.
Operations of the obscure hospital panel were thrust into the public
spotlight after Edward officials filed a federal whistleblower lawsuit
alleging that hospitalswere being pressured to hire a Deerfield construction
company to build new projects and Bear Stearns & Co. to finance them or risk
rejection by the board, sources said.
Bear Stearns confirmed Wednesday that Nicholas Hurtgen, a senior managing
director at the investment firm who was named in the sealed lawsuit, had
resigned last Friday.
Bear Stearns spokesman Russell Sherman said the company had no comment on
Hurtgen's departure.
The Edward suit accuses Hurtgen of pressuring the hospital to finance its
Plainfield proposal through Bear Stearns, saying he was "politically
connected to the Illinois state government administration and can `get
things done,'" sources said.
The lawsuit also accused Bear Stearns of winning the contract to help
underwrite a $10 billion State of Illinois bond issue last year "through
unlawful kickbacks," although it did not elaborate, sources said.
The City of Chicago last week cited concerns about the investigation when it
announced it would not use Bear Stearns in an upcoming sale of $500 million
in general obligation bonds.
Blagojevich also has said there would be no new state contracts for Bear
Stearns until the matter is resolved.
Brian Davis, the vice president for marketing and governmental affairs at
Edward, said the hospital interviewed several lobbying firms for the job,
settling on Wilhelm & Conlon because of its reputation for good work. Davis
said he entered talks with the firm around June 2003 and hired it in July.
`Phenomenal reputation'
Davis said he became aware sometime last year that Wilhelm & Conlon had been
tabbed to suggest members for the health facilities planning board, but he
could not remember precisely when.
"This is one of the biggest projects we've ever undertaken. We felt we
needed to do whatever we could to develop a proper strategy to make it
happen," Davis said when asked whether it was proper for Edward to hire the
lobbying firm. "I knew regardless of who submitted what names [that] Wilhelm
& Conlon has a phenomenal reputation, and we would have hired them anyway."
Wilhelm, the former chairman of the Democratic National Committee, played a
major role in Blagojevich's 2002 campaign for governor and led his
transition team. Wilhelm left the firm, but until then was part of the team
that represented its health-care clients, including Edward.
But Conlon said Wilhelm was not involved in the process of forwarding names
of potential health board candidates to the administration.
Conlon and Pickering said the firm did not endorse any candidates for
selection to the board, but simply passed along names of possible nominees.
"We just kind of pulled them altogether," Pickering said this week. "I did
not claim to know everything about these people."
Pickering said he told Blagojevich's office that the people on his list were
"names you might want to look into, and I just left it at that. We did not
place any phone calls after those names and bios were given to them."
Copyright © 2004, Chicago Tribune