The No. 2 executive of the United Neighborhood Organization quit Tuesday, eight days after the Chicago Sun-Times reported that the politically influential charter school operator paid state grant money to companies owned by two of his brothers.
Miguel d’Escoto, who was UNO’s senior vice president of operations, resigned “by mutual agreement” in a letter submitted Tuesday evening, said the group’s CEO, Juan Rangel.
“Unfortunately, my being a member of UNO’s staff has become a distraction,” d’Escoto wrote. “I believe it is in the best interest of the organization and our community that I step down.”
Rangel said UNO’s contracting process “followed the law.”
“However, we want to avoid even the appearance of conflicts of interest,” said Rangel, who was a co-chairman of Mayor Rahm Emanuel’s 2011 campaign.
D’Escoto was paid $200,000 a year by UNO and had worked for it for six years, public records show. He previously was a city transportation commissioner in the administration of former Mayor Richard M. Daley.
D’Escoto’s brothers were paid with state funds under a $98 million grant UNO got to build new schools. The Sun-Times reported Feb. 4 that UNO’s contractors under the grant included d’Escoto Inc. — owned by former UNO board member Federico “Fred” d’Escoto — and Reflection Window Co., owned by Rodrigo d’Escoto.
Rangel said Sunday UNO would stop doing business with d’Escoto Inc. until after the organization completes an internal review of its contracting process.
Fred d’Escoto was the secretary of UNO’s board until stepping down at some point in 2010, according to public records. His company received its first payment of state grant money in August 2010 for work on the construction of the Soccer Academy Elementary School on South Homan Avenue.
D’Escoto Inc. has been paid more than $1.5 million so far for working as “owner’s representative” on that project and on two other UNO schools: in the Galewood neighborhood, on the Northwest Side, and at the Soccer Academy High School that’s under construction.
Rodrigo d’Escoto’s company was paid about $6.7 million for work on the Soccer Academy Elementary and Galewood schools, and the firm has a contract for about $3.1 million to help build the new high school.
Rangel has said UNO hired d’Escoto Inc. without seeking other bids but solicited multiple offers for the deals awarded to Reflection. UNO did not use the sealed-bid process that’s required to select contractors for new Chicago Public Schools facilities and other public construction projects.
In addition to the two d’Escoto-owned firms, other UNO contractors with the grant money included the sister of the charter group’s lobbyist Victor Reyes and the brothers of State Rep. Edward Acevedo (D-Chicago).
State officials who oversee the grant have said they are reviewing UNO’s spending.